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AFRICAN DAWN Annual Report 2016

continued Notes to the Financial Statements Annual Financial Statements For the year ended 29 February 2016 9. Properties in possession (continued) Almika Almika owns a low-cost residential development consisting of 50 units in Loerie Park, Benoni, Gauteng. The development has now been completed and the units are in the process of being sold. In terms of the agreement with the property developer, Afdawn Group will receive R70 000 on transfer of each unit that is sold. It is estimated that this will amount to approximately R3,4 million. A total of 26 units have been transferred and payments of R1,8 million have been received by February 2016. Greenoaks Candlestick has title to a residential housing complex called Greenoaks in Centurion, Gauteng. These units are currently being rented to tenants on annual leases (with renewal periods and rates subject to negotiation). Rental income of R5 314 558 (2015: R5 345 811) has been recognised. Greenoaks was transferred to Candlestick in August 2010 in settlement of amounts due to African Dawn Property Transfer Finance 2 Proprietary Limited (“PTF 2”) and African Dawn Property Transfer Finance 3 Proprietary Limited (“PTF 3”) by Blue Dot Properties 1198 CC (”Blue Dot”). PTF 3 is not part of the Afdawn Group. In terms of an agreement between PTF 2 and PTF 3, any amount realised on disposal of the property less amounts payable to Nedbank (under the first mortgage bond) less related costs less amounts due to certain other third parties will be shared between PTF 2 and PTF 3 on a 50:50 basis in settlement of the balance of their respective loans to Blue Dot. For this reason, the reconciliation above is split as follows: • Amount relating to legal title of entire property • Less PTF3 share of the property (50%) • Equals amount relating to Afdawn Group’s share of the property (i.e. the 50% referred to above that is in substance Afdawn Group’s share of the property). Blue Dot was placed in liquidation and there was a dispute in terms of which the liquidator is attempting to have the property transferred back into the insolvent estate of Blue Dot. Negotiations between the Blue Dot liquidator and Candlestick were concluded and a settlement was reached whereby on the sale of the building the Nedbank bond and selling costs will be settled first and the balance will be split in the following ratio PTF2 35%, PTF3 35% and Blue Dot liquidator 30%. The other claims against the property include: • A Nedbank loan, in terms of which Nedbank registered a first bond against the property. The original facility was R14,100 million and the amount outstanding at the reporting date was R7,5634 million (2015: R8,869 592 million) (refer to note 15). 70 AFRICAN DAWN ANNUAL REPORT 2016


AFRICAN DAWN Annual Report 2016
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