Investec's favoured property developer back in limelight

Zunaid Moti, who ratcheted up more than R1bn of debt with Investec, in liquidation court action. Zunaid Moti, the high-flying luxury property developer who was allegedly unable to service more than R1bn of debt with Investec Bank, is in the news again. This week, part of his Abalengani Group of Companies was provisionally liquidated by the Grahamstown High Court, East London's Daily Dispatch has reported.

The publication said 85Grayston Drive Developments Pty Ltd was not at the behest of Investec Bank, but of Johannesburg businessman Vivien Natasen, whose reasons for registering his company in Cradock are not clear.

Natasen's success in court led the newspaper to speculate online that the move might not be good for Investec's attempts to recover the Moti-linked debt.

But Investec Bank spokesman Ciaran Whelan told Moneyweb's property news site Realestateweb on Friday that Natasen's victory in court would not have an adverse effect on Investec as the mortgages over the Sandton property stood before other debt. Investec would be paid first. He said the bank did not oppose the court action and that going the route of a liquidator was "the easiest and quickest" way for Natasen to recover his debt.

Whelan said each Moti/Abalengani debt was "separately ringfenced".

Natasen, said the Daily Dispatch, invested a deposit of R8.8m in one of Moti's luxury Sandton property schemes and wants this money back. Natasen had wanted to buy the entire third floor of the building for over R40m, but the building was never constructed.

In 2008 Natasen "obtained a court order declaring the sale agreement void" and ordering Moti's company to reimburse him.

But Investec took the bulk of the Moti family property business, reportedly in a settlement agreement, in connection with the R1bn-plus debt. The bank then proposed to Natasen that if the property was sold by it for more than the value of the R53.6m worth of mortgage bonds over the Sandton property it would use the surplus to repay Natasen the deposit.

Natasen, said the paper, has argued that the undeveloped property is not worth more than R12m and there is therefore no prospect of him recovering any money in terms of the proposal. 

Moti caused a stir last year after details of his monster debt with Investec were leaked to investigative journalism magazine Noseweek. Then, the bank organised lie detector tests in a bid to find the staff member who handed over confidential banking information to the media.

Whelan told Realestateweb the culprit was never found. "We'll never know," he said of whoever blew the whistle.

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