Singh’s R3,5?bln deals

2013-12-02 00:00

JAY Singh has won an astonishing R3,5 billion in building contracts — almost all of which are now under active investigation by national regulators for illegal construction.

The full size of the tender tycoon’s construction empire can be revealed for the first time, thanks to documents in the possession of The Witness, which were compiled by his own staff.

The documents — which Singh’s company prepared as part of a takeover bid in September — reveal that Gralio Precast has scooped 42 housing, retail and civil projects around Durban in the past decade, with most built at lightning speed.

Totalling over R3,5 billion, the projects range from as little as R450 000 — to upgrade a cemetery in Tongaat — to building a R725 million mega-housing development in Phoenix.

Councillor Heinz de Boer, a DA member of eThekwini’s executive committee, said the figure was “outrageous”.

“How can Gralio have won all these contracts when there are hundreds of construction companies with proven track records and proper skills and resources to build these houses?”

This week, industry experts told The Witness that Singh’s turnover was “huge” for a private firm operating exclusively within the Durban boundaries.

Consulting engineer Nelson Allopi, who worked with Singh on housing and retail projects, said: “For an industry player working almost exclusively in Durban this is high, however, it is known that Gralio was always a competitive bidder on any project.”

But Allopi criticised Singh’s construction teams for working at “lightning pace, seven days a week”.

Other industry players estimated Singh would have netted about R300 million profit working on margins of between seven to 12%.

Gralio’s list — entitled “completed projects; work in progress” — was submitted as a demonstration of its financial muscle, in an effort to take over part of a Pinetown-based construction firm Stedone, which was placed under business rescue by its management in April.

The document announced its total contracts at R3 373 978 353, 81. The amount includes R1,9 billion from eThekwini council made up nearly entirely of low-cost housing projects in areas such as Tongaat, Verulam, Inanda and Kingsburgh.

In addition, Gralio has, since September, won additional contracts including, R135 million in extension work for the Cornubia project and R51 million from Umdoni Municipality.

But in another document obtained by The Witness, Stedone rejected Gralio’s takeover offer on the grounds that it was “not satisfactory”.

Stedone, which is struggling with debt, claimed that Gralio was, in fact, “technically insolvent” and was unconvinced on how they would fund the takeover.

Meanwhile, the National Homebuilders Registration Council has launched an investigation into “all” of Singh’s housing developments, following allegations of sub-standard building and illegal construction.

Molebogeng Taunyane, spokesperson for the NHBRC, said the regulator’s investigative team “comprises legal people, quality assurance — including building inspectors, and an audit team”.

She said owners or tenants of houses that were never enrolled with the NHBRC would not qualify for the agency’s five-year warranty for major structural defects.

Tauyane confirmed that all Gralio developments — both complete and under construction — would be probed, but would not reveal the number. The Witness found that 18 housing developments are listed within Gralio’s portfolio, from Chatsworth to Inanda.

The rest of Singh’s empire includes mining, machinery hire, property development, aluminium products and vehicle repairs.

Singh is a convicted fraudster and therefore cannot hold a company directorship.

He and his family rocketed to national prominence last month when a mall in Tongaat being constructed by Gralio Precast, which is owned by his wife Shireen Annamalay, collapsed, killing two people and injuring 29.

The mall had no planning permission and just days before the tragedy had been instructed by a Durban high court order to stop all construction. The order was ignored.

Mervyn Reddy, a spokesperson for Singh, said Singh’s company was widely respected, and provided a “needed service”. He said complaints of “shoddy workmanship” were driven by tenants who refused to pay rent.

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