Tenants owe TransNamib over N$20m
Beleaguered carrier TransNamib has since June issued numerous letters of demand to non-paying tenants for more than N$20 million in outstanding rent, the company’s spokesperson Abigail Rautenbach said.
In 2020, CEO Johny Smith revealed that a valuation exercise had placed the value of the company’s assets at over N$2.6 billion, but the enterprise was 30 years behind where it should be.
He also recently told the media that TransNamib is operating at a loss of N$10 million monthly due to delays in acquiring backing for its integrated strategic business plan, which was approved by Cabinet in December 2018.
The railway operator needs about N$2.5 billion to fund the plan aimed at making it profitable and doubling its revenue.
In desperate need of money, while confronted with workers on strike for salary increments, TransNamib recently undertook an auction of some of its non-core assets in Windhoek, Seeis, Okahandja, Otavi, Karibib, Omaruru, Otjiwarongo, Maltahohe and Keetmanshoop.
According to insiders, the company’s properties department has been in complete disarray for years, with many tenants occupying property without lease agreements, while others are in court disputing ownership.
The national carrier has also found itself in a tug of war with some of its employees occupying company property illegally.
Understaffed
Meanwhile, the sizeable outstanding amount from tenants has had a massive impact on the organisation’s ability to fund its operations and plough back into the maintenance of its rolling stock and infrastructure, Rautenbach said.
One of the challenges of the slow progress is the fact that the properties department - headed by Alynsia Platt - only employs four people, who are tasked to handle the parastatal’s properties countrywide.
According to the spokesperson, following the launch of an aggressive ‘clean-up campaign’ between 2018 and 2019, a number of tenants signed acknowledgements of debt and, through this process, TransNamib recovered a substantial amount.
New leases were also entered into and signed.
Astronomical debt
“Certainly, defaulting tenants have been a considerable factor hampering the success of TransNamib’s property portfolio. The company identified tenants with massive arrears, the majority of whom did not even have a valid lease agreement with the company. Currently, TransNamib’s bad debt in its property portfolio is astronomical and our finance department is hard at work to recover this,” Rautenbach said.
She added that current efforts to transform the company into a sustainable organisation are severely hampered by its cash-flow constraints.
TransNamib has spent substantial time making tenants aware of their defaulting status and the consequences thereof; however, many of these disputes ended up in court - further prolonging the recovery process, she said.
“Our property portfolio needs to be aligned with the objectives of the business, which is to turn the entity into a profit-driven organisation which adds value for our shareholder. It is against this background that TransNamib has put very stringent measures in place to drive the debt-recovery process.
“All defaulting tenants have received fair warning, and we encourage them to fulfil their obligations, otherwise the company will be left with no choice but to evict these non-paying tenants.”
[email protected]
In 2020, CEO Johny Smith revealed that a valuation exercise had placed the value of the company’s assets at over N$2.6 billion, but the enterprise was 30 years behind where it should be.
He also recently told the media that TransNamib is operating at a loss of N$10 million monthly due to delays in acquiring backing for its integrated strategic business plan, which was approved by Cabinet in December 2018.
The railway operator needs about N$2.5 billion to fund the plan aimed at making it profitable and doubling its revenue.
In desperate need of money, while confronted with workers on strike for salary increments, TransNamib recently undertook an auction of some of its non-core assets in Windhoek, Seeis, Okahandja, Otavi, Karibib, Omaruru, Otjiwarongo, Maltahohe and Keetmanshoop.
According to insiders, the company’s properties department has been in complete disarray for years, with many tenants occupying property without lease agreements, while others are in court disputing ownership.
The national carrier has also found itself in a tug of war with some of its employees occupying company property illegally.
Understaffed
Meanwhile, the sizeable outstanding amount from tenants has had a massive impact on the organisation’s ability to fund its operations and plough back into the maintenance of its rolling stock and infrastructure, Rautenbach said.
One of the challenges of the slow progress is the fact that the properties department - headed by Alynsia Platt - only employs four people, who are tasked to handle the parastatal’s properties countrywide.
According to the spokesperson, following the launch of an aggressive ‘clean-up campaign’ between 2018 and 2019, a number of tenants signed acknowledgements of debt and, through this process, TransNamib recovered a substantial amount.
New leases were also entered into and signed.
Astronomical debt
“Certainly, defaulting tenants have been a considerable factor hampering the success of TransNamib’s property portfolio. The company identified tenants with massive arrears, the majority of whom did not even have a valid lease agreement with the company. Currently, TransNamib’s bad debt in its property portfolio is astronomical and our finance department is hard at work to recover this,” Rautenbach said.
She added that current efforts to transform the company into a sustainable organisation are severely hampered by its cash-flow constraints.
TransNamib has spent substantial time making tenants aware of their defaulting status and the consequences thereof; however, many of these disputes ended up in court - further prolonging the recovery process, she said.
“Our property portfolio needs to be aligned with the objectives of the business, which is to turn the entity into a profit-driven organisation which adds value for our shareholder. It is against this background that TransNamib has put very stringent measures in place to drive the debt-recovery process.
“All defaulting tenants have received fair warning, and we encourage them to fulfil their obligations, otherwise the company will be left with no choice but to evict these non-paying tenants.”
[email protected]
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