GEORGE NEWS - In an annual review of the upset price for the industrial plots behind Stanmar Motors in the Pacaltsdorp industrial area, the George Council approved lowering of the price per square metre from R400 to R334.
This is to stimulate sales that have dwindled despite an aggressive marketing campaign and a price reduction in 2013 when the price was set at R400 per square metre.
The first of these plots were sold in 2005. Since then, council has earned R75,77-million from sales.
According to a report tabled at a council meeting in February, a lot of enquiries are received regarding the erven, but the poor sales can be attributed to the high prices and poor economic conditions.
Donnie Gelderbloem, head of properties, says in his report that even if the economic situation improves and the property market recovers, the prices are still too high for the average buyer.
The municipal property management policy stipulates that the upset price of an immovable property must be determined in a way that corresponds with a fair market value and must include the recoverable development costs such as municipal services, advertising and survey costs.
The development cost for the 44 plots behind Stanmar was determined in 2006 as being R11,74-million or R70,96 per m² (marketing costs excluded).
Most of the opposition parties welcomed the price reduction, but think that the price is still too high.
Cllr Virgill Gericke from the PBI said the initial purpose of making the plots available was to give previously disadvantaged entrepreneurs opportunities to start or expand businesses.
"The price should be lowered further to help increase the number of participants in the mainstream economy. We are not saying that we should be reckless, but the price must be economically viable."
Freedom Front Plus Cllr Gert van Niekerk was opposed to the lowering of the price. "The DA municipality is stripping our assets for BEE political purposes. They are impoverishing the ratepayer.
This is not a business decision, it is to satisfy factions within the DA. This is the second time that the price is lowered under DA management. If there is not a demand, then a lower price will not help the sales."
Johan du Toit from the ACDP welcomed the decision. "It will attract industries and raise rates and tax earnings for the municipality, as well as create work. The community and municipality will benefit."
Cllr Basil Petrus from the SAC said the initial purpose of the plots, that were put on the market during his term as mayor, was to provide empowering opportunities to developing entrepreneurs.
"The plots have been lying there for years and the infrastructure is being vandalised. Selling them will provide long-term income for the municipality. The price should be even lower than what has been approved." EFF Cllr Laetitia Arries agreed that the price should be lower than the approved rate.
"We want the plots to be affordable for the disadvantaged so that George can contribute to economic transformation and assist developing entrepreneurs to become part of the mainstream economy."
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