{UAH} Crested Towers is only worthy 70 billion -Imaginehe Libyians!
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National Housing misreported Kireka land ownership, says AG
Kampala.
National Housing and Construction Company Limited (NHCCL) misreported its interest on 250 acres of land in Kireka, the Auditor General's report has said.
According to the report for the year ended June 30, 2015, NHCC revealed to the Auditor General that it was holding a freehold title on the land in Kireka valued at Shs68.8b.
"However, I was not provided with evidence of ownership of freehold interest in this land; instead, the company has a title deed stipulating ownership of leasehold interests. In that regard, the basis for the carrying value is not adequately supported," Mr John Muwanga, the Auditor General, said in the report.
According to the Land Act, holding a freehold title, the landowner has no limitation on what they can do on the land.
In fact, the Act states that a landowner can use the land by lawfully "entering into any transaction in connection with the land, including but not limited to selling, leasing, mortgaging or pledging, subdividing creating rights and interests for other people in the land and creating trusts of the land; disposing of the land to any person by will."
Leases of private land on the other hand often have conditions of payment of rent while leases over public land have conditions of use.
That means by NHCC stating it had a freehold land title yet it has leasehold title, it may have over-valued the land.
NHCC has been embroiled in a dispute over the ownership of the land with several residents of Kasokoso.
The company wants to evict them in order to construct what it considers low-cost housing, however, the residents have resisted, insisting they also have rights over the land.
Furthermore, the Auditor General also said NHCC had not disclosed, in the asset register, its legal ownership of a freehold title for 16.6 acres of land in Mbuya.
Assets losing value
One of National Housing and Construction Company Limited (NHCC)'s assets is the 20-storey Crested Towers building, which is the home to Uganda's largest bank, Stanbic Bank.
It also has tenants like Uganda Revenue Authority. During 2014, NHCC is said to have carried out renovations worth Shs597m. When revaluation of the property was done after renovation, the value of the building had depreciated by Shs4b to Shs70b. "Under the circumstances, there is a risk that the company may not be undertaking adequate maintenance and repairs on the said property, to enable preservation and/or enhancement of its value," Mr Muwanga said.
Additionally, NHCC was revealed to have an unauthorised bank Shs2.3b overdraft facility that had no proper documentation to support it. It was also converted from a long-term loan to an overdraft without the approval of the board.
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