Tall & Urban News

Singapore’s Chip Eng Seng Corporation (CESC) sold its interest in the troubled Tower Melbourne skyscraper to Cbus Property as part of a massive aggregation that will create a landmark development site of close to 3,000 square meters in the heart of the city.

CESC confirmed in an announcement to the Singapore Stock Exchange on March 16 that it had found a buyer willing to pay AU$55 million (US$42.3 million) for the 150 Queen Street site and would also cease legal action against the owner of a neighboring property.

Cbus has also bought out two sites that the owner of the property, CESC, was in dispute with, and a fourth site owned by a Brunei-based family.

The total paid for the four properties was reported to be more than AU$170 million (US$130 million).

Cbus is expected to undertake a major mixed-use development, utilizing existing approvals on the site, similar to the AU$1.2 billion (US$920 million) Collins Arch office, residential, and hotel project located on a 6,000-square-meter CBD site.

CESC had been planning an AU$350 million (US$269 million) apartment project on the site but commenced the termination of more than 550 sales contracts as a result of protracted legal proceedings with the owner of the adjoining property relating to demolition works.

As a result of the legal action, the timeline for the completion of Tower Melbourne was delayed indefinitely.

CESC said it considered the sale of the property to be its most viable option at this point in time.

“The opportunity to sell the property presents the company with a clean exit from the Tower Melbourne project, given that is it no longer feasible for the company to move forward with the project,” CESC said in a statement.

“Continuing to hold the property while the legal proceedings remain unresolved would also mean that that the company will continue to incur additional expenses in ensuring that the site is secure.”

The sale also presented an avenue for CESC and the adjoining property owner to work towards an expedient out-of-court settlement of their dispute.

For more on this story, go to The Urban Developer.