BCC, FBC Bank in housing deal

FBC-BANK

Prince Sunduzani, Business Reporter
THE Bulawayo City Council (BCC) has rejected a proposal for a housing project partnership by Metbank but embraced a similar pitch from FBC Bank.

Latest council minutes released yesterday indicate that the proposal for the development of 816 housing stands in Emganwini suburb by Metbank was rejected on the grounds that the bank owed council and should clear its arrears first.

Metbank owes the local authority up to $20 000 dating back to 2013 and has not finished settling the arrears, reads the report.

“It was resolved that the proposal for partnership between Council and Metbank in the development of 816 high density residential stands in R/E of Emganwini be not acceded to at this stage as the bank still owed Council money ($20 000),” said council.

“On 22nd July 2014 Metbank proposed a scheme of arrangement wherein the bank was to pay Council $10 000 per month towards liquidating the balance of $140 000. This arrangement was not honoured. Instead, the bank paid $10 000 in January 2016. As from March 2017, the bank offered to pay the balance of the principal amount over 10 months and thereafter discuss the payment of interest”.

Since then, council said, $110 000 had been deposited into its account by the bank with a balance of $20 000 scheduled to be paid by 31 December 2017. It said interest on the account was $17,825,44 as at 30 November 2017.

Meanwhile, the local authority has approved a partnership proposal with FBC Bank for the development of 513 stands in Luveve, saying the move would help the city to meet housing demand and also generate revenue. The council had earlier rejected the FBC offer after the two partners failed to reach understanding on the project rollout.

“In view of the demand for housing and the need to explore various housing delivery strategies, there were no objections to Council entering into a partnership with FBC Bank in the development of 513 high density stands in Luveve North,” said council.

It said partnerships arrangements were in line with council’s approved policy of the 7th August 2014 on involvement of private developers in housing delivery. “The establishment of a partnership was a welcome move as it will unlock housing development in the area with benefits of providing the residents with the much needed housing as well as increasing council’s revenue base as the residents will pay rates in perpetuity,” said the local authority.

Through partnerships, BCC has pledged to provide land, technical expertise and goodwill while the bank provides finance to title survey the stands, fully service the stands with sewer, water and roads and construct houses. Upon completion of the project the parties would then share the stands based on each party’s percentage contribution to the total project value. — @PrinceNkosy102

 

Article Source: The Chronicle