Ivory Properties still in talks with Plaza Rakyat developer on pact extension

Posted on 1 July 2014 - 05:39am

sunbiz@thesundaily.com

PETALING JAYA: Ivory Properties Group Bhd, which reportedly is to be replaced as the developer of the abandoned Plaza Rakyat project on Jalan Pudu, Kuala Lumpur, said that it is still in discussions with the receiver and manager of Plaza Rakyat Sdn Bhd (PRSB) to extend the conditions and precedent period of the acquisition and rehabilitation agreement signed in September 2013.

The group, which is developing the project through subsidiary Ivory Place Sdn Bhd, told Bursa Malaysia yesterday it is unaware of the intention and statements made by Kuala Lumpur mayor Datuk Seri Ahmad Phesal Talib regarding other parties being considered for the Plaza Rakyat project and the ongoing arbitration involving PRSB.

Last Friday, a news report quoted Phesal as saying that he is awaiting the completion of arbitration between Kuala Lumpur City hall and PRSB to appoint a new company to revive Plaza Rakyat.

Ivory Properties in September 2013 announced that it won the bid to redevelop the Plaza Rakyat commercial project, which was abandoned in the aftermath of the 1997/98 Asian financial crisis, with a revised gross development value of RM8 billion.

Ivory seeks amicable deal, wants recognition of interest in revival of Plaza Rakyat

BY DAVID TAN

“We would like to appeal to DBKL to give us a chance to present our blueprint to them. “The best solution is for all parties to sit down and reach a win-win solution for all the stakeholders, which include the purchasers who have already made downpayments,” group chief executive officer Datuk Low Eng Hock told StarBiz.
“We would like to appeal to DBKL to give us a chance to present our blueprint to them. “The best solution is for all parties to sit down and reach a win-win solution for all the stakeholders, which include the purchasers who have already made downpayments,” group chief executive officer Datuk Low Eng Hock told StarBiz.


GEORGE TOWN: Ivory Properties Group Bhd is seeking an amicable solution even though Kuala Lumpur City Hall (DBKL) has refused to recognise its interest in the revival of the abandoned Plaza Rakyat project in Jalan Pudu.

“We would like to appeal to DBKL to give us a chance to present our blueprint to them.

“The best solution is for all parties to sit down and reach a win-win solution for all the stakeholders, which include the purchasers who have already made downpayments,” group chief executive officer Datuk Low Eng Hock told StarBiz.

Low said he did not believe in bringing the controversy to court, as it was not the best solution even though AdamPrimus – the receiver and manager of Plaza Rakyat – had awarded Ivory the right to resuscitate the abandoned scheme.

“We will exhaust all channels to work out an amicable solution with DBKL to materialise the project as the plan to develop Plaza Rakyat, due to its strategic and prime location, would benefit the local community and the stakeholders concerned.”

Low said DBKL might be too concerned with the legal tussle between it and original developer Plaza Rakyat Sdn Bhd (PRSB), but Ivory believes it is a third party coming in as a white knight to solve the long-standing problem being faced by all.

“We believe we are the easiest party to close the deal since we have signed an acquisition and rehabilitation agreement with the lenders and PRSB,” he said.

According to legal opinions, even if PRSB did not get a favourable decision from the ongoing arbitration between the company and DBKL, the former still had the recourse to appeal, which would further delay the redevelopment of the Plaza Rakyat project.

The arbitration revolves around whether DBKL had the right to terminate the joint-venture agreement (JVA) and lease agreement with PRSB on the Plaza Rakyat project in 2010.

On June 27, Kuala Lumpur mayor Datuk Seri Ahmad Phesal Talib had revealed that DBKL did not recognise the appointment of Ivory to revive the project.

Ahmad Phesal had said that he was awaiting the completion of the arbitration between DBKL and PRSB to appoint the new company. He, however, had declined to name it.

“DBKL, together with the Federal Territories Ministry, has decided that some other company should take over the redevelopment of Plaza Rakyat and not Ivory. We were not involved in the appointment of Ivory for this project (initially),” he had said.

On the other hand, Ivory, which had won the rights to revive the project after a tender exercise conducted by PRSB in September last year, has not given up on undertaking the job.

Under the agreement, PRSB would transfer the existing sub-lease and all development rights under the JVA with DBKL to a subsidiary of Ivory.

