13/04/2006 The Sun

KUALA LUMPUR: Some 1,364 homebuyers are "stuck" with their investments in nine housing projects which have been abandoned and deemed as "cannot be revived" by the Ministry of Housing and Local Government.

Construction of one of the nine projects has not started while work on the other eight have reached between 10% and 20% before things came to a halt.

In total, the nine projects involve a total of 2,866 units worth RM335.29 million.

A breakdown obtained from the ministry shows that two are located in Selangor (Ampang and Klang) and one each in Ipoh (Perak), Sri Hartamas (Kuala Lumpur); Senawang (Negri Sembilan), Klebang (Melaka), Muar (Johor), Bt Mengkebang (Kelantan) and Jerantut (Pahang)

The types of homes in the projects vary and these include condominiums, bungalows, 2-storey links, low-cost homes and shop apartments. In terms of value, the Klebang project is the highest at RM125 million, followed by Sri Hartamas (RM123 million) and the two projects in Selangor (RM38.5 million). (See table)

The sales performance of these projects varies from 1. 7% to 100%. The Jerantut project (260 units) has all been sold while the project in Kelantan-1-storey bungalows - has only two of the 118 units sold. Meanwhile, the Ipoh project has seen 93.5% sales (404 out of the 432 units).

Housing and Local Government Ministry director of monitoring and enforcement Dr G Parameswaran(pix) told theSun that they have "not completely given up" on reviving these projects. "Our doors are still open," he said when asked on the recourse of the affected buyers.

He explained that these were among the abandoned project cases that they have difficulty in finding "white knights" to revive the projects. Even Syarikat Perumahan Negara Bhd (SPNB) found these projects not viable for revival. Among the problems faced, he explained, are difficulty in locating the developers and landowners. Other parties involved include bankers and liquidators.

The nine projects are among the total of261 (involving 88,410 units valued at RM8.043 billion and 58,685 buyers) abandoned from January 1990 to December 2005.

Of these, 93 projects (17,450 units valued at RM1.879 billion; 12,541 buyers) have since been rehabilitated. Ten projects (4,191 units valued at RM426.2 million; 2,074 buyers) have since been taken over by white knights.

The remaining 149 projects (63,894 units valued at RM5.4 billion; 42,706 buyers) have the potential of being revived, based on the feasibility studies carried out so far.

It is important to note that the development licenses for all the 261 projects were issued before the amendment to the Housing Development Act in December 2002. "With the amendment, we have tightened the law," said Parameswaran.

A project is classified as abandoned when there's no work ongoing on site for at least six months continuously or when the company has been wound up and placed under receivership for a period of six months.