Essential Points: The cases that led the PJ to Lisbon City Council

By TPN/Lusa, in News, Crime, Lisbon · 22-04-2021 16:22:00 · 0 Comments

The PJ carried out searches on Tuesday, 20 April, at Lisbon City Council (CML) related to the area of urbanism, for suspected crimes committed in the exercise of public functions, including abuse of power, economic participation in business and corruption.

In a statement, the PJ said Operation Olissipus was carried out as part of eight investigations led by the Lisbon Regional Department of Investigation and Prosecution (DIAP), and "28 search warrants were executed, 10 house searches and 18 non-house searches, aimed at collecting documentation related to suspected criminal practices under investigation".

The searches at Lisbon City Hall were carried out at the Campo Grande and Paços do Concelho offices and "resulted from several complaints, including reports to the Public Prosecutor's Office", relating to urban planning processes, the city council announced.

Among the processes in question are three that had already been announced in 2017 as being the subject of investigation, such as the construction work cancelled by the municipality on the Segunda Circular, the Torre de Picoas and the Hospital da Luz.

According to the council, the urban planning processes of the Entrecampos Integrated Operation, the Petrogal land, the Matinha Detailed Plan, a building in Praça das Flores, the Continente building, the 'Twin Towers', the Beato Convent, the redevelopment of the Penha de França swimming pool and the works at the São Pedro de Alcântara viewpoint are still under investigation.

The Mayor of Lisbon, Fernando Medina, confirmed that one of those targeted in the investigation is former town planning councillor Manuel Salgado.

Salgado was a councillor between 2007, with António Costa as mayor of Lisbon, and 2019, already with Fernando Medina, having been replaced by Ricardo Veludo.

Despite having ceased to be a councillor, he remained at the head of the municipal company Sociedade de Reabilitação Urbana (SRU), which he left in February 2021, after being made a defendant in a case involving the CUF Tejo Hospital, approved when he was responsible for Urbanism.

The 12 urbanism cases that led the PJ to Lisbon City Council are:

Hospital da Luz Expansion

In 2016, the Lisbon City Council authorised an architectural project regarding the expansion of Hospital da Luz, as well as the new construction in the neighbouring premises, which belonged to the Regiment of Sappers Firefighters (RSB) and were demolished only about 10 years after their construction.

In order for this project to happen, CML had to change the Detailed Plan of the area and demolish the Lisbon Sappers Fire Brigade barracks located on land adjacent to the hospital.

The barracks were sold at public auction in December 2015 for more than €15 million to Espírito Santo - Unidades de Saúde (ESUS), a company of the Espírito Santo Group that then owned Hospital da Luz, the only interested party to submit a bid.

A month before this purchase and even before the detailed plan was changed, the executive president of Luz Saúde, which in the meantime succeeded ESUS, announced that Hospital da Luz would double in size by 2018 in an investment of around 100 million Euros, which represented the creation of 1,000 to 1,200 new jobs.

Isabel Vaz announced that the licensing and architectural projects for the expansion of the Hospital would be presented to the Lisbon City Council by the end of 2015 and that the new facilities would start to open, in a phased manner, from 2018.

Entrecampos Integrated Operation

After two attempts to sell the land of the former Feira Popular in Entrecampos by public auction, but without success, in 2018 the Lisbon City Council divided the land into three plots as it considered that this would make it easier to find a buyer.

According to the project, called Operação Integrada de Entrecampos, two of the plots would be occupied by offices and a smaller one by housing.

However, the Public Ministry raised a number of questions regarding this project, which caused the municipality to postpone the receipt of proposals.

In December 2018, at the fourth attempt of sale by the municipality, Fidelidade Property bought all the land that comprised the public auction of the former Feira Popular and also a plot on Avenida Álvaro Pais, for a total of around 274 million Euros.

The local authority expected to raise 188.4 million Euros with this public auction, but raised 85.5 million Euros more than expected.

The Entrecampos Integrated Operation, which covers around 25 hectares, provides for the construction of 700 affordable housing units in that part of the capital (515 built by the municipality) and a public car park on Avenida 5 de Outubro. The operation is budgeted at 800 million Euros, of which 100 million will be the municipality's responsibility.

A further 279 homes are planned for the site of the former Feira Popular, which will be put up for free sale, and offices, which the local authority expects will lead to the creation of 15,000 new jobs.

Torre Picoas

On 14 January 2015, CML approved the construction of a 17-storey office tower on Avenida Fontes Pereira de Melo, on a plot owned by a Grupo Espírito Santo company, justified by the aim of bringing companies to the centre of Lisbon.

