Tshwane Mayor, Solly Msimanga, witnessed the final disposal of a scandal-plagued city “asset” that has been the subject of a corruption probe relating to the previous administration’s R12 million “upgrade” to the property.
In a South African metro first, Tshwane’s full council voted recently to dispose of the opulent property in which Msimanga has refused to live. Among the reasons cited were the substantial cost to ratepayers of maintaining the property and the council’s desire to utilise the funds for the construction of low-income housing.
Joff van Reenen, lead auctioneer and director of the High Street Auction Co, said the company has previously worked closely with the City of Tshwane to quickly and successfully convert non-performing core assets to cash. High Street was therefore delighted to resume the relationship – especially with such a centrepiece property.
Addressing a packed sales floor prior to the auction, Msimanga made a plea for bidder generosity, explaining that he had already committed the money to housing for the people of Tshwane.
“Whatever we can get – R5m or more, we’d be grateful.”
Van Reenen then stepped onto the block and encouraged the fierce bidding; finally dropping the hammer at R5,1m in a sale that – in total – took less than two minutes to conclude.
The buyer of the property wishes to remain anonymous, but mentioned the property was an “investment purchase”.
Addressing the media after the auction, Msimanga said: “The house was previously valued so we knew roughly what we would get at auction.
“This money will allow at least 40 less fortunate families to have decent roofs over their heads.”
Msimanga says the City of Tshwane has not yet decided whether to allocate all the funds to one area or split the proceeds across several regions, but “we intend to be able to take media on a tour of the building sites before the end of the City’s financial year (mid-2018)”.
High Street Auctions joint MD, Lance Chalwin Milton, said auctions are a preferred method for government, state-owned enterprises and large corporates such as property funds to divest of non-core assets because of the transparency and the fair market value achieved on the day.
“We can achieve in a matter of minutes what a tender process or broker does in six months or more; it’s sales on steroids and delivers fast and satisfactory results.”