Source: Solar energy plant for Bulawayo | The Sunday News 18 AUG, 2019
Vusumuzi Dube, Senior Municipal Reporter
BULAWAYO will soon have its first-ever solar plant after the council agreed terms with a local investor — Rishi Investments — to set up the plant.
The lease agreement of the solar plant was signed early this year. The plant, which will be a first of its kind in the city, will be located at Hyde Park Estate and is expected to be fully functional in the next 24 months, according to the latest council report.
The two parties, the report stated, have since entered into an agreement to ease rental burdens on the developer during the developmental period of 24 months. The deferred rentals were to be paid as a lump sum or instalments over a period of six months to 12 months after the development period.
“The reasons for deferment of rent payments had been necessitated by the need to acquire relevant permits from the regulatory authorities as well as application fees. These included Zimbabwe Energy Regulatory Authority, Environmental Management Agency, Construction Industry Federation of Zimbabwe and Ministry of Public Works, Zimbabwe Power Company and Zimbabwe Energy Transmission and Distribution Company and the Feasibility Study report.
“The rent to be paid by the lessee shall be a monthly rental of US$1 400 excluding Value Added Tax shall be paid subject to review. The rent shall be paid monthly, in advance, and not later than the 5th day of each and every month and was subject to review,” reads part of the report.
The developer has also managed to get the local authority to alter part of the original lease agreement arguing that the original clause was bound to scare away investors. In the original lease the local authority had implored that; “Should the city at any time require the said piece of land for its own or public purposes, it shall be entitled to resume possession thereof on giving to the lessee six months’ notice in writing to that effect. In the event of the possession of the said piece of land being resumed by the city under the provisions of this clause, the city shall pay to the lessee reasonable compensation for any improvements and buildings erected by the lessee on the said piece of land.”
The local authority has since amended the clause but noted that this will only be applicable during the initial lease period.
“Council therefore recommends that clause three of the Agreement of Lease shall be amended to include deferment of the payment of rentals and interest during the development period of 24 months, clause of the Agreement of Lease shall be amended to indicate that council shall not assume repossession of the land during the initial lease period unless there is a breach of terms and conditions of lease.
“It further recommends that the interest and total monthly rentals be deferred during the development period of 24 months after the signing of the agreement date, that the deferred interests and rentals shall be paid either as a lump sum or instalments immediately after the development period at the prevailing rate of interest at the time and that the deferred interests and rentals shall be paid over a period not exceeding 12 months after the development period,” reads part of the council report.
All the recommendations were adopted during a full council meeting a couple of weeks ago.
Meanwhile, America-based multi-national hospitality entity, Radisson Group of Hotels, has approached the local authority with the intentions of establishing a hotel in the city. The Group has managed to open a new hotel in Africa every 60 days over the last 24 months and they had added a new hotel to their pipeline in Africa every 37 days.
According to the latest council report the group approached the local authority through Mkhuze Global Investments, a special purpose vehicle that looks at various investment opportunities in the Sadc region.
“Setting up a hotel in Bulawayo would have a great impact on the economy of Bulawayo as the increase in the number of beds in Bulawayo would enable the city to attract major conferences and events would also bring great employment opportunities from the construction phase up to the stage when it’s operational.
“It was the norm for council to tender out such sites and of late, there had been no development on tendered sites. Permission was therefore sought to negotiate with the applicants as it had proven effective with developments such as Parklands Shopping Centre, Nkulumane Mall and Zonkizizwe Shopping Centre having been developed through council negotiating with the developers,” reads the report.
The local authority will now, therefore be establishing an interdepartmental committee tasked with negotiating with Mkhuze Global Investments on behalf of Radisson Group of Hotels on the setting up of the hotel.