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SSB Spending Millions to Retrofit McKoy Building

The press told the Prime Minister about the other public embarrassment for the Social Security Board in which their eight-million-dollar David L McKoy building in Belmopan has to be retrofitted to bring some structural integrity to it.

It was opened last year, but had major issues. Those missteps are now forcing the SSB and this new government administration to spend an additional 3 million dollars to make necessary repairs.

That's almost half of the full price of the building, and here's what the Prime Minister had to say about it when the media asked about it:

Hon. John Briceno - Prime Minister
"Well, yes, we have been, again, briefed about it. And it was a bad design. It was badly - the architect supposedly seems to have made a number of - or overlooked a number of things that should have been in the design. We could have made it political, but we did not. We decided that now we have a problem. We have the people's money. We just can't walk away from it. And Social Security is going to spend the extra money to be able to repair it because we have to fix it."

Channel 7

The $11 Million Dollar Disaster At David L. McKoy Building

The David L. Mckoy building - you may not be familiar with the name offhand, but it's that shiny four story structure on Bliss Parade Road in Belmopan.

It was built as an investment to rent commercial office space in Belmopan - and it was opened a year ago.

But, since then, things have gone very wrong - and millions of dollars of your money have been spent trying to salvage a very deficient structure.

7News has been investigating this ever since we saw an additional structure being fastened on to the existing one. And tonight in the first of a multi part series - we begin our search to find out what went wrong, and who's to blame. Here's where the story begins:

posted (June 9, 2021)
The David L Mckoy building was opened with much fanfare in June of 2021, with the promise of an immediate return on the 8 million dollar investment:

Reynaldo Magana, Investment Chairman
"We will already achieve immediate returns."

But immediate has gone to indefinite….more than a year later, the building is still not really opened - and, in fact, is going through a massive and costly retrofitting.

Lawrence Ellis, Director - SSB Board
"The building was still not finished, because it was supposed to have been finish already and when we were trying to get answers as to why it hasnt been finish yet, we found that there were many delays and many things that are not up to standards."

And it all starts with that gleaming glass facade that you see on the outside; today, it looks very different once you get inside.

That's because large sections of it are being covered over with drywall. Why? Because of the heat, extreme heat felt inside…as it turns out, while living in a glass house may look fancy and modern, working in one - in the tropics - can be like a sweatbox.

The problem has a lot to do with the orientation of the building - it faces east-west - meaning that in the afternoon and evening, the sun's rays are hitting all those glass panels directly - heating up the inside - it's almost like a heat conductor.

And then that brings us to the next problem - which is the quality of the glass. It's too thin and lets in too much light.

That's where the trouble started - when the first tenant started complaining about the unbearable heat in the offices. That's when social security knew it had a problem. They just didn't know how big a problem it would turn out to be.

Today, 3 million dollars of workers' money later, they are still trying to recover.

Jules Vasquez
"When we did the opening of this building it was told to us the cost was 8.2 million dollars. What is that cost now?"

Deborah Ruiz,,CEO - Social Security Board
"With the additional works that are going, we are talking 11.1 million dollars at the end of the day."

And it starts with the windows - but when it comes to those, truth can be a moving target. The architect Luis Ruiz said he consulted with specialists at Benny's to get solar reflective, double-glazed windows laminated to withstand strong winds.

The contractor Daniel Fabro of Fabros Limited says that the contract he got clearly had specifications for clear glass. In this letter to Social Security, he writes that he changed the glass to tinted solar reflective low - e glass to make it more energy efficient.

Fabro told us the design specifications had many conflicts...glass being one, and insists that the actual plans call for clear glass.

But, no matter the glass, with the glass faced building situated to face the sun from morning to evening - even much more expensive argon filled glass would likely have not kept it cool.

The sheetrock solution has turned what should have been magnificent views into just portals to the outside world.

But, that was just the start of the troubles with the building. In response to a Freedom of Information request, Social Security's CEO Deborah Ruiz says, quote, "Because of growing concerns during the Defects Liability Period, the Board contracted the services of New Buildings Ltd to do a complete assessment of the building."

When we spoke to her three weeks ago - she explained that the issues were substantial:

Deborah Ruiz, CEO - Social Security Board
"We have international clients in our building, we have to assure in writing some of the constraints that we have in terms of protection against earthquakes, protection against high winds, hurricane winds, we are looking at enhancing bathroom facilities for some of the areas and strengthening the entire frame in terms of the stability of the building to make sure that we can guarantee our clients their safety in terms of the sustain winds and hurricane."