Ivory wants to develop it into a mixed-development project comprising a shopping mall, serviced residences and hotels at a gross development value (GDV) of RM8bil.

“Plaza Rakyat will be enhanced with the introduction of new building components to maximise the potential of the land.

“On top of new serviced residence towers, the affordable component introduced will establish a community of young working adults, making it possible for them to afford a home located at the convenience of a city centre,” Low had said in an earlier report.

Ivory is currently working with PR1MA Corp Malaysia to come up with 1,000 affordable housing units for Plaza Rakyat, Low had said.

The group had put up a fair and attractive package for DBKL and PRSB, Low had added.

The story of Plaza Rakyat dates back to 1993 when PRSB, which was then controlled by Tan Sri Ting Pek Khiing’s Wembley Industries Holdings Bhd, had ambitious plans to develop it into a mixed-development project comprising a shopping mall, serviced apartments, a hotel and office towers.

The project was supposed to have a GDV of RM1.3bil.

However, the Asian financial crisis of 1997-1998 forced the developers to abandon the project, although the foundations and a six-storey basement car park were completed.

Subsequently, PRSB went into receivership and came under the administration of a consortium of lender banks.

Published: Thursday August 7, 2014 MYT 12:00:00 AM
Updated: Thursday August 7, 2014 MYT 8:10:10 AM

Ivory Properties walks away from plan to redevelop Plaza Rakyat

The RM1.4bil project was 30% completed about 15 years ago when the developer, PRSB, ran into financial difficulties.
The RM1.4bil project was 30% completed about 15 years ago when the developer, PRSB, ran into financial difficulties.

PETALING JAYA: Ivory Properties Group Bhd is walking away from a deal to redevelop the long-abandoned Plaza Rakyat in Kuala Lumpur after it failed to agree on the terms with the project’s receiver and manager.

It said in a filing with Bursa Malaysia that its unit, Ivory Place Sdn Bhd, and Plaza Rakyat Sdn Bhd (PRSB) could not come to an agreement following their discussion to extend the conditions precedent period of the acquisition and rehabilitation agreement (ARA).

“Accordingly, the ARA has been terminated, both Ivory Place Sdn Bhd and PRSB have acknowledged and will observe the terms and conditions therein to come to a satisfactory conclusion arising from the termination of the ARA,” the Penang-based property firm added.

Group chief executive officer Datuk Low Eng Hock told StarBiz early last month that Ivory was intent on seeking an amicable solution to the troubled Plaza Rakyat along Jalan Pudu even though Kuala Lumpur City Hall (DBKL) had other plans for the project.

Ivory had won the rights to revive the project after a tender exercise conducted by PRSB in September last year.

It had proposed a mixed-use development comprising a shopping mall, serviced residences and hotels with a gross development value of RM8bil.

But Kuala Lumpur mayor Datuk Seri Ahmad Phesal Talib said in June that DBKL did not recognise the appointment of Ivory as the new developer of Plaza Rakyat.

It was reported that DBKL was awaiting the completion of arbitration proceedings between it and PRSB and was set to reclaim possession of the site following the green light from the arbitrator.

The original plan for Plaza Rakyat had comprised a 79-storey office tower, 46-storey condominium, 24-storey hotel and seven-storey shopping centre.

The RM1.4bil project was 30% completed about 15 years ago when the developer, PRSB, ran into financial difficulties during the 1997/1998 Asian financial crisis that forced them to abandon the project.

The Government decided to terminate PRSB’s contract in 2010, 12 years after the company gave up on Plaza Rakyat.

Subsequently, PRSB went into receivership and came under the administration of a consortium of lender banks.

Ya feel relief knowing they quit, lousy revival proposal lol.
Moreover I dont think they are financially strong enough to be the knight trying to save our ugly sleeping princess !

Don't worry. DBKL has already identified a developer to revive the project. All we are waiting now is the forever arbitration proceedings to damn f**king come to an end!

Been to Penang Time Square twice. One word to describe...Emmmmmpty.
Yes the whole space and layout design is totally a failure. When u walk in the mall everything seems not right. Vary bad feeling.

Well let's wait and see.
DBKL is desperate to recover all his losses all these years. Sure will see big greed in the revival plan.

Payout in millions for stalled project is in the city’s interest, says mayor

BY BAVANI M

THE abandoned Plaza Rakyat project in Kuala Lumpur will finally be revived next month with a new developer named after the Kuala Lumpur City Hall (DBKL) takes vacant possession of the site.

