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HSRC Annual Report 2016/17
PART E: Annual Financial Statements
Sweetwaters lease
A lease agreement was signed between the HSRC and Mr FA Bhalya in respect of a property referred to as Sweetwaters
Bus Depot. The agreement came into operation on 1 March 2008 and was valid for five years. The lease agreement was
renewed on 1 March 2013 for an additional three years, and expired on 29 February 2016, after which it was renewed for
another five years. The current lease payment per month is R11,789.75 (VAT excluded). The contract includes an annual
escalation of 10% (compounded) annually. The HSRC does not have the option to acquire the building.
Council for Scientific and Industrial Research (CSIR) lease
The HSRC leases property in the CSIR campus located in Building 14, Scientia. Total space acquired is 63 square metres
utilised as a disaster recovery site. The lease agreement was renewed on 1 October 2014 for a period of three years
expiring on 30 September 2017. The contract has a fixed rental amount with no escalation clause. The current lease
rental payment per month is R6,365.78 (VAT excluded). The HSRC does not have the option to acquire the building at
the end of the lease agreement but has an option to renew the same lease agreement.
7.2 Operating Lease arrangements as the lessor:
7.2.1 Future minimum lease payments
2017
R ‘000
2016
R ‘000
Up to 12 months
Department of Public Works lease
1,703
20,311
One year to five years
Department of Public Works lease
-
1,703
Other disclosures
Department of Public Works lease (Pretoria)
The operating lease is undertaken between the HSRC (the lessor) and the Department of Public Works (the lessee) on
behalf of the Department of Social Development. The leased building is situated at 134 Pretorius Street, Pretoria. The
existing contract was signed on 30 May 2014 for a three year period, with a commencement date of 1 May 2014. Monthly
rental receivable is R1,703,136.32 (excluding VAT), with an escalation clause of 8% compounded annually. The contract
currently runs on a month-to-month basis awaiting renewal finalisation.