China Railway First Group (CRFG), the contractor behind the multimillion-dollar FHL Tower project in Suva City, has billed Fijian Holdings Ltd (FHL) approximately $40 million in variation claims due to complications arising from the COVID-19 pandemic. The total amount claimed represents nearly 60 percent of the original cost agreed upon before the pandemic disrupted construction.
During the company’s annual general meeting in Lami, FHL’s CEO, Jaoji Koroi, addressed shareholder concerns regarding rumors that the cost of the tower had doubled. He clarified that the initial contract was set at $62 million, but as the pandemic caused many construction companies to halt operations, FHL chose to continue working with China Railway.
Koroi explained that although China Railway submitted a variation claim for the additional $40 million, FHL initiated a validation process that led to a decision to only approve $12.5 million of that claim. As a result, the current total cost approved by FHL for the project stands at $74 million.
“So, whoever is saying the contract value is now double is wrong,” Koroi emphasized.
Additionally, he shared optimistic news that FHL has received Letters of Intent from prospective tenants indicating a strong interest in 85 percent of the building. This development highlights the ambition and scale of FHL’s investment, which is considered its “single largest investment” since construction began six years ago.
In summary, while the project faced challenges due to the pandemic, FHL remains committed to its development, underscoring the demand for the FHL Tower in Suva City. This response to the situation reflects a proactive approach that may ultimately lead to securing a prosperous future for the investment and its stakeholders. With a commitment to transparency and accountability, FHL is navigating the complexities of construction in a post-pandemic world, which could bode well for both the company and the local economy.
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