Emaar, the Economic City, has terminated the local Al-Redwan Contracting Company’s contract for the construction of 134 villas at its King Abdullah Economic City (Kaec) development near Jeddah.
Al-Redwan was awarded a SR325m ($86.7m) contract to build the villas in December 2008 and had completed some of the foundation and structural framework. The client had paid the contractor SR56.8m for the work carried out to date (MEED 29:12:08).
“The company and the contractor have agreed to terminate this contract, whereby remaining part of the contract will not be executed. This decision has been made after re-evaluating the cost of the project and the cost of city’s other projects and shall not result in any financial burdens on the company,” said a statement on the Saudi Stock Exchange (Tadawul) website.
The $27bn Kaec was launched in December 2005, the first of six economic city projects that were originally planned for the kingdom. The scheme is being built at Rabigh, 100 kilometres north of Jeddah, and is expected to house 2 million people, as well as create 1 million jobs
The development is expected to cover a total area of 168 million square metres. The scheme is expected to house 2 million people and create 1 million jobs. It comprises six integrated zones: the sea port, industrial zone, central business district, waterfront resort area, education zone and residential zones.