Undeveloped land
A satellite view of part of the undeveloped land now owned by government pensioners, via Google Maps.
  • The PIC has invested well over half a billion rand in government pension money in farmland between Klerksdorp and Stilfontein. It says it got a good deal.
  • A different pension fund, for municipal councillors, bought land from the same company in the same to-be-developed area.
  • That fund lost 35% of its money at current valuations, though it hopes to get it all back, possibly through legal action.
  • For more stories go to www.BusinessInsider.co.za.


A pension fund for municipal councillors has lost some 35% of an investment it made in property in Klerksdorp – property in the same area where the Public Investment Corporation (PIC) just invested more than half a billion rand, and bought from the same company.

It emerged this week that the PIC had paid R586.5 million for two pieces of farmland between Klerksdorp and Stilfontein, on behalf of the Government Employees Pension Fund (GEPF). That deal has drawn scrutiny since being spotted among a list of farm sales in Landbouweekblad.

The PIC says that, although it is buying undeveloped farmland, it envisages building a new suburb for Klerksdorp on the site, and that the price it paid was fair.

The PIC appears to have paid 15% more than the value the seller, Isago@N12, placed on it.

See also: Govt's pension fund seems to have gifted developers hundreds of millions for empty farmland – now questions are being asked

The Municipal Councillors Pension Fund (MCPF), on the other hand, does not believe it got a good deal from Isago.

In mid-2015 the MCPF "bought" 11 stands from Isago in the same Klerksdorp extension where the PIC plans to build homes and offices, for around R140 million. Those pieces of land were never actually transferred to the fund. The MCPF was eventually refunded the full amount – apparently using money from the PIC purchase – after it was placed under administration. 

But a 12th stand, also from Isago, was actually transferred into the name of the MCPF, which still owns it, and is now trying to be rid of it.

The MCPF paid Isago approximately R64.7 million for the 12th stand, its curator Juanito Damons told Business Insider South Africa. It was last listed on the organisation's books at what it believes to be a more realistic value of R41.8 million – around 35% less than the purchase price.

The MCPF hopes Isago will buy back the land. If not it may auction off that stand, Damons said, then look for a way to recover any shortfall against what it originally paid.

Business Insider has not been able to reach the directors of Isago and its shareholder companies.

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