The owners of the Gafoors Houston Complex only recently secured insurance coverage for the US$2M stocks that went up in flames on Monday and an investigator from the US has been hired to determine what transpired.
Bond six, which had been rebuilt, was destroyed on Monday and it was a major blow for the company, according to Executive Chairman Sattaur Gafoor, coming just months after a large fire on May 9 in the same area.
He told reporters on Thursday at the New Thriving Restaurant on Main Street that the same day the fire erupted they had opened the bond after packing it with US$2M in stock, which was mainly for the Christmas season.
Gafoor said that the second fire was “not normal” and that in the event of a third fire, the directors have made certain decisions, which he could not disclose.
He pointed out that it was difficult to operate in a situation where they were not certain what happened. As a result, they have employed the services of a private investigator from the United States. He is confident that at the end of the investigation, there would be nothing to prove that the company was at fault.
“We have too much to lose, too much at stake, we had lost profits during this period of time when we were out of compliance. We have no stocks of goods right now for the Christmas period…,” he told the media.
The sad part, he said, is that they waited for four months for the 52 containers of goods, which had arrived in the country on October 4.
They have so far been paid by the underwriters through a number of insurers for the stocks from May’s fire but not for the buildings, which were valued at US$12M or for the clearing of the debris and other coverage.
Gafoor contended that in the second fire, there were no combustible materials despite a statement by Fire Chief Marlon Gentle and a photo in this newspaper which showed aerosol cans amid the rubble.
Gafoor pointed out that the bond contained items including tiles, flex hoses, toilet sets, electrical fittings, generators and granites. He explained that the cans were from paint that was kept there to paint the bond and foam to seal off creases.
He added that in the previous fire, there was no electricity within the bond where the fire started but combustible items were indeed stored.
He pointed out that May was the first time the company experienced a fire since it was started 64 years ago. That fire quickly spread through six bonds, the administrative building, conference room and storage room, where records were kept.
Among the items lost were personal possessions and historical records that can never be replaced. One of the burnt buildings still stands to facilitate the investigation.
The effects of that fire, he said, was that the next day, their competitors increased their prices and they had to bring stocks from other locations to Houston, resulting in the other outlets having less to sell.
They also had to buy stocks locally at a higher price than what were sold to the “general public because they knew that we needed the items. But we had to buy because we needed to service our customers.”
Some staff members who had to remain at home were paid seventy-five per cent of their salary. The devastation from the first fire also resulted in the company having to acquire new furniture, air-conditioning units, computers and they had to rent portable washrooms while directors and senior staff had to work under severe stress with no privacy.
After several meetings with the insurance companies and the fire department, they were able to rebuild. Suppliers also had to be flown in to discuss premium prices for the earliest deliveries.
They also “faced considerable pressures from creditors from fear of them not being paid.” Moreover, they had to ensure that precautions were taken to avoid a second fire and are extremely grateful for the advice and support “from the fire department, particularly Mr. Sparman and Mr. Mc Gregor.”
The company also had to fly in an expert from the fire department in the United Kingdom to identify the best practical solutions.
Recommendation were issued to install not less than 25% corrugated PVC pipes for roofing and wind turbines, which had to be imported as well as air ventilation to prevent heat in the bond.
Gafoor said the newspapers questioned the absence of sprinkler systems following the second fire but it would have been difficult to source water for that. He said he also learnt that the systems can erode after a time.
The most practical alternative was found to be a “ring system around the building,” which involved laying galvanized pipes and having a pressure pump with water stored so that in the event of the fire, they would immediately be able to access water…”
He said it took more than three months to find a suitable supplier for the pressure pumps before they ordered them.
He was pleased that based on the advice of the experts, the fire did not spread beyond one bond or there would been a recurrence of what took place on May 9.
Up to the time of Monday’s blaze, they had already completed the rebuilding of the retail section, the offices and six bonds.
He said given the financial strain and time it took to stock 205,000 square ft., it was not easy to stand and see 39,500 sq. ft. bond virtually destroyed less than 10 hours after it was stocked.
According to him, the company has 987 personnel on its payroll and last year it paid $794M to them, $42M to contractors, $396M in corporation taxes and $120M capital gains tax, $98M in property tax and $60M to the National Insurance Scheme.
He said too that apart from paying taxes and honouring employees, they have also made their contributions to society and try to be public-spirited citizens as much as possible.
According to him, it was difficult to give a report to the press following the Monday fire, in light of the adverse publicity.
Public relations and advertising executive Vic Insanally, who was also present during the meeting with the media, said he empathised with Gafoor, who had been trying for the last four months to get back on his feet only to have his stocks wiped out by fire on the day the bond was opened.
In light of questions about whether the fire was “arson or accident,” he said the Gafoor family wanted to share the pain they were going through with the press.
Insanally said he found that the press had been “very sympathetic” and that it had focused on things that needed explanation since “a couple of aerosol cans were seen.”
He said that “at the end of the day, the company would have to go back and begin to look at events that may have gone unnoticed on the day of the fire…” to see if there may be need for further probing.
Gafoor also mentioned the tremendous support he had from Bish Panday of P & P Insurance Brokers, who sat in at several meetings. According to Panday, they did not carry “loss of profit insurance,” for the company, which means that they would only be compensated for the stock and the building. Therefore, he said, he does not see why they would be “negligent.”