Minister Ignatius Chombo has ordered Harare to withdraw from a partnership to build a $145-million hotel and to focus on service delivery.
Local Government, Public Works and National Housing Minister Ignatius Chombo has stopped the Harare City Council from jointly building a $145-million five-star hotel in the capital that would be run under the Hilton Hotel franchise, saying the city must concentrate on its core business of service delivery.
The council partnered with local private investor Stream Walk Recreational Arcade to build the 96 000m2 hotel on a piece of municipal-owned land along Samora Machel Avenue in Eastlea suburb, which is a stone's throw away from Harare's famous Chapman Golf Club.
Developers say the five-star hotel would be a 12-storey complex that would have 275 guest rooms, offices, a 6 000-seater conference centre, retail units and a basement car park that could hold up to 1 000 vehicles. Construction was expected to start next year and be completed in 2016.
The Harare City Council's deal with Stream Walk Recreational Arcade was to build and operate the hotel.
Under the arrangement, the Zimbabwean-registered Stream Walk Recreational Arcade was the developer, and international firm Hilton would provide management services, among other things.
Aecom would be the project consultant for quantity surveying, and Stauch Vorster Architects would handle the architectural and other design work.
No reason given
The Mail & Guardian is in possession of a letter Chombo wrote to the city's town clerk directing the council to pull out of the project. Chombo gave no reason for the decision.
The Harare Residents' Trust, however, criticised Chombo for the directive, saying he had no business meddling in council affairs. The minister has previously used his powers to fire city officials who refuse to comply with his orders.
"The residents always expect that all land deals must be done in a transparent and accountable manner. In our view, the minister has no business directing council to bow out of projects that have a benefit to residents," the trust said.
Chombo was in meetings throughout the week and could not be reached for comment to explain why he ordered the city out of the partnership that would have generated much-needed income for the city.
But in an interview this week, Harare deputy mayor Thomas Muzuva confirmed that they had received a directive from Chombo to leave the deal and focus on service delivery.
He said that the council has since sold the land on which the hotel was supposed to be built to the investors.
"Council operates on two things: council resolutions and ministerial directives," said Muzuva.
"At first it was supposed to be a joint venture with a partner, but [we] received a ministerial directive to leave [the venture] to our partners. We have since sold our land to the partner, I think for $3-million."
Muzuva said he could not comment on how much the city stood to benefit from the deal.
However, in the same interview, Muzuva disclosed that tenants who were leasing the land from the council had approached the courts to challenge the deal, which would leave them without property.
"They are challenging the case, but I think, even if they win, they would not be able to stop the project as they are likely to just be compensated for breach of contract," said Muzuva.
Stream Walk director Farai Jere said: "It was a proposed partnership, but because of bureaucracy in council it was agreed that you have to move ahead because it's in the national interest. It was agreed that we move ahead."