Report of the Trustees of the Big Bay Residential

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					    Report of the Trustees of the Big Bay Residential Estate Homeowners
           Association for the Financial Year ended 30 June 2006


It is with pleasure that we report to the homeowners on the year under review.

OVERVIEW FROM THE CHAIRMAN(TONY BAYLEY)

The last financial year has been a year of good growth for the Estate, with many new houses being
completed, other projects being started, and lots of happy families making Big Bay their new homes.

It has also been a year of difficulty for us, with our previous Estate Manager leaving, and the
appointment of Ben as his replacement. We are pleased to report that the hand over went smoothly, and
Ben has settled in to his new job with great flair. The administration of the Estate from our side has
improved vastly, and long outstanding queries and problems have been eradicated, unfortunately not
always to the entire satisfaction of the home owner. Next year, under the guidance of the permanent
staff, new trustees, and the managing agent, we are confident that matters will be handled much better,
to the benefit of all concerned. There were too many stress points last year, even for a 205 unit luxury
beach Estate.

This year will see the roll out of our new website, which needs to be populated by us with various items
of interest to us, our friends, and the public at large. Our Constitution and Design Guidelines are readily
available to anyone to read on the site, as we would like to be above board and open with all of our
current or potential investors.


My heartfelt thanks go to an outstanding Board of Trustees, who initially decided on their own brief,
being that we appoint the correct person to the job, and that they would take ownership of their portfolio
entirely. I am pleased to confirm, that in my humble opinion, they have achieved their desired goals.
However, next year will be a year of greater challenges, and to achieve our objectives will require greater
focus and co-operation from owners and builders.

Your trustees and their positions were as follows:

Chairman                                  Tony Bayley
Vice Chairman(Building Operations)        Ondrej Vasica
Finance                                   Morne Weyers
Security                                  Chan Pillay
Maintenance & landscaping                 Belinda Kettel
Building                                  Jacques Gresse
Communications                            Stefan Lindeque

Your professional service providers, and permanent staff were:
Our managing agent, Yvonne Green from Cape Classic Property Solutions (Pty) Ltd, has always been a
pleasure to deal with, and her experience since inception has been an invaluable asset to us.

Ben Lutumba, who only joined us as Estate Manager on 1st May 2006 having previously been our security
supervisor, has developed in a very short time to what we believe will be one of the best available in
years to come.

I am proud to say that not once has the Board let the Estate down in matters of good governance, and
we have strictly upheld the Constitution, and Design Guidelines, even to our own detriment. It is easy to


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be friends with everyone, but when you have to enforce the rules on your colleagues, things are not very
well accepted.

Further on in this document, you will read individual reports from the Trustees themselves, highlighting
the positive and the negative items. We have tried always to work within the budget, but as with an
emerging luxury Estate, there are constant requirements and requests for costly items that we must
address. In some ways we may have failed, but at least we came through the year with many milestones
to be proud of, and still carrying a positive cash flow.

Unfortunately, this financial position cannot last forever, especially with proactive Trustees, so we find
ourselves in a position where we have to prioritise, much to the disappointment of some home owners.

At the AGM you will be asked to choose a new board of Trustees to look after your affairs for the next
twelve months. We would be most keen to have some new faces aboard, provided that they subscribe to
the same ethics and diligence as our current group. Alternatively, if nobody nominates you, do so
yourself. The democratic voting process takes place thereafter.

Please continue to read the detailed Trustee reports below.

FINANCE (MORNE WEYERS)

The past financial year has once again seen a cash positive period largely thanks to endowment levies
received due to the sale of property within the estate. Although the current cash flow is very positive, the
coming financial year may be a bit less buoyant. It is anticipated that the estate will experience increased
expenditures to the previous two financial years. Improved services and the increase in expenses due to
the higher occupancy levels are set to increase the operational expenses within the estate.

