By Kuvee Kangueehi
The multi-million-dollar B1 City Mall, whose development came to a standstill last year November due to cash-flow problems, is expected to go under the hammer soon.
Sources close to the N$54-million City Mall development said some of the creditors who pumped money into it want the entire project to be auctioned to enable them to recover their cash. The creditors are said to have run out of patience as the project owners, /Ae//Gams Engineering, keep promising that new investors would be found.
However, when contacted for comment, David Imbili, Chairman of /Ae//Gams Engineering, said the project would not be auctioned as no creditor has demanded his money, but added that his company was looking at legal options.
Imbili said his company was the owner of the land and thus the project could not be auctioned without their approval.
The chairman blamed the failure of the project on the Roads Contractor Company (RCC).
He said the company stopped the construction work without informing them.
He noted that the RCC was expected to secure funding but pulled out without an explanation. He added that the RCC suddenly started claiming that their former CEO Kelly Nghixulifwa, who signed the agreement, had no authority to do so. Imbili said the claim by the RCC was surprising as Nghixulifwa was given powers by the board.
Imbili’s statement contradicts the RCC, which earlier claimed that the RCC’s role was only that of a developer and main contractor for the B1 City development, with /Ae//Gams Engineering being the owner.
The RCC stressed that the project had until then been financed through a bridging facility which has unfortunately been exhausted. It was anticipated that the main loan agreement would have been concluded earlier.
After its sudden rise on the B1 Road, the B1 City Mall development came to an unexpected halt as the RCC pulled the plug on funding for mysterious reasons.
Efforts from the owners /Ae//Gams Engineering to get new lenders for a N$52-million loan failed to materialize.
Work on the main structure came to a standstill in November after workers allegedly employed by a Chinese sub-contractor downed tools.
Employees working for other sub-contractors on the site say the workers had not been paid for three months.
The ambitious B1 City plans include a large shopping mall, service station, truck stop and long-distance taxi rank on the strategic corner at the intersection of Independence Avenue and the B1 highway.
Two financial institutions including Old Mutual’s MIDINA Fund (Managing Infrastructure Development in Namibia) were originally intended to fund the development, with the other lender as yet unknown or non-existent.
Old Mutual’s Managing Director for African Operations, Johannes !Gawaxab, could not be reached for comment yesterday.
Despite the fact that the RCC was optimistic about B1 City, describing it as a “viable and exciting” project and giving the assurance that the developers, consultants and contractors remained committed to completing the project on time, no work was done on site for the last eight months. The expectation that B1 City would be completed early this year and trading would have started before the end of the first quarter of 2007 did not materialize, and the chance that /Ae//Gams Engineering will complete the project remains slim.