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- A Sandton property that is among SA's most valuable is up for auction.
- The property was controversially sold in 2013 to the Kgoro Consortium - majority owned by Gupta-linked Regiments Capital - for R280 million.
- However, it was never paid for, and plans for development on the property fell flat.
- For more financial news, go to the News24 Business front page.
A Gupta-linked portion of land in South Africa's "richest square mile" in Sandton is finally up for sale - several years after it found its way to the ownership of a Gupta-linked company through a remarkably favourable deal.
Norman Raad, CEO of Broll Auctions and Sales, which is handling the sale through a closed tender, noted its "fantastic position and zoning", saying:
"The land was initially earmarked for the development of Kgoro Central, a 65-floor tower with hotel, luxury apartments, art gallery, retail, and restaurant component, but nothing came of these proposals.
The three-hectare piece of land, which is used by the Gautrain underground in terms of a servitude, has been described as one of the most valuable properties in South Africa.
Adjacent to the Sandton Gautrain station, it also lies near the five-star Michelangelo Hotel and Nelson Mandela Square, at the corner of Rivonia Road and West Street.
In 2013, the land was bought for R280 million by the Kgoro Consortium, which is majority-owned by Gupta-linked Regiments Capital, from the City of Johannesburg via a bond from the metro.
Cedar Park, which forms part of the Regiments Group, was listed as the property owner. Cedar Park was not required to begin making payments until it began turning a profit from the development and, according to Rapport, it may never need to begin making payments provided it continues to lease out units rather than selling them.
Cedar Park's directors are Trillian's Eric Wood; former CEO of Regiments, Niven Pillay; and Regiments chair, Litha Nyhonyha.
Failure to launch
The company obtained a R2.4 billion development bond and concluded a R150 million loan agreement with Vantage Capital for the Cedar Park Kgoro Gateway development on the property.
However, despite the favourable terms, plans for a residential unit, hotel, and art gallery fell flat, with Cedar Park failing to meet its loan obligations with Vantage Capital that became due in 2018.
The property was also heavily contested between the City of Johannesburg and Regiments Capital.
Meanwhile, the city launched an investigation in 2019 into the property for outstanding property rates and services, and water was subsequently cut off to the Gautrain station. At the time, Cedar Park had owed the city more than R7 million for services.
Cedar Park then applied to the High Court in Johannesburg for water to be restored, but the request was denied, with the matter struck from the court's urgent roll in October 2019.
Cedar Park has since been liquidated after courts denied business rescue requests in 2022. A decision to liquidate Regiments Capital was confirmed in August this year.
Now, Broll has high hopes for the property's future prospects.
Raad believes the property will attract huge interest from property owners and developers, particularly from those abroad.
"With fantastic position and zoning, this is an opportunity for an investor to bring this dream of a highly sought-after live-work-play development to life," he said.
The closing date for bids is 28 February 2024.
