Emaar pays more contributions; Games village on track

After the Delhi Development Authority (DDA) bailed real estate developer Emaar MGF Land Ltd by agreeing to buy 333 apartments in the Village for the Commonwealth Games in Rs700 crore, the civil contractor for the project said it had received more than the contribution that Emaar MGF due.

On 8 March, the Mint said that the village is unlikely to be completed in time because of alleged delays in payment of Emaar MGF. Ahluwalia Contracts India Pvt. Ltd, the contractor, then said he had not received all payments by the developer during the five-six months and Emaar MGF, it was almost RS85 crore.
The resumption of payments, allowing the contractor to pay construction workers on site and double their number, in May to improve the chances of the project being completed on time. The Commonwealth Games are scheduled for October 2010.

The deadline for the completion of the Games, the village is in March. "This is a difficult goal to meet ... We lost four months because of late payment," said an official of Ahluwalia Contracts, which is not to be named. "We need to complete the project on schedule, but it will be difficult unless the flow of funds is maintained."

Emaar MGF has paid Ahluwalia Contracts RS60 crore of dues in three parts, the same official said.
"The payment of the construction are made on basis ie as and when bills are high, payments are being authorized, a" Emaar MGF said door voice in response to a questionnaire sent by e-mail from the Mint.

"The Commonwealth Games Village is a residential project of national importance and delivery in time for the Games next year is the highest priority for us," added the spokesperson.

In December, a fund called Emaar MGF DDA Rs300 crore for a loan to finance the construction of the project. While DDA refused a loan, the government agency said May 11 that it purchased 333 apartments in the village of around Rs700 crore out the developer.

Since then, Emaar MGF has published approximately RS60 crore of the amount due at Ahluwalia Contracts in three parts. "Some of the payment is still waiting ... but Emaar said they pay us," the official told the contractor.
Ahluwalia Contracts has used the funds for payments to be made full employees of the construction of the Games village site. "Our first priority is to pay the workers," the official said. "Earlier too, we pay our workers, but since the payment is made from our own resources, we could not pay their full salary."

The number of workers on site has doubled, accordingly, from about 1500 to 3000, the official said. In March, the number of workers on site had dropped dramatically from about 7,000-8,000 to 2,000-2,500, after more than change jobs because their salaries were not paid.
The delay in payments also affected the markets Ahluwalia's ability to obtain equipment such as cement. But now, suppliers have been paid. "We are for the organization of more resources and materials such as cement, steel, sand and equipment ... A substantial amount of resources has been mobilized, "said the official. "During the last months, we RS8-9 crore the value of work."

Ahluwalia Contracts has spent about Rs20-30 crore every month when the work is booming. "We will have a month to reach the peak level of employment," the official said.

In June 2007, Emaar MGF, a joint venture between Dubai-based Emaar Properties PJSC and MGF Developments Ltd, India, won the tender to build the Village for the Commonwealth Games on 118 acres near the Akshardham temple in east Delhi. Emaar is building 1168 apartments in the village for athletes and delegates to stay in. These will then be sold to buyers in October-November 2011. Emaar MGF is developing the project in partnership with DDA.

"DDA has expertise in construction, then you have a name like Emaar involved. With two mated, the project should be finished in time," said Shweta Jain, director of national marketing and residential investment, to real estate consultancy Cushman and Wakefield.