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PM wants London to explain Milshirv deal (with CNC3 video)
Prime Minister Kamla Persad-Bissessar is demanding answers from Chief Secretary of the Tobago House of Assembly (THA) Orville London as to why, after some 20 years and millions of dollars spent, the THA has chosen to give the Milshirv property back to its directors.
She is also questioning why the office lease agreement which was incorporated into the lease agreement of Milshirv was not immediately registered. She said she found it highly suspicious and irregular with the recent Bolt (Build Own Lease Transfer) agreement between the THA and special purpose company Milshirv Ltd.
And up to last Friday, Persad-Bissessar said it remained unregistered. “They failed to register together with this deed, a document they called the Office Lease and you would have heard me say that, but up to when I checked that Office Lease was not registered and up to the close of business on Friday,” Persad-Bissessar said in an interview yesterday.
Milshirv was incorporated on October 3, 2011. On November 15, 2011, the THA purchased three acres of land situated at the corner of Shirvan and Milford Roads for $12 million from Dankett Limited. Six days later, on November 21, 2011, the THA leased the same three-acre property for 199 years at an annual rent of $10 to Milshirv Properties Limited, this a mere two months after Milshirv was incorporated.
Persad-Bissessar said there was no existence of any “Annex B” to the deed given to Milshirv, regarding all actions agreed to that must happen at a later date. The deed, she said, was registered in the Lands Registry as deed number 201200109459D001 on January 27, 2012.
She also accused London of engaging in a “sweetheart deal” which was nurtured by Milshirv Properties Ltd and Dankett Ltd. Persad-Bissessar said according to the lease document, Milshirv would construct an office building and facilties which, upon completion, would then rent to the THA who leased Milshiv the land at $10 per year for 199 years for a term of 20 years at $1.3 million per month.
“This office lease is expressly incorporated into other lease agreement and supposedly annexed to the lease agreement,” she said. “This office lease is critical as it contains the duties and obligations of the THA, Milshirv and provides an account of how revenues received by the THA would be spent.”
She said the office lease embodied the terms and conditions of the agreement whereby the THA was going to lease the office building. “There is an article on the THA’s Web site which states that the THA has agreed to lease the Milshirv complex for $15.61 per square foot per month.
The complex is supposed to provide approximately 83,000 square feet. I am therefore advised that this rent could therefore be as high as $1.3 million per month or $15.5 million per year. Can you imagine burdening the treasury to such an extent without any form of public disclosure?
“The THA, in a press release on September 6, 2012, admitted that the total rental sum to be paid to Milshriv over the 20-year period of the lease will be $322million. It also conceded, in the same breath, that the cost of building the office building would be $143 Million. In other words, the THA is going to pay $322 million for a building that cost $143 million to construct,” Persad-Bissessar said.
Questioning the integrity of the THA, the Prime Minister called on London to clarify what figures were used to calculate these property value/rent assessment figures on a building which was yet to be constructed? These questions as concerns the financing and use of tax payer’s money could be obtained by virtue of the said lease agreement.
CHRONOLOGY OF EVENTS
• On October 3, 2011, Milshirv Ltd was incorporated.
• On November 15, 2011, the THA purchased three acres of land at the corner of Shirvan and Milford Road for $12 million from Dankett Ltd.
• Six days later, on November 21, 2011, the THA leased the same three-acre property for 199 years at an annual rent of $10 to Milshirv Properties Ltd, a mere 2 months after Milshriv was created or incorporated.
• This lease agreement contained vital information regarding the terms and conditions of the lease. According to the lease document, Milshirv would construct an office building and facilities which upon completion, would then rent to the THA (who leased Milshirv the land at $10 per year for 199 years) for a term of 20 years at $1.3 million per month.
• This “office lease” is expressly incorporated into the lease agreement and supposedly annexed to the lease agreement. This office lease is critical as it contains the duties and obligations of the THA and Milshirv, and provides an account of how revenues received by the THA will be spent. In other words, it embodies the terms and conditions of the agreement whereby the THA was going to lease the office building.
• The lease agreement with the incorporated “office lease” annex is dated and executed on November 21, 2011. It was not immediately registered. It was in fact registered two months later on January 17, 2012.
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