Chinese Estates can file appeal if La Scala seized
Chinese Estates Holdings has been told it can file an appeal if the site of its La Scala residential project in Macau is seized following a corruption trial.
The company's shares were suspended from trading yesterday after the Macau government issued a warning on Tuesday that it might cancel a deal in which jailed public works chief Ao Man-long awarded the land to a company called Moon Ocean, now owned by Chinese Estates, after allegedly receiving HK$20 million from Chinese Estates chairman Joseph Lau Luen-hung and fellow tycoon Steven Lo Kit-sing.
The luxurious La Scala residential development is now being built on the land.
Last night, Chinese Estates issued a statement saying it had been told by its Macau legal adviser that if the site was seized it could file an appeal within 30 days. Its shares will resume trading today.
A promotion counter for La Scala in Windsor House, Causeway Bay, was closed yesterday.
A security guard at the mall said the counter was still open on Tuesday but had closed yesterday.
A saleswoman on the La Scala sales hotline said the Macau government's announcement had not affected sales and the showroom in Wan Chai was still available for customers to visit by appointment. Asked if there was any risk in buying flats, she said: 'I cannot tell you whether there is any, but we are continuing the sales activities.'
Chinese Estates' share price has dropped 8.5 per cent since Macau's Court of Criminal Instruction on May 23 accepted the accusations of bribery and money laundering against Lau and Lo, chairman of BMA Investment and convenor of the South China soccer club. Both deny the charges and may face trial.
On Tuesday, the office of the Secretary for Transport and Public Works in Macau said that in relation to 'the sale and transfer of five pieces of land in which illegal conduct was involved, the government will wait for final confirmation of the previous court ruling early next week. We will not rule out the possibility of declaring the sale of the five pieces of land as invalid.' Ao was sentenced to 29 years in jail for corruption and money laundering on May 31, six months more than the term he had been serving for previous graft charges.
La Scala, the residential project involved in the lawsuit, is fully owned by Chinese Estates.
The developer said the total investment cost for the project reached HK$20 billion.
It has four phases and will provide more than 4,000 flats. The first phase, with 899 flats, was launched on the market in March and recorded strong sales.
About 300 flats were sold at an average price of HK$7,200 per square foot in four days.