The incomplete mayoral house in Bergsig Extension 9, on which the Gauteng’s embattled Lesedi local municipality spent nearly R1.9 million, has been snatched for a mere R360 000 – a massive financial loss of R1.54 million for ratepayers.
Interested parties included a local SA Communist Party businessman, but it is not clear if they ended up registering for the auction.
R1.9 million project sold for R360 000 at auction
Those intending to bid for the property were required to pay a R20 000 registration fee and, at the end, there were only three registered bidders.
The auctioneer yesterday opened up the bidding at R300 000 and the highest bid of R360 000 was from a former local ANC ward councillor candidate.
His bid was not bettered and the politician walked away with the property.
One of the bidders was local property developer Nico Howell, who had previously purchased the property for R850 000 in the initial auction.
But the deal fell through after the municipality failed to adhere to his requirement to consolidate the two stands into one.
Wasteful expenditure and poor oversight
It appears the stands have since been consolidated into one.
The sale of the abandoned property has once again placed the spotlight on wasteful expenditure and poor oversight within the embattled municipality.
The council spent R1 867 532 on improvements to erf 1812 and 1813 after the properties were earmarked for use as an official mayoral residence.
However, the project was never completed and the partially built structures have been standing empty for years.
Thieves stripped the property of roofing materials, fittings, windows, doors and electrical infrastructure.
Project never completed
The sale means the municipality effectively lost direct expenditure, excluding additional losses linked to security failures, deterioration and the potential market value of the land itself.
Bouwe Wiersma, a local lawyer specialising in property conveyancing, said the sale was “a real bargain for the new buyer but a total loss for all citizens of Lesedi”.
He had previously forecast that the council would have been lucky if it received R700 000 for the abandoned property.
Wiersma said it remained to be seen if the municipality was going to own up and be accountable to the losses.
Municipal spokesperson Katleho Seaga did not respond to questions on whether the municipality was satisfied with the amount it received for the property; who was responsible for the waste of public funds; and whether there will be consequence management for the wastage.
