Simmering row over BCM leases

R160k-a-month offer for land to racing club, while Motorsport to pay far less

Some startling discrepancies emerged in some of Buffalo City Metro’s lease agreements on Thursday.
Earlier in the week, the Dispatch reported that city manager Andile Sihlahla tabled a report to council urging the cancellation of a 2013 resolution to lease about 160ha in Berlin to the Masibambane Race Club.
Lumumba Makaula, who chairs the club, spoke to the Daily Dispatch this week, saying they had never signed the lease BCM was offering as they felt R160,848 a month for a barren piece of land was too steep.
In August last year the council agreed on a new 20-year lease with the Border Motorsport Club (BMSC) for the East London Grand Prix Race Track on the West Bank.
The motor racetrack grounds, just under 118ha, were to be offered at a monthly rental of R11,800, excluding VAT.
This means that while BCM proposes to charge the Masibambane Race Club about R1000/ha, the Border Motorsport Club was to be asked for R100/ha.
Spatial planning and development portfolio head Pumla Nazo-Makatala said the amount asked for the Berlin land was based on a land evaluation done by BCM.
“The price depends on the size of the land in question. The evaluations are done by competent BCM workers. It does not matter if the land is for a creche or a racecourse – it depends on the size of the land, not buildings on the land,” said Nazo-Makatala.
Both leases include a 12.5% annual increment clause.
However, BMSC’s increment is to take “the magnitude of the proposed development and investments thereof into account”.
Masibambane wants to build a racecourse, conference centre, jockey academy, boxing arena and shopping mall on the land. “The Berlin land is rural land that is not even serviced by BCM. The premier (Phumulo Masualle) tried to assist us, and organised a meeting for us with the mayor.
“The mayor also tried to assist us but the spatial development and planning department does not want to decrease the amount,” said Makaula.
“We have no problem with paying the amount once our development is in place but we think it is unfair to demand so much money immediately upon signing the lease agreement.”
Nazo-Makatala said the Berlin rescindment had not yet been approved as the council had requested missing documents from Sihlahla’s report.
Although the Border Motorsport Club’s lease agreement was approved more than a year ago, public relations officer Dave Kirkman said the agreement was still unsigned.
“I hand delivered letters to the mayor and city manager this week asking them to intervene and it has been more than a year since the council approved the agreement.
“The holdup is with the legal department, they have not given us the agreement to sign,” said Kirkman...

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