Collective sale meeting: No-show by HPL's firms

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FIRMS owned by property tycoon Ong Beng Seng's Hotel Properties (HPL) recently sought to initiate the collective sale of Ming Arcade, near Orchard Road, but mysteriously failed to follow through.

The HPL-linked firms, the majority owners, called for a meeting with subsidiary owners to be held last Saturday but did not turn up - angering owners who had gathered in anticipation.

The move had sparked talk of a possible redevelopment of the 32-year-old building, next door to Orchard Parade Hotel - where the stillborn meeting was held.

Mr Ong is in the process of trying to privatise HPL, which owns Forum The Shopping Mall and nearby HPL House.

Documents obtained by The Straits Times showed that HPL's firms had sent a note dated April 23 to the management council of the 21 Cuscaden Road building, asking "to convene the extraordinary general meeting (EGM) as soon as practicable".

"We hereby requisition an EGM... to pass the following resolutions in connection with the proposed collective sale of all strata units and the common property of the Management Corporation Strata Title (835)," it said. A proposal to form a collective sale committee was also tabled on the agenda.

This is the third time owners of the rundown property - home to pubs, eateries and karaoke joints - have tried for an en bloc sale. It had an indicative price of $120 million, or $2,180 per sq ft (psf) per plot ratio (ppr), when it was put on the market in 2012. Its first en bloc attempt in July 2011 had an indicative price of more than $130 million, or around $2,360 psf ppr.

The HPL firms, McMing Investments and Travel Bug Touring, own four units at Ming Arcade and hold the majority of its share value at 51.6 per cent, so they are pivotal to obtaining the requisite 80 per cent consensus needed to put the strata-titled building up for collective sale.

Ming Arcade sits on 1,127 sq m of freehold land, with a gross floor area of 5,338 sq m. The seven-story building has three basement levels, and has 88 units with 1,000 share values.

EGM notices went to all owners including McMing Investments and Travel Bug Touring.

Owners of Ming Arcade said 185 share values, held by owners of 36 units, were represented at the meeting within an hour. But by 3 pm, nobody from HPL's companies had turned up and the meeting was short of the quorum of 30 per cent needed to proceed, under the Land Titles (Strata) (Amendment) Act.

The management council of Ming Arcade had also spent about $3,000 to organise the meeting, owners said.

One owner, who declined to be named, said: "They don't even have the courtesy to let the MCST know (they're not coming) so the council can cancel it and save half the money spent."

HPL had not commented on why it did not turn up for the EGM by press time.

Century21 chief executive Ku Swee Yong noted that the site accommodating HPL's properties can potentially become a large mixed development along the popular shopping belt.

"This front end of Orchard Road is starting to show its age. The vibrancy of Orchard Road is only apparent as we approach and go beyond the junction of Orchard and Scotts," he said.

ocheryl@sph.com.sg

Source: Straits Times, 30 May 2014