2007 / 2008 Annual Report - Eastern Cape Development Corporation

EASTERN CAPE DEVELOPMENT CORPORATION 2007/08PROGRAMME PERFORMANCEPROPERTY MANAGEMENT &DEVELOPMENT3.2 Programme 5: Property Management and Development trends in performance 2005/06 to 2007/08Measurable ObjectiveTo increase rentalcollection from 60%to 95% by 2009/10Increase collection onoutstanding rentalsTo convert residentialproperties to tenantsin good standingMaintain ECDCpropertiesIncrease rate ofoccupancy by 5%PerformanceMeasure2005/6(actual)Rental received R46, 87 5mil2006/7(actual)2007/8(actual)Arrears collected N/A N/A R15,389milValue of propertysalesObtain goodvalue for propertyNumber of unitsoccupiedCompoundAnnualGrowth %Reason for deviationR48, 855 mil R34,68 mil -14 Change in performancemeasure which nowexcludes recoveries onarrear collection. For directcomparative purposes(R34,68m + R15,389m =R50,074 m)See aboveSee aboveR13 mil R23 mil R18 mil +18 Moratorium on evictions hadan adverse affect on propertysales.R3,761 mil R5,725 mil R5,967 mil +26n/a n/a n/a n/a Unchanged4 Property Management and Development challenges FACED DURING 2007/08• Low levels of occupancy in the industrial sector, especially in areas like Ezibeleni and Dimbaza;• The lengthy legal processes of collection and the impact of the moratorium on eviction of residential defaulters;• Delays in implementing the first phase of the Asset Conversion Policy due to the number of defaulting residentialtenants that do not qualify to purchase their houses;• The debt collection results of the debt management company appointed in the prior financial year have not been assuccessful as anticipated due to the moratorium, among others.5 Property Management and Development achievements DURING 2007/08• Improved the integrity of the Asset Register;• Identified the disposal of properties with no intrinsic value and have commenced the process of transfer ofproperties into the name of ECDC where such properties have intrinsic value and ECDC has a right to them but wherethese are currently under the control of third parties;• Implemented the first phase of the asset conversion process, the second phase will be initiated in the 2008/9financial year.56