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What next for Oceanus Mall?
Published on: Saturday, May 19, 2018

Kota Kinabalu: Sparsely occupied but well-located Oceanus Mall is the latest shoping complex to fall on hard times, judging from the over 230 buyers of its retail shop lots who came together Thursday to demonstrate their anger in a scene reminiscent of the uncompleted Star City nearby left by a wound-up insolvent developer.

They as legal creditors suspected that "the winding-up of the Oceanus Mall developer firm - Sunsea Development Sdn Bhd, in Kuala Lumpur High Court by Ecoquad Sdn Bhd, a firm in Penang, on April 19," was a ploy to deprive them of outstanding dues by the said developer firm.

They held a press conference to demonstrate their frustration here at suspected moral hazards causing them to suffer some RM40m "financial losses" from unpaid rental guaranteed in contractual agreements to them by the developer in lease back deals, with some of them "losing" their life savings.

New national president of the Malaysia International Chamber of Commerce and Industry (MICCI) Datuk Tan Cheng Kiat told the media that Tan Sri Musa Aman whom he met on a Malindo flight on May 14 from here to Kuala Lumpur, encouraged them to sue for their rights and against those who assigned Phase 2 of the project to another firm.

According to one of the creditors, Joseph Tham, the buyers' "helpful lawyer" had resigned" from representing them to focus on something bigger.

Tham claimed that he bought his 1,000 square feet ground floor unit at RM3,000 per square foot commanding a rental rate of RM15,000 per month. He was not paid any rental by the developer firm that leased his retail shop to an optical firm for more than 18 months.

Their protem committee spokesman C. K. Tan hoped to meet Api-Api Assemblywoman Christina Liew next week to seek her help and advice, as the mall is located within her constituency.

The mall is managed by Sunsea Pavilion Sdn Bhd and Azmi & Co. is appointed as agency until June this year to maintain the property.

"We just want justice," Tan said, of their efforts to seek redress however possible to recover their losses on their investment in the mall, now with the Marriot Hotel due to open next month. The 'Pelagos Designer Suites' condominiums are also now open for occupation.

Some buyers were angry that Phase 2 of the Kota Kinabalu Waterfront Project in joint venture with DBKK as landowner, which covers the UNHCR Market or the 'Filipino Market' was assigned away to another company contrary to legal advice. They want the MACC to vet the deal for any irregularities.

Tan claimed that Musa, as the then Chief Minister "was not involved" in the project fiasco.

He acknowledged that the buyers undertook the commercial risk to invest in the project "because the landowner was DBKK."

A buyer even claimed to have inside information that "Musa was very angry with recent deals that were concluded from the Tun Fuad Park Theatre Banquet Restaurant.

Star City buyers also claimed to be taken in to invest in Star City because the landowner is SUDC of the Sedco Group, an agency of the Sabah Government.

The moral lessons from these unhappy commercial property investment episodes here point to the fact that because GLCs or government agencies or local authorities are involved in commercial projects development, their success is not assured given the prevailing market condition for malls, that Tan also deemed as a national or worldwide phenomena for the retail industry.

Tan claimed to be able to better manage the mall with others with experience, once they are empowered to do so, to save the viability of the commercial business prospects which otherwise would degrade the reputation of the city's CBD discouraging business investments by locals and foreigners as some other malls also face a downturn in business.

Before the developer's firm was wound up, there was a proposal for a white knight to rehabilitate the mall for the benefit of the creditors under a scheme by Orienthold Waterfront. - David Thien

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