This was following the arbitrator’s July 4 decision in favour of the local authority which stated that DBKL was lawfully entitled to terminate the joint-venture agreement with developer Plaza Rakyat Sdn Bhd (PRSB).

But this comes with a heavy price.

The same arbitrators had also ordered DBKL to pay PRSB’s bank loans based on an undertaking given by the former although it has no legal obligation to do so.

Now DBKL has to pay a whopping RM200mil of taxpayers’ money — RM100mil to PRSB for the structure and foundation of the 20-year abandoned project, and the balance for bank loans with interest that had snowballed since 1992.

The initial loan taken was a total of RM58mil. It is learnt that DBKL was in the midst of negotiating the amount to pay the financiers.


Rusty metal bars and concrete at the abandoned site.
Plaza Rakyat on the other hand must pay DBKL RM30mil for arrears of quit rent amounting to RM7,043, 500, arrears of lease rental amounting to RM2,525,000 and RM20, 045,000 in liquidated damages.

In order for DBKL to take vacant possession of the site, it has to register the award with the authorities.

The order has raised several immediate questions, chief of which is why did DBKL agree to pay the sum when it never took the money from the banks.

“This sets a dangerous precedent whereby public funds are being used to pay banks which loaned money to developers.

“The question is, despite not having any legal obligation to do so, why did DBKL agree to pay the sum,” asked an informed source.

Defending the move to pay up the charge, Kuala Lumpur mayor Datuk Seri Ahmad Phesal Talib said DBKL had to settle the charge over the sub-lease before they could cancel it.

“The decision for that loan to be settled with the bankers had been decided by the arbitrator earlier as a separate decision that needs to be obliged by DBKL.

“What’s important is Plaza Rakyat must be revived as it is not in the city’s interest to delay the project further. We are pushing to start as soon as possible. I want this solved during my tenure.

An LRT passes inside the half completed structure with exposed rebars and scaffolding and parts of a crane.
An LRT passes through the half- completed Plaza Rakyat structure.
“Once we register the award we can take vacant possession of the site. We are currently in negotiation with the banks on the amount to be paid,’’ said Ahmad Phesal, adding that DBKL would be able to reclaim the site next month once the award is registered.

Ahmad Phesal said DBKL was discussing with a new company to develop the site at a reasonable offer.

He added that it would be a mixed development and that DBKL was looking at the layout, and the intensity and density of the project.

StarMetro had earlier quoted Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor saying that several parties had shown interest in developing Plaza Rakyat, but the Government was adamant in selecting the right one.

He said the government wanted the best proposal to benefit all stakeholders, including DBKL.

The abandoned Plaza Rakyat had become derelict with pools of stagnant water everywhere and rubbish strewn all over the place, which made it a paradise for mosquitoes to breed.

The original plan comprised a 79-storey office tower, 46-storey condominium, 24-storey hotel and seven-storey shopping centre.


A TNB substation inside the project site with a pool of water around it.
The RM1.4bil project was 30% completed about 15 years ago when the developer, PRSB, ran into financial difficulties during the 1997/1998 Asian financial crisis forcing it to abandon the project.

The Government decided to terminate PRSB’s contract in 2010, 12 years after the company abandoned the mixed-development project.

Subsequently, PRSB went into receivership and came under the administration of a consortium of lender banks.

This post has been edited by bb68: Aug 14 2014, 02:38 PM

How is this outcome compared to previous Ivory proposal which suggest as follows:

According to the ARA, Ivory Properties will pay RM560 million to DBKL for the project. At the same time, Ivory Properties will settle all outstanding quit rent to DBKL, while PRSB will be paid RM400 million, which will go towards settling its debts with the banks and other parties.

I differ. With Ivory proposal, DBKL only get 560mil equivalent to 7% of new 8B GDV. Now if DBKL gets control over the land and redevelopment they could get a lot more. Say 20% as what they always wanted, that will be 1.6B .So minus 200mil they still pocket in 1.4B ! !

10 ringgit says it maybe GAMUDA LAND !!

Get controls means they now legally free to decide if to sell or lease the land at higher price or joint develop the site and get shared profit. As for the doubt on use of received money, I have no comments, too early to judge.

