Auction of VBS property aims to recoup losses for creditors affected by corruption

The vacant eight-block office park property is now being sold to contribute to recouping losses suffered by creditors in the VBS Mutual Bank corruption scandal. 

This prominent 22,826m² office campus at 82 Wessels Road will go under the hammer with Auction Inc. this month, marking a significant step in the protracted recovery of funds looted from the bank and its municipal depositors.

The creditors included numerous municipalities that deposited funds unlawfully.

VBS’s rapid rise crumbled in 2018 when it was exposed as the epicentre of a massive fraud.

A forensic investigation by the South African Reserve Bank (Sarb), led by Advocate Terry Motau SC, found the bank “corrupt and rotten to the core,” with over R2 billion siphoned off through schemes involving executives and politicians.

Placed under final liquidation by the North Gauteng High Court in November 2018, the process of recovering assets for creditors has been ongoing for over six years.

The sale of this prime asset is a tangible outcome of that lengthy liquidation process. It represents a rare opportunity in one of Johannesburg’s most sought-after nodes.

“The VBS property is one of the most desirable Rivonia sites to ever go under the hammer,” says Ari Ben, CEO of Auction Inc.

“82 Wessels Road is a strategically located office campus with immediate N1 highway access. The current B-Grade configuration offers excellent flexibility, but the true value lies in its conversion potential.

“The Metropolitan Office Park's versatile layout and favourable zoning create an opportunity for conversion into high-demand residential apartments or sectional-title residential complexes.

"Its existing Business 4 zoning and well-maintained infrastructure provide a significant cost and logistical advantage for any large-scale residential conversion.

“82 Wessels Road is a rare campus-style property of scale in a prime Rivonia location with direct N1 exposure,” says Ben.

“With multi-block layout and parking capacity to support uses such as corporate head offices, multi-tenant office environments, serviced work spaces, or a medical/professional campus.”

The property boasts a combined gross lettable area of approximately 13,123m² across eight individual blocks.

Its existing Business 4 zoning and well-maintained infrastructure present a compelling opportunity for conversion into high-demand residential apartments or a sectional-title complex - a use experiencing rapid growth in the area.

Alternatively, the campus is ripe for an upgrade to A-Grade corporate offices.

“Rivonia is a premier mixed-use node north of Sandton, popular with financial, legal, and tech firms,” Ben adds. “This asset offers a blend of immediate income potential, with a projected gross annual income of R15.74 million when fully let, and significant strategic value for redevelopment.”

Ben says the Rivonia property is just one of 20 incredible lots going under the hammer on  February 24. 

“This auction runs the gamut from luxury residential property across the country, to prime redevelopment sites and a plethora of commercial and industrial opportunities.”

Auction industry pivotal in asset recovery

The sale is said to underscore the critical role the auction industry plays in South Africa’s asset recovery landscape.

Joff van Reenen, Auction Inc. auctioneer and director of the SA Institute of Auctioneers, notes that auctions have become a vital tool for state agencies and liquidators seeking to claw back the proceeds of corruption.

“The auction industry in South Africa has become a critical mechanism for liquidators and state agencies, such as the Asset Forfeiture Unit (AFU) and the Special Investigating Unit (SIU), to recover assets acquired through the looting of public funds,” says Van Reenen.

“These seized assets – ranging from luxury properties to vehicles and equipment – are sold at public auctions to recover stolen funds, with recovery amounts linked to state capture cases reaching R11 billion by March 2025.”

The auction of the VBS Rivonia HQ is a high-profile example of this process in action, converting a once-notorious symbol of graft into a liquid asset for creditor distribution.

In December last year, the Special Investigating Unit (SIU) obtained a preservation order from the Special Tribunal to freeze a residential property in Hesteapark, Pretoria, linked to the late actor Presley Chweneyagae, his spouse, and several other respondents in a National Lotteries Commission (NLC) corruption case.

The property is alleged to have been purchased with approximately R889,000 diverted from a R15 million NLC grant meant for youth arts programmes.