Selling of Ga-Rena might be an option

By the end of March 2020, the revenue collection rate at the Ga-Rena Rental Village stood at a measly 15,61% of rental revenue owed per month to the Polokwane Housing Association (PHA), which manages the units on behalf of the Polokwane Municipality.
The occupancy rate was 90,94%, with 46 units vacant.
The Polokwane council was updated about the current situation during a recent council meeting and was informed that at the end of May 2018, the municipality was owed just over R31 million, as well as R1,7 million for water services.
This despite the fact that the rental was between 40% and 60% lower than the average for comparable rental units in the private sector.
The village was plagued by violent unrest from 2013 to 2018, when no official from the municipality or PHA was allowed to set a foot on the premises.
This followed a retraction by the municipality of rent to buy or own lease contracts, which stipulated that the lessees could buy their units after having continuously stayed in the units for four years.
This was done because the municipality had to service a long-time loan of more than R31,5 million over 20 years, and they would need the rental money to do this.
Residents went on the rampage after they heard that they would not be able to buy their units. The municipality has currently re-instated the rent to buy clause, but with the provision that rental accounts are up to date. Residents were asked to register their interest to buy units, but since January 2015 no one has reportedly registered to buy.
The municipality appointed a new security company to restore order at the complex and intends to outsource the management and rental collection of Ga-Rena with a view to possibly sell the complex.
Maintenance to the amount of around R25 million will have to be undertaken first, according to a report by a property management company. These include damage done during unrest, among others the site office of R80 000 that was burned down and the biometric entrance system, valued at R228 000, that was demolished.
The audit, which was finalised in March, found in its first phase that out of 254 units, some 44 units were illegally occupied by tenants who had to be forcefully removed.
A total of 137 units were illegally sub-let, 63 were not verified and ten were vacant. At the end of March, 46 units were vacant.
Prepaid units will be installed at all units again after 84 meters were removed due to bridging of electricity in June 2018, and the municipality will only re-install the meters after the tenants have visited and engaged with the municipality.
Meters will also be placed outside the complex to discourage bridging. Any further bridging will lead to criminal cases to be opened.
Should tenants refuse to renew or regularise their leases, they would be evicted as a last resort.

Story: Nelie Erasmus
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