VANDERBIJLPARK – The DA in Emfuleni has raised concerns over the Emfuleni Local Municipality’s lease agreement for the ABSA Building, saying it intends referring the matter to an investigating body.

According to a statement issued by DA councillor Maureen Dosoudil earlier this month, the party alleges the municipality signed a lease agreement for the building as a sublease with what it describes as “an unknown, inexperienced and recently formed business entity”, rather than directly with the registered owner of the property.

The DA claims the company is listed as a shelf company, with its sole director appointed in February 2024. It further alleges that the company’s nature of business is not disclosed, it does not have a VAT number, and its listed address is an incomplete residential address in Vanderbijlpark. According to the DA, the title deed for the ABSA Building is held by a Johannesburg-based company and the lease was not concluded with the property’s registered owner.

The party says the municipality advertised the lease on tender, but alleges only one bid was received.

According to the DA, market-related rentals for approximately 3 000m² of office space range between R120 750 and R276 000 per month, including VAT. The party claims Emfuleni is paying R1.11 million per month, including VAT, which it says equates to R368.73 per square metre.

The DA says it was unable to obtain comparative figures for the OK Building, from which municipal offices were relocated, but questioned whether sufficient due diligence had been conducted before the municipality committed to the lease.

The party also questioned the relationship between the property’s owner and the entity acting as lessor, and whether the municipality had adequately assessed the terms of the sublease agreement and its potential implications.

The DA further alleges that, despite the municipality spending millions of rand on renovations, the building remains incomplete and in poor condition. According to the statement, only two floors are occupied, while two others remain vacant. It also alleges that some staff members do not have offices or office furniture, while unused offices are stacked with broken furniture.

The party further claims there is a R2 million claim against the municipality by the owner of the former OK Building, allegedly arising from the municipality not giving the required notice under the lease agreement.

The DA questioned why the municipality proceeded with the lease instead of issuing a new tender process.

“The Democratic Alliance will refer the matter to an investigating body for further investigation,” Dosoudil said.

The Emfuleni Local Municipality had not publicly responded to the allegations at the time of publication.