RCC to sell city plots in property plan U-turn

THE Roads Contractor Company has abandoned a property development plan that saw the parastatal dominate an auction for erven in Windhoek’s Auasblick residential area almost three years ago.

The 20 plots in Auasblick, Windhoek’s newest upmarket residential area, which the RCC bought at a public auction on September 3 2004, are now being offered for sale by the parastatal. Advertisements inviting bids for the erven have been placed in the press over the past two weeks.”The RCC has assessed its options with regard to the Auasblick properties and has decided to sell.These properties are currently doing nothing for the company and we need to free up the balance sheet to do other things,” the RCC’s Acting Chief Executive Officer, Noks Katjiuongua, informed The Namibian in writing in response to a request for comment.”There are no sinister reasons for the decision to sell.Depending on the response, the company will review its decision,” Katjiuongua stated.The RCC snatched up 20 of the 44 Auasblick erven that the City of Windhoek offered for sale at the auction almost three years ago.Armed with what appeared to be a limitless mandate to pay top dollar for plots of land in Auasblick, where the new State House complex is also under construction, an RCC buyer easily outbid other would-be buyers at the auction as he went on to spend N$8,7 million on the 20 erven that the RCC ended up buying.In the process, the RCC paid both the highest two prices for erven sold at the auction – N$600 000, for a plot that the City offered for sale at an upshot price of N$128 511, and N$570 000 for the second most expensive erf.The RCC paid N$500 000 or more for nine of the plots that it bought.The average upset price that the City had set for the 44 Auasblick erven was N$129 244.The RCC paid an average price of N$435 000 for each of the 20 plots it bought, which was more than three times the lowest prices that the City was willing to sell the plots for.Having spent N$8,7 million to buy the land, the RCC is now asking at least N$15,1 million in total for the 20 plots, at an average price of N$756 250 per plot.The highest reserve price that the RCC has set for one of the plots now up for sale is N$880 000, for an erf measuring 1 842 square metres.The lowest reserve price, for an erf 903 square metres in size, has been set at N$616 000.KELLY’S DREAM Just after the auction, the then CEO of the parastatal, Kelly Nghixulifwa, told The Namibian that the purchases formed part of property development plans that the RCC, as a civil engineering company, had to get involved in.A year ago, the parastatal’s plan to build houses and 15 sectional-title units on the Auasblick plots ran into trouble with the Windhoek City Council, though, when the Council turned down an application to allow the company to build townhouses on the land.The property development ran into this difficulty only about a week after Nghixulifwa had been suspended from his post as CEO.With a disciplinary hearing still pending against him on various charges, including two charges of dishonesty and four of “gross negligence”, Nghixulifwa resigned from the CEO position early this year, with effect from January 1 2007.One of the conditions of sale under which the plots had been sold in the first place was that the registration of sectional-title units would be prohibited on any erf zoned as a residential plot with a density of one dwelling per erf.When it decided to turn down the request to permit the building of townhouses in the area, the City Council pointed out that the RCC had been aware of the zoning restrictions when it bought the plots.The RCC’s application to be allowed to build the townhouses would have required the City to reverse the message that it has consistently been giving out to everyone else regarding the development of Auasblick, it was reported at the time.Advertisements inviting bids for the erven have been placed in the press over the past two weeks.”The RCC has assessed its options with regard to the Auasblick properties and has decided to sell.These properties are currently doing nothing for the company and we need to free up the balance sheet to do other things,” the RCC’s Acting Chief Executive Officer, Noks Katjiuongua, informed The Namibian in writing in response to a request for comment.”There are no sinister reasons for the decision to sell.Depending on the response, the company will review its decision,” Katjiuongua stated.The RCC snatched up 20 of the 44 Auasblick erven that the City of Windhoek offered for sale at the auction almost three years ago.Armed with what appeared to be a limitless mandate to pay top dollar for plots of land in Auasblick, where the new State House complex is also under construction, an RCC buyer easily outbid other would-be buyers at the auction as he went on to spend N$8,7 million on the 20 erven that the RCC ended up buying. In the process, the RCC paid both the highest two prices for erven sold at the auction – N$600 000, for a plot that the City offered for sale at an upshot price of N$128 511, and N$570 000 for the second most expensive erf.The RCC paid N$500 000 or more for nine of the plots that it bought.The average upset price that the City had set for the 44 Auasblick erven was N$129 244.The RCC paid an average price of N$435 000 for each of the 20 plots it bought, which was more than three times the lowest prices that the City was willing to sell the plots for.Having spent N$8,7 million to buy the land, the RCC is now asking at least N$15,1 million in total for the 20 plots, at an average price of N$756 250 per plot.The highest reserve price that the RCC has set for one of the plots now up for sale is N$880 000, for an erf measuring 1 842 square metres.The lowest reserve price, for an erf 903 square metres in size, has been set at N$616 000.KELLY’S DREAM Just after the auction, the then CEO of the parastatal, Kelly Nghixulifwa, told The Namibian that the purchases formed part of property development plans that the RCC, as a civil engineering company, had to get involved in.A year ago, the parastatal’s plan to build houses and 15 sectional-title units on the Auasblick plots ran into trouble with the Windhoek City Council, though, when the Council turned down an application to allow the company to build townhouses on the land.The property development ran into this difficulty only about a week after Nghixulifwa had been suspended from his post as CEO.With a disciplinary hearing still pending against him on various charges, including two charges of dishonesty and four of “gross negligence”, Nghixulifwa resigned from the CEO position early this year, with effect from January 1 2007.One of the conditions of sale under which the plots had been sold in the first place was that the registration of sectional-title units would be prohibited on any erf zoned as a residential plot with a density of one dwelling per erf.When it decided to turn down the request to permit the building of townhouses in the area, the City Council pointed out that the RCC had been aware of the zoning restrictions when it bought the plots.The RCC’s application to be allowed to build the townhouses would have required the City to reverse the message that it has consistently been giving out to everyone else regarding the development of Auasblick, it was reported at the time.