Options to revive Rhythm Avenue in Subang Jaya
21/04/2004 The Star

Bankers for the troubled Rhythm Avenue service apartments in Subang Jaya are conducting a feasibility study on how much it will cost to revive the project, said Subang Jaya assemblyman Datuk Lee Hwa Beng.

“The bankers have appointed Price Waterhouse Cooper as the project receiver in November last year. “The feasibility study is expected to be completed by June. Hopefully, there will be some good news for the long-suffering buyers who have lost so much money when the project was abandoned,” said Lee. He also urged the same action be initiated on another abandoned service apartment project, the Newgate apartments also in Subang Jaya.

He felt that having the banks take over the project was the best option for the affected parties. Another alternative, said Lee, included getting the buyers to sue the developer for a refund of the money invested but the exercise would be futile as the developer (Saujana Utama Sdn Bhd) had no more money. “Another option is for the buyers to group together, and in the capacity as creditors, file a winding up order against the developer in the High Court.

“The buyers can then take over the project. “However, this method has it limitation because it involves a huge fund and expertise to start the project revival,” said Lee. He added that the banks, after getting the approval from the courts, could take over the abandoned project and initiate revival plans.

Such an arrangement had worked well in the revival of another abandoned project, the Subang Mewah Industrial Park which had been left dormant since 1998. Under the revival scheme - Ler Lum & Co, the court-appointed liquidator for the developer Korakyat, had initiated a “self-help” plan where the buyers played an active role in financing the completion of the project.

Lee had also participated in the revival discussion for Subang Mewah and he felt the plan could be used to revive other abandoned projects.

Subang Mewah Industrial Park consisted of 478 single-storey, one-and-a-half-storey and double-storey factories as well as single-storey semi-detached factories worth RM146mil.

The Rhythm Avenue service apartments started off as a well-planned project but ended up a financial mess when the developers claimed they ran out of money. The project was supposed to have been completed in November 2001. However, it remains a sorry sight of bricks and steel frames scarring the surrounding neighbourhood near the Vision School.

It is also a major heartbreak for the 1,500 buyers who paid between RM80,000 and RM500,000 each for a unit but had no property to call their own even after they had diligently serviced 90% of their bank loans in progress payments.

Some affected buyers had lodged police reports, written to former Prime Minister Datuk Seri Dr Mahathir Mohamad for help as well as complained to the Bank Negara, Board of Architects and the Bar Council for suspected foul play involving architectural, engineering and construction approvals granted to the project.