Mogul living on edge high above the beach
Property mogul Stuart Chait has developed luxury homes for wealthy buyers, from billionaire Christo Wiese’s daughter to former mining boss Lloyd Pengilly.
This week he was embroiled in a struggle to hold onto his own home, a six-bedroom Clifton mansion worth an estimated R150m.
The high court in Cape Town issued a warrant of execution to the sheriff to attach the property after Chait’s Maverick Trust, which owned the property, defaulted on loan repayments to a creditor.
Documents submitted to the court show that Chait owed about R66m on the loan, after having paid back a similar sum.
The property was advertised for a sale that will take place via an online auction on Tuesday.
The standoff is in stark contrast to Chait’s heyday when the Nettleton Road property was frequented by friends and clients.
Another Chait-linked property development went under the hammer this week, prompting talk in property circles about the impact of a downturn at the top end of the property market. Chait is one of the country’s most accomplished developers and is linked to a string of major successes, including Melrose Arch in Johannesburg, Big Bay in Bloubergstrand and Stonehurst in Tokai.
He is particularly known for his properties on Nettleton Road, where he developed Clifton’s first gated estate, Nettleton Ridge, featuring four luxury homes. One of these fetched R96m on auction in 2016. It was sold to Wiese at a then South African record residential auction price.
Chait’s own home, on a 1,481m² erf, has a lift, wine cellar, steam room and sauna, rim-flow pool and an expansive outdoor entertainment area. Next week’s auction has a reserve price of R85m.
Nettleton Road was named the thirdmost expensive street to live on, at a cost of R76,000 per square metre, in the SA Wealth Report for 2020, compiled earlier this year by New World Wealth.
The two most expensive streets — Victoria Road and The Ridge & Cliff Road— are also in Clifton. Chait is offering his home, called Nettleton House, for rental at R275,000 a night.
According to papers submitted to the high court last year, Chait’s Maverick Trust concluded a loan agreement with Creditsmith Capital Partners in 2014.
The loan was to help Maverick settle a previous debt with Sasfin Bank, to be advanced in three tranches. As a result, a mortgage bond was registered on the house in favour of Creditsmith.
Chait paid back a substantial chunk of the money, but breached the terms of the loan agreement in 2018, prompting Creditsmith to approach the high court to obtain a writ for sale in execution.
This week lawyers representing Creditsmith confirmed that Chait had filed an urgent application to stop the auction.
“We are opposing the application,” said Martin Bey, a director at law firm STBB. “No settlement has been reached,” he added on Friday.
Chait declined to comment but property sources said the developer may have overreached at a tricky time in the prop
erty market, and was now struggling to service his debt.
His access to capital may also have been negatively affected by the coronavirus lockdown.
Meanwhile, the auction of another Chaitlinked property above Clifton First Beach, which includes business plans for a boutique hotel, went ahead this week.
The development was led by Chait, and included some high-profile shareholders including Pengilly.
Pengilly’s spokesperson, David Simonson, confirmed the sale.
“Lloyd was a minority investor in a proposed development property led by Stuart Chait in Victoria Road, Clifton.
“For a range of reasons this development has not been able to proceed and the funders and Lloyd have agreed that the property should be sold.” The plan had been to build an 18-suite boutique hotel .