And here's the engineer's review - obtained via a freedom of information request. It is peer reviewed by two engineers, William Lamb and Carlton Young.

Running a simulation for Category 1 winds, they found multiple column failure with even 115 mile an hour winds. Their conclusion was grim: "The results showed that the building as is would not resist a storm as per design codes."

And this was the solution: a frame - something like a spine - built onto the back of the building to give it what the engineers call lateral stability in the event of a storm or hurricane. That's how it looks on paper - and this is how it looks on the ground, like some strange add-on.

Inside, large cross members are hidden underneath new drywall sheets - a Frankenstein creation if ever there was one.

Tomorrow, we'll have part 2 of our investigation where we try to find out just where things went wrong, and who gave the orders that got the SSB a cheaply built structure with major deficiencies.

Channel 7

The David L Mckoy Disaster, Day Two

Last night we showed you the David L Mckoy building Belmopan - owned by Social Security - and built with 8.2 million dollars of workers' money.

But 3 million more has been spent "retrofitting" the building - bringing it up to standard.

That would be fine and well if it were a private company - but the fact is - such a construction disaster would never happen with a private enterprise - because the owners - would have been there to make sure their money wasn't wasted on an inadequate structure.

And that's the same role that the Social Security Board of Directors should have played in making sure that they got value for workers' money. But something went wrong - and in an investigation spanning weeks - Jules Vasquez found out that Social Security got what they paid for: a low budget building with corners cut in critical areas. Here's part two of our investigation.

Based on this request - Social Security - to its credit - flung open the doors of the David L McKoy Building and had our team do a complete, all-access walk through.

Engineer Dr Dwayne Thurton is the project manager spearheading the retrofitting - both in design and concept. While he declined an on camera interview - he answered all our questions in person. He's the one leading what looked to us like a salvage job - and it is VERY involved.

Lawrence Ellis, Director - SSB Board
"Vertically, the building was good, but after we did the studies we understand that if we had an earthquake or if we had a hurricane we could not, I could not 100% and the committee and the board could not 100% say the building was 100% safe."

And to make it safe, this is the breakdown from New Buildings - the company that built the original structure and was then contracted to retrofit it. It calls for extensive structural and retrofitting works - and adds up to almost a million dollars.

First the beams had to be fireproofed, by spraying them with a coating - so that meant opening up the ceiling….

And then spraying each of the beams with the coating and then these fire hydrants had to be installed, On every floor

And then of course, this stabilizing structure had to be joined on to the existing steel frame.

And these counterpart cross members installed don every floor.

It's a lot and probably unprecedented retrofitting work for a structure of this size.

Jules Vasquez
"Where was the due diligence and oversight when this is being built, I mean how approves this sort of thing?"

Lawrence Ellis, Director - SSB Board
"Well, I don't want to cast any aspersions as to where it went wrong so we at the building committee, we officially decided and we have forwarded to the board that we will, we are requesting a complete review of the building."

Jules Vasquez
"Are you able to trace it in your abacuses of events are you able to trace all the problems to the seed of single event or a single a poor decision made at any level at the corporate level at the design level, at any level?"

Deborah Ruiz, CEO - Social Security Board
"At this time, I would not be able to point a finger, I think it's a systemic issue In terms of the whole methodology, so we would have to analyze fully all that went wrong."

Jules Vasquez
"But social security builds buildings, you all have buildings all over this country, how could you all have gotten it so wrong?"

Deborah Ruiz, CEO - Social Security Board
"I don't think we got it wrong Jules, in terms of the..we have a nice building at the end of the day."

Jules Vasquez
"It looks nice from the outside, but inside it's a nightmare, CEO!"

Deborah Ruiz, CEO - Social Security Board
"No, it's not a nightmare, Jules."

Not a nightmare, maybe, but certainly a Frankenstein structure.

And, the first thing you might want to say is who built this thing!? It must be the contractor's fault!

That's Fabros Construction - a company that did not have a history of building structures of this scale, but blaming that enterprise is not so easy.

The fact is the then Social Security Board of Directors accepted the lowest bid, which was Fabros for just over 6 million dollars. Other, well known contractors were quoting 9 million and above.

