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House buyers protest delay in reviving projects

The Star 29/04/2004 by Darmender Singh

About 200 buyers of the stalled Rhythm Avenue and Newgate Avenue apartment projects in Subang Jaya held a peaceful demonstration on Sunday to voice their disappointment over the delay in reviving the projects.


Rhythm Avenue and Newgate Avenue apartments buyers committee chairman Pritpal Singh said they were urging the bridging financiers to get the projects under way again.


He said those who had bought the Rhythm Avenue units were to have received their apartments at the end of 2001 while the Newgate Avenue apartments were to have been completed by mid-2002.


The buyers had been under financial pressure ever since the projects were stalled as they had to pay interest on the housing loans.


Those who had bought units in the 60% completed Newgate Avenue project are paying about RM500 monthly while those whose units in the 90% completed Rhythm Avenue project were paying about RM900.


Pointing out that the buyers had also to pay rental on the premises in which they were living now, he said a number of them had been blacklisted by the end financiers for failing to pay the interest.


Pritpal Singh said he would be meeting the bridging financiers of both projects next week to find out if and when work could begin.


He also planned to ask the bridging financiers for the Newgate Avenue project to give a deadline for the original contractor to restart work.


It was possible for another company to take over the project as the commercial units were never sold and a number of the apartments had not been sold, he said, adding that the money from the sale of the units would be sufficient to cover the existing amount owed to the financier and contractor with enough left over to cut a profit.


He said it had been announced that bankers for the troubled Rhythm Avenue service apartments had hired a project receiver to conduct a feasibility study on how much it would cost to revive the project.


He added that he would find out the status of the study which was to be concluded by the middle of this year.


The buyers committee vice-chairman Victor Huang said the committee also urged the Housing and Local Government Ministry to include service apartments under the Housing Developers Act.


He said now, service apartments were not covered by the Act and this had created problems in the way funding was disbursed to developer by the end financiers.


"For properties which are covered by the Act, the progressive payments are released into a fund and the payments are made directly to the contractors," he said.


He added that for those properties that were not covered by the Act, the money was released directly to the developers and the contractors were at times not paid accordingly.


"This creates problems when a stalled project is to be revived as there is an outstanding amount owed to the contractors that needs to be settled, besides the cost needed to complete the project," he said.


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