The management of Katong Shopping Center is pleased to announce that they have begun collecting approval signatures from property owners to kick off yet another en bloc sale process. Katong Shopping Center was Singapore's first air-conditioned shopping mall when it opened in 1973. The mall contains 425 units and sits on a nearly 87,000 sq ft freehold plot. Situated along Mountbatten Road, it houses, among others, offices, employment agencies, printing and tailoring services shops, and eateries. —
This is not the first time the Katong Shopping Center is planning an en bloc sale. In mid-January 2010, the shopping center began its first attempt at conducting an en bloc sale. 80 percent of the 410 owners approved the en bloc sales. At that time, owners were expected to receive a reserve price of at least $2000 per sq ft. In August 2011, plans were fully implemented to achieve the shopping center's first attempt at en-bloc sales, slated to be completed in mid-2012. But the $445 million deal fell through. Back then, the apportioned value to each owner was an average of $2,000 to $2,800 per square foot.
As of June 2014, there was a second attempt to have an en bloc sale, but the deal fell through once again. However, using the previous data as a yardstick, the approval signatures expected for this third en bloc sales attempt will be secured from a good percentage of the 410 owners at the Katong Shopping Center.
To better understand the situation, the writer made a trip down to interview some of the tenants and shop owners of Katong Shopping Center on why they chose to sign the collective sales agreement. When asked by the writer, one owner who gave his name as Mr. Shi Jing Lee complained that there had been many grievances and dissatisfaction towards the management council and management office. He proceeded to show the writer a square box outside his shop that he rented from the management office. He complained that the management office wanted to charge him $10,000 to engage a professional architect to draw a simple box on the floor using a cloth tape.
Mr. Shi felt that the cost was unjustified, and he sought out another company on his own to do it at only $4000, but after the submission was made, his application was put on hold for two years. During the two years, he repeatedly chased the management for the approval of his request, but the management refused to provide the status of the application. It was only when the new management office took over after two years that his permit was improved instantly. According to Mr. Shi Jing Lee, he could not help but wonder if this was due to his refusal to use the architect recommended by the management office.
Another tenant interviewed by the writer complained about the management office's practice of renting out outdoor spaces. The tenant, Mr. Tsao Nimat, reflected that he had rented an outdoor space outside his shop for several years but was shocked to discover that his rented space had been given out to another tenant despite paying rental fees every month.
Both tenants will sign the sales agreement as they find it hard to continue doing business in such an environment. The same sentiments were echoed by other tenants interviewed. What remains to be seen is whether a buyer can be secured for this aging icon in the east of Singapore.
Release ID: 89065000