Horizon Towers Sale Deadline Expires

Source : Sunday Times, 12 Aug 2007

Owners will not extend sale deadline but will appeal against STB’s dismissal of the sale

The legal battle over the Horizon Towers collective sale entered a new stage when majority owners decided not to extend the sale agreement that expired yesterday.

Instead, the sales committee will appeal against the Aug 3 decision of the Strata Titles Board (STB) dismissing the $500 million sale on technical grounds.

If the appeal succeeds, another sale application can be made to the STB, but not under the terms - and price - of the old agreement as that died yesterday.

Yesterday’s decision - after two days of intense legal meetings - could also fend off a threatened lawsuit from the intended owners, Hotel Properties Limited (HPL), Morgan Stanley Real Estate and Qatar Investment Authority.

Committee member Joyce Tan said last night: ‘We heard many views from home owners who are anxious over the prospect of litigation.

‘The feeling was that they did not do anything wrong, but they are faced with potential lawsuits with huge claims against them.’

The intended buyers have threatened to sue the majority owners for lost profits - estimated at between $800 million and $1 billion - from the project that would have been built on the Leonie Hill site.

They also wanted the sale deadline extended by four months and the STB decision appealed. Both moves could have cleared the way for the sale to go ahead - but at the original $500 million price many owners now feel is inadequate.

If the sales committee’s appeal succeeds, it will re-submit its sale application.
It is not clear why the committee decided against an extension, but it hopes that its appeal will show that it cannot be faulted for not getting the paperwork right.
But if it wins the appeal, Horizon Towers cannot be sold to the HPL group under the existing agreement as it lapsed yesterday.

Owners will be back to square one and have to negotiate a new deal, and presumably a higher price.

The Grangeford next door was sold en bloc earlier this month at double the asking price per square foot (psf) achieved by Horizon Towers in February.

Many owners realised earlier this year that they had sold at a bargain price and even those who signed the sales agreement ended up backing the minority owners in their bid to unwind the deal.

If the sale had gone through, the owners of the 199 flats would have pocketed $2.3 million while the 11 penthouse owners would have walked away with $4 million or more each.

LITIGATION WORRIES

‘We heard many views from home owners who are anxious over the prospect of litigation. The feeling was that they did not do anything wrong but they are faced with potential lawsuits with huge claims against them.’MS JOYCE TAN, Horizon Towers sales committee member