Update on the township industrial parks - very slow progress to resolve the issue

One of the issues I have taken up since my appointment as Shadow Minister of Small Business Development is the appalling neglect of the township industrial parks in Gauteng. These were set up in the early to mid 1980's by the Small Business Development Corporation, a joint venture between government and the private sector headed by Anton Rupert's Rembrandt Group. They were an attempt to get around the Group Areas Act, which prevented blacks from owning businesses in areas designated for whites, which was where the economy of South African was concentrated.

For some background on the parks, read this piece I wrote for Politicsweb here as well as this blog post here.

Since the SBDC was broken up into the private sector part, Business Partners, and government's part, now the Small Enterprise Finance Agency (SEFA), the parks have fallen into disrepair and the tenants have been in constant disputes with their new owner - SEFA. 

It's a complex story, but centres around tenant claims they were promised title to the properties after ten years of continuous occupancy and paying rent. After much discussion it appears that SEFA has accepted this in principle but have been stalling on how it will be accomplished.

In a response to a written Parliamentary question to Minister Zulu, below, it is clear things are moving at a snail's pace. My most recent communication from OWIPA, received this morning, confirmed discussions are underway and that monthly meetings are planned, the next one due on June 23rd.

I will be following up with all parties concerned to ensure this issue is resolved fairly and the parks are restored to their former status of thriving places to do business.

QUESTIONS FOR WRITTEN REPLY

1340.        Mr R W T Chance (DA) to ask the Minister of Small Business Development:

(a) Who are the registered owners of each Township Industrial Park under the control of the   Small Enterprise Finance Agency (sefa), (b) what steps are being taken to transfer title and ownership of the specified parks to the tenants currently occupying them and (c) when does she expect that such transfers to (i) sefa and (ii) thereafter to the tenants

Reply

(a)    The properties identified to be transferred to the tenants are located in Gauteng Province. sefa’s Board of Directors has approved a resolution to transfer the ownership of the properties to qualifying tenants. The preferred tenant representative organization, Gauteng Province Industrial Parks Association (GAPIPA) and OWIPA (Orlando West Industrial Property Association) and sefa are currently in discussion to formulate and agree on the process to be followed in transferring the ownership of the properties to the existing tenants.

            The Township Industrial Parks are:

Industrial Park		Registered Owner
1.	Orlando West Industrial Park	sefa
2.	Atteridgeville Industrial Park 1	Tshwane Metro
3.	Atteridgeville Industrial Park 2	Tshwane Metro
4.	Sebokeng Industrial Park 1	Business Partners Ltd.
5	Sebokeng Industrial Park 2	Business Partners Ltd.
6.	Vuka Tsoga Industrial Park	sefa
7.	Mamelodi Industrial Park 1	Tshwane Metro
8.	Mamelodi Industrial Park 2	Tshwane Metro

(b)     The transferring attorneys, Kokinis Inc. are currently in the process of transferring these properties to Khula Business Premises Ltd. (100% subsidiary of sefa), where these properties will be housed.

(c)     This process is anticipated to be completed by September / October this year. Once this is done, sefa will commence with negotiations for the sale of properties to the tenants. The process of transfer of ownership to the tenants is being negotiated with GAPIPA and their respective affiliates currently.

It is important to note that these properties were not designed and developed with the intention to sell to individual tenants at the time. The cost of subdivision may end up being substantial. It is for this reason that sefa is engaging with tenants representative bodies and together try and ascertain the most suitable way to transfer the properties and also ensuring that all the tenants hold equity (ownership) equivalent to the square metres and portion(s) they are occupying / renting.  The recipients (tenants) of the properties will be notified of the obligations, both financially and legally, of owning a fixed commercial property.