SAHRA Property Portfolio and Revenue Generation Potential

1. Setšhaba Letlotlo la Setjhaba Ons Erfenis Ilifa Lesizwe Lifa Lesive Ilifa Lesizwe Ifa la Lushaba Ilifa Lesitjhaba Ndzhaka ya Rixaka Bohwa bja Setšhaba Heritage for the Nation PRESENTATION OF THE PROPERTY PORTFOLIO OF SAHRA TO THE PORTFOLIO COMMITTEE 11 AUGUST 2015 Presented by: Ms Veliswa Baduza Chief Executive Officer Parliamentary Precinct

2. Contents • Purpose • Introduction • Composition • SAHRA’s Property Portfolio • Properties with a Potential for Revenue Generation 5.1 Fishermans Cottages – Struisbaai 5.2 Daljosafat Farms - Paarl 5.3 Welcome Cottages – Simons Town 5.4 Posthuys – Muizenburg 5.5 Valkenburg Manor - Observatory • Conclusion Tuynhuys 1

3. Purpose The purpose of this presentation is to brief the Portfolio Committee on the performance of the Property Portfolio of SAHRA as well as the planned maximization strategy. Union Buildings, photo by R Aspeling 2

4. Introduction • SAHRA is established in terms of the National Heritage Resources Act No.25 of 1999 (NHRA) which outlines an integrated interactive system for the management of the national heritage resources of South Africa • As the implementing agency of the Department of Arts and Culture, SAHRA plays a critical role in the identification, conservation, protection and promotion of our heritage resources for the present and future generations • SAHRA currently has a property portfolio of 36 buildings, cemeteries and memorials which are considered to be of historical importance. These properties were donated to the National Monuments Council and the Historical Monuments Commission (the predecessors of SAHRA) by the State and other institutions and individuals. The properties were typically donated to ensure their continued protection and to prevent them from being demolished. • Following a thorough analysis and understanding of the each Property, SAHRA developed a property maximization strategy which will provide a sound business case for rehabilitating the heritage sites while at the same time deriving socio economic values. 3

5. Composition of Properties The Portfolio of 36 Properties across 8 Provinces consisting of: • 3 burial sites Western Cape Properties • 3 open sites; • 15 monuments • 15 buildings 4

6. SAHRA Property Portfolio 5

7. SAHRA Property Portfolio 6

8. SAHRA Property Portfolio 7

9. Properties With Potential For Rehabilitation And Revenue Generation The properties below have been determined as having the potential for significant economic and social impact to the Country. These Properties could potentially provide sustainable revenue to the Agency at the same time creating job opportunities by providing community projects such as substantive farming, Arts & Culture hub, hhotels, crèches etc. 8

10. Fisherman Cottages – Struisbai In the early 1980, the cottages were in a state of disrepair, and the then NMC entered into leases with eight tenants on a long term (25 years with the option to renew for another 25 years) basis at nominal rent of R1 per annum. The lessees were responsible to rehabilitate the cottage at their own expense and also responsible to pay a one ninth share of all levies and amounts payable to the local authorities and the cost of restoring and maintaining the properties. 9

11. Fisherman Cottages – Struisbai cont. Struisbaai is a small seaside town with arguably one of the longest sandy beach in South Africa, but also one of the safest swimming beaches, with water from the warm Agulhas current. Current Use • Out of the 8 Cottages, 3 have been cancelled due to the fact that the Lease Agreements were never renewed in the 2006 for a further 25 years as allowed in the lease agreements. • The lease agreement states that the cottages are leased at nominal rent, subject to the lessees restoring and maintaining the cottages and contributing to the rates and taxes and maintenance of the properties. • Legal advice was sought for the other 5 Cottages for the possible termination of the long term leases entered into in previous years. Attorneys have been approached from those available in the area of Bredarsdorp, near Struisbaai, to institute eviction proceedings at Court in the District of Bredarsdorp. Future Use • The existing buildings will be restored to a standard determined by the relevant authority, then utilise them for administration, educational or commercial purposes.   • 16 cottages new Cottages could be erected on the property (8 on Erf 1400 and 8 on Erf 1401, subject to confirmation by Cape Agulhas Municipality and rezoning) built in a style to replicate the design of original that of the fisherman’s cottages.   • These cottages must be equipped with standard accepted equipment in the timeshare/ self catering industry and should be graded by a relevant authority for time to time. 10

