It will cost between R700-million and R800-million to get The Villa shopping centre property development, south-east of Pretoria back on track according to Paul Kyriacou, chief executive of Capicol.
A rescue plan has been set up for The Villa, Pretoria property development in an attempt to prevent investors from losing hundreds of millions of rands. The plan has not yet received the backing of Sharemax’s board.
His comments come amid threats from the main contractor for the project, GD Irons to liquidate Capicol in order to get payment of R150-million for work done on the project.
GD Irons holds a lien over the property.
Former Sharemax Investments managing director Willie Botha has set up a rescue plan for The Villa in an attempt to prevent investors from losing hundreds of millions of Rands. The rescue plan has not yet received the backing of Sharemax’s board.
In terms of the plan Botha proposes raising an additional R100-million from current investors in the property by asking them to inject R12k each into Sharemax. This money, says Botha, will be used to pay GD Irons and prevent the development from being liquidated.
It would also mean that The Villa could be transferred to the investor company.
Botha says that once this was done, investors could determine a way forward for The Villa, which could be sold as it stands, or raise additional funds to complete it.
However, Dawie Roodt, chairman and chief economist of Efficient Group and an independent director of The Villa says that he is opposed to the plan because companies that are under statutory management are not allowed to trade with the assets of the company without approval from the Reserve Bank.
Geoff Irons, managing director of GD Irons says he is not prepared to lift the lien until the debt is settled. He says his company owes about R100-million to sub-contractors and creditors who were now demanding payment for work done at The Villa.
Irons says that unless the R100-million is received from Capicol he will have to institute liquidation proceedings to recover what is owed.
Construction work on the R3,5-billion shopping centre ground to a halt last year when funds to the developer, Capicol dried up.
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