Wednesday, June 19, 2013

Developer running at a loss in unpaid service charges and quit rent

The Star, Wednesday June 19, 2013   

THE developer of Pusat Perniagaan Desaria 2 said it had been managing the commercial centre at a loss, as most of the property owners had not been paying their fees over the past decade.

“Despite regular notices reminding them to pay up and even after offering discounts to encourage full payment, most of them failed to pay,” said the developer’s representative.

“They owe us money for service charge and quit rent. This does not include the maintenance fee or sinking fund.

The representative said there were 275 units of apartments and shoplots.

“Based on the monthly service charge of RM60 per apartment and RM90 per shoplot, we should have collected RM2.3mil from January 2002 until March 2013. However, we have only been able to collect RM554,000 thus far. Despite offering a discount, the owners still owe us RM1.6mil.

“We have also sent yearly invoices for quit rent payment, but only a few paid up. The amount from 2000 to 2012 is RM75,000, but we collected RM49,000 thus far.

“The company had to absorb RM1.9mil in expenditure since January 2002 until March 2013. The expenditure includes staff salary, office rental, utility bills and repair bills.”

In view of the owners’ failure to pay up, the representative said the developer had not imposed any maintenance fees.

“The maintenance of public facilities such as streetlights and roads is Kajang Municipal Council’s (MPKj) responsibility, as they have been handed over to the council.”

On the issue of forming a joint management body, the representative said the developer made three attempts but failed.

“These meetings were held in May, July and November 2010. However, a JMB could not be formed as there was insufficient quorum and those who attended still had service charge arrears.”

The Building and Common Property (Maintenance and Management) Act 2007 states that the quorum for a meeting is at least one quarter of all property owners who have submitted all payments.
Each of the meetings in 2010 was attended by fewer than 35 people, all with payment arrears.

“In April 2012, MPKj sent a letter to the property owners stating that its Commissioner of Buildings (COB) would appoint someone to help hold the first JMB meeting,” said the representative.

“The owners elected their JMB committee in June 2012, and MPKj sent a letter acknowledging the JMBs for Desaria 2 Blocks A, B, C and D.”

Meanwhile, in a meeting at the Housing and Local Government Ministry office in October 2012, it was agreed that the developer would submit the audited accounts to MPKj’s COB the same month and transfer the remaining funds in the property’s accounts to the JMB.

On claims that no audited account had been sent, the representative said the developer had submitted a copy of Desaria 2’s audited accounts until July 2012 to both the COB and the ministry.

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