SINGAPORE - Four construction firms will finish the five Build-To-Order (BTO) housing projects left in limbo after contractors Greatearth Construction and Greatearth Corporation suddenly went bust.
However, their completion will be further delayed by about two to three months.
This means buyers of the 2,982 affected units at the projects - Sky Vista @ Bukit Batok, Senja Heights and Senja Ridges in Bukit Panjang, Marsiling Grove in Woodlands and West Coast Parkview in Clementi - can now expect to get their keys between the first quarter of 2022 and the third quarter of 2023, the Housing Board said on Wednesday (Sept 29).
The four contractors - Teambuild Engineering & Construction, Newcon Builders, Welltech Construction, and CES Engineering & Construction, a unit of Singapore-listed Chip Eng Seng Corp - were appointed on Tuesday, with building work at all five sites to progressively resume early next month.
Work slowdowns due to on-site safe management measures, acute worker shortages and disruptions to the materials supply chain have sent labour and building costs soaring.
This has raised the question of whether the four firms will get top-up payments to meet additional costs arising from risks not factored in the tenders awarded before the pandemic struck.
An HDB spokesman told The Straits Times: "The replacement contractors will be paid fair market value for the remaining works to be completed for the five projects.
"Arising from the pandemic and measures related to it, construction costs have risen since the projects were tendered by Greatearth. Hence, some price adjustments will be needed to take this into account.
"The specific details of the agreements are confidential."
Chip Eng Seng told the Singapore Exchange on Wednesday night that the contract with the HDB to finish work on the Marsiling Grove project is "not expected to have any material impact on (its) net tangible assets and earnings per share for the current financial year ending Dec 31".
Work at the five projects ground to a halt on Aug 20 after Greatearth told the HDB that it had run into financial difficulties and was unable to complete the projects despite government assistance. Two public projects could be held up as well. Several subcontractors are now staring at sizeable losses on unpaid fees by Greatearth.
HDB chief executive Tan Meng Dui said: "We recognise that the delays caused by Greatearth's exit will affect flat buyers and disrupt their life plans. We are also conscious that the construction industry is under severe strain, and the current situation brought about by the pandemic could not have been fully anticipated and is quite unprecedented.
"This is why we have worked with Greatearth and their liquidators... to source for several suitable contractors to take over the projects as quickly as possible," he said.
This has enabled HDB to bring on board the four contractors within about a month, compared with the three to four months it would typically take to call a fresh tender for new contractors to take over the remaining work.
That has minimised delays to flat buyers but completion will still be delayed by another two to three months due to the need for the replacement contractors to mobilise their resources.
The HDB has also offered help to buyers who are unable to secure alternative interim accommodation. "For those who wish to cancel their flat purchase to buy a resale flat, HDB will also consider waiving any forfeitures," Mr Tan said.
The HDB said it has received feedback from 117 flat buyers, or about 4 per cent of a total of 2,982 buyers, inquiring about their bookings.
"About half of these involved requests such as waiver of forfeiture upon cancellation of their flat application, assistance with interim housing, as well as requests to be prioritised for early key collection once the flats are completed," the HDB said.
Greatearth Construction owed at least $70 million to several hundred creditors at the time it was wound up on Monday.
That $70 million figure does not include anticipated liabilities from projects that could not be completed by Greatearth, which include two public projects, as well as the five BTO projects, ST understands.
A list of Greatearth's subcontractors and material suppliers had been provided to the new contractors so the parties can work out arrangements to stay on and finish the projects, the HDB said.
