Hatten Land refutes claim of probe into its unit over Melaka project Harbour City

An artist's impression of the Harbour City project in Melaka, which is to comprise a mall, theme park and three hotel blocks. PHOTO: HATTEN LAND

SINGAPORE – Hatten Land on Wednesday addressed a claim that its subsidiary was under probe by the Malaysian authorities over its Harbour City development in the Malaysian state of Melaka.

The Singapore-listed developer was responding to a report in China Press, a Chinese-language newspaper in Malaysia, which quoted a Mr Ng Kian Nam making allegations against Gold Mart, the developer of Harbour City.

Mr Ng charged that Gold Mart had not applied for a housing developer licence for the project, and that the authorities had agreed to investigate Gold Mart under Malaysia’s Housing Development Act.

In a document seen by The Straits Times, Malaysia’s National Housing Department said this was the first complaint it received regarding the mixed-use development, and said it will conduct a site visit on June 6.

“If any violation or non-compliance is found under the Housing Development (Control and Licensing) Act and the regulations under it, then further action will be taken against the developer,” read the document, which was signed off by the National Housing Department’s director-general N. Jayaselan.

Responding to queries from The Straits Times, Hatten Land said its subsidiary had yet to receive an official letter regarding the June 6 site visit, and is in the midst of clarifying and confirming it with the Malaysian authorities.

It reiterated that Gold Mart’s team, along with its project consultant or manager, are ready to furnish official documents that approved the Harbour City project.

“Gold Mart is committed to providing full cooperation and assistance... to ensure the said site visit is being carried out smoothly,” it said.

Referring to Mr Ng’s allegation, Hatten Land said in a statement on Facebook that it did not have to apply for a housing developer licence under Malaysia’s Housing Development Act because the units sold were commercial ones, and not residential.

It added that its buyers were aware of this “as the relevant sale and purchase agreements clearly describe the nature and specifications of the said units”.

Hatten Land said the allegations had “tarnished the reputation” of its subsidiary and “resulted in unnecessary concern and fear among our contractors and purchasers”.

It added that Gold Mart would initiate legal proceedings against Mr Ng for his charges.

Plans for Harbour City were unveiled in 2018.

The mixed-use development, to comprise a mall, theme park and three hotel blocks, is expected to span five million sq ft in built-up area when completed.

The project was to have been opened in the first half of 2020, but construction was delayed because of a legal dispute between Hatten Land and the main contractor, and also because of the Covid-19 pandemic.

The Straits Times reported in April that at least 80 people, including Singaporeans, had organised a protest against Hatten Land in March at one of its developments, ElementX Mall in Melaka.

The buyers said they were unhappy with the long delay and that they were having to continue paying for their investments in the meantime.

Giving an update on the stalled project, Hatten Land said: “(Gold Mart) is diligently working towards the resumption of construction at Harbour City, and aiming to complete the project as soon as possible.” It did not provide details of a completion date.

The legal dispute in 2020 that stopped construction work involved a claim of RM100 million (S$29.7 million) by main contractor China Construction Yangtze River over the construction and completion contract for the project. The total contract value was RM818.2 million.

Hatten Land said: “The main contractor ceased work and initiated legal proceedings. However, we have successfully resolved the legal dispute with the main contractor at this point.

“Additionally, the construction progress of Harbour City was further impacted by the Covid-19 pandemic.”

It added: “Mr Ng Kian Nam’s statement has had a negative impact on our contractors’ willingness to resume construction work, thus resulting in further delay in the project’s development and completion. Additionally, purchasers have been unnecessarily alarmed.

“(Gold Mart) remains committed to completing the Harbour City project and ensuring the satisfaction and confidence of our valued stakeholders and investors.”

In February 2023, Hatten Land announced that it would terminate an existing agreement it had with Tayrona Capital Group over the proposed divestment of Gold Mart. It said Tayrona did not comply with its obligations, including paying a consideration to Gold Mart.

Hatten Land shares closed down 5.6 per cent at 1.7 cents on Thursday. THE BUSINESS TIMES

Additional reporting by Aqil Hamzah

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