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Friday Jun 13, 2014

Part of Mandela Rhodes property development for sale

Part of the landmark Mandela Rhodes Place is up for sale after its owners failed to secure a business rescue.

Before it was liquidated West City Precinct Properties, which owned the property, had its appeal of a 2012 judgment dismissed last week.

In 2012, Anglo Irish Bank Corporation successfully applied for a provisional sequestration and liquidation order against the majority shareholder Frank Gormley and West City. This after the bank, which was also under liquidation, recalled over R219 million in debt owed to it by West City. The order was made final the same year.

The company - which owned a significant number of the building's sectional title flats, as well as the commercial space and parking lot - had failed to pay since April 2008.

In papers submitted to the Western Cape High Court the bank said West City showed a loss of R7.8m for the 2010 financial year and R20m in 2009. Gormley said the company did owe money to the bank, but it was making money. 'Mandela Rhodes Place was operating at profit. The bank then collapsed and recalled all its business loans,' Gormley said.

He said the remaining part of the property could be snapped up any time because it would continue to make money for investors.

Cape Times


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