DBKL acquisition of Plaza Rakyat poses many questions
Published: Wednesday August 27, 2014 MYT 12:00:00 AM
Updated: Wednesday August 27, 2014 MYT 7:11:07 AM

BY CHOONG MEK ZHIN

BUYERS of the long delayed Plaza Rakyat project want Kuala Lumpur City Hall (DBKL) to prove their commitment in reviving and completing the project as well as to consider their wishes.

“We have been waiting for this project a very long time. In fact, while waiting for it, some buyers have already passed away without ever knowing the fate of their purchase,” Stephen Yong, a buyer, said.

He purchased two units as a retirement plan for he and his wife.

“We run small businesses — she runs a salon and I a food court stall. We had bought the units in hopes of renting them out when we retire,” he said.

Another buyer who only wanted to be known as Danny said the buyers had initially been excited about Ivory Properties Group Bhd developing the project.

“From what we had read, it sounded like a good deal with talk of compensation for us too.

“Currently, DBKL is in the midst of deciding on a new developer for the project but nothing has been said about us. We are in the dark and how do we know our interests are being looked into?” he said.

Earlier this month, Ivory filed with Bursa Malaysia that Ivory Place Sdn Bhd and Plaza Rakyat Sdn Bhd (PRSB) could not come to an agreement and thus, had terminated the acquisition and rehabilitation agreement.

PRSB had completed about 30% of the project before experiencing financial problems during the 1998 financial crisis, forcing the developer to abandon it.

StarMetro recently highlighted several issues at the site, including a rickety connecting bridge that is currently being fixed, mosquito breeding spots and overall structural integrity concerns.

DBKL is expected to announce a new developer for the project next month after the takeover.

This is following the arbitrator’s decision in early July for the local authority to terminate the joint-venture agreement with the PRSB with the condition it pays RM200mil to the developer for the portion that had already been built as well as bank loans with interest.

it was a mix development with mall, hotel, apartment bla bla bola

well as reported, to be announced in September ! Looking forward for a BLAST !!

DBKL gets better deal for Plaza Rakyat from party chosen without tender



BY SHALINI RAVINDRAN AND DAVID TAN

KUALA LUMPUR: Kuala Lumpur City Hall (DBKL) has chosen a new company over Ivory Properties Group Bhd to revive the Plaza Rakyat project because the city hall was offered a more attractive deal for the abandoned project.

However, DBKL did not undertake an exercise to invite other interested parties to submit their bids for the project before issuing the letter of intent to Profit Consortium Sdn Bhd , the company that plans to build a “Sungai Wang Plaza” kind of mall on the site that is located near the Pudu Raya bus terminal.

“The site is ideal for a Sungai Wang kind of development,” said an official close to DBKL.

According to the official, apart from Profit Consortium, there was another party that expressed interest in reviving the Plaza Rakyat project.

“But Profit Consortium gave far better terms than what was offered by Ivory Properties or the other company. Among others, the returns to DBKL was not pegged to sales of the project. AlsoProfit Consortium did not seek a revision in plot ratio of Plaza Rakyat,” said the official.

“DBKL would get a guaranteed portion of the sales. The new consortium wants to replicate the Sungai Wang Plaza in Plaza Rakyat,” said the official.

It is believed that the new proposal allowed DBKL to save more than RM100mil, which was another reason why it chose Profit Consortium.

“DBKL does not have to pay the old developer – Plaza Rakyat Sdn Bhd (PRSB) – a sum of RM200mil to take possession of the site. Discussions are ongoing to reduce the amount to less than RM100mil,” said the official.

Profit Consortium is owned by Maxcorp Development Sdn Bhd, SW Land Sdn Bhd and Tan Sri Abdul Samad Alias. Maxcorp is the private vehicle of Major (Rtd) Anuar Adam while SW Land is the developer of Sungai Wang Plaza.

Plaza Rakyat has been abandoned since the 1998 financial crisis and PRSB was finally put under receiver and manager AdamPrimus Chartered Accountants a year ago.

AdamPrimus called for a tender exercise in May 2013, in which Ivory Properties was chosen. Under the terms, Ivory Properties had to pay PRSB RM400mil for the work done on Plaza Rakyat then and pay DBKL a maximum RM560mil from the development.

A crucial condition set by AdamPrimus was that Ivory Properties obtained the consent of DBKL to take over the project.

However, this was a sticking point because DBKL had filed for legal action to terminate its agreement with PRSB on the grounds that the latter did not fulfil its conditions.

Consequently, DBKL did not recognise AdamPrimus taking over the revival of the project and the tender exercise where Ivory Properties came with the best offer.