The proposal, signed by the Councillor for Urbanism, Manuel Salgado, specified that it would be a tower with a façade and building height of 67.65 metres and a park with six underground parking floors, with capacity for 194 private parking spaces and 49 for public use, in a project intervention area of 2,141.54 square metres, covering four urban buildings in Avenida Fontes Pereira de Melo and Avenida 5 de Outubro.

The proposal was opposed by the PCP, due to the planned construction volumetry in height, and abstained by the PSD and CDS-PP, who also raised doubts regarding the concession of construction credits that allowed the building to reach 23,000 square metres, benefiting the builder.

Since the approval of the intervention, this was questioned in the Municipal Assembly, where the opposition viewed with strangeness that the building was gaining more floors and construction area, and in July 2015 the Left Bloc recalled the plot's history.

According to then municipal deputy Ricardo Robles, the previous owner of the plot had "for decades" requested an increase in buildable area from the council, having been told by the urban planning department that the limit was 14,000 square metres. However, the new owner, a company "partly owned by Banco Espírito Santo", was allowed to build up to 23,000 square metres through the purchase of building credits.

In response, the town planning councillor, Manuel Salgado, indicated that there had been a change in the PDM in force, approved in 2012.

Plots of land of the former Petrogal

Lisbon City Council gave its conditional approval in April 2015 to a prior information request (PIP) for the construction of 11 buildings on the former Petrogal land next to the Gare do Oriente, in Parque das Nações, in an area where those holding the construction rights were Gesfimo, of the Espírito Santo group, at a time when it was already insolvent.

The proposal was approved by the PS with the votes against from the opposition - PSD, PCP and CDS-PP.

The proposal, signed by councillor Manuel Salgado, stated that the issue was a development with 11 lots, for the use of services, equipment and housing, next to Avenida Infante D. Henrique, in Parque das Nações, in a subdivision operation covering an area of 71,193.60 square metres, of which 3,401.80 square metres belonged to the municipality and the rest to private entities.

The opposition criticised the approval of the PIP, given the insolvency of Gesfimo, the fact that the proposal allowed the promoter to increase the construction index, calling the PDM into question, and the transfer of construction credits by the municipality.

Manuel Salgado justified the increase of the area with the change to the PDM verified in 2012.

This was not, however, the first controversy around the lands of the former refinery.

In 2007, the then councillor for the BE, José Sá Fernandes, demanded the annulment of the allotment of the land, approved by the Lisbon City Council in November 2006 following a request for prior information on allotment by Gesfimo, and filed a complaint with the Department of Investigation and Penal Action for considering that the initiative would harm the State and the municipality.

The land was sold to the private sector in 2005, when it was classified as industrial, for 25 million, and if it was allotted, the state could then have to pay 100 million in compensation to the developer to expropriate the area, located in an area reserved for the then planned high-speed rail corridor (TGV).

Detailed Plan of Matinha

The Detailed Plan of Matinha was delivered by Gesfimo to the Risco studio, of the architect Manuel Salgado, in 2004, when he was not yet a councillor, for the reconversion of an old industrial area in Matinha, in the parish of Marvila.

The project for the zone, which is still being transformed today, foresaw the reconversion of the old factory premises mainly for housing, with tower blocks that, in some cases, exceeded the urbanistic parameters, with buildings reaching 50 metres in height.

The initial Plan changed the uses foreseen in the PDM for the area and also changed the parameters for public parking, reducing them for housing and increasing them for commerce and the tertiary sector.

When Salgado became a councillor, the project continued to be developed by the atelier, now under the responsibility of his son, Tomás Salgado, and the councillor put the project for Matinha on a list of interests on which he would not make decisions.

In 2010, the City Council, then led by António Costa, postponed the vote on the Detailed Plan of Matinha, so that the Commission for Coordination and Regional Development of Lisbon and Tagus Valley (CCDR-LVT) could assess legal doubts expressed by councillors from the PSD, CDS-PP and PCP on the obligation of the preparation of an urbanism plan in that project and disagreements with the Municipal Master Plan (PDM), such as the volumetry or the height.

The final version of the Plan was eventually approved by CML in February 2011, but at that time the PSD councillor referred to the advisory board of the Attorney General's Office the doubts it had about the regularity of the plan's preparation process.

Already in 2015, an investigation by the newspaper Público revealed that a real estate project for the Matinha area, which had been under assessment at CML since 2013, had received unfavourable opinions from the Lisbon Port Authority and CCDR-LVT due to contamination of the soils where it was intended to be built.

