HOPE Inc. Faces Lawsuit Over $64 Million Contract: Audit Reveals Failures in Home Construction Projects

Home Ownership Providing Energy Inc. (HOPE Inc.) the company created by Government to build homes for low to middle income workers, is facing a lawsuit over a $64 million contract it signed with a precast company which it was not able to fulfil.

This, among other shocking revelations, is contained in a special audit by the Auditor General’s department ordered by Prime Minister Mia Amor Mottley on the heels of criticisms and concerns about the construction of the houses.

The Sunday Sun recently obtained a copy of the 42-page financial investigation and is providing an exclusive review today of its contents.

The audit revealed that HOPE Inc. was not able to meet its target of building 2 000 houses from 2020 to 2024; that it had constructed houses on lands which Government did not own; it had entered into contracts which it did not have the financial capabilities to fulfil and the quality of work by some of the contractors hired to build the houses was below industry standards leading to the bulldozing of some of the houses at Vespera Gardens, Lancaster, St James.

Signed deal

In the report which was made available in February but which was not mentioned during Government’s just presented Financial Statement and Budgetary Proposals 2025, the audit noted that in December 2022, HOPE Inc. signed a contract with Preconco for the supply of 1 000 precast units to be built at Pool Land, St John, Colleton, St Lucy, Fairfield, St Philip and Searles, Christ Church.

The audit noted that HOPE’S construction method involved paid for labour only contracts with HOPE

providing all the materials and the company would be paid $75 000 for the labour for constructing the houses.

However it noted: “This arrangement was, however, changed for the construction of some houses at Pool, St John. HOPE Inc. obtained quotations from Preconco Ltd. for the supply and installation of various quantities of precast concrete units …; the quotation did not provide a total cost, but based on the unit costs … it worked out to 64.5 million”.

The audit went on to say that HOPE Inc. entered into the contract while not having the resources necessary to meet its obligations under the contract. The contract required the supply of 1 000 units over a 15-month period.

“However at this time, HOPE Inc. did not have in its possession the number of lots required. HOPE Inc. would have needed to obtain additional funding to meet the $64.5 million required under the contract. Furthermore, financing would also be required to construct foundations and roofs for each house as these were not included in the contract with Preconco. No information was seen to indicate that a source of financing was identified prior to the signing of the contract. (MB)