/ 14 March 2012

CT-Naspers deal under protector’s scrutiny

Public protector Thuli Madonsela is to investigate a proposed property deal between Cape Town City and media holding company Naspers.

ANC chief whip Mathole Motshekga said on Wednesday he had asked her to “investigate the suspicious City of Cape Town-Naspers multimillion rands property deal”.

The Democratic Alliance-run City of Cape Town was intending to buy “a piece of parking space” from Naspers, which independent property analysts had valued at no more than R50-million, for a “whopping” R106-million, according to Motshekga.

The value looked heavily inflated and raised questions regarding “who is set to benefit out of the deal”, the chief whip said in a statement.

“We are pleased that the public protector has already made an assessment of our complaint and has concluded that it is within her jurisdiction.” he said.

She had also confirmed that she would conduct a preliminary investigation into the allegations, and an investigator had already been assigned to work on the complaint, Motshekga said.

In a letter to Madonsela, Motshekga said that according to press reports, the city was set to buy the parking space from Naspers for the expansion of the Cape Town International Convention Centre, in which the city was a shareholder.

“The deal between the City of Cape Town and Naspers, as it stands, looks extremely suspicious and dubious,” he wrote.

Property analysts believed the R3 000 per square metre was way above what an average vacant piece of land would fetch in the city.

The deal amount had even surprised Mansoor Mahommed, former City of Cape Town executive director who now worked at a property development company, who regarded it as a “high” price.

“This transaction, dubbed ‘an extremely sweet deal for Naspers’ due to the extraordinarily and unjustifiably high price involved, raises serious questions regarding the nature of the relationship between the DA and Naspers,” he said.

“We are concerned that a company that, through its media publications prides itself on being the public watchdog and acting in the interest of the public, is expecting the public to fork out R56-million more on a piece of parking space.”

Ian Neilson, Cape Town deputy mayor said claims of overpayment were based upon a miscalculation.

“The city’s independent valuation at R2 800 per square metre sets a value of R103.6-million. Despite the portrayal of the site as a “parking lot” it is in fact a business site with rights to 37 000 square metres bulk plus 900 parking bays,” Neilsen told the Mail & Guardian.

Moreover, Neilsen says the purchase is vital to Cape Town’s improvement.

“The expansion of the area around the CTICC will see Cape Town further position itself as a leading global conference and events destination. The area will play a key role in driving skills development and creating short and long term jobs,” he said.

Motshekga called for the deal to be suspended until the investigation was concluded. — Sapa