DBKL filed for arbitration and subsequently won an award in its favour in early July to terminate the agreement with PRSB and take back the site.

However, the condition is that DBKL pays PRSB RM100mil for work done on the site and settle outstanding bank loans with interest.

“DBKL is negotiating with the receivers and manager to reduce the amount to RM70mil after netting off the amount due for quit rent and other fees,” said the official. “City hall has filed the arbitration awards at the Kuala Lumpur High Court to make them enforceable as a court order. Once the award is registered only then can we take possession of the site.”

However, Ivory Properties is still keen on reviving the abandoned Plaza Rakyat mixed development project and is hopeful of getting some feedback from DBKL on the matter.

Ivory Properties chief executive officer Datuk Low Eng Hock said that although the acquisition and rehabilitation agreement (ARA) had been terminated, the group was still waiting for DBKL to get back to them.

“We are still keen on reviving the abandoned project and have laid our conditions to DBKL.

“We are still waiting for DBKL to get back to us and we hope to receive a favourable response from DBKL soon,” he added.

Low said the company believed that DBKL would find an amicable solution that benefited all parties, especially the buyers who had been affected all these years.

In an announcement to Bursa Malaysia on Sept 6, Ivory Properties announced that the ARA had been terminated between its subsidiary Ivory Place Sdn Bhd and PRSB as both parties could not come to an agreement.

This post has been edited by bb68: Sep 9 2014, 09:33 AM

又迎來另一場起訴官司‧人民廣場復工遙遙無期

WTF !!
http://mykampung.sinchew.com.my/node/321086?tid=6

擱置長達20年的吉隆坡人民廣場工程（Plaza Rakyat）“命運坎坷”，儘管仲裁庭已在今年7月裁決出現復工轉機，詎料市政局又再迎來另一場被清盤司起訴的官司，以致復工期依然遙遙無期，121名產業業主只能繼續痴痴等待！

