HDC to pay USD 22 mln to Malay firm WZR Property over office complex project
Asian International Arbitration Centre (AIAC) on Sunday, ordered Housing Development Corporation (HDC) to pay USD 22.8 million (MVR 352 million) in compensation to WZR Property over the development of a 25-storey office complex in reclaimed suburb Hulhumale'.
Malaysian company WZR Property was contracted with constructing the office complex during former President Abdulla Yameen Abdul Gayoom's administration.
According to AIAC, WZR has yet to receive the payments for invoices issued in May 2018, adding that the total adds up to USD 22,823,432.68 at the current exchange rate.
HDC was ordered to pay the aforementioned amount to WZR within a period of seven days.
WZR Property Sdn Bhd group's Chairman Datuk Sazmi confirmed to Malaysian news outlet Malay Mail that the arbitration was filed at the Asian International Arbitration Centre in September 2019. The case concluded on July 5.
Sazmi had told Malay Mail that WZR Property won the bidding process conducted by the Maldivian Ministry of Finance and Treasury to develop a 25-storey office complex on Phase Two of reclaimed suburb Hulhumale' and was awarded the contract on February 1, 2016.
According to Housing Development Corporation (HDC), the office complex was set to be developed with state-of-the-art features found similar to those in well-developed nations. The project was to be completed in 2018.
The total cost of the project, which was officially signed on March 1, 2016, amounts to nearly USD 123 million.
However, WZR Property claimed that it has not received a single payment despite completing 20 percent of the total work in addition to 60 percent of the pilings for the structure.
Highlighting that the contract was signed during the previous government, the Malaysian company stated that the current administration was reluctant to continue the project.
"... and our outstanding claim of USD 29 million was not being entertained", Sazmi had told Malay Mail.
Despite the progress made on the office complex, the incumbent administration decided to pull the plug on the project, adding that the state was attempting to reach a solution for breaching the contract outside of arbitration.