George building collapse: Families ask bank to donate R3.75m property sale proceeds

The families of the 62 victims of the 75 Victoria Street building collapse have appealed to Standard Bank, which financed the development, to consider donating the proceeds from the recent auction of the property to the victims.

George Herald reports that according to a media statement issued by these families on Tuesday, many of the survivors and relatives of the deceased were left destitute and are still waiting for the Department of Labour and Employment to process workmen’s compensation claims.

Auction proceeds

The property was sold in an online auction in November following the developer, Neo Victoria Developments, going into liquidation. Standard Bank is the preferred creditor to receive the proceeds from the sale.

The families say in their statement that the proceeds are just a drop in the bucket of what the developer owes them. “… if this amount was shared among the 62 families, it would help to pay school fees, doctors’ bills and put food on the table. Such an initiative will also speak volumes in terms of the bank’s sense of justice and mercy.”

Municipal response

In a similar vein of thought, Good’s councillor Chantelle Kyd submitted written questions to George Council Speaker Sean Snyman regarding the transaction, referring to possible alienation of the disaster property for public use. Previously, members of the public have suggested that a memorial garden be established on the property in remembrance of the victims.

According to responses from the office of the municipal manager, Godfrey Louw, to Kyd’s questions, a valid sale agreement is in place, but it would ‘technically’ be possible to negotiate with the new owner to buy the property from him. However, since Neo Victoria Developments is under liquidation, the liquidator and the bondholder would have to be involved in the negotiations.

Negotiation would also only be possible if the municipality is ‘willing and able’ to pay at least an amount equal to the sale price, as Standard Bank can be expected to protect its commercial interests.

Kyd’s questions and the responses were noted in a report on the council agenda dated February 27. According to the report, the transfer of the property has not been registered yet.

In one of the responses, the municipality states that expropriation is not considered viable because the property is not required for the rendering of basic municipal services and no budgetary provision has been made for it.

Recovery costs and sale

The municipality has spent R9.296m on recovery costs and the rehabilitation of the site, but did not follow through with a claim against the developer since the bank is the preferential creditor in the liquidation. Legal advice obtained by the municipality indicated that additional legal expenses to recover these costs would be fruitless expenditure.

Dewald Breytenbach, the liquidator, confirmed to George Herald that the highest bid at the auction was R2.86m. “During the confirmation period, higher offers were received, after which the original purchaser matched the highest bid of R3.75m. The bid was then awarded to him.”

The nearly completed five-storey building collapsed on May 6, 2024, killing 34 workers and injuring 28.

In their statement, the families expressed their ‘deep appreciation to the people of George who have been supporting us with their compassion, prayers and donations’.

A media enquiry has been sent to Standard Bank and its feedback is being awaited.

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