Joburg wants to buy R45m land it sold for R1

9 February 2021

The DA has uncovered a scheme by the City of Johannesburg to buy a piece of land in Jabulani for R45 million from Calgro M3, when it sold this land for only R1 12 years ago. They claim that this land is needed to complete the Jabulani Transit Development Project, which is part of the Jabulani CBD development.

The land in question was subdivided, with the Soweto Theatre and Jabulani Amphitheatre built on a portion. Aquarella did nothing with the remaining pieces, which were sold to Calgro M3 in 2018 for R37 million. It appears that Aquarella was a subsidiary of Calgro M3 and shared directors. Now Calgro M3 wants to sell one of these pieces back to the City for R45 million which doesn't reflect the actual value.

This raises a number of serious questions: why would the City sell land for way below its market value (illegal under the MFMA), and then spent its own money to build the Soweto Theatre on land which it no longer owns? Why would the City sell land it knew that it needed for the development of the Jabulani CBD?

The Johannesburg Property Company, whose CEO is under a number of forensic investigations for land deals in the area, was responsible for the sale, and is still forging ahead with the development of the Jabulani CBD - using City-owned land which it leases out to developers. These leases come with strict clauses to enforce development, otherwise the land returns to the City. Why JPC did not use a lease with development agreement in this case is a mystery.

When the DA pointed out these contradictions at the January Council meeting, even the Mayor acknowledged that this deal was highly suspicious, and agreed to the DA's recommendation for a full forensic investigation to be conducted.

Johannesburg residents deserve an honest, well-run city which puts their needs first. The DA supports the vision of a flourishing CBD in Soweto, and will make sure that this is realised through proper planning and public private partnerships which are not mired in corruption.

Issued by David Dewes, Councillor, Economic Development S79 Committee, 9 February 2021