12. Struisbaai from this currently... 11

13. ...to this after development 12

14. Dal Josaphat Farms Potential Community Projects Parameter Fencing to be erected Extent of the site 13

15. Rehabilitation Plans for the Dal Josafat • In 1981, the separate farms situated east of the Roggeland Road, including the 173ha of deproclaimed land, and a further 59ha of land west of the road, were consolidated as Erf 1341 and transferred to the Department of Public Works. In 1985, consolidated erf 1341 was declared a national monument in terms of the National Monuments Act 1969 (Act 12 of 1969, now repealed). It was transferred from Public Works to the National Monuments Council (now S A Heritage Resources Agency or SAHRA) by means of a Deed of Donation a year later • There are 14 buildings on the Daljosaphat farms that are of significant heritage value, however the practice of renting them out for long term residential purposes has allowed for the degradation of the buildings, both internally and externally and significant sums of money will have to be spent to restore these buildings Future Plans • Create a commercial “Heritage Village” by utilising the existing buildings, landscape and infrastructure. Convert, where possible, all the “Manor Houses” into Accommodation Establishments, Spas or Wellness Centres and convert their larger outbuildings into Conference and Function Facilities, restaurants. • The other buildings can be utilised for Reception, Administration Offices, Heritage Information Centres, a Library, Delicatessens, Wine Tastings, Curio Shops, Art and Craft Shops and Art Studios. Short term residential (hotel), educational or commercial purposes. 14

16. Welcome Cottage -Glencairn, Simonstown In 1810, HE Brand, Deputy Fiscal at Simon's Town petitioned the Cape Government for the lease of a piece of land. The farm was granted formally to Brand in 1811 for a 15 year period and its main product was vegetables. Welcome Cottage was built between 1812 and in 1822 a new grant was issued to Brand. The property was later acquired by Mr F B Pinney, then Sub-Collector of Customs at Simon's Town and in 1871 it was bought by Mrs N Albertyn (nee De Villiers). It was passed down through the De Villiers family until the property was acquired by the Ministry of Defence in 1974 or 1975. The transfer of the property to the NMC was agreed to in 1979. 15

17. Welcome Cottage -Glencairn, Simonstown The leases on both these properties have expired and have not been extended. Letters of intention to cancel have been sent to both tenants who occupy the converted stables and the outbuilding, advising them of at SAHRA intention to renovating the building. Future Use Due to the location of the Property, it is proposed that the property is renovated with the intention of converting it to one of the following: an upmarket Spa and Wellness Centre, an upmarket guest house, or a themed restaurant, which would serve not only the tourist trade but also for the estimated 1200 local residents. The establishment could either be rented out in its entirety, or managed by an experienced Manager employed by SAHRA. The outbuildings can be used as additional rooms, administration offices, laundry and manager’s accommodation. Alternatively, the property could be converted into office space and be utilised for a small training academy, medical practitioner offices (doctor, physiotherapist, chiropractor, or occupational therapist), or as a day care centre. 16

18. Posthuys in Muizenburg Inside of the Museum 17

19. Posthuys in Muizenburg cont. First recorded on a map in 1687, the actual origins and history of this building are still a subject of debate, (as dates vary between 1662 and 1673) but it is thought to be the 2nd oldest building in the Cape after the Castle, and the oldest in False Bay.   In 1662, due to the imminent outbreak of war between the Netherlands, the site on which Het Posthuys is situated, was chosen for the erection of a watch post to guard False Bay in case of attack. The building, part of a larger barracks complex, was built by the Vereenigde Oost-Indische Companies (Dutch East India Company or VOC) between 1663 and 1673, it was presumably used as a lookout point for enemy ships entering False Bay and as a signal station by the VOC during the Dutch occupation of the Cape. The property is located on Erf 94323 at 180 Main Road, Muizenberg, Western Cape, directly across the road from the sea, and a few hundred metres from Muizenberg Beach. Current Use Today it houses a small museum featuring a few interesting pieces about the Battle of Muizenberg (when the house came under fire) and historic photos of the Muizenberg area. Planned Use A proposal for the construction of a small 60 seater conference facility, a restaurant plus deck, together with off road parking is currently being drafted. 18

20. The property is currently being leased by UCT at an annual cost of R74 508 per annum and the lease has another 47 years to termination. We have negotiated the lease rental. This will increase income from the property from R74 508 per annum to R 200 000 per annum. 19

21. Valkenburg Manor • The University of Cape Town (“UCT”) were ceded a Lease Agreement of SAHRA’s property in Valkenberg in 1993. • The rental that they have been paying to SAHRA has been escalated over time and to date they are renting R74 508.47. • UCT has requested consent to sublease the property to a third party and the proposed rental with the proposed subtenant is around R400 000.00. • The parties (UCT and SAHRA) have negotiated and UCT has accepted that it is willing to pay 50% of the rental to be generated escalating annually, on anniversary date. • The Sublease is for a period of 20 years. 20

22. Value of the Leased ( Investment Properties) It is evident from the loss situation depicted by the revenue vs expenditure that capital injection is critical for the rehabilitation of these Properties to enable self sustainability and improved revenue generation. 21

23. Conclusion • SAHRA guided and supported by the Council is determined to turnaround the Property Portfolio to ensure their continued preservation and protection while at the same deriving value out of their existence. • We are in discussions with the DAC regarding funding for the full implementation of the strategy. • Processes of obtaining permits from the Provincials heritage authorities and engagements with Municipalities have already commenced. • We will also be engaging the National Treasury on various possible funding models such as the PPP. • In conclusion I would like to thank the Portfolio Committee for giving us this opportunity of discussing our Property strategies. 22

24. I THANK YOU! 23