According to Público, the real estate request was from the Fimes Oriente fund, of the Espírito Santo universe, for a subdivision of 771 flats, in buildings reaching 21 floors, to be built on the land of the former Matinha gas factory. This urbanization would be the first of a total of four to be executed in the area of the detailed plan of Matinha, developed by Gesfimo and atelier Risco.

Twin Towers' commercial space

In October 2019, the residents of the Twin Towers, two towers with 26 floors in Sete Rios, advanced a criminal complaint for suspected irregularities in the licensing of the installation of a business centre in the condominium, which eventually led to the opening of an enquiry.

The residents argue that they gave a space of three thousand square metres to the investment holding The Edge Group because it had presented them, in 2014, a project for a shopping centre, but only in 2018 did they learn that the space would be occupied mostly by offices.

In relation to the residents' complaint, The Edge Group said it contested the action and sought compensation against the plaintiffs.

Contacted at the time by Lusa, the Lisbon City Council revealed that a Prior Information Request for the expansion and refurbishment of the Twin Towers shopping centre entered the municipality in 2014, which was approved by a majority in the same year.

In 2015, a Sete Campos real estate company's project was submitted to the council, and the project was also approved that same year.

Meanwhile, in 2018, "an alteration process was entered in the course of the work (prior communication), having had an admission order," the council said, adding that it "went to the site to verify compliance with the project, which was verified.

In an interview with Lusa, in 2013, the then executive director of The Edge Group, José Luís Pinto Basto, explained that the objective of the rehabilitation of the Twin Towers commercial space, acquired by the ‘holding’, was to accommodate local commerce and be "an alternative to large shopping centres".

The new concept would occupy around 8,000 of the then 15,000 square metres of the Twin Towers shopping centre, and the remaining space would be transformed into an office centre linked to entrepreneurship and small businesses, a restaurant area and a gym.

At the time it said that the project was in the permitting stage in 2013, that construction was expected to begin in the second half of 2014, scheduled to last nine to 12 months, and that it expected the development to open in the second half of 2015.

Praça das Flores building

In 2016, councilman Manuel Salgado approved the demolition of a historic building in Praça das Flores that would be replaced by a more modern one, with five glazed floors, based on a reinforced concrete and iron structure, designed by architect Souto de Moura.

The new structure was contested by the residents, who feared that it would alter the character of the place, and also had a negative opinion from the city's technical services.

A restraining order against the demolition of the building and the construction of the new one was brought by the association Fórum do Património, having been initially rejected by the Central Administrative Court (TCA) of Lisbon.

The residents filed a new action in the South Administrative Court, but as this one had no suspensive effects, the old building was demolished by the developer.

In June 2018, the Southern Administrative Court ruled for the suspension of the work permit, considering that the municipal licensing had not respected several provisions of the Lisbon PDM concerning the defence of properties and building complexes covered by the Municipal Heritage Charter.

It also decided that the demolition of the old building was not a reason for the construction of a new building, since that was what the residents intended to prevent with their action.

The municipality and the developer appealed and a decision in January 2019 dismissed this appeal, upholding the decision to prevent the construction of the building intended by CML on the site.

Continente Building

The City Council approved on 15 April of this year the construction of a Continente mega hypermarket in the Garagem Liz building, classified as property of public interest, on Rua da Palma, next to Avenida Almirante Reis, in downtown Lisbon.

The project for the 2,500 square metre property was approved with votes in favour from PS, PSD and CDS-PP and votes against from PCP and BE.

In a statement, the BE, whose party headquarters are next door to the property, accused the developers of having started work on the site on 12 April, before the project had been approved by the CML and the permit had been obtained, so it will "formally question Fernando Medina about the legality of this start of works".

Sonae, owner of Modelo Continente Hipermercados, is already one of the tenants of the building, dating from 1933, representative of Art Nouveau architecture in Lisbon and privately owned.

According to the proposal, to which Lusa had access, "this urban operation aims to change the use of the old 'Liz Garage' for a new commercial establishment (supermarket), proposing the replacement of exterior frames, keeping the design of the original elevation, the demolition of the existing interior compartmentalisation (so that the supermarket is installed on the ground floor and the support car park on the upper floor), with the reconstruction of the roof (removing the harmful materials placed there and opting for current solutions)".

The document highlights that the transformation of the building had three conditional favourable opinions from the General Directorate of Cultural Heritage (in September 2019 and in August 2020), three opinions - two unfavourable (in 2020) and one favourable (already in March 2021) - from the Department of Mobility Management and the favourable opinion of the Santa Maria Maior Council (PS).

Convent of Beato

Lisbon City Council gave up the right of first refusal in the acquisition of the urbanisation where the Convento do Beato is located, a property classified as heritage of public interest, which was sold in 2018 by the Cerealis Group to the Swiss group Larfa Properties for €21 million.

