The stalled Hazina Towers construction project is set to cost NSSF billions.
This is according to the auditor general Edward Ouko who pointed that the continued stalemate with Nakumatt Holdings over the construction of an additional 36 floors is likely to lead to escalation of costs and possible claims for compensation by the contractor.
“At the time of stoppage of builders works, a total of Sh. 1,912,043,004 had been paid to the contractor,” he says.
Already, the State pension fund had paid Sh1.9 billion to the contractor at the time the construction of the tower that is billed to become the tallest building in Kenya was stopped. It risks losing the said amount if the project is stopped indefinitely.
According to this report for the period ended June 30, 2015, the multi-billion shilling project that was expected to be completed in July 2016, was stopped after Nakumatt “denied the contractor access to the basement floors contrary to the provisions in the lease agreement signed in 2003”.
“The reasons given for the stalling of the project was that some columns inside Nakumatt Lifestyle Supermarket needed to be reinforced and strengthened for other floors to be added,” the report, published in yesterday’s newspapers, says in part.
China Jiangxi International Kenya Ltd was awarded the tender after a competitive process on February 26, 2013 and was expected to take 155 weeks to complete the work. Construction started on June 17, 2013 but an audit inspection carried out on January 14 this year revealed that the work had stopped after reaching 15th floor or after doing 38 per cent of the work.