Business rescue practitioners ‘working to resolve’ crisis at Tshwane social housing company
Tshwane’s social housing company, Yeast City Housing, has been placed under business rescue after racking up debts of R130 million.
It has also bemoaned the failure of courts to provide it with eviction orders for indebted residents.
The management of Yeast City subsequently entered into voluntary business rescue in May in an attempt to resolve the debt.
Business rescue practitioner Sello Mkhondo said the company failed to meet its obligations to its lenders, which include the National Housing Finance Corporation, Gauteng Partnership Fund, as well as the City of Tshwane.
According to Mkhondo, housing is an industry which is very sensitive to the non-payment of rent and services, and any slight deviation in collections could have a major impact.
He said that payment collection appears to have been not strictly enforced, and the rental boycott at Thembelihle Village in the Pretoria CBD reduced collection levels substantially.
“The Engaged Business Turnaround Team has extensive experience working with all stakeholders, funders, regulators and other parties impacted by financial challenges that businesses may be experiencing. We have been working closely with all stakeholders to resolve the situation and ensure the best outcome for tenants and employees,” said Mkhondo
Yeast City Housing has 11 blocks of flats and houses. The company’s site has flats for R1,500 per month for people who earn R5,000 a month or less and rentals for R1,800 for people who earn up to R6,000 per month.
Properties include Gilead House, which cares for more than 60 homeless and vulnerable people who live with chronic illnesses.
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