HARARE - Real estate developer Equity Properties (Private) Limited (Equity) has secured a compliance certificate for its first phase of the Golden CT Suburb (Golden) in Harare’s Mount Pleasant district.
The development not only means the property firm has met certain conditions related to ancillary infrastructure as demanded by the Harare City Council (HCC), but can also go ahead and start transferring ownership of about 80 stands to clients, while work is being done to obtain compliance for phases two to seven — with about 200 stands.
While the process to achieve compliance has not been easy as Equity has had to contend with fresh demands from the local authorities and that were not specified in the original plans, an official with the company said this could cause markedly increased costs and push back project completion.
“When we completed work on the first phase and seeking compliance, we were informed by HCC that we had to put double-layered tarred roads due to pothole problems, stand access culvert and lined storm drains to avoid erosion,” he said.
“As such, this has pushed up construction costs by an additional $2,43 per square metre from the (original) $18 per square metre. Upon engagement of the residents association, we also asked our clients to top up funds as provided for in clause 6.10 of the agreements (of sale)... but since not everyone had the money we borrowed from the market to ensure that we meet the additional demands... to achieve compliance,” they said.
Additionally, the Zimbabwe Revenue Authority has also directed Equity to remit its value added tax (VAT) on stands sold from 2009 and also levied penalties on the unpaid VAT since then.
“We decided to pay off the penalties and passed on the other costs to the stand holders as per our agreements. For instance, section 6.9 of the agreements obligates purchasers to pay a percentage of the property values (as endowment) to statutory authorities at the time of transfer... as well as VAT or sales tax should it be required by the same authority before full transfer,” he said, adding all these issues had been communicated to clients in a series of letters on December 6, 2013 and February 6 this year.
Equity said it was “important that Golden City investors” paid their dues “so that it can repay the loans and effect transfers soon”.