CITY PRESS, Business
JSE-listed black-owned property companies have defended their decision to list on the stock market after an emerging property investor warned that the listings were eroding black ownership in the commercial property industry instead of taking it a step higher. Monde Mbeta, a director of property development and management firm E-Bongo Property Holdings, said the listings have led to the reduction or heavy dilution of black shareholdings in black-owned property companies, which some have listed on the back of leasing offices to government departments and state-owned enterprises. “When BEE companies list (on the JSE), there is a serious dilution of their empowerment status. It is categorically stated on the leases that should the BEE status dilute after having a long lease, the lease will be reduced proportionally or cancelled,” explained Mbeta. “Where is the actual transformation in this model (listing) if the benefit of long-term guaranteed income from a government lease goes back to fmancial institutions, pension funds and white individuals who can afford to subscribe for the shares?” he asked.