Notable operational expenses that will have an impact on the budget for the coming year are the
improved security services together with the expense of landscaping, which has now become the
responsibility of the estate after RabCav’s obligation to maintain the estate open areas has come to an
end. Expenditure in maintaining the estate is further expected to increase with the increase in traffic and
activity within the estate.

Further investment in the estate, notably verges and speed bumps will further impact on the cash flow.

We expect similar returns from endowment levies during the coming year, but will primarily be driven by
two factors: i) the escalating exchange rates and ii) increased pressure for home owners to start building
in the face of the prescribed building period coming to a close. At this stage the trustees would like to
advise that the levies within the estate be kept at the current rate until such time as a clearer financial
picture is available.

In summary, the coming financial year will be a watershed year as the estate operational expenses
increase with the improved services and increased maintenance becoming further in line with the
expenditures that can be expected for a luxury estate with full occupancy.

LANDSCAPING & MAINTENANCE (BELINDA KETEL)

Landscaping:

The landscaping of the private open spaces (parks) was initially done as part of the original development
and maintained under contract for a period of 12 months thereafter. These contracts in both estates were
completed (Blouberg Hills in 2005 and Sandown in early 2006). The Trustees appointed Cape Scapes
(same contractor) to continue with this work as from February 2006. There were many frustrations with



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this contract – delays in landscaping of verges, poor maintenance and lack of availability of contractors
on site. The Trustees agreed to end this contract in May 2006 and appointed Plubs & Roses to take over
this maintenance contract from 1 June 2006.

They have to date provided us with an exceptionally high standard and quality of work. Individual verges
are landscapes weekly and all back-log has been dealt with. The general maintenance of the estates is
much improved and many compliments have been received from residents. They are also in the process
of identifying incorrect plants and grasses that are currently in the estates (common areas and individual
erven) and will assist in providing advice in this regard.

Home owners are reminded that that the Architectural Design Guidelines contain a list of permitted plant
species approved by the Council, all of which are indigenous. Exotic plants are not permitted. The
difficulty however, lies in the enforcement of these guidelines, as other than relying on the Estate
Manager to advise owners and builders. There are no current checks and balances to monitor and
enforce compliance. Transgressions are usually brought to the attention of the Trustees only after the
planting is complete and it is then usually very difficult to enforce compliance. To deal with this the
trustees and estate manager have included a sign-off sheet for the vegetation that is included in the final
sign-off of the house before occupation certificates are approved.

Maintenance :

The general maintenance of the estate is a continuous portfolio of work and varies from large and
expensive activities to small daily routine tasks that can be managed by the Estate Manager. During the
past year, much of the maintenance of the estate was neglected and handles in an ad-hoc manner. This
process of identifying maintenance priorities, actioning them and quality controlling the outputs has been
significantly improved and is well managed by the new Estate Manger. The main maintenance activities
that have taken place this year include the following:

    1. External estate walls and guard houses: The problems related to poor waterproofing and paint
       peeling off the walls was identified as a priority issue. The matter was taken up with the
       developers who agreed to redo all the work. The external walls of the estates were re-
       waterproofed and repainted.
    2. Stains on brickwork at entrances: The various oil stains on the paving at the entrances to the
       estates, but especially at the entrance to Sandown 1, have been cleaned, and will be cleaned on
       a regular basis to avoid permanent stains. Regulations as to the accessibility of such vehicles (not
       road worthy/leaking oil) has been discussed with the new security company and such vehicles
       are no longer permitted to enter the estate.
    3. Hay Bales: To avoid the wind blowing sand across open areas and onto open roads, the new
       estate manager constantly arranges for the delivery of hay bails to place alongside the road
       verges. These are temporary measures to try to stop the sand from blowing around.
    4. External perimeter of estate: The external perimeter of the estate (outside the security fence)
       was cleared and flattened during this year. This was done to avoid possible fire hazards and to
       enable the security to monitor more easily the external perimeter of the estate.
    5. Boardroom at gatehouse: The room next to the estate manager’s office at Sandown 1 has been
       transformed into a small boardroom in which the Trustees and estate manager regularly meet
       with various service providers, security and other stakeholders.
    6. Speed bumps: Four speed bumps were erected in Blouberghills Estate as a pilot to try and
       manage the issue of speeding in the estate. This appears to have been very successful and
       budget provision has been made to erect speed bumps in Sandown in the next year.
    7. General maintenance: Other smaller more general maintenance items are handled on a daily
       basis by the 2 general assistants on the estate under the direct supervision of the estate
       manager. These include items such as painting graffiti, keeping the park areas clean, maintaining
       and cleaning the lamp posts etc.