Juliet Thimbriel who sat on the board and later chaired the Building Committee told us she flatly opposed Fabros selection and voted against it twice at the board level. Why? Because of his inexperience building such structures.

But Chairman of the Board, Doug Singh had all confidence in Fabros. Singh is credited as the driving force behind the project.

He told us he supported Fabros low bid because he felt the office building could be constructed affordably - and still feels that the structure as Fabros built it is satisfactory. He feels that all the retrofitting is unnecessary and a profiteering scheme.

It also became clear in our investigation that Singh introduced Fabro to the supplier for the Chinese made glass windows - the same kind used at Singh's resort, Blue Zen - where Daniel Fabro had been a consultant.

In a September 2021 letter to the SSB Board, Fabro writes, quote,
"it was agreed and understood that Fabro's Limited was to build a quality building on as cost effective a budget as possible."

He adds,
"SSB knew that some items purchased from China would not have test certificates and other similar documentation available…but that we were to ensure that all items purchased were of the best available quality."

Most alarmingly, he also notes, quote,
"Fabro's Limited executed and completed this entire constructions project without receiving a Central Building Authority approved set of plans"

Fabro told us they wanted a champagne building on a beer budget.

And that seems to be the consensus the building was built cheap, about $130 dollars a square foot - by a contractor without the requisite experience. He says he took a huge loss - and at that price per square foot, we would want to believe him.

Jules Vasquez
"It was a misconceived decision, what you pay for is what you get."

Lawrence Ellis, Director - SSB Board
"I could agree on that, there were some, I don't know if you call it ill advised decisions, but, it didn't turn out the way they planned it."

Jules Vasquez
"Where was the due diligence and oversight when this is being built, I mean how approves this sort of thing."

Lawrence Ellis, Director - SSB Board
"Well, I don't want to cast any aspersions as to where it went wrong so we at the building committee, we officially decided and we have forwarded to the board that we will, we are requesting a complete review of the building."

Fabro says he was not a consultant on Singh's Blue Zen but, quote, "merely briefly assisted with the project management while Doug Singh was out…."

We must stress that the project was spearheaded under the former board of directors appointed under the UDP, and the retrofitting started when the new board came in with the new government.

So, now you've seen most of the building's problems - tomorrow we'll tell you what's being done to fix it and to ensure that fund contributors get value for their money.

Channel 7

Digging Deeper At David McKoy

For the past two nights - we've taken you inside the David L McKoy building - showing you why it's costing 3 million dollars more - of workers' money to retrofit a structure that was declared open in June of 2021.

But, is all that money spent - which will total at 11.1 million dollars really worth it? That is, will contributors take a loss? In part 3, Jules Vasquez gets to the meat of the matter:

Lateral stability - that's what these cross braces are supposed to provide to the David L McKoy building. They were installed along the length and across the width of the building to brace it laterally. And then this brace frame is built on the back - the structure - the engineers say will, quote, "transfer all lateral loads here in the event of a category 3 hurricane or earthquake."

It's a freakish structure - jammed unto the back of the building like a bulging spine - but it is being maximized to create more office space for the tenants who've already rented space in the building.

Roberto Allen - the engineer who was the Contract Administrator for the Social Security Board scoffed at the structure and all the retrofitting - he told us on the phone that it's overkill. He says the size of the steel structure alone gives it stability.

It was his duty to report on the works to the former SSB Building Committee - but the relationship between him and Fabros Construction was contentious. These emails obtained by 7News show some of his reservations.

Much of the discord was over what are known as variation orders - basically requests for more money to complete the project. At least four of them came - like this one for three quarters million dollars - and board member Juliet Thimbriel says she cursed at each one. She felt that the contractor had underbid - and was then adding charges retroactively.

This internal SSB email also expresses concerns about another further payment, saying for this variation requesting 181 thousand dollars more that too much money had been paid out to Fabro. The author notes that materials were not on site or in transit.

This document shows the original contract price and the cost of variation #3 - almost a million dollars. It shows a contractor either in over his head - or who could not deliver the building for the price he bid at. For his part Fabro said that the design was flawed and the modifications he had to make were to correct it during construction.

