City of Windhoek: N$357m Land Swap Debt Settlement Approved

• The City of Windhoek and the Ministry of Finance signed a land-swap agreement on April 27, 2026, to settle N$357.8 million in municipal capital debt.
• Phase One of the agreement involves six properties valued at N$291.5 million, covering approximately 81% of the debt, including portions of Farm 1009 and Farm 1019.
• A N$66.287 million shortfall remains after Phase One, which Phase Two aims to address by transferring additional land, potentially around the Independence Stadium.
• The Ministry of Health and Social Services has requested approximately 1.5 hectares of the Ramatex Complex for a Central Medical Store, which Cabinet suggested incorporating into Phase Two, though the City Council has not yet approved this specific transfer.
• The deal requires further approvals from the Minister of Urban and Rural Development and Treasury before the Minister of Finance can issue a completion of payment certificate.

This process sets a significant precedent for how municipal debt can be settled through asset transfer, potentially influencing future land availability and valuation in Windhoek.

The City of Windhoek has entered into a significant land-swap agreement with the Namibian government, aiming to resolve a substantial capital debt amounting to N$357.8 million. This strategic arrangement, formalized on April 27, 2026, between the City and the Ministry of Finance, has received Cabinet approval and is structured for implementation in two distinct phases. The deal represents a novel approach to municipal finance, leveraging public land assets to settle outstanding obligations.

Finance Minister Ericah Shafudah communicated the details of this agreement to Windhoek mayor Sakarias Uunona, confirming the Cabinet's endorsement. The total capital balance of the loan stands at N$357.765 million, while an additional N$352.631 million in interest is slated for waiver, significantly reducing the overall financial burden on the municipality. This Windhoek N$357m land swap debt settlement is a critical development for the City's financial health, addressing a long-standing liability through a non-cash transaction.

The initial stage of the agreement, Phase One, involves the transfer of six specific properties from the City to the government. These properties have been independently evaluated, with their collective value assessed at approximately N$291.5 million. This transfer covers about 81% of the City's capital debt, marking a substantial reduction in the outstanding amount. The properties designated for Phase One encompass a total area of approximately 274.98 hectares.

Among the parcels included in this first phase are portions of Farm 1009 and Farm 1019, two proposed sections within Groot Aub, Erf 5727 located opposite the Windhoek Police Station, and Erf 6348, which houses the High-Performance Centre. Despite this significant transfer, a shortfall of N$66.287 million in the capital debt remains after Phase One. This outstanding balance necessitates further action, which is planned for the subsequent phase of the Namibia municipal debt land transfer.

To fully offset the remaining N$66.287 million capital debt, Phase Two of the land swap is designed to incorporate additional municipal land. The Ministry of Finance is currently awaiting the completion of valuations for several land parcels situated around the Independence Stadium, which are intended to be part of this second phase. The government has specifically requested four properties in this vicinity: Erf 6758 on the north-western corner, the remainder of Erf 6755 on the eastern side, Erf 6848 on the southern side, and Erf 7054 on the south-western side.

Beyond the Independence Stadium properties, the Ministry of Health and Social Services has put forward a separate request for approximately 1.5 hectares of Farm 466 Otjomuise, known as the Ramatex Rhino Garment Factory, to establish a Central Medical Store. Cabinet has acknowledged this request and urged the City of Windhoek to consider integrating the Ramatex Complex land transfer Namibia into Phase Two. While the government views this as the most efficient and mutually beneficial acquisition method, the City Council has not yet approved the Ramatex transfer, opting to consider and interrogate this request separately to ensure due diligence.

The finalization of this extensive City of Windhoek government land deal hinges on several crucial regulatory approvals. The agreement requires authorization from the Minister of Urban and Rural Development, alongside specific Treasury authorisations pertaining to the transfer of municipal properties. These steps are essential to ensure compliance with Namibia public finance law and property transfer regulations, underscoring the complex legal framework governing such transactions.

Preceding this agreement, the Windhoek Municipal Council had adopted resolutions in April 2023 and March 2025, which provided the mandate for negotiations between the city and the central government. Once all stipulated conditions and approvals are met, the Minister of Finance will issue a completion of payment certificate to the City, serving as definitive proof of the full and final settlement of the capital debt. This process sets a significant precedent for how municipal debt can be settled through asset transfer, potentially influencing future land availability and valuation in Windhoek.

Lawyers advising on property development, municipal finance, or public sector transactions in Namibia should monitor the finalisation of this land swap, particularly the required approvals from the Minister of Urban and Rural Development and Treasury. This deal sets a significant precedent for how municipal debt can be settled through asset transfer and could impact future land availability and valuation in Windhoek.

Source: Original reporting via The Namibian