Developers snapping up own units

At least four have sold units in their projects to kin or 'interested parties'

THE sizzling property market is prompting even the developers themselves to snap up units in their new projects, especially high-end properties.

Singapore Exchange filings show that at least four listed developers have sold units in their residential developments to relatives or ‘interested parties’.

An interested party can be a director, a chief executive, a controlling shareholder or one of their associates.

Madam Cecilia Kok, wife of City Developments (CDL) executive chairman Kwek Leng Beng, has bought a third-floor unit in the 228-unit Residences at W Singapore Sentosa Cove for $4.6 million after a 22 per cent discount.

At the time the option to purchase was granted, members of the public were being offered a 20 per cent discount.

An additional 2 per cent discount was offered to the company’s directors, including their spouses and children, under its preferential discount scheme for buying units in its developments, said CDL in its statutory filing.

The chairman and chief executive of Ho Bee Investment, Mr Chua Thian Poh, and his wife, Madam Ng Noi Hinoy, have both bought units in the 151-unit condo Seascape at Sentosa Cove. A 2,863 sq ft unit cost $7.6 million while one of 2,164 sq ft went for $5.6 million.

The couple received an additional 2 per cent discount over the price offered to the public.

Nine units at The Laurels – an upmarket 229-unit project in Cairnhill Road – have been bought by interested parties of its developer Sing Holdings, at a 3 per cent discount.

The buyers included chief executive Lee Sze Hao and his wife, Madam Susan Soh, and controlling shareholders Lee Sze Siong and Lee Yit, both siblings of Mr Lee.

Sale prices ranged from $1.4 million to $4.9 million.

Four similar sales have been recorded at GuocoLand’s Goodwood Residence in Bukit Timah Road.

Malaysian tycoon Quek Leng Chan, a director of the company, picked up the biggest unit in the 12-storey project – a penthouse – for $18.8 million.

Brother Leng Hai bought another penthouse for just over $13.8 million while sister Guat Kim secured an apartment on the eighth floor for $6.03 million. Another sister, Lay Lian, bought a ninth-storey unit for $7.46 million.

No discounts were given, according to statutory filings by GuocoLand.

Chesterton Suntec International’s research and consultancy director, Mr Colin Tan, said purchases by interested parties can be a marketing strategy to kickstart sales when a development is launched.

‘But if it’s a good unit in a good development location, then it also makes for a good investment that usually pays off for family members who have first pickings,’ he said.

Mr David Gerald, president of the Securities Investors Association of Singapore, said statutory filings allowed developers to be transparent and above board in their dealings.

‘Stakeholders need to be informed that this is a fair transaction…since too many of these sales at too steep a discount might affect the bottom line of the firm,’ he said.

Sales to interested parties must be approved by a firm’s audit committee and be considered fair and reasonable and not prejudicial to the interests of the company or minority shareholders.

Source: Straits Times, 13 Apr 2010