The majority owners of Horizon Towers - who face possible legal action over a botched en bloc sale of the development - have huddled together to decide if they should extend the deadline for the completion of the collective sale.
Stymied: Horizon Towers' buyers had threatened to sue every one of the sellers, when the en bloc sale collapsed on a technicality Their lawyers have also denied all allegations that the sellers have not kept up their end of the deal.
BT understands the sales committee of Horizon Towers met with some of the owners of 173 units - who had agreed to the en bloc sale - yesterday, and are meeting others today, to decide if they should accede to demands of the buyers to push back the completion date and file a fresh application for the sale.
It’s believed the sellers’ lawyers from Tan Rajah & Cheah communicated this to the buyers’ representatives from Allen & Gledhill (A&G) yesterday, to hold off any legal action earlier threatened by A&G, if the sellers did not respond to the buyers’ demands by 3pm yesterday.
Tan Rajah & Cheah have also denied allegations by A&G that the majority sellers have breached the collective sale agreement.
This latest development comes on the back of a fresh dramatic twist to the saga on Monday: Horizon Towers’ buyers - Hotel Properties Limited (HPL), Morgan Stanley Real Estate and Qatar Investment Authority - had threatened to sue every one of the sellers, when the en bloc sale collapsed on a technicality.
At a hearing before the Strata Titles Board (STB) last week, the STB had rejected the majority sellers’ application for a collective sale order on the grounds that certain statutory requirements had not been fulfilled. The buyers then sent a letter of demand to the majority sellers on Monday - asking that the sellers push back the collective sale completion deadline, currently on Aug 11, by four months and file a fresh application for a collective sale order.
Should they fail to do so, the sellers would be sued for between $800 million and $1 billion for a breach of the sales contract.
The majority sellers - which make up some 84 per cent of the owners of Horizon Towers - had agreed in February to sell their Leonie Hill development en bloc to HPL and company for $500 million.
They are now believed to be in the midst of discussing if they should accede to the buyers’ demands.
BT understands that, even if the sellers don’t push the sale deadline back by the full four months, they are considering extending the Aug 11 deadline by a shorter period of time - just to give themselves enough time to discuss the buyers’ demands.
The legal suit which the buyers have threatened to bring against the majority sellers would mean that the owners of the 173 units would be personally liable for $5.78 million per unit - a sum which is likely to wipe out any gains that can be hoped to be achieved from a fresh en bloc sale of Horizon Towers.
The $500 million price tag would have meant that the 199 apartment owners would have pocketed about $2.3 million each and the 11 penthouse owners at least $4 million each.
The neighbouring development, The Grangeford, had been pledged for sale in June for $625 million or about $1,820 psf ppr.
It’s been reported that the majority sellers of Horizon Towers had changed their minds, after signing off on the deal, after nearby developments such as The Grangeford started fetching much higher sales prices. The majority sellers are not allowed to renege on their deal with HPL. But the sale collapsed last week at the hearing before the STB, when minority sellers - who objected to the deal - raised arguments that the sale had failed to comply with legal requirements.
The minorities themselves are not being sued by the buyers, having not been a party to the sales contract.
These ongoing developments, however, are no doubt taking their toll on the minorities - whose fate of their homes will remain in limbo until all is settled.
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