The City of Johannesburg in 2008 reportedly agreed to sell three hectares of prime land in central Sandton to a politically connected consortium for R280 million. But some 13 years later, the buyer of the land has yet to pay the city the purchase price.
Investigative journalism news outlet amaBhungane reported on Tuesday that the developer of the land, the Regiments Kgoro Consortium, took possession of the land in 2013 and no development ever happened, resulting in the project going into liquidation.
The land, which is above the Sandton Gautrain station, is now apparently out of the city’s ownership and is set to be sold by the liquidator.
According to amaBhungane, which is doing a three-part investigation series into the land deal, a handful of people made millions from the sale of the land, including the brother-in-law of former Johannesburg mayor Parks Tau and a mysterious trust with apparent links to the ANC.
The land deal has long been suspected to be dodgy for several years, but with no evidence to back up the claims.
However, amaBhungane was able to uncover that the majority shareholder of Regiments Kgoro Consortium is Regiments Capital. The company has been marred in state capture allegations involving the controversial Gupta family.
Regiments Capital reportedly promised to bankroll a mining venture linked to a member of the bid evaluation committee in order for the land to be sold to Regiments Kgoro Consortium.
The member of the bid evaluation committee is William Mathamela, the City of Johannesburg’s then-treasurer in 2008.
The city reportedly opened bidding for the land to developers while the Gautrain Sandton station was under construction. Four companies submitted proposals to the city. But it signed the deal with the Regiments Kgoro Consortium on 3 July 2009.
This was apparently despite the consortium having no track record as a developer, but its main shareholder, Regiments Capital, was influential in the city as it had run its debt management fund. Regiments was a regular donor to the Johannesburg branch of the ANC at the time.
Mathamela, who is now the chairperson of Joburg’s refuse removal company Pikitup, denied to amaBhungane that Regiments Kgoro Consortium was sold the land because Regiments promised to bankroll a mining deal that personally benefited him.
This was despite emails linking him with TLD Mining, which Regiments paid monies to for “mining rights” prior to the R280 million land deal.
It was unclear whether Mathamela declared a conflict of interest before sitting on the bid evaluation committee that recommended the Regiments Kgoro consortium.
Mathamela reportedly played a major role on the city’s risk committee which oversaw Regiments being awarded the contract to manage the city’s debt management fund, known as the sinking fund contract.
He also became Regiments’ business partner after he stepped down as the city’s treasurer before being appointed as the acting chairperson of Pikitup earlier this year.