The South African Department of International Relations and Cooperation (Dirco) is struggling to maintain its extensive property portfolio abroad, with 30% of its 174 state-owned properties in poor condition and requiring significant intervention. The department's property portfolio, worth over R5bn, comprises 174 state-owned properties across 114 missions, including chanceries, official residences, staff accommodation properties, and undeveloped land parcels. Dirco's condition assessment found that 30% of its properties were classified as C1, indicating poor condition, while 42% were in fair condition and 28% were in good condition.
The problem is particularly pronounced in Europe, where Dirco has 35 state-owned properties, many of which are high-value assets acquired or built before 1994. In Africa, the department has 100 staff accommodation properties and four compounds, while in the Americas, it has 16 properties, and in Asia, it has seven properties and two undeveloped land parcels. Dirco has allocated R130.9m during this financial year for work on properties in several countries, including Copenhagen, London, New York, Brasilia, Washington, and The Hague.
Dirco has requested R341m from the National Treasury for 2027/28 and a further R366.4m for 2028/29 to continue addressing the infrastructure backlog. The department is prioritizing deteriorating properties while selling unused assets to fund refurbishment and redevelopment of strategically important missions. Several projects are underway, including the development of a new office and official residence in New Delhi, refurbishment work in London and Vienna, and projects in Copenhagen.
However, the department faces challenges, including procurement problems, local regulatory requirements, and heritage restrictions, which have delayed several projects. In some cases, projects have had to be re-advertised after bidders failed to meet compliance requirements. Dirco's ability to address the backlog is also constrained by limited technical capacity, with only seven officials overseeing the department's 174 state-owned properties abroad.
To manage these constraints, Dirco has adopted a risk-based prioritization system that focuses on preventing further deterioration, occupational health and safety, restoring vacant properties for operational use, and addressing critical infrastructure. The department is also prioritizing projects that could reduce longer-term expenditure, including rental costs. A key part of Dirco's strategy is a "dispose and reinvest" model agreed with the Treasury, allowing the department to sell unused or non-strategic properties and reinvest the proceeds in strategically necessary properties.
Dirco has already sold several properties, including one in Milan for R137m, one in Funchal, Portugal, for R9m, and three properties in Namibia for R5.7m. The proceeds are being directed towards redevelopment projects in New Delhi, Luanda, and Brasilia. The department is also exploring alternative funding arrangements with the Treasury, the private sector, and other potential partners to address its maintenance and capital requirements.
The property management challenges come as Dirco argues that its budget should be viewed not simply as an operational allocation but as an instrument for implementing South Africa's foreign policy. The department's missions are spread across 103 countries and are used to develop political and economic partnerships, facilitate trade, investment, and tourism opportunities, support technical cooperation, and provide consular services to South Africans abroad.
Key points
- Dirco's property portfolio is worth over R5bn and comprises 174 state-owned properties across 114 missions.
- 30% of Dirco's properties are in poor condition and require significant intervention.
- Dirco has adopted a "dispose and reinvest" model to address its maintenance and capital requirements.
