New SOE coming to South Africa – managing R155 billion

President Cyril Ramaphosa has announced that a new state-owned enterprise (SOE) will be established to oversee the government’s R155 billion property portfolio. 

Speaking at the 2026 State of the Nation Address (SONA), Ramaphosa explained that this SOE will be used to ensure the state’s vast property portfolio is put to good use. 

This SOE will oversee around 88,000 buildings and five million hectares of land, making it one of the most important companies in the country. 

The plans for the new company are consistent with a decision by the nation’s 10-party ruling coalition to retain a tight hold over most state assets and ensure they are put to good use. 

Public Works and Infrastructure Minister Dean Macpherson first outlined the creation of a state property-management company shortly after he assumed office in mid-2024. 

Bloomberg reported that Macpherson said the new company will deter government departments from leasing expensive buildings from private companies rather than utilising those owned by the state. 

“We are going to create an asset book that is worth hundreds of billions of rands that could possibly be traded, could possibly be sold for equity or could raise debt for social infrastructure,” he said at the time.

“We really have to stop seeing public works as a department of bad buildings, and we have to see ourselves as an economic delivery unit,” Macpherson said in an interview with the publication.

Bonginkosi Madikizela, a lawmaker who, like Macpherson, is a member of the Democratic Alliance party, said the government could save about R6 billion a year if it ended the practice of state entities leasing private buildings.

In 2025, the Department of Public Works and Infrastructure sought advice from development finance institutions on how to set up an entity with strong governance structures and generate revenue and profit from the assets. 

The proposal will add to the list of more than 120 companies run by the government. Most of which are unprofitable.

This proposal is coupled with Macpherson’s ‘adopt-a-municipality’ initiative, with four local governments run by different political parties across the country.

Under the arrangement, public works officials will effectively take over running projects to ensure they’re delivered effectively and efficiently. 

“I would like to see us transition so that there is a single point of entry and execution on infrastructure. So you don’t have this sort of mixed bag of results,” Macpherson said.