He later wrote to the SSB, "there is no denying that the improvements are excellent and should have been included in the building plans from the very start." Fabro also says that Allen failed to report to the board many difficulties he encountered with the design. When it was installed, the new board terminated Allen:

Lawrence Ellis, Director - SSB Board
"When we came on board and our initial meeting, we met with the project administrator and the contractor to familiarize ourselves and after a couple of meetings we realized that we are not on the same page. And the fact that the building was still not finished because it was supposed to have been finished already and when we're trying to get answers as to why it was not finished yet, we found that there were many delays and many things that were not up to standard."

Not up to standard - but they may have had a different standard in mind - because the design specifications did not include fireproofing or fire hydrants, for example. And the design also did not say that it had to be resistant to a category 3 storm and an earthquake - the type which has never hit Belmopan.

Reporter
"Are you all in effect trying to improvise and rigamajig the structure?"

Lawrence Ellis, Director - SSB Board
"No, it's not rigamajig, it's works that should've been done initially. It's just being done now. The building is safe, it's going to be safe and we are not throwing good after bad, this building will be profitable, this building is going to be a shining benefit for the contributors of this social security fund."

All that will cost Social Security just under 3 million dollars more of workers' money. Which does not include the repairs that Fabros Construction has to do as part of the Defects Liability period - such as sealing this roof - and fixing cracks in the cement:

Deborah Ruiz, CEO - Social Security Board
"We have because of the heat; a couple windows have shattered and things like that. The contractor has been making those repairs."

Still, despite all this, Ruiz says she is confident that the workers will get a fair return on their investment:

Deborah Ruiz, CEO - Social Security Board
"We would have realized our full in 7 years so it's just pushed back 10 years in the long term a building of this magnitude will last another 50 to 60 years of rental income."

Reporter
"Are you all throwing good after bad?"

Lawrence Ellis, Director - SSB Board
"No, definitely not, you only throw good money after bad when there will never be a good outcome. This building will have a good outcome, this building will have a profitable return for the long-term branch, this building will be beneficial for the people that pay into the fund."

And in the conclusion tomorrow night, Jules Vasquez presents the conclusions, the bottom line of all that went wrong at David L McKoy - plus, he'll ask those tough questions you've been waiting for.

Channel 7

David L McKoy - In The Final Analysis

For the past three nights, we've told you all about the multi million dollar problems at the David L McKoy building in Belmopan. In closing tonight, we have something like a "brata" - as Jules Vasquez shares his personal conclusions after investigating the tour bled structure for 6 weeks and hearing all sides of the story. Here's what he found:

After a month spent talking to more than a dozen persons involved with the project, I'm no expert, but based on those many conversations, I concluded that a number of factors influenced a very flawed project with huge cost overruns:

First off, the East west orientation and the concept for - what is basically a glass building. Social Security owns 12 acres of land on this green - but instead of positioning it north south - they positioned it east west. The contractor said that's the design he got, the architect said they gave him the concept.

And they did that by installing glass panels that could not keep out the heat. That's the fundamental failure, the building is too hot to be used as an office. And it is left to be seen whether these drywall curtains - overlaid on the windows to keep out the heat - will make a difference.

Former chairman and the driving force behind the project, Doug Singh says "The people who made the decision to spend the extra money - that's not the decision I would have made - the glass would have gotten changed." The new engineers say that would have cost well over a million dollars.

They also didn't consider changing the air conditioning units. It's a different kind of system - what's called cartridges are on every floor - and they are individually controlled - it's not central air.

So that they didn't change, but perhaps the biggest change was the structural issues to make the building category 3 hurricane and earthquake resistant. Is it justified?

The contractor Daniel Fabro said, "I think it's structurally sound at 4 floors."

The architect, Luis Ruiz, said "They don't need to do anything to the structure."

But, when the building was contracted - Social Security never asked for those features. The fact is - the old Social Security Board of Directors wanted a building on the cheap, in the words of Chair Doug Singh, "the investment had to make sense."

The CEO says even with the significant overruns it still does:

Deborah Ruiz, CEO - Social Security Board
"Even though we have invested so much money, If we had the money at the bank or if we had it in treasury notes or whatever those percentages are still low, marginal 2.75, 3%, 4%, so you're looking at the end of the day, based on the numbers we are getting a return of 5.6% return on our investment in this building, so that is higher than if we had the money sitting in a cd at the bank or whatever."

One of the significant issues was the constant bickering between the contractor, the project supervisor and the Building Committee.