據悉，市政局在仲裁庭作出判決後，進入工地和準備接管有關工程，不過清盤司卻在8月5日入稟高庭，以挑戰市政局不同意由該造委任承建商IVORY復工的決定，目前仍在排期等待開庭審訊。
市長盼任期內解決
吉隆坡市長拿督斯里阿末菲沙接受《大都會》社區報記者的專訪時，除了詳述該項工程的“坎坷遭遇”和遲遲未能復工的緣由，也強調克服人民廣場廢置問題，是他任期的其中一項任務和挑戰，並希望能在退休之前解決有關問題。
他指出，目前人民廣場現有的工地底層積水已有3層樓高，而強大的水壓讓牆壁變得“穩固”，一旦將積水抽吸出來，牆壁的結構極有可能坍塌。
他補充，由於市政局目前面對上述技術問題，所以市政局不會進行任何工程，直至案件審結後，才深入研究穩固建築物結構的措施。
上述位於富都路的人民廣場工程是政府在1995年推出的計劃，工程包括興建1座79層樓高的摩天樓，除了長途巴士終站、德士站及輕快鐵外，也包括辦公大樓，其中59層樓為服務式公寓、450間房的4星級酒店及150間房的廉價酒店。
與發展商終止合約鬧上庭
仲裁庭裁決市局賠1億
阿末菲沙追述，基於人民廣場計劃已擱置多年，吉隆坡市政局決定採取行動，與發展商Tetuan Plaza Rakyat終止合約，可是後者卻把此事帶上法庭，最終法庭裁決成立一個仲裁庭，以審理此案。
他說，仲裁庭被賦權針對發展商被吉隆坡市政局終止合約而索取賠償一事作出裁決。
他指出，市政局是於1992年與發展商簽署合約，並在2010年4月21日解除合約，可發展商不滿市政局解除合約，因此向市政局索取超過12億令吉的賠償，加上市政局同時也向發展商追討應有的損失賠償，雙方對簿公堂。
“此事（人民廣場廢置工程）已延宕多年，仲裁庭在今年7月4日裁決（Interim Findings）市政局採取的終止合約決定是合法和有效，不過市政局必須根據發展商已在合約內完成的部份基設工程，如輕快鐵站，繳付相關費用給承包商。”
他披露，根據仲裁庭的裁決，市政局必須繳還給發展商高達1億令吉的毀約金，這包括延遲完工的賠償、地價、門牌稅，以及已完成的建築物結構，如輕快鐵工程等。
發展商須賠償3千萬
不過，仲裁庭同時也裁決發展商必須賠償3千萬令吉給市政局，作為延遲完工、租金和地價的損失賠償；換言之，從1億令吉扣除約3千萬令吉之後，剩餘的約7千萬令吉，必須償還給銀行，以便市政局可以收回和取消土地抵押。
他指出，根據合約規定，銀行的土地貸款費用高達2億令吉，但銀行支付給發展商的貸款額只有5千萬令吉，不過該筆貸款被拖欠多年，因此欠款額已累積到1億4千400萬令吉。
他說，他將與有關銀行代表進一步商討，以確定所要支付給銀行的實際費用。
他強調，為了避免人們產生混淆，他有必要作出澄清，即仲裁庭是向銀行作出“分開式的裁決”（Keputusan Berasingan），即市政局所支付給發展商的1億令吉，是包括用以贖回向銀行作出的土地租賃（或抵押給銀行的土地費用）。”
清盤司通過招標遴選
市局不同意委IVORY接管
針對一些購屋者希望市政局能考慮接納由銀行建議的一個新的發展商IVORY來接替人民廣場工程時，阿末菲沙回應說，當市政局終止與發展商的合約時，發展商已被視為破產，銀行委任清盤司為接管人（Receiver and Manager）以處理人民廣場事務。”
他說，由於有關清盤司欲以通過招標方式，以讓工程復工，然而市政局拒絕並已通知對方，市政局已否決這項要求，可是對方仍一意孤行，並通過招標方式向許多承包公司作出獻議，最終經過自行的評估和分析後，委托發展商IVORY來接管有關工程。
“市政局已表明不同意這項獻議和方式，因為這是我們（市政局）的權利，要委任誰來繼續承建，是我們的決定。”
他指出，市政局在仲裁庭作出判決後，也進入工地和準備接管有關工程，不過清盤司卻在8月5日入稟高庭，以挑戰市政局作出的上述決定，目前仍在排期等待開庭審訊。
“根據法庭的庭令，之前的發展商必須在法庭作出裁決的30天內或8月5日之前，將有關工地主權移交給市政局，所以市政局才準備進入工地。”
市局原擬委私人公司復工
他說，經過他與聯邦直轄區部長拿督斯里東姑安南的商討後，同意將有關工程委托給一家私人公司，以便在人民廣場復工。
“我們仍在等待這間公司擬定商業模式（Business Model），才來考慮和決定是否適合採用，當中必須考慮到所需承擔的責任，如支付給銀行的費用、賠償給121名索價的購屋者，以及其他相關費用等。”
當記者詢及這間全新的承包公司，是否需要根據原有的建築模式和規格，來續建人民廣場工程時，他指出，市政局一定會慎密審視有關合約內容。
“如果這項將繼建的聯營工程不會為市政局帶來利益，我們會研究和探討其他新的建議，好比發展商要求提高人口密度、更改建築物結構和藍圖、容積率等，我們都會探討，以便為市政局與發展商製造雙贏局面。”
他說，由於時代已經不同了，市政局或許不可以採用舊有的建築物模式和建築藍圖，更何況它將需要復工。（星洲日報／大都會‧報道：蘇斯敏）

Kuala Lumpur mayor to make site visit today



http://www.thestar.com.my/News/Community/2...te-visit-today/

AFTER 20 years in limbo, the metaphorical gates of the abandoned Plaza Rakyat project in Kuala Lumpur will finally open as Kuala Lumpur City Hall (DBKL) has taken vacant possession of the site.

It is learnt that City Hall has finally settled the outstanding loan to the financiers after months of negotiations.

The initial loan taken was RM58mil but the amount snowballed to a whopping RM150mil since 1992.

Kuala Lumpur mayor Datuk Seri Ahmad Phesal Talib is expected to visit the site today.

The abandoned Plaza Rakyat had become derelict with pools of stagnant water and rubbish strewn all over the place, making it a paradise for mosquitoes to breed.

The original plan comprised a 79-storey office tower, 46-storey condominium, 24-storey hotel and seven-storey shopping centre.

The RM1.4bil project was 30% completed about 15 years ago when the then developer Plaza Rakyat Sdn Bhd (PRSB) ran into financial difficulties during the 1997/1998 Asian financial crisis, forcing it to abandon the project.

