City of Cape Town fails to explain R140m property sale bungle
Deputy Mayor Ian Neilson has defended the City of Cape Town's controversial sale of Site B – a prime Foreshore property.
But Neilson's statement is inconsistent with municipal laws, GroundUp reports.
Last week, GroundUp reported on an apparent valuation blunder which saw the City sell Site B 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.
The difference stems from the maximum combined floor area that a high-rise building on the site may occupy. Auction documents incorrectly stated that the maximum floor area was 17 500m2 when in fact, it was 46 000m2. (This is a slight simplification. Interested readers can read last week's article for the details.)
Ndifuna Ukwazi (NU), an NGO which advocates for affordable housing in or near Cape Town's city centre, first picked up the mistake. The organisation said the sale amounted to a "gift to one of the most profitable companies on the JSE" and blamed Neilson and his team.