Takeouts from the 2025 International Precinct Management Leadership Summit
By Brian Wright, Managing Director, UrbanMGT
One of the more pressing themes raised at the International Precinct Management Leadership Summit was how quickly the property usage landscape is shifting and the impacts this has on precinct funding models.
In precincts across the globe, there is a clear trend – reducing demand for commercial and retail space as a result of two key contributing factors:
- The COVID initiated work from home shift, office flexibility and office rationalisation
- Every growing % of online retail trade
There are proactive examples, like Dublin, where the local authorities and the private sector are actively collaborating on a revisioning the City offering to counter this trend. In others, it’s a wait and see approach with the market taking a reactive response to declining retail and commercial space vacancies by responding to the growing housing demand with residential conversions.
Commercial conversion to residential usage, in most countries where residential usage is exempt from precinct levy obligations is reducing the levy base—while increasing service complexity.
What the Numbers Aren’t Capturing
Across most legislated precinct models internationally, residential usage is exempt from paying precinct levies. But once a building converts from commercial to residential use, the service profile doesn’t shrink, instead it expands exponentially.
Security demands change. Waste volumes increase. Maintenance expectations rise. Night-time disturbances and noise complaints are more common. Parking, access, and service delivery logistics become more layered. Add in the complexity of mixed-use environments with overlapping user groups and the strain is real.
In short, precincts are being asked to do more, with less.
We’ve Been Managing This for a While
In South Africa, and particularly in Greater Durban and Greater Ballito, this pressure is not new. We’ve been managing the levy-service imbalance for years.
Residential users have different expectations, but don’t always contribute to the precinct funding model. Yet if something goes wrong – whether it’s a sewer failure, security issue, or illegal dumping, the precinct is still the first call.
This has forced us to find workarounds. We’ve deepened stakeholder engagement. We’ve tightened operational visibility. And we’ve begun engaging with municipalities and property stakeholders about the very real need to rethink how shared urban services are funded in mixed-use environments.
The Innovation Imperative
We can’t afford to be passive observers of this shift. If precinct funding continues to be based on outdated commercial assumptions, the entire model risks becoming unsustainable.
This is why our internal systems, especially our proprietary software management platform is designed not just to manage precinct operations, but to track, measure and report on service volume and complexity in real time. It’s not just about knowing how many callouts happen – it’s about understanding what type, how often, for whom, at what cost and importantly how long it takes to fix.
Very importantly is it providing a reporting a free and easy use platform for all precinct members, tenants, visitors and stakeholders, a go to point for fault reporting and precinct service requests which is mapped spatially and reported back once resolved.
We’re building a credible evidence base that will inform the case for funding model reform.
We’re also looking at alternative mechanisms whether it’s co-funded service partnerships, special residential levies, or new hybrid models that reflect reality on the ground.
What Needs to Happen
For precincts to remain effective in protecting and enhancing destination appeal and investor confidence, there needs to be a shift in how value is understood and funded. A precinct levy model that worked for mono-use, daytime office CBDs no longer holds in the face of 24/7, mixed-use, socially complex urban precincts.
This isn’t a call for just expanding the levy base, instead it’s a call for a more holistic approach to smarter and more equitable funding models, ones that reflect service realities and embraces performance.
We’ve reached a tipping point. And South Africa, because of our earlier exposure to these pressures, is once again well positioned to lead the thinking, we’re built the evidence-based business case to drive the conversation.
In the next piece, I’ll unpack how UrbanMGT has built an operational model capable of navigating this complexity. It hasn’t been easy. But it’s made us stronger, more agile, and more relevant than ever.
