'Deceived' investors want action after losing millions on mainland mall
500 Hongkongers want mainland authorities to act against company they say misled them into losing millions on shopping centre project
Hong Kong investors who say they were misled into pouring money into a Guangdong shopping mall have called on the provincial authorities to step in after repeated petitions to local government were ignored.
Some of them claim they lost as much as HK$5 million and want their money back.
Yesterday one investor described the deal they made with the mall's management as "pure deception".
At the centre of the controversy is the Taishan Landmark shopping mall project in the coastal city of Taishan.
Investors said they entered into a 10-year agreement with the management company, authorising it to manage and rent out their shops. In return, the investors were promised an annual return of 6 to 15 per cent of their investment.
The project drew 1,500 investors, who paid a total of about 700 million yuan (HK$890.4 million). Some 500 investors from Hong Kong bought 30 per cent of the 1,700 available shops.
In the first year, the promised returns were paid. But business turned bad last year. The investors complained that the 70,000 square metre mall had been largely deserted due to poor management and they had not received any returns since the second half of the year.
"It is sheer deception," the convenor of the Taishan Landmark Owners' Rights Concern Group, Francis Wu said yesterday.
"When we bