Saudi: $332m KAFD tower faces seven-month delay
The project has reportedly been put on hold following 70% completion of construction works
A stock exchange center worth $332m in the King Abdullah Financial District (KAFD) in Saudi Arabia led by Samsung C&T reportedly has been put on hold for seven months.
Saudi Arabia has been building its own financial hub in Riyadh, capital of Saudi Arabia, but the massive project has paused in the wake of the government’s financial troubles.
According to Pulse News, the Kingdom’s project to establish a financial hub in Riyadh that is targeted to be concluded next year has stopped at the 70% level of the completion, reflecting the fall of Saudi Arabia’s economy amid oil price slump.
Saudi Arabia’s largest construction company Saudi BinLaden Group and developer Al Ra’idah have co-headed the KAFD development project for Saudi Public Pension Agency (PPA), but they have stopped the work after PPA delayed making payments for the project.
PPA in turn has notified Bin Laden Group and Al Ra’idah that it would cancel the contract if they do not resume the work within two months.
The KAFD is designed to become the largest financial hub in Middle East on 1.6 million sqm site with about $7.8bn investment.
The project is comprised of constructing 73 buildings including Saudi stock exchange and other developments such as housings, offices, exhibition halls, and hotels.
In 2012, Samsung C&T was named to build Saudi stock exchange center that would become the KAFD’s landmark together with Al Ra’idah with a plan to compete the construction by Sep. 2015.
The Korean construction firm holds 60% stakes of the project. “The company is placed in a situation to adjust the pace of the construction as the payment on the project has been delayed,” said an unnamed Samsung C&T official.