Lui Huailang

Flashback May 2019: Housing Minister Edmund Dillon, left, presents a token of appreciation to Lui Huailang, general manager of China Gezhouba Group International Engineering Company Ltd (CGGC) following the contract signing for the construction of housing units in Port of Spain and San Fernando, at the Hyatt Regency (Trinidad) in Port of Spain.

THE Housing Development Corporation has pushed back the deadline for submissions of proposals for the construction of two apartment building complexes to be located at Lady Hailes Avenue in San Fernando and at South Quay in Port of Spain.

The HDC has also agreed to separate the contract, so that the winning bid is not obliged to undertake the construction of both complexes at the same time. Express Business understands that the seperation of the Request for Proposals (RFP) into two discrete projects increases the likelihood of local contractors being able to compete with the foreign apartment builders.

The original deadline for the submission of the proposals was January 6 (last Monday) at 3.30 p.m., according to the newspaper advertisement for the Request for Proposals, which was placed in all three daily newspapers during the period November 17-21, 2019 and also uploaded to the HDC’s website.

The new deadline for the submission of proposals is now to January 27, 2020 at 3.30 p.m.—an extension of 21 days.

A third development for a housing complex on Tragarete Road in Port of Spain was also tendered at the same time.

An HDC spokesman confirmed that both the extension of the deadline and the separation of the Lady Hailes and South Quay contracts into two were done by an addendum to the original RFP, which was distributed to the tenderers.

Responding to Express Business questions by email on Friday, the spokesman said: “To clarify, before submitting the mandatory RFP documents, interested contractors/firms had to purchase an RFP package. The purchase period was November 20-29, 2019. The names and contact information of these contractors/firms were recorded by the Tenders and Contracts Department as they received the packages.

“Once a decision was made to extend the period for the submission of the RFP documents, the addenda with the new date and any other amendments were dispatched by the Tenders and Contracts Department to those who had purchased the RFP packages.

“The purchase period is now closed. As such, a press release will not be issued nor will an advertisement be made at this time.”

If the tenderer had purchased the RFP package on the first day the document was available, November 20, there would have been 29 working days to develop a full design, build and finance proposal. That would have included detailed information architectural drawings as well as civil, mechnaical and structural engineering drawing and drainage. The RFP also requires a financial commitment from a lender to fund the construction as the winning contractor will be paid after the completion of construction.

The RFP package was sold by the HDC to contractors for a non-refundable payment of $5,000, which was to be paid into a Republic Bank account at Independence Square in Port of Spain.

According to the Request for Proposal document, “The successful DBF (design, build, finance) contractor will be chosen using a competitive selection process as outlined in the Request for Proposal and will be required to demonstrate adequate DBF experience in the provision of similar services as defined in the RFP.

Submissions must include all documents listed in the RFP. Failure to do so may result in disqualification.”

 Second time around

The design, build finance arrangement to construct 235 two- and three-bedroom apartments at Lady Hailes Avenue and 204 two- and three-bedroom apartments at South Quay was first awarded to the Chinese construction company, China Gezhouba Group International Engineering Co Ltd (CGGC).

The contract that was signed on May 17, 2019 and was for the construction of 439 apartment units in Trinidad’s two main cities was for US$71,739,411 ($485.7 million).

The contract to construct the 439 apartment units was part of a framework agreement for the 5,000 apartment units that was signed by HDC and CGGC on July 13, 2018. The existence of a framework agreement between the HDC and a Chinese contractor was only disclosed at the signing ceremony in May last year.

When Express Business first reported on the issue, in an article published on August 28, 2019, that was headlined ‘HDC’s sweetheart deal with Chinese contractor,’ there was considerable public comment at the unprecedented benefits and incentives granted to the Chinese contractor.

The week after the publication by Express Business, Prime Minister Keith Rowley told the post-Cabinet news conference of September 5, 2019, that the contract had been cancelled.

“HDC has been instructed to go back out to tender, because there were some parts of that contract that did not meet the Cabinet’s acceptance and approval, structurally and legalistically. So that contract has been stopped. We are not going forward with it in the way in which it was produced,” said Rowley, confirming that the contract had been cancelled.

Among the benefits that the HDC granted to China Gezhouba (CGGC) were:

• HDC agreed to reimburse all of CGGC’s VAT one month after each interim payment certificate. HDC agreed, in writing, to use its own funds to reimburse the Chinese contractor;

• HDC agreed as well to reimburse all of CGGC’s corporate tax payments within a period of one month after the submission date;

• The contract also ensures that the Chinese contractor does not pay customs duty or import duties, and all other related fees or charges levied on the contractor during the performance of the project, in accordance with the laws of T& T;

‘CGGC shall be eligible for taxation relief in accordance with the Income Tax Act, order under section 93 (1) of the T& T income tax law,’ the contract states, adding that in the event that the exemption is not approved by any authorities, all above-noted taxes, duties, fees and charges shall be reimbursed by the HDC through its own fund resources;

• HDC shall, as reasonably possible with the assistance of CGGC, obtain all permits including tax exemption certificates, planning permission, work permits, permits to work and any other permits and approvals required for the project;

• While the contract also states that CGGC ‘is committed to its social responsibilities and pledges to use as many local workers and materials as possible for the project,’ the arrangement made provision for CGGC to be granted work permits for 400 Chinese labourers. Some 200 extra work permits ‘shall be granted if necessary to ensure the timely delivery of the project,’ according to the contract documents, which indicated that HDC is responsible for obtaining all visas, resident permits and work permits;

• HDC had the responsibility to provide 4.94 acres (2 hectares) of land to serve as temporary housing for the up to 600 labourers who were expected to work on the housing projects. These camps must be within five kilometres from each site during the execution of the project;

• HDC was also obliged “at its cost provide sufficient security for contractor’s personnel and property.”

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