The Government decided to terminate PRSB’s contract in 2010, 12 years after the company abandoned the mixed-development project.

Subsequently, PRSB went into receivership and came under the administration of a consortium of lender banks.

DBKL Health and Environment Department director Dr Hayati Abdullah said a team specifically in charge of monitoring active and abandoned construction sites visited on Wednesday to make a preliminary assessment and gauge the extent of work required for the clean-up.

“It is going to be a big job and we have only been informed about it this week.

“The initial inspection will involve the basics, which means identifying what needs to be done where; we have to get our priorities right because it is a big area,” said Hayati.

She said the basement carpark area would not be touched as yet.

“It is not safe and that particular job requires some expertise,” she added.

Hayati said the department had been keeping close tabs on the construction site to ensure it did not become a breeding ground for mosquitoes.

In June, Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor told StarMetro that three companies had shown interest in developing Plaza Rakyat but the government decided to go with Profit Consortium Sdn Bhd, which presented a better deal.

He also said the new developer would ensure the buyers were duly compensated.

The arbitrators Prof Tan Sri Visu Sinnadurai, Datuk Ghazi Ishak and Robert Lazar, who were involved in negotiations with PRSB and DBKL, confirmed in June that the local authority was lawfully entitled to terminate the agreement because of non-performance and breach by PRSB.

However, they said DBKL had to settle the RM200mil outstanding loans taken by PRSB and reimburse the company and the banks. In addition, DBKL was not allowed to enter the site until they had registered the award with the court.

The new development will include a mall, service apartments and offices, and will integrate with the Plaza Rakyat LRT station.

While relieved over the news of the Plaza Rakyat project revival, the long-suffering buyers want the Government to ensure they got the units they purchased decades ago.

“We have been waiting for years for our units, so we want the Government to ensure that we are given similar lots in this new project,” said Stephen Yong.

Yong, 70, said he had paid a 20% deposit of RM300,000 19 years ago for two units in Plaza Rakyat.

“It was a lot of money back then, a large chunk of my life savings. I want units in the new project. It is only fair that they compensate us with units for all the pain and suffering that we had been put through,” he said.

Buyer Danny G. agreed with Yong.

Danny added, “Since the previous developer failed to deliver the units at the expiry of the extension period, the vendor should pay us liquidated damages (LAD). Going by the sale and purchase agreement from November 1996, the developer was given three years plus one year extension to complete and hand over our shoplots.

“They should have handed over by year 2000, but there has been a lapse of 14 years. So the LAD would run into hundreds of thousands of ringgit.”

Another buyer, who wanted to be identified as only Lee, said she had paid 30% of RM600,000 as down payment to purchase two shoplots.

“Fortunately the bank had not released the balance 70% of the payment when the project stalled, or I would be paying the loan and interest for a property that was not completed,” she said.

There are about 200 buyers, many now in their twilight years, who have invested their life savings in the Plaza Rakyat project almost 20 years ago.

In 2011, about 20 buyers lodged police reports at the Tun H.S. Lee police station demanding compensation and refund of their downpayment for the abandoned project.

A total of 221 business lots were sold.

Pledge to Plaza Rakyat buyers

http://www.thestar.com.my/News/Community/2...ests-will-be-l/

PURCHASERS of the abandoned Plaza Rakyat project in Jalan Pudu have been assured that their investments will be returned either in the form of new units or cash payments.

Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor said the matter would be solved at the end of the month when the government awards the contract to develop the place to the new developers.

“We hope to solve it by the end of the month after we make the award.

“The new developer has been told it must uphold the interests of Kuala Lumpur City Hall (DBKL) and the buyers. We will make sure they do so.

“Apart from the need to revitalise the project, we have always been concerned about the rights of the buyers,” Tengku Adnan said.

“If the buyers want cash, the developer will make sure they get their money back, and if they want units in the new development, they will get that.

“Please have faith in the Government,” he stressed.

Last week, StarMetro reported that DBKL had taken vacant possession of the site.

Excited over the news, several buyers had called the newspaper saying they wanted the Government to ensure they received the units they purchased decades ago.

A total of 221 business lots were sold 20 years ago when the project was launched.

Today, there are about 200 buyers, many now in their twilight years, who had invested their life savings in the Plaza Rakyat project.

In 2011, about 20 buyers lodged police reports at the Tun H.S. Lee police station demanding compensation and refund of their downpayment for the abandoned project.

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