Deputy mayor Ian Neilson  Picture: Courtney Africa/African News Agency (ANA)
Deputy mayor Ian Neilson Picture: Courtney Africa/African News Agency (ANA)

No action on City of Cape Town’s ‘R140m loss’

By Nicola Daniels Time of article published Jul 1, 2019

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Cape Town – In a surprise forensic report conclusion not communicated to the activists who called for the investigation, the City has reported no irregularities in an alleged botched auction of prime Foreshore land.

After several calls for the report to be made public, Ndifuna Ukwazi (NU) were on Sunday alerted to the investigation’s conclusion for the first time by the Cape Times.

The investigation probed the alleged loss of R140 million of public money due to an alleged botched auction of prime land on the Foreshore to Growthpoint Properties, the largest South African property investment trust, listed on the JSE with assets on three continents.

NU at the time fingered then mayoral hopeful Ian Neilson to be partly to blame for the loss. Neilson did not respond to requests for comment on Sunday.

City spokesperson Luthando Tyhalibongo said on Sunday that they had concluded the investigation. The report could not be provided on request.

“The investigation into the sale of Site B, Foreshore, has been concluded. The investigation revealed that there were no irregularities with regard to the sale of the property,” Tyhalibongo said.

NU attorney Jonty Cogger said they were not made aware of the outcome.

“It is in the public’s interest to have access to the report to know whether or not there was corruption.

‘‘If there isn’t transparency, the public is never going to know what happened. How are we supposed to know that there wasn’t a loss?” Cogger said.

NU charged that Growthpoint bought the 46 000m² of bulk, or allowed building magnitude, at the price of 17500m², as the latter measurement was stipulated in the city council’s prospectus as the site’s bulk rights.

The cost of the 17500m² was R86m, amounting to R4942 a square metre, the NU had said.

NU charged that meant the City lost about R140m as a result of the discrepancy during the auction.

“Once we discovered the irregularity in the disposal of Site B, we requested a forensic investigation. We made a number of follow-ups requesting access to the report, but every time they said it hadn’t yet been finalised and they’d get back to us.

‘‘We have been writing to all councillors to amp up the pressure to publish the report. We will try our utmost to get access to that report.

“The land-use application is being adjudicated on Tuesday by the Municipal Planning Tribunal. They will decide how much rights Growthpoint has. Growthpoint, as well as the City’s asset management department, will be represented by senior counsel in this matter,” Cogger said.

Meanwhile Reclaim the City and Unite Behind Friday celebrated victory after the Western Cape High Court ruled in their favour against Growthpoint.

The property developer’s interim interdict against the activists was dropped and it was ordered to pay their legal costs. “This judgment is a win for working-class people’s right to protest,” Reclaim the City’s Karen Hendricks said.

The judgment came after Reclaim the City opposed the interim interdict when they protested at Site B on December 4 last year, erecting makeshift shacks on the land, amid the plight for affordble housing in around the CBD.

Approached for comment last night, Growthpoint’s media liaison officer was unsure as to whether they would be able to respond by deadline.

Hendricks said: “We protested on this piece of land to question and to hold accountable those who were involved during the sale that has lost the public up to R140million.

"Poor and working-class people derive power from protests in order to voice their issues and frustrations and a powerful property company like Growthpoint tried to silence us by applying for an interdict without informing us. This limited our right to present the facts to the high court as to why we were protesting on the day.”

Of the City’s forensic conclusion, Reclaim the City’s Fagmeedah Ling said: “We don't have any clarity on that investigation, it has been going on for more than six months. 

"This is the first time we're hearing it from you. We are going to follow up because we need answers, in fact we demand answers, we’ve waited long enough.”

Cape Times

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