Singapore’s Chip Eng Seng Corporation 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 3,000sq m in the heart of the city.
Chip Eng Seng confirmed in an announcement to the Singapore Stock Exchange on Friday that it had found a buyer willing to pay $55 million for the 150 Queen Street site and would also cease legal action against the owner of a neighbouring property.
Cbus has also bought out two sites 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 $170 million.
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Cbus is expected to undertake a major mixed-use development, utilising existing approvals, on the site similar to the $1.2 billion Collins Arch office, residential and hotel project located on a 6,000sq m CBD site.
Chip Eng Seng had been planning a $350 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.
Chip Eng Seng 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,” Chip Eng Seng 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 Chip Eng Seng and the adjoining property owner to work towards an expedient out-of-court settlement of their dispute.