COVID cost claims plague FHL Tower
COST variation claims because of COVID-19 continue to plague construction of Fijian Holdings Ltd’s FHL Tower, with the likelihood that completion, scheduled for April, will be delayed again.
Described by Fijian Holdings Ltd Group (FHL) as its “single largest investment”, the 17-storey $65 million tower at the corner of Gordon and Gorrie streets in Suva is still incomplete, five years after its ground breaking in 2018.
In its 2023 Annual Report released in September last year, the publicly listed company had blamed global economic and political disruptions for the delay and moved the expected completion timetable to April this year.
However, The Fiji Times was reliably told FHL has had to push back on COVID-based variation claims from its main contractor to the tune of more than half the initial investment value, now a major bone of contention between the two parties.
“One of the group’s subsidiaries, FHL Properties Pte Ltd, has a potential obligation in respect of variations claimed by the main contractor relating to construction of the FHL Tower,” FHL had stated in its 2023 Annual Report.
“However, these claims have not been agreed as at year end and the subsidiary company has engaged external experts to assess the validity and quantify the variation.
“If successful, the potential obligation could impact the fair value of the FHL Tower in 2024.”
Contractor China Railway First Group referred all questions to the project management company, who said it could not comment on the issue.
FHL is reported to have already secured tenancy for around 60 per cent of the building.