So much trouble, so little reward

So much trouble, so little reward

After winning bitter legal battle to sell former Mitre Hotel, owners take site off market due to bad economic times

By Crystal Chan

May 10, 2009

THE Chiam family went to court twice to gain control of a piece of prime land, hoping to cash in on the property boom. But both times, boom turned to bust before they could sell. Now, the owners of the former Mitre Hotel – at one time expected to fetch about $200m – has withdrawn the site at 145 Killiney Road from the market. Jones Lang LaSalle, which marketed it in August 2007, after the Chiams won a second bitter legal battle to evict one relative who refused to sell the place, told The New Paper that the place is no longer for sale. The fall in private home prices – 14.1 per cent in the first three months this year, the biggest on record – is to blame. Ms Stella Hoh, director of investments at Jones Lang LaSalle, said interested parties were invited to tender for the site in August 2007. At the time, the property sector was booming. She said: ‘There were keen parties at the close of tender (on 12 Sep 2007). However, the owners did not accept the offers then. ‘Since the closure of the tender and change in market conditions, the owners have withdrawn the property from the market.’ MOVED OUT: Mr Chiam Heng Hsien does not live at the site of the former Mitre Hotel anymore. –TNP FILE PICTURES The site was marked for residential use and this was stated in the tender. Ms Hoh would not say if there was a minimum bidding price. The New Paper understands that the highest bid topped $100 million, though The Straits Times has quoted analysts as saying that it could fetch twice that amount in the boom. Ms Hoh said the property is still featured on Jones Lang LaSalle’s website. ‘The owners have told us to stop advertising the property in the papers but if interested parties call us, we can still try to sell it,’ she said. Madam Chiam Ai Thong, whose late father Heng Luan began the legal battle, was reticent when The New Paper called her. She said: ‘At this point, I’d rather not comment, except that we have no plans for the Killiney Road site for now.’ Madam Chiam agreed her family had spent a lot of money on legal fees as their team from Drew & Napier included Senior Counsel Harpreet Singh Nehal. Her family also owns the Sloane Court Hotel on Balmoral Road. Her voice breaking, she said: ‘I’m sorry, but my father’s passing (last year) is still raw.’ The site has a plot ratio of 2.8 – the ratio of maximum potential gross floor area to land area – and a 10-storey height limit. The hotel and a two-storey outhouse sit on freehold land with an area of 39,972 sq ft, roughly half the size of a football field. In 2007, the High Court had ruled in favour of the late Mr Chiam Heng Luan, who wanted his cousin Heng Hsien evicted from the pre-war property so that it could be sold. Mr Chiam Heng Hsien had managed the hotel and continued living there after it went out of business in 2002. On 18 Sep 1996, Mr Chiam Heng Luan had a similar legal victory but the sale fell through when Mr Chiam Heng Hsien objected to the prices quoted by interested parties. When the tender closed on 23 Jan 1997, there were bids for $73.3 million and $72.3 million. Another buyer offered just over $50 million. But the Asian financial crisis struck the same year, causing property prices to plunge. In April 2006, as the market was on another upswing, Mr Chiam Heng Luan started a new legal battle, and won again. Waited too long Property agent Nancy Hawkes, who has a 2 per cent stake in the property, was hoping for a sale. Mrs Hawkes, whose husband Noel was the general manager of the former Hotel Phoenix, bought her stake from one of the Chiam family members. She told The New Paper: ‘I told them to sell when times were better. After tenders were called, one buyer offered more than $100m. But the other owners wanted a higher price. ‘They should have sold the place there and then.’ Mr Chiam Heng Hsien, 64, who opposed his relatives’ attempts to sell the site, is said to have moved out after Justice Judith Prakash ordered the place to be sold in April 2007. When The New Paper visited the site on Tuesday evening, two of his relatives were busy cooking dinner there. A white dog chained to a pillar barked at every stranger who entered the compound. One of the relatives, who declined to give his name, said: ‘If you want to know more about this place, go to Sloane Court Hotel. Mr Chiam (Heng Hsien) no longer lives here. He just comes here once in a while to collect mail. We don’t know where he lives now.’ BAD TIMES 16 Dec 1996: Property put up for sale after the High Court orders it sold. Buyers invited to tender. 20 Sep 1997: Sale falls through when Mr Chiam Heng Hsien rejects all three bids April 2006: Faction led by Mr Chiam Heng Luan apply to High Court in another bid to evict his cousin and to sell the property. 30 Apr 2007: Justice Judith Prakash orders property sold and for MrChian Heng Hsien to leave. The New Paper runs a series of reports on the tussle Jones Lang LaSalle appointed to market the property. Aug to Sep 2007: Bids as high as $100 million received but Chiams refused to sell. Property eventually withdrawn from market.

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