Tale of three abandoned projects at Lagos airport

For over 12 years, the Hotel and Conference Centre projects at the Murtala Muhammed Airport (MMA), Lagos have remained abandoned following the protracted legal tussle over the concession agreement between the Federal Airports Authority of Nigeria (FAAN) and the concessionaire, Bi-Courtney Aviation Services Limited (BASL), operators of the Murtala Muhammed Airport terminal two (MMA2).

Daily Trust in this report examines the implication of the perpetual neglect of the projects and another Transit Hotel project at the international wing of the airport.

Will the government abandon the buildings perpetually without resolving the issues surrounding their neglect? Is it not high time a political solution is deployed to allow the matter to rest? What purpose does it serve for remaining perpetually abandoned?

These are posers observers and stakeholders continue to raise following long years of neglect of the buildings occasioned by the several litigation over the MMA2 concession.

In retrospect, the concession of MMA2 to BASL is the first terminal concession ever carried out in the history of aviation in Nigeria. It was again described as the most hurriedly conducted thus setting a bad precedent for aviation concession in Nigeria. This was why analysts say any effort to concession airports as being proposed by the Federal Government without resolving the MMA2 debacle might not see the light of the day.

There have been claims and counter-claims over who is right and wrong between the BASL and FAAN over the concession. BASL owned by business mogul and legal luminary, Dr. Wale Babalakin, SAN, insists the concession premised on a Build, Operate and Transfer (BOT) basis was for a period of 36 years contrary to what the company believes is an erroneous impression that the concession was for a period of 12 years. The BASL has also battled relentlessly with FAAN over the operation of the General Aviation Terminal (GAT) which it believes should be part of the concession.

When the Muhammadu Buhari-led administration came in 2015, part of the promises by Senator Hadi Sirika, who was then Minister of State for Aviation and now substantive Minister of Aviation, was to resolve the disputes over MMA2 concession.

But the seemingly intractable disputes have also contributed to the neglect of the two projects- conference centre and hotel – which the concessionaire initiated almost after the MMA2 concession agreement was finalized.

Daily Trust reports that though the two projects directly opposite the MMA2 were separate from the main terminal concession which still remains a matter of dispute at the moment, the litigation over projects was initially precipitated by the suspicion and disagreement arising from the entire concession.

It would be recalled that Babalakin sought the approval of FAAN to build the two projects to which the land was allocated by the latter and work started in 2005. In line with the terms and conditions of projects, Babalakin was to secure a foreign loan to complete the four-star hotel and conference centre and FAAN was expected to provide a guarantee.

But the project was taken to about 70 per cent completion until it was stalled by funding because according to sources privy to the matter, Babalakin could not secure the foreign loan to complete the project.

However, on March 2013, FAAN announced that it had terminated the leases granted Babalakin for the development and management of the two projects which were also on the BOT arrangement.

FAAN claimed that it had, in two separate letters, dated 19 April 2012, informed Bi-Courtney that the two leases had been terminated as a result of breaches committed by the company in the agreements it signed with FAAN.

By the said agreements, according to FAAN, the two projects were to be completed in 2008 but FAAN graciously extended the construction period to July, 2009 but Bi-Courtney still failed to complete the two projects at the expiration of the extended period.

FAAN also claimed that Bi-Courtney had forcefully and illegally acquired part of the premises belonging to the Murtala Muhammed Airport, School, Ikeja to construct the conference centre, despite protest by the pupils and parents of the school.

However, prior to the takeover, Bi-Courtney approached the court to secure an order of perpetual injunction restraining FAAN from taking over the properties, arguing that the delay in completion of the projects in the first place were attributable to FAAN’s non-cooperation by providing the guarantee to secure the foreign loan and so it could not enforce the terms of the BOT agreement.

It was gathered that because of the litigation, FAAN is constrained to do anything on the projects despite the huge money that has been sunk into them. At the moment, the projects remain abandoned. It was observed that the entrance to the buildings was occupied by some petty traders and FAAN registered towing operators while visible structural cracks could be observed.

In January 2018, the Infrastructure Concession Regulatory Commission (ICRC) led by Engr. Chidi Izuwah, the Director-General visited the MMA2 and the sites of the projects, promising to wade into the matter. According to Izuwah, the projects no doubt have had their fair share of challenges, which the Commission is not unaware of.

“The Commission is here today as the regulatory body saddled with the responsibility of monitoring and ensuring the efficient execution of all Private, Public Partnership (PPP) projects entered into by MDAs on behalf of the federal government as spelt out under section 20 (a) of the ICRC establishment Act, 2005,” Izuwah said.

