Sep 13, 2015 News
– CH&PA agreement says land was for construction, sale of homes only
Months after officially purchasing a prime piece of housing land on the East Bank of Demerara, a private developer last year turned around and sold it to a Chinese logging company. The Chinese company in turn, shortly after, unveiled an ambitious gated community behind the National Stadium in Providence.
But that development along the East Bank Demerara corridor is in deep trouble with works stalled in recent months.
The particulars of the sale of the 100-acre plot by Sunset Lakes Inc. to BaiShanLin Forest Development Inc. is not only raising eyebrows but has fallen under the radar of the new administration. A review of the Sale and Purchase agreement is underway.
Sunset Lakes, a company whose Director is well known businessman/contractor, Brian “BK” Tiwarie, was last week ordered to attend a meeting with Minister within the Ministry of Communities, Keith Scott, and other officials of the Central Housing and Planning Authority (CH&PA), to explain the delays.
Summoned also were officials of the BaiShanLin. However, Tiwarie was absent, sparking heavy criticisms from Minister Scott on Thursday. The business executive has since written to CH&PA asking to meet shortly, Scott confirmed late Friday.
From all indications, Sunset Lakes breached the agreement by selling the entire plot without building any homes.
How the developer was able to get away with the breaches would raise troubling questions about CH&PA’s monitoring of the housing projects during the reign of the previous PPP/C administration, especially as thousands of persons are on file awaiting house lots.
According to the generous clauses of the “Agreement of Sale and Purchase” entered into on February 7, 2014, the 100-acres was sold for $458.18M with 25 percent or $114.54M handed over as an advance.
Some 35 percent or $160.36M would have been paid after CH&PA had evaluated the infrastructural works completed by Sunset Lakes/Tiwarie.
Under the agreement, Sunset Lakes was to hand over the final $183.27M when the Block Certificate of title for the 100-acres was passed.
With the basic infrastructural works still incomplete, it meant that CH&PA only collected $114M.
CH&PA also handed over the land to the purchaser after the agreement was signed.
There were some special clauses in the agreement.
For instance, Tiwarie agreed that he will develop the lands for the construction and sale of houses only. That would suggest that he breached the agreement with the sale to BaiShanLin.
Among other things, Sunset Lakes was supposed to submit a design layout of the proposed housing scheme within four weeks after the agreement was signed.
Sunset Lakes was supposed to start mobilizing immediately after the contract was signed last year February to execute the infrastructural works, including roads, drainage, water and electricity.
The developer was given eight months to complete the works with CH&PA insisting that it will be carrying out periodic inspections.
Tiwarie also agreed to complete the construction of the homes within 24 months and ensure 100 percent occupancy, or face a fine of 25 percent of the market value of the land.
The ambitious gated community was talked about since 2012 with the Guyana Chronicle in July of that year quoting Tiwarie as mentioning Sunset Lakes as one of the highlights for that Building Exposition.
It is unclear when Sunset Lakes was sold to BaiShanLin.
The logging company reportedly offered US$9M for the 100-acres plot but still owes another US$3M.
Last October, during the GuyExpo trade fair at the Sophia Exhibition, BaiShanLin announced the gated community called “New Life” with a huge display. Prices for homes were from $50M and reaching over $100M.
In its Facebook page this year, however, it appeared that the developer scaled back, offering some of the homes from $40M and others at $70M.
The company is facing tough times, with its aggressive entry into the logging sector and the unusually large tax and other concessions it was granted under the previous administration.
It has failed to build a US$70M wood processing plant in Linden despite drawing down on the monies from China Development Bank. It is believed that the monies were diverted to housing and into gold mining.
Its two listed phone numbers- 265-1705-6 –for the offices at Cacique Palace and Banquet Hall, located behind Princess Casino and Hotel, were not in service.
The BaiShanLin/Sunset Lakes growing scandal would seem to be only a tip of the iceberg when it comes to the lands allocated to the private developers.
An inspection visit by Scott and senior CH&PA officials last Tuesday found several of the developments way behind.
Some 16 developers have benefitted from large plots of lands between Republic Park and Little Diamond.
It is unclear how much CH&PA collected from the sale of the lands.
What is known is that CH&PA is now reporting that it has about 25,000 applications on file with only 5,000 to be addressed in the coming five years.
The new administration has said that housing developments, especially on the East Bank of Demerara, are facing delays because of contractors’ tardiness and poor oversight.
Yesterday, Minister Scott disclosed that he has mandated a special body of CH&PA staffers and others, to monitor private housing developers and report on their progress every month.
The developers have been given a February 2016 deadline to complete infrastructure works.
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