Tag: Apex Realty

Housing minister hopes to sign amended TATA contract next week

Minister of Housing and Infrastructure Dr Mohamed Muiz has expressed hope that the amended contract with Indian infrastructure giant TATA Housing regarding the construction of two apartment complexes can be signed next week.

“Based on the most recent communication, we estimate that the amended contract will be signed next week, that is if no further reasons for delays come up,” Muiz told local media.

He stated that the company was expected to commence work on the two sites within a period of 45 days after the signing of the contract, and to complete the projects within a year.

The deal – first signed in 2010 – has faced repeated delays after successive governments sought amendments to the original contract.

“In addition to this project, there is also work on an additional 150 flats that need to be started,” Muizzu said yesterday.

The minister explained that previous delays in signing the agreement had occurred due to the actions of TATA Housing.

After deliberation by the cabinet’s economic council in July, the Housing Ministry had announced intentions of resuming the projects under a revised contract.

The government of Maldives contracted Apex Realty Pvt Ltd – a joint venture between TATA Housing Development and SG 18 Realty – to construct residential apartment complexes on four separate sites in capital Malé city in May 2010.

Work commenced on the Gaakoshi site and former Arabiyya School premises, but was later halted due to pending resolution of numerous contractual issues.

While reasons suggested for the delay included shortages in construction materials and the incumbent government’s reclamation of land plots included in the original deal, TATA was reported in Indian media as expressing concern that local politics were endangering their investments.

Apex Realty also released a press statement in May 2014 indicating its intention to commence work on the apartment complexes within 45 days of getting the final approval from the government of Maldives for the amended contract.

“We are committed to the Maldives project and can start the project within 45 days after the final nod is received from the Housing Ministry and contract amendment is signed,” Apex Realty Director Sandeep Ahuja stated at the time.

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Housing Ministry to resume stalled Tata housing project

The government expects to sign a revised agreement with Tata Housing Developing Corporation next week to resume stalled housing projects in the capital Malé, Housing Minister Dr Mohamed Muiz revealed at a press conference yesterday.

The terms of the agreement were revised on the advice of the cabinet’s economic council after agreeing to some of Tata’s conditions, Muiz explained, and have now been forwarded to the Indian real estate developer for final approval.

“We have agreed that work must begin in two sites in Malé within 45 days of signing the amendments [to the contract],” Muiz said, referring to the Gaakoshi plot and former Arabiyya School premises.

Muiz further revealed that the government has also agreed to give back the vacant ‘Naadhee’ plot in Malé and approve construction on the site.

The site was taken over by the administration of former President Dr Mohamed Waheed with the intention of building a new Supreme Court complex on the premises.

While the previous administration had offered a plot in Hulhumale’ as an alternative, the developers felt the change would affect financing of the project.

The multi-million dollar housing project – a combination of commercial and social housing through a Public-Private Partnership model – was signed in May 2010 by the administration of former President Mohamed Nasheed with Apex Realty Pvt Ltd, a special purpose vehicle (SPV) or joint venture formed between Tata (65 percent) and SG18 Developers (35 percent).

Providing affordable housing to resolve the acute housing shortage in the capital was a core pledge of the Nasheed administration as well as the current Progressive Party of Maldives-led (PPM) government.

Contractual dispute

Housing Minister Dr Mohamed MuizThe Naadhee plot on Sosun Magu was among four plots of land in the capital awarded to the Tata subsidiary for construction of flats.

The Waheed administration’s decision to take over the plot was the source of the dispute with Tata, Muiz conceded yesterday, which has now been resolved after the economic council decided to give back the plot in accordance with the terms of the original agreement.

The government has agreed to purchase 20 percent of the flats constructed on the plot, he noted.

Discussions were meanwhile ongoing between the Supreme Court and the President’s Office on a new site for the apex court’s building, he said.

The flats in Gaakoshi and the old Arabiyya School site would have to be completed in 10 months and a year respectively, Muiz continued, while Tata has also agreed to construct 150 flats in Hulhumale’.

In May, Apex Realty announced that the company was prepared to resume work on the project as soon as the agreed upon amendments were incorporated into the contract.

“Apex Realty officials have undertaken multiple rounds of meetings with the economic council of the cabinet and the Ministry of Housing to find a mutually acceptable solution to contractual issues,” the company said in a press release.

“We are committed to the Maldives project and can start the project within 45 days after the final nod is received from the Housing Ministry and contract amendment is signed,” said Mr Sandeep Ahuja, Director at Apex.

