Horizon Towers sellers to discuss options on Wednesday
By Joyce Teo, Property Correspondent
HORIZON Towers flat sellers will meet next Wednesday in a push to raise millions of dollars to fight a lawsuit by Hotel Properties (HPL) and its partners over a botched collective sale. Another meeting is due to be held on Sept 7.
In a protracted saga, the HPL consortium has been trying to buy Horizon Towers for $500 million, a price inked in February.
But the collective sale hit a brick wall earlier this month when the Strata Titles Board (STB) threw out the estate’s sale application as the paperwork was not in order.
The sale lapsed as the would-be sellers had included an Aug 11 sale deadline in their contract. The HPL consortium then asked flat owners to extend the deadline so the application could be refiled or an appeal could be made for the sale to go through - but the sellers declined.
On Thursday, the buyers filed a High Court lawsuit over the failure of Horizon Towers’ owners to go through with the deal.
A flat owner keen on contesting the lawsuit said: ‘We are going to raise $3 million to $5 million to fight it.’ Each of the 177 units may have to pay about $30,000.
He said they will put this move to the vote at next week’s meeting. But some owners keen to sell the 99-year leasehold Leonie Hill estate are said to be very upset at how the deal has panned out, as they had wanted to extend the deadline so the sale could go through.
‘We never wanted to fight it,’ said one of them.
If the $500 million sale had gone ahead, owners of the 199 apartments would have reaped about $2.3 million each, while owners of the 11 penthouses would have received at least $4 million each.
If the HPL lawsuit succeeds, the majority owners could be forking out a lot more in damages.
HPL and its partners have estimated their lost profits at up to $1 billion. At that rate, owners of the 177 units who agreed to sell could end up paying more than $5 million per unit.
Now, they have two options, observers say. They can either give in and do whatever is necessary to complete the sale or contest it.
The former means the sale goes through at $500 million. They get their proceeds and will probably have to pay some damages.
If they fight, they could start third-party proceedings against other parties involved in the sale process to claim back the damages.
These parties could be the sales committee that represent the sellers, the property agent which marketed the estate and the sellers’ lawyer which usually prepares the sale documents for the STB application.
Source : Straits Times - 25 Aug 2007
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