Curators sell off Bonitas assets

Posted On Thursday, 25 August 2011 02:00 Published by eProp Commercial Property News
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Bonitas, the country's second-largest open medical scheme, which was placed under curatorship following a settlement reached between the scheme and the Council for Medical Schemes, is now disposing of its properties and freeing up cash

Rael LevittThis is according to auctioneers Auction Alliance.

The medical scheme, which covered more than 650,000 members, owns several properties in Gauteng and KwaZuluNatal. When Bonitas was placed under curatorship it was probed for spending more on property that what had been planned.

The properties will all be going on auction in Sandton on Thursday this week, Auction Alliance said.

The KwaZulu-Natal properties that are going under the hammer include an apartment and a small shopping Centre in Empangeni.

According to Rael Levitt, CEO of Auction Alliance, there is strong interest in the retail centre which measures approximately 1,000 square metres.

"Questions were previously raised as to why the medical scheme was investing in residential and retail property, which was not its core function or business model."

In Gauteng, a 7,960 square metre development site on William Nicol Drive in Bryanston is also going to be sold at the auction on Thursday. The site, which was planned for the medical scheme's head office, is zoned residential but was in the process of being rezoned to a business zoning, before Bonitas was placed under curatorship. Bonitas's head office is currently situated in Sandton.

A fully let office block in Hans van Rensburg Street in Polokwane, measuring 1,425 square metres, will also be sold.

"This property with three strong tenants, two being Medscheme & The Department of Public Works, is attracting considerable attention''.

According to the auctioneers, "it is a good solid property in the government precinct of Polokwane and the type of building that always sells well".

The third tenant has just resigned a three year lease.

The Council for Medical Schemes confirmed in June that the scheme had not been placed under a curator due to financial or other difficulties, but a curator was deemed necessary to regularise the governance of Bonitas.

The regulator filed for an application to place the scheme under curatorship at the beginning of last year. This followed a probe that began in 2009.

Eight allegations of corporate transgressions were levelled against Bafana Nkosi, the former principal officer, who resigned before facing a disciplinary hearing. The same accusations were also borne by members of the board of trustees.

The allegations ranged from investments in properties for which the scheme paid about 20 million rand more than planned, to exclusive contracts with suppliers that were governed by verbal agreements only.

In September last year, the high court divested the trustees of their powers. The board went to court earlier this year seeking a reversal of this decision. However, a court-sanctioned agreement to put a curator in charge of the scheme was reached.

Medscheme, Bonitas' administrator, said it was business as usual because the settlement did not affect its agreement with the scheme.

Last modified on Friday, 15 November 2013 10:40

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