Prior to his visit, members of the Senate Committee on Privatization in the 8th Senate also made a vow to get to the root of the matter.

This was in line with the assurance of the Minister that resolving the MMA2 concession debacles remains the top priority of the present administration.

But four years after and almost 15 years into the Hotel and conference centre projects, they remain abandoned with observers, analysts and stakeholders suggesting it is high time the government resolve the issues by exploring out-of-court settlements.

Former General Secretary of the National Union of Air Transport Employees (NUATE), Comrade Olayinka Abioye says the aviation unions objected to the buildings from day one because of the manner the land was taken over from traders and business owners.

He added that when the building started, “we (the unions) raised security issues essentially as it in directly line of sight to the Presidential lounge.”

“After security scrutiny, it was discovered that a sniper could actually shoot at VIPs at the lounge,” Abioye said.

This line of thought was shared by Group Capt. John Ojikutu, rtd, a popular aviation analyst, who faulted the Nigeria Civil Aviation Authority (NCAA) for approving the projects in the first place, asking if it is in tandem with the National Civil Aviation Security Programmes?

He said: “I was and still against the location of the multiple story car park which is not too far from the Presidential Lounge. At any of the upper levels of the car park, you have a good targets in the lounge and the aircraft apron. Same with that at the airport’s international terminal. The other two buildings of hotels and conference hall are not too different; the question is; who approved those buildings including the FAAN secondary school within the recommended standards in the NCASP? What is or what should be the minimum of these public areas to the airside especially where operational aircraft are parked and checked-in passengers are housed?

“Some of us raised the issues with the responsible authorities in the early 2000s, but political power and ego of the associates are stronger than the establishment and the established laws.”

Proffering a way forward, he said, “The solution is to first, respect the position of the court of law on this first that is on the side of Bi-courtney. Secondly, for national interest and security, pull down the agreement between ministry on behalf of FAAN to restore the environment to the established laws and pay compensation to whoever is or would be affected.”

Abioye on his part argued that since Bi-Courtney couldn’t complete the projects within the stipulated time, the abandoned buildings presently belong to FAAN, adding that it should be converted to FAAN’s headquarters instead of wasting money on building another head office in Abuja.

Sheri Kyari, an aviation expert and founder of the Centre for Aviation Safety and Research said government should show political will to deal with the matter and allow it to rest. According to him, government can carry out what he called, ‘buy-back’ of the buildings.

“If the government had leased the buildings, government can buy them for overriding public interest. The matter in the first place emanated when the Federal Government represented by FAAN saw that the contract papers were biased towards the lessor. Since the government has not review it, they only put a lid over the matter. They can as well remove the lid.”

But the NCAA absolved itself of any blame over the abandoned projects, saying there was nothing wrong with citing the buildings where they occupy. Spokesman of the NCAA, Mr. Sam Adurogboye said while the issue is still in court, he said the NCAA had not breached any provision of its regulations on the hotel project, adding, “Istanbul has a 10-storey building within the terminal used as hotel. Are you saying NCAA should not have allowed development at the airport which would create jobs?” He said the comment about the Hotel facing the VIP lounge is not tenable, adding nobody needs to come to the airport to carry out an espionage with the advancement in technology.

As the projects remain perpetually abandoned, a real estate expert, Ayo Ibaru said the projects are just two out of 1001 abandoned projects spread across the country as a result of dispute between the governments either at state or federal levels and the developers.

“This is what you have when government disagrees with the private sector after some kind of arrangement,” he said, saying there must be some kind of agreements to resolve the issues surrounding the multi-billion naira projects.

Lagos Transit Hotel

The Lagos Transit Hotel is another perpetually abandoned projects at the Lagos airport which construction was started in 2012 under Senator Stella Oduah as Aviation Minister.

The then Minister revealed that the transit hotel situated on the third floor of the terminal, was only for transit passengers who were travelling beyond Nigeria to other parts of the world to use instead of going out of the terminal to look for accommodation or sleep on the floor.

Our correspondent learnt that the project was at demarcation and fitting stages since 2014 when Oduah was removed as Minister. In 2015 when the new administration came on board, Sirika and his then boss and Minister of Transportation, Rotimi Amaechi toured the airport and at the time saw the project abandoned and promised to look into its completion. Up till now, the project remains abandoned.

“This has added to the growing number of abandoned projects in the sector,” a source said.

Ibaru stated further that it high time the government set up a department if not Ministry to be in charge of abandoned projects

Minister of Aviation has not responded to our correspondent’s enquiry sent to his Director of Press, Mr. James Odaudu as of the time of filing this report. The spokesperson promised to direct the request for comment to the Minister at the weekend.