AIIM leads investment in R1,9bn government office project

African Infrastructure Investment Managers (AIIM), through its IDEAS Managed Fund, has acquired a 32.5% stake in a public-private partnership (PPP) to develop new office accommodation for the Department of Agriculture, Rural Development and Land Reform.

“We are extremely proud to participate in this project, says Vuyo Ntoi, Joint Managing Director of AIIM.

“PPPs introduce the possibility of private funding for public infrastructure, which is highly relevant in the South African context, where public budgets are constrained, and the need for investment is significant.”

Vuyo Ntoi, Joint Managing Director of AIIM

The IDEAS Managed Fund is one of South Africa’s largest domestic infrastructure equity portfolios that invests in economic, social and renewable energy infrastructure in the Southern African Development Community (SADC) region.

With consortium partners, WBHO, Bidvest, Vulindlela Holdings and the Tshala Bese Uyavuna Broad-Based Ownership Scheme, this R1,88 billion project will be operated on a 25-year concession.

The terms of the concession will see the Tshala Bese Uyavuna Proprietary Limited Consortium design, build, finance, operate and maintain the new serviced working environment. This facility will accommodate all of the department’s Tshwane-based employees in a single work environment.

Ntoi explains that the PPP agreement removes the financial burden from the fiscus because the capital expenditure will be funded upfront by the consortium during the construction period. “This partnership involves locking in a long-term collaboration between both parties to share the costs, rewards and risks of the project,” he says.

“In addition, the risk transfer aspect embedded in the contract will enforce specific performance from the consortium to ensure the project is delivered on time and within budget. This further limits the risk for the government.”

Other crucial aspects of the concession include a commitment to meeting employment equity and skills development targets. This will see black people, women, and youth involved in management positions within the project company’s executive and governing bodies.

Both the BBBEE and PPP codes of good practice were applied by the department to ensure equitable participation in the project.

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Zeerust Solar joins the North West Province’s green power map

Zeerust Solar, situated in the North West Province, has commenced its commercial operations, having achieved full compliance on 1 January 2021. This 100% South African-owned PV project, joins Bokamoso and Waterloo Solar plants, putting the North West on the map as a player in the renewable energy sector, not only delivering additional power to the country’s national grid, but also benefiting the rural communities through impactful economic development programmes.

“Extensive economic development projects kicked off during our project’s construction period to provide Covid-19 relief, in addition to Enterprise Development training and accelerator programmes, skills development training and other welfare initiatives.”

Isaac Mmushi, CEO of Zeerust Solar

In partnership with the Ramotshere Moiloa Sub-District of the Department of Education, Zeerust Solar has also supported education. “The implemented programmes, including specific support for Stinkhoutboom Primary, have helped rural learners gain confidence to succeed despite the challenges they face.  This is in addition to a Grade 12 excellence awards programme, aimed to stimulate and honour academic achievements of Matriculants, in schools across the Sub-District,” said Dr BKM Molokoe, Sub-District Manager.

The focus of Zeerust Solar’s Economic Development programme is to empower and strengthen local communities in and around the Zeerust area, namely Ikageleng, Henryville, Olienhout Park, Shalimar Park, Welbedacht (Lehurutshe Town) and Groot Marico, as well as extending to 40 villages located within the Ramotshere Moiloa Local Municipal area.

The 75 MW Zeerust Solar is currently the largest solar PV power project in the Province, with 250 080 solar panels harnessing the intense North West sun. The solar plant began generating the much-needed green electricity estimated to reach 180GWh each year, which is enough to satisfy the needs of around 84 000 average South African households.

The project, which commenced construction in January 2019, is constructed on a 179-hectare project site and is connected to Eskom’s Kameeldoorn switching station, which feeds the generated power into the country’s national grid.

Around 1 000 people from the local beneficiary communities were directly employed on the project during construction. This is in addition to the employment created through the contracting out of various services. 

Zeerust Solar’s socio-economic development projects are focused on education, youth development, health, food security and welfare. The programmes have been chosen following research and engagement to ensure that they are well informed and will strengthen the beneficiary communities. Additionally, a percentage of the revenue generated each year will be committed to implementing Enterprise Development initiatives, to build resilience and accelerate the growth and success of entrepreneurial businesses, ultimately stimulating the local economic growth and creating opportunities for the economic participation of previously disadvantaged groups.

The focus is on small and micro enterprises, designed to enhance growth. To deliver on this objective, the establishment of a local resource centre, for use by local SMMEs and communities at large, will support this drive to support development, whilst the provision of accredited skills training will be provided to start-up businesses.

Zeerust Solar is owned by African Infrastructure Investment Managers (AIIM, a member of Old Mutual Alternative Investments) through its IDEAS Fund, Reatile Solar Power (RF) (Pty) Ltd, Phakwe Solar (RF) (Pty) Ltd, AREP (African Rainbow Energy and Power) and Cicada Community Trust.

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