The new owner built a residential condominium on the site, whose project was given to the atelier coordinated by Tomás Salgado, son of the then councillor for Urbanism Manuel Salgado.

The lack of interest from the council was highly contested by the opposition and the CDS-PP even tabled a proposal to change the rules of the council's right of first refusal so that the councillor has to issue a decision whenever, above a certain value, the council chooses not to exercise the right of first refusal.

Construction work on the Penha de França swimming pool

The Penha de França swimming pool, closed for about 10 years, will reopen in May, the deputy mayor of Lisbon, João Paulo Saraiva, announced this month, after controversies that included defects detected in the work, disagreements with the contractor, a fake engineer and several lawsuits.

Lisbon City Council, the parish council of Penha de França and the Association Centro Cultural e Desportivo Estrelas S. João de Brito signed a programme contract in 2014 for renovation works at the municipal swimming pool located in this Lisbon parish.

The pool has been closed since 2011 and the works, the responsibility of the club and delivered to the company Tanagra, should have finished at the end of 2016.

However, that same year, the council informed that the pool would not reopen on time and that the delay was due to "defects in the work" and a dispute with the contractor.

In February 2020, following information about a fake engineer in the company Tanagra, Fernando Medina considered that the club, promoter of the work, "is responsible for serious damage to the public interest, serious damage to the Lisbon City Council and the citizens".

Due to the problems detected and the impasse created, in June 2020 the Lisbon City Council approved the revocation of the contract-programme of sports development for the pool, alleging non-compliances by the club, owner of the work, taking administrative possession of the equipment.

However, in October of that year, the Court of Arbitration for Sport (TAD) decided to annul the municipality's decision, arguing that the right to a prior hearing was not ensured by the Lisbon municipality to the club, a decision confirmed after an appeal by the municipality.

The club claimed, in a communication sent to the Ombudsman, that, already after the TAD's ruling, the municipality signed "an illegal contract" to start the works to renovate the pool "when it could not do so, since the only one with the power to do so is the owner of the work", which was the club itself.

On 1 April of this year, the Lisbon City Council approved, by majority vote, the termination of the contract to upgrade the Penha de França pool with the club, considering that the Association Centro Cultural e Desportivo Estrelas São João de Brito had already "exercised the right of prior hearing", having protested on "10 February".

Despite the announced reopening of the pool for next month, the process may not stop here, since on Tuesday, 20 April, Fernando Medina revealed that the City Hall will still file a complaint about this case.

Segunda Circular construction work

In July 2016, Councillor Manuel Salgado announced in an interview with Lusa that the first of two phases of redevelopment works on the Segunda Circular would begin that week, but the tender for these works was eventually cancelled by the city council itself less than two months later.

According to the councillor, work was going to be carried out on a stretch of about three kilometres of the Segunda Circular, between Avenida de Berlim and the northern entrance to Lisbon, with a budget of 750 thousand Euros and a maximum period of 90 days.

This was followed by a second, larger contract, valued at 9.5 million Euros and with a deadline of eight months, with interventions from the Buraca to Aeroporto junction (around 10 kilometres).

This intervention foresaw the afforestation (with about 500 ash trees) and the widening of the central reservation area (which was highly contested during the public discussion phase), repaving, renewal of the signage, lighting and drainage, creation of a vehicle restraint system, introduction of safety guards and the creation of transition zones in the accesses.

However, in September, Lisbon City Hall announced that it had cancelled this tender and also suspended the contract that was already underway, opening an enquiry to investigate the existence of possible "conflicts of interest" on the part of a designer.

According to Fernando Medina, the jury of the tender detected "indications of conflicts of interest due to the fact that the author of the paving project is also a manufacturer and marketer of one of the components used" in the bituminous mixture.

Contract Works at the Miradouro de São Pedro de Alcântara

The contract to stabilise cracks in the platforms of the Miradouro de São Pedro de Alcântara was awarded by direct agreement in 2017 by Lisbon City Council to the construction company Teixeira Duarte for €5.5 million.

The work had an execution period of five months and the direct award was justified by the then councillor for Urbanism, Manuel Salgado, by the urgency due to the serious risk to the safety of people and property represented by cracks in the viewpoint, an area with more than 250 years of existence.

A report by the National Laboratory for Civil Engineering (LNEC) did not state any urgency in carrying out the work to stabilise the cracks, which, according to pieces published at the time by the Lusa news agency, had already been detected at least in 2006.

However, the mayor of the city, Fernando Medina, justified that other opinions requested from other entities signalled risks "in case of increased rainfall and in case of a seismic event".



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