Many we spoke to feel that the designers Luis Ruiz and his engineer should have been advising on the construction - and that would have cleared up many uncertainties about the structure and other specifications:

Jules Vasquez
"Did the board, or whoever was overseeing, make a fatal error when they did not make sure that the designer was intimately involved with the buildout of the project?"

Deborah Ruiz, CEO - Social Security Board
"I think that is one consideration in terms of continuity but as I said we have to look at all the different missteps along the way."

Ruiz is in a delicate position here because her husband Luis Ruiz was the architect. Doug Singh's board awarded him the contract to design the building - at a time when Colin Young was the CEO.

Still, the name association persists:

Jules Vasquez
"CEO, inevitably you will come under scrutiny because your husband is the architect, he has been the architect for a number of Social Security buildings, I know this as well. But I can say off the cuff wrongly aspersions will be cast, well, ofcourse da her husband da di architect. So I am dutybound to ask you how do you negotiate that situation that a structure that is a problem both at the design and build level your husband was an instrumental part of it as the architect? What's your response?"

Deborah Ruiz, CEO - Social Security Board
"My husband is the architect on record, he was not involved in the construction of the project and yes he was involved there and whatever decision the board makes, that is acceptable. I had no stay on the onset pf the project as you know I was only recently appointed as the CEO. This building was designed over 8 years ago. So those factors, Jules, they are what they are."

And as they are the bottom line is - the old board paid the price for a cheap building - and the new board wanted one that met all the highest safety standards - two conflicting visions, one Frankenstein structure:

Jules Vasquez
"Would something like ever happen in any private sector enterprise you were involved in?"

Lawrence Ellis, Director - SSB Board
"No it wouldn't. No, it wouldn't."

Jules Vasquez
"Reason being?"

Lawrence Ellis, Director - SSB Board
"Reason being that I am aware of what should be and what shouldn't be and we use profession; people form the beginning to get things done the right way."

Jules Vasquez
"If it were their money, they would have been there every waking day to make sure they got value for money and a functional structure."

Deborah Ruiz, CEO - Social Security Board
"Jules, I think we have a functional structure in play. In terms of the oversight that was done, we have in place a building committee, we have in place our project supervisor, whatever flaws that is found, we will make a determination at the end of the day."

Jules Vasquez
"We are spending 3 million dollars more of people's money to do a retrofitting which is almost unprecedented in Belize. The scale of the structural retrofitting that has to be done. Is the Social Security Board seized of the seriousness of that?"

Deborah Ruiz, CEO - Social Security Board
"The Board is aware of the seriousness of it. as i said that is the reason why as soon as the project is complete, the board will be undertaking a full review and audit of the process."

And while we've shown you all the changes - the real bottom line is: no one knows if it will work - that means, will the drywall curtain inside the windows actually keep the heat out of the offices? No one really knows. But what we do know is that because of the heat radiating in, electricity bills in the building have been excessively high since the compressors are working all day to cool it. Again, hopefully that changes with the drywall curtains, but, again, no one knows for sure since the building is currently under construction, or, as the case may be, re-construction.

And, a small correction. Colin Young was not the CEO of the SSB when the contract was awarded to architect Luis Ruiz to design it 8 years ago. He was the CEO when the contract went out to bids and was approved by the SSB board of directors.

And, a final note, this was the first in our investigative series, but we'll be following up with more in the coming months, so stay tuned for that.

Channel 7

PM Blames DLM Disaster on UDP

Back in August, we brought you an investigative report on the David L Mckoy building in Belmopan, which currently houses the Social Security Board. Since it was opened a year ago, it has been budgeted for 3 million dollars worth of retrofitting and repairs - and all that money coming out of the workers' purse.

7News did a four part investigative series trying to determine what went wrong and who is to blame for this massive multi million dollar gaffe. We found that the price point of the contract, the design and orientation of the building, and the type of glass windows used were all critical factors.

On Saturday, we asked the prime minister whether someone would be held culpable - here's what he said:

Hon. John Briceno, Prime Minister
"Maybe you should ask the UDP because they are the ones that created that problem. Certainly we would have to take a look at it and that's something for the Social Security Board to look at, not the government, remember that they have some form or sort of independence and I'm sure that if they find that there was negligence on the part of anybody, being it the previous board, the previous chairman, or anybody, and there is the evidence for negligence, I do believe that they should be held responsible."

Channel 7