Good asks Public Protector to probe Growthpoint's Cape Town land purchase

2019-07-05 12:15
Public Protector advocate Busisiwe Mkhwebane.  (Phill Magakoe/ The Times/Gallo Images/Getty Images, file)

Public Protector advocate Busisiwe Mkhwebane. (Phill Magakoe/ The Times/Gallo Images/Getty Images, file)

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The Good party has asked Public Protector Busisiwe Mkhwebane to probe whether the sale of a prime piece of property in the City of Cape Town's CBD was above board.

In 2018, GroundUp reported on an apparent valuation blunder which saw the City sell Site B - a prime Foreshore property - to property giant Growthpoint for much less than its market value.

According to a calculation based on the size of the development that Growthpoint intends to build on Site B, the plot is worth up to R227m, and not the R86.5m for which it was sold.

Growthpoint Properties Limited is the largest property investment holding company listed on the Johannesburg Stock Exchange (JSE). It owns and manages 533 properties, including 473 properties in South Africa.

Good secretary general and Western Cape MPL Brett Herron said: "If profits are made from the sale of valuable assets belonging to the state, those profits must accrue to the citizens, not private companies.

READ: City of Cape Town fails to explain R140m discrepancy in property sale to Growthpoint

"In this instance, instead of the developer scoring a walloping R140m discount, the City could have used the additional cash to build 1 000 fully subsidised homes, several new libraries, or to install better lighting and surveillance equipment in communities that bear the brunt of gangsterism and crime," said Herron. 

Herron also hoped the Public Protector would investigate what the relationship was between the company and the Democratic Alliance, if any, as she was already investigating a similar complaint relating to discounts afforded to Growthpoint in Johannesburg - where the DA also governs.

"If any major company is profiting from relationships with DA administrations in Cape Town and Johannesburg, as alleged, how does the DA benefit from the relationship?" he asked.

Last week the Western Cape High Court ruled that an interdict, prohibiting activists from protesting at Site B, should not be granted.

Last December, a group of around 30 protesters from Reclaim the City, Unite Behind and the Social Justice Coalition occupied the property owned by Growthpoint.

In a press release, the groups said the City had lost up to R140m on the sale – "a gift of our best land to one of the wealthiest companies on the JSE".

Growthpoint, in a statement released last year, said that the company had "met with the City's Property Management Department, which undertook the auction of Site B.

"They are of the view that Growthpoint purchased Site B for a fair price, through a transparent and legitimate process."

Read more on:    good  |  cape town  |  public protector  |  land

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