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Tata Housing group agrees to revised contract, ready to resume construction

After resolving contractual disputes with the government, Apex Realty has announced it is prepared to resume work on its Malé housing projects as soon as the agreed amendments are introduced into the contract.

“We are committed to the Maldives project and can start the project within 45 days after the final nod is received from the Housing Ministry and contract amendment is signed,” said Mr Sandeep Ahuja, Director at Apex.

The project – a joint venture between the Maldives Housing Ministry and the housing arm of multinational conglomerate Tata – was agreed under the government of Mohamed Nasheed in 2011.

The combination of commercial and social housing was due to be completed within three years before stalling following disputes with the new government over the terms of the contract.

One of the four sites given to Apex for development was subsequently earmarked by the new administration as the site of a new Supreme Court, leading to reportedly heated negotiations.

“Apex Realty officials have undertaken multiple rounds of meetings with the Economic Council of the Cabinet and the Ministry of Housing to find a mutually acceptable solution to contractual issues,” read an Apex press release today.

The Apex group revealed that it had indicated its acceptance of the revised terms to the Housing Ministry.

“Apex Realty is now waiting for Ministry of Housing to enter into an amendment to the contract to record the modified terms.  Apex Realty is willing to recommence the work and finish the project in the shortest possible time.”

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Tata reaffirms commitment to stalled Maldives housing projects

Indian-based corporate giant Tata has said it has no intention of offloading its stake in a Maldivian joint venture overseeing several housing projects in Male’, despite local media speculation that land set aside for the company had  been sold off.

Tata this week confirmed to Minivan News that it remained invested in Apex Realty PVT Ltd, a Maldives joint venture established under the previous government between itself and developers SG18.

Tata Housing Development Spokesperson Vikram Kharvi added that the company was not considering selling its stake in the project, despite construction work having stalled on several commercial residential projects it was developing through the joint venture.

Kharvi confirmed that negotiations were ongoing with the government at present to resolve certain issues concerning the stalled developments on land provided to the company under its joint venture agreement.

He declined to clarify the exact nature of issues that had stalled the projects at time of press, forwarding specific questions on the matter to Sandeep Ahuja, Tata Housing Development’s Senior Vice President .

Minivan News was awaiting response from Ahuja at time of press.

Deputy Minister of Housing Abdulla Mutthalib confirmed to local media this week that the projects being overseen by Apex Realty had stalled due to what he said were a shortage of funds and construction materials.

Mutthalib expressed hope that the stalled projects could still be completed by year end.

“There are some constraints as they are also using subcontractors. The earlier deadlines given by the government have passed. Shortage of funds and construction material have brought both the projects to a complete standstill,” he was quoted as saying by Haveeru.

Local media also noted speculation that plots of land originally promised to Tata for its residential projects had since been purchased by local developers.

Contacted by Minivan News, Mutthalib declined to comment, adding that only Housing Minister Dr Mohamed Muiz was able to provide information to the press.

Dr Muiz was not responding to calls at time of press.

“Political interference”

In November last year, Tata was among a number of Indian companies reported to have expressed concerns over  political interference threatening their investments.

Officials involved in the Apex Realty housing development project told Indian media in November 2012 that the government was attempting to take over a site in Male’ given to the company, with the intention of building a new Supreme Court.

The current Supreme Court building was formerly the palace of former president Maumoon Abdul Gayoom, but became the court under his successor Mohamed Nasheed, who opted for the less ostentatious official residence of Muleaage.

A source involved in the Tata deal confirmed to Minivan News that the government had offered land on the island of Hulhumale’ to Tata as an alternative to the agreed site in Male’. However, the same source said the developers felt the change would affect the financing of the project.

The claims were made just weeks before the present government declared a concession agreement signed with infrastructure group GMR to manage and develop Ibrahim Nasir International Airport (INIA) “void” – terminating outright the country’s single largest foreign investment project. GMR were then given seven days to leave the country.

Tata, one of India’s most powerful corporate entities, announced its entry into the Maldives housing sector in 2011 as part of a multi-million dollar cooperation agreement with the administration of former President Mohamed Nasheed to build residential and resort properties.

The Wall Street Journal newspaper reported at the time that the Maldives government-commissioned programme, valued at an estimated US$190 million, required Tata to develop around 350 residential flats and a number of island villa properties that would be sold both to the state and on the open market.

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