Work delayed due to land, water issues: North Coast Construction

The project to develop the Aasandha building, which was assigned to former Isdhoo MP Ali Hameed's company North Coast Construction, was delayed due to issues with the land and water supply pipelines, Hameed has said.

Housing Development Corporation (HDC), Aasandha, and North Coast Construction was summoned by the Parliament's Public Accounts Committee, which is now investigating the matter.

Regarding the matter, Ali Hameed said that the land was handed over to his company on 16th October of last year and that the power of attorney was received in November that year.

At the time, the area's fencing work began without proper fencing permits, he said, adding that they redid all fencing work after applying for the license.

However, throughout the process, Aasandha's consultants changed frequently, Hameed said. He added that he does not know why the consultants changed so often.

He went on to say that these changes led to repeated meetings and long waits for appointments.

Hameed also shared a timeline of how the projects delays took place.

He further said that the building's engineering documents were submitted to HDC, and that the company allocated plots based on the documents and building requirements.

However, when the sheet piling process started, it was discovered that it overlapped with all pipelines supplying utilities to Hulhumalé Phase 2, he said. Hameed explained that HDC's response was to notify the relevant companies and continue with the work.

"When we informed HDC, they said it was not of their concern, and that we should discuss with the utility companies. Three to four meetings were held after emailing STELCO. They said those were the main lines of Hiyaa [flats]. That relocation would be very difficult and expensive. And that cutting off electricity for 48 hours and doing the work would not be a solution. That we should speak with HDC," he said.

Following the discussions, the land was moved inwards and relocated on May 15 this year.

Upon receiving the new plot, the company applied for water and electricity to the area, but the land had been previously allocated to another party and water metre there was registered in the previous owners' names, Hameedh explained the situation.

Because of this, HDC and MWSC informed the company that there was no possibility of applying for a new connection, he said.

"So we informed this to Aasandha. They decided to change it [the registration] to under Aasandha's name. There was a lot due on the metre, and MWSC didn't want to do the transfer without paying that, so all the water issues took a long time to resolve," Hameed went on to say.

That process alone took about 269 days, he said, adding that the delay was not intentional.

HDC's Managing Director Fazul Rasheed, who was also summoned to the meeting agreed that the issues were true.

"It was resolved by moving the plot inwards. Time took for the [processes] mentioned. Our records also reflect it," Fazul said.

When asked further about it, Fazul said that the plot was allocated from the correct location, but that the issue was the sheet piling process took place one meter out of the plot.

"Usually sheet are piled within the boundary line. This caused the issue of the STELCO power cables and MWSC's water network," he said

However, when the contractor informed them why it was necessary, the plot was moved inward to support the project's progress, he also said.

In response, Hameed said that the real issue was the plot's measurements.

Aasandha also responded on the matter via letter and said that they do not believe the company is capable of carrying out the project. When asked why they made the statement when the delays are as such, Aasandha said that the contractor was required to formally inform and request for an extension, but that it did not happen.

Aansandha further said that a meeting was held with the company on 3rd September, and that the project site's work is slow and inadequate.

"So, we believe that there is delay in the work. We're unable to assure their competency."

In September, 2016, Aasandha awarded North Coast Construction the project to build a six-storey hospital for MVR 61 million. The project was estimated to generate MVR 18.3 million at a three per cent profit margin for the North Coast.

Although the project was required to be completed in 15 months, work never started and in June 2017 Aasandha requested the project to be paused due to budgetary constraints.

The settlement agreement signed afterwards states that the discontinuation of the project caused North Coast Construction a significant financial loss, owing to the company dedicating its time and resources for the project.

During former President Ibrahim Mohamed Solih's administration, the matter was discussed amongst the President's Office, Aasandha and the Economic Council, and a decision made made to offer a 10-storey building construction project of Housing Development Corporation (HDC) in Hulhumalé to the company instead of the original project. With that, the company began formulating the project's concept and determining the project with HDC.

A total of MVR 44 million split into two payments was paid to the company as advance payment for the project.