3 parties vie to rescue Star City
Published on: Monday, October 20, 2014
KOTA KINABALU: Property and business investors who have dumped financial resources into the abandoned Star City mall were elated to learn of a recent tender exercise by the court-appointed liquidator that attracted three interested parties seeking to revive the commercial venture structures left in dilapidated condition."I am so relieved to be able to have hope now to recover my retirement funds invested into this hopeless project," said Chong, a long-suffering purchaser, obviously stressed out for years over a property investment which he claimed should have doubled his funds had he invested in other property projects when the boom cycle was peaking in Sabah or other parts of the country, and even overseas.The cost to health, including mental health from property investments gone wrong or just plain problematic either from returns on investments, loans repayment or tenants from hell is not well documented in Malaysia but it does affect a lot of people compared to the free and easy homeless sleeping in public places with not a care in the world, when charity meets their basic needs. Other woes concern dealing with authorities, politicians and graft to get things done.
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Some investors claimed to have almost paid up their banking loans taken out to buy retail shoplots in Star City, but are still waiting for their business premises.For professionals like Alvin who had fully settled his loan, it remains a waiting game as it was for more than a hundred of purchasers.All three tenderers were reported to have deposited RM2 million in earnest money, to show their seriousness, ability and earnestness to fulfil their intentions to fruition. Selection of the successful tenderer is still work in progress.However, the elation of the Star City investors and potential business operators were tempered by the realisation that only one of the tenderers, reputed to have political connection, has the intention of retaining their interests in the commercial mall project.
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Its sole distinctive differentiation lies in the prospect of emulating the Johor Branded Outlets which is a US concept perhaps with the Royal Malaysian Customs approval for GST free shopping or a reduction in consumption tax that has yet to be worked out in finality.What is needed in Kota Kinabalu if the city attracts more tourists and more locals settling down for jobs in the booming oil and gas industry is a concept like Singapore's Mustapa Centre with its 24-hour round the clock shopping galore.
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Why would tourists want to do shopping at wee hours? Some wanted to save a night of hotel expenses before leaving next morning or just arrived pending checking in the next day or leaving for other Sabah destination at the first morning light. Some may want to adjust their biological clock from a different time zone. Some may just want to amuse themselves with impulse buying after the closure of entertainment joints by law at 1am or 2am.Mustapa Centre which stocks whatever is available in Singapore from electronics to food items, gold, watches, bags, apparel and items from A to Z with an eatery features a full time 24 hours GST claim back counter where at least two staff manning the registry on line with Changi Airport help tourists to file for GST refunds saving them the hassle of doing the processes at the airport when they leave Singapore.Malls this helpful in Sabah will retain more tourist business if located in tourist areas after April 2015. Admittedly to be successful in this concept, there has to a critical mass of patronage by both locals and outstation visitors or tourists.The other two private entities who submitted their tenders likely have plans to buy out their interests as the layout of the mall would have to be redesigned to suit their business plans. And accordingly there will loom in the near future if any of these two tenderers is successful, prospects of consensus on the compensation quantum of a fair transaction price acceptable to all the investors or purchasers of Star City.Many blamed the landowner joint venture partner SUDC for teaming with the insolvent developer whose principal officer was also the owner of the architecture firm certifying progress payment claims for the project, giving rise to a question of the conflict of interest which PAM should look into, in the interest of professional ethics.Then there was another issue of changing the architecture layout without approval or knowledge of the local authority or the purchasers at the whim and fancy of the developer / architect by adding more shop lots for sale.Most of the purchasers are members of their association known as Pekestar, and even within the organisation it was not easy to get all members to agree to a common stance whether to sell off their lots or hang on until the completion of the project now delayed for more than half a decade.For now at least, there is light at the end of the tunnel to get back their money or get to see their shops in business operations in one of the state capital's most desirable locations. Prior to this development, there is a fear that another mall planned next door – the City Point Complex would be completed and operational before Star City is revived thus relegating Star City to the bottom positioning of the barrel of the many shopping malls coming into operation within these last six years of the decade before Malaysia is designated a developed nation by 2020.The Star City episode has shown that property investors in commercial projects declared open by top politicians with the land owner a state agency deserve legal protection under a new law which should be tabled in the Sabah State Legislative Assembly for this purpose, otherwise foreign investors looking at such cases would think twice about investing in Sabah.The successful tenderer still has to face a lot of hurdles especially in getting political approval to carrying out the remaking of Star City expeditiously, unless there is a connection nexus that make it sooner. As an example is the Blue Summer Suites project between Bank Negara and the Kota Kinabalu Central (Wet) Market left awaiting for a final approval to commence work for more than a year giving time for the wild trees and bushes to grow taller and denser.It's jungle out there.Meanwhile, the first Jesselton Wet Market, now a shopping supermarket is said to have been assigned for redevelopment for residential SOHO or SOVO to a business entity with interest in resort. The structure on government land was said to have no prior land title. Stay up-to-date by following Daily Express’s Telegram channel.
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