Govt buys former PwC offices for N$67 million

Minister of finance and public enterprises Iipumbu Shiimi has defended the government’s decision to buy a building in Windhoek’s central business district for N$67 million.

The property, which used to house accounting firm PwC, includes a four-storey building on a 3 240-square metre plot.

The building is located opposite the Ministry of Finance and Public Enterprises along Independence Avenue and across Windhoek Police Station.

Shiimi says the decision is meant to accommodate treasury staff and to cater for new positions to be created in the ministry.

The property is owned by a company called 344 Independence Avenue, of which the chairperson is businessman Johannes Swanepoel. 

Swanepoel this week told The Namibian an independent valuer assessed the building’s worth at N$70 million.

A 2019 municipal valuation estimate suggests that the total municipal value of the property is N$43,6 million – which includes municipal land value (N$18 million) and municipal improvement (N$25,5 million).

Municipal valuations are often significantly lower than the actual selling prices agreed on by buyers and sellers based on market prices.

Works and transport ministry executive director of Esther Kaapanda represented the state in the deal, while Swanepoel represented 344 Independence Avenue. 

Swanepoel is currently the board chairperson of Bank Windhoek. 

PwC occupied and rented the property for 28 years.

THE AGREEMENT

Documents show that the government through the works ministry entered into an agreement of sale two months ago.

Records from the deed’s office shows that 344 Independence Avenue first bought the property in 1995 for N$1,6 million.

The property is made up of two consolidated plots – Erf 95 and Erf 871, which became Erf 7501.

According to the agreement of sale, the government will pay N$67 million for the building.

The agreement indicates that the government can occupy the building on 1 July in a deal that includes the sale of office furniture for N$1 million.

The building has four floors, offices, parking bays, office furniture and equipment and a diesel back-up power generator. 

The director of treasury, Martin Ashikoto, approved the sale of the property in a letter addressed to the executive director of finance and public enterprises, Titus Ndove, on 14 May.

“Treasury has in terms of section 23 (1) (a) (d) read with section 18 of the State Finance Act,1991 granted authorisation for the acquisition of Erf 7501 property 344, situated in Independence Avenue Windhoek for N$67 million, excluding transfer costs and VAT, 15% of the agreed amount, which is N$10 million,” he wrote.

Ashikoto said the N$10-million transfer costs would be paid by the ministry. 

TREASURY DEFENCE

Shiimi on Tuesday said the purchase was accommodated in the ministry’s 2024/25 budget.

“This purchase was necessary to provide space for organisational units that are currently renting offices elsewhere in the city. Additionally, the ministry is in the process of reviewing its organisational structure to better align with its mandate, which will create a need for more office space to accommodate the new positions that will be created,” he said.

Shiimi said the building has undeveloped bulk, which will allow for an additional 8 000 square metres of office space to be developed in the future.

“The new building includes additional parking bays, which will help alleviate parking congestion at the ministry’s head office, experienced by us, Namibia Revenue Agency officials and clients,”

Iipumbu Shiimi

Shiimi said two valuations were involved in the process.

“As part of the ministry’s due diligence, two valuations were conducted – a private valuation that assessed the property at N$70,5 million and a second valuation by the government through the Office of the Valuer General, which valued it at N$64 million,” he said. 

“Additionally, the attorney general was consulted to clear the sale agreement. We have no doubt that the government managed to obtain value for money and the building,” he said.

Shiimi said the office furniture and equipment and a generator on the property were valued at more than N$1,4 million, but this was negotiated down to a final amount of N$938 000.

INDEPENDENCE AVENUE

Swanepoel on Tuesday said the company received a notice from its long-term tenant, saying it was vacating the building on 30 June.

“Directors decided to advertise the building for lease or for sale. Several expressions of interest in both leasing or purchasing the property were received, including the one from the Ministry of Finance and Public Enterprises,” he said.

Swanepoel said the company decided to negotiate with the finance ministry for the sale of the building after initial discussions and consideration of offers.

He said the company had bought the vacant land of the premises in 1995.

“It does not include the construction cost of the building by which the vacant land was improved. It should also be noted that significant investments were made over the years to maintain and effect improvements to the building. 

“The most recent investments include the installation of a solar power plant to supply the building with electricity. We believe the purchase price represents fair market value,” he said.