Leases up for grabs — but black landlords only
The Eastern Cape department of public works is on the hunt for black property owners to lease office space to the government.
MEC Babalo Madizikela said the department wanted to lease 22 office spaces from businesses that were fully black-owned and based in the province.
This is in a bid to transform the property sector in the province, according to Madikizela..
Delivering his policy speech from his office in Bhisho on Tuesday, Madikizela said in the last financial year about R286m was spent on leases for office accommodation by the provincial government.
“The majority of these leases are in the hands of white landlords.
“Black landlords benefited to a total of R74m; however, interestingly, Eastern Cape African-owned leases were valued only at R14.6m.”
“This scenario cannot continue.
“If it does, the poor and marginalised will have nothing to eat, [only] the rich,” Madikizela said.
He said more than R50m had left the province but that they hoped to change this by ensuring residents and business owners in the province benefited from government partnerships.
Madikizela said they were unapologetic about advertising a bid for 22 leases for office space targeting properties that were 100% black-owned.
In December, while tabling the public works committee’s annual report, portfolio chair Nomvula Ponco revealed that an investigation into government-owned buildings in the province found that only 36 out of the 279 buildings assessed were in good condition.
This amounted to 12.9% of the properties in question, which included clinics, hospitals and schools.
Only 229 were considered to be in fair condition, while 14 were categorised as bad.
On Tuesday, Madikizela said “perpetually leasing” and heavily relying on privately owned properties by Bhisho could not be a permanent solution.
He said the key to this would be to ensure that the Bhisho Office Precinct was completed in the current term of the administration.
Provincial government departments are scattered between Bhisho, King William’s Town and East London.
The province aims to develop the precinct through a public-private partnership model as outlined in the Public Finance Management Act, for which the National Treasury has provided approval.
“I can confidently claim that all necessary measures have been put in place within the prevailing conditions to close the tender on June 15,” Madikizela said.
“Moreover, the construction of the cluster offices will address this challenge and help reduce the expenditure on leases.”
He also announced that the province would host an Eastern Cape Government Property Development and Investment Conference, which would serve as a catalyst for sector transformation with an emphasis on introducing new entrants.
“We are engaging property investors, developers and development finance institutions to ensure the success of the conference.
“In addition to this, the conference will present an opportunity for the state to generate the much-needed revenue for the province,” Madikizela said.