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BUILDING (JACQUES GRESSE)

Building operations during the past financial year have increased tremendously, with a lot of houses
being completed and residents taking occupancy in their new homes. We currently have 91 houses
completed and 19 houses under construction.
We foresee a big increase in building activities during the coming financial year as the 3-year building
period draws to an end.

Scrutinies of building plans and compliance with the Design Guidelines on behalf of the HOA have been
subcontracted to Graham Holland Architectural Designs.

Once the building plans have been approved, the Estate Manager ensures that property owners and
builders do not make ad hoc changes on site in contravention to the guidelines.

Before contractors start work on any site, they are required to sign a Contractors’ Agreement to ensure
good house keeping and to minimize inconvenience to residents. The Contractors’ Agreement provides
for fines to be issued where the contractor contravenes the rules. In the interests of those home owners
residing on the Estate, the Estate Manger has been instructed to enforce the terms of the agreement and
issue fines where necessary.

Owners are reminded that there is a mean finished ground level (average site height above sea level) for
each erf and that the maximum height of any structure may not exceed 8m above this level. The Estate
Manager can advise on this important issue prior to the commencement of building operations and point
out the closest datum (control) point. Failure to observe this requirement may necessitate undesirable
and sometimes costly changes later during or after construction.


Building Hours
Building hours are stipulated in the Contractors Agreement as follows:
        Mon     -        Fri              07h00 to 17h00
        Sat                               08h00 to 13h00
        Sun & Public Holidays             no work permitted

For the benefit of residents, these hours are strictly enforced and concessions will be made only under
exceptional circumstances.

Construction Period
The Constitution read in conjunction with the Design Guidelines requires all buildings to be complete
within three years of the transfer from the City of Cape Town to the first purchaser. Thereafter a penalty
levy of four times the current monthly levy, in addition to the normal monthly levy is charged.

MARKETING(STEFAN LINDEQUE)

The last year of being involved with the Big Bay Home Owners Association has been interesting,
educational and entertaining.

Due to my area of expertise, I was given the communication/marketing portfolio. Initially we were faced
with the issue of a variety of estate agents boards making the estate look untidy. After careful
consideration, we decided on a uniform look for all estate agents boards. This has given the estate a
more professional, up market feel when driving around in search of a new home.




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On a lighter note, the golf car serving the two estates, Blouberg Hills & Sandown Estate, was in
desperate need of branding. I arranged for the branding to be approved by all Trustees and the golf car
now has a new identity.

The most important and challenging task for the year was to get an estate website up and running for its
residents. After much hard work and a great team effort between Yvonne Green and myself, the site
www.bigbayhoa.co.za went live, with weekly updates and improvements.

With this, my year of serving as a Trustee has come to an end. I would like to congratulate the Trustees
on a job well done and wish you all the best for the coming year.


BUILDING OPERATIONS(ONDREJ VASICA)

The objective of the Building Operations portfolio is to render itself redundant, via a fully built-up Estate,
in the shortest possible time.
To achieve this, we need the Estate to return the best possible re-sale prices to our investor/developer-
owners.
We feel that this is only possible through creating a highly desirable residential environment, which in
turn requires a strict control of the building activities within the Estate.

The enforcement of rules is never pleasant and this, together with the building control administration in
general, proved to be a vast challenge for our previous Estate Manager.
Recognising the shortcomings, we have decided to model our building control on the highly-regarded
Atlantic Beach Estate, where the Building Rules enforcement is subcontracted to the Estate’s security
management company and the rules are applied without exception. Our past experience taught us that
every time an owner seeks a relaxation of a rule, there is likely to be another owner who feels that such
relaxation constitutes a violation of his/her rights.
Our new Estate Manager, Mr. Ben Katuzeyiko, has proven to be vastly more effective in managing the
Estate’s Building Operations and he has greatly contributed to the much improved current situation.

We have started the year with 158 empty erven, 29 houses under construction and 18 finished homes.
During the last financial year the situation has changed substantially, with 90 empty erven, 36 houses
under construction and 79 finished homes.
As per our estimates, 62 empty erven were held by developers not intending to reside in the Estate as at
the end of July 2006.

We wish to remind everyone that, as stipulated by the City of Cape Town in paragraph 17.3 of our
Design Guidelines, all structures must be completed within 36 months from the date of transfer from the
City of Cape Town to the first owner, failing which a monthly fine to the value of 4 x the HOA levy shall
be payable.
This mandatory 36 months development period will be expiring in 2007, as follows:

    1. Blouberg Hills – all on 26/3/2007
    2. Sandown1 - all on 11/6/2007
    3. Sandown 2 – between 15/7/2007 and 1/9/2007, depending on the date of registration

Due to the above deadline, we can expect increased building activities on the Estate during the new
financial year, and hopefully a fully built-up Estate in the not so distant future.




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SECURITY(CHAN PILLAY)

As we all are fully aware security is the most import part of a Residential Estate, and is the very reason
we all bought into the respective Estates. Whilst the security portfolio is an extremely sensitive one, it is
also an extremely important one and one that has a direct impact on people’s perceptions of the estate.
The last year, has been a major security challenge from a number of areas:

        -   Management of the vast building activities
        -   Dealing with the non deliveries of our past suppliers
        -   Dealing with equipment that has been of sub or heavily deteriorated standard
        -   Estate manager trying to manage the vast number of contactors & run the estate
            successfully

What was clear was that we needed a total solution in security. To this end we did a full security
assessment both as trustees as well as from a professional external security contractor. We benchmarked
out standard to that of our neighbors Atlantic Beach. All assessments supported this.

We made a strategic decision, to have a total security solution and appointed Thorburn Security as the
new Estate Security as of 15 July 2006. They brought with them a wealth of residential security
knowledge and have many prestigious contracts i.e. Ou Baai , Atlantica Projects etc

Their contract covers the following:
        -      Gate guarding
        -      Venue Host Supervisor for the Estate
        -      Senior Guard to deal with contractors and enforcing the estate rules
        -      Medical Emergency via Net Care 911
        -      Armed response via the Estate’s dedicated vehicle
        -      Full site checking equipment, (Guards roaming the estate will net to clock in at different
            points to ensure full circulation)
        -      One dedicated armed response vehicle for Blougberg Hills estate, Sandown 1 & 2
        -      Medically trained supervisor
        -      Snake catching trained supervisor

Thorburn has full management back-up and support structures, as they manage two of the biggest
estates in the area. Thornburn has settled well into the estates and building a real presence with the
professional manner in which they handle the security from contactor management to the day to day
security.

As residents, we are fully aware and at times and at frustrated regarding the inconsistent working order
of certain security equipment i.e. booms. We are addressing this and had to get various costings in place
before moving forward. We now have to make key decisions on the replacement of the following:

        -      All Booms due to rust
        -      Cameras
        -      Linking each home to medical & armed response, to the main gate control room
            (In the event of a signal the Venue Host supervisor will respond and only if life threatening
            will he call for either medical
            or armed response) This way we keep out many different companies flying into the estate for
            armed response
        -      Changing the remote system to a card system

Only after upgrading & replacing our equipment will we have our desired benchmark standards in place.
Security is a real and ongoing challenge



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