US moves SA staff due to crime
Johannesburg – Buy-to-let investors who have signed long-term leases to house United States Embassy staff are in for a rude shock. Crime concerns have prompted the embassy to terminate residential leases in stand-alone houses in Pretoria, Johannesburg, Durban and Cape Town. The US plans to move embassy families to multi-unit security complexes.
Letters of termination have already been sent to some landlords and rental agents have advised them that US Embassy staff and their families will vacate stand-alone houses within 90 days.
“The US Embassy has taken a decision to move from stand-alone residences to compound residential units due to increased security concerns,” reads a letter sent to one rental agent in Pretoria.
That particular lease is being terminated two years earlier than originally agreed in the contract. The embassy typically signs residential leases for a period of nine years.
The US Embassy’s new housing policy will no doubt be a blow to investors who have poured money into building and renovating luxury, stand-alone houses to meet the specific requirements of embassy staff. Some will no doubt battle to replace tenants.
Moreover, it’s unlikely that new tenants will be able to match the US dollar-based rentals paid by the embassy.
David Grier, deputy press attaché at the US Embassy in Pretoria, confirms that a heightened security profile was one reason that leases are being reassessed.
He says the demographics of embassy staff have also shifted from large families to singles and married couples with no children who require smaller houses. Says Grier: “Several recent lease terminations have been due to the fact that the embassy no longer requires as many large houses.”
Grier says the US Embassy terminates approximately 20 leases every year. “And this year is no different. However, it’s always done in accordance with all the requirements of the lease signed by the owner of the property and the US Embassy.”
Grier dismisses talk that the embassy will build its own security villages to house staff. He says the US Embassy already owns some properties in SA but will continue to rent the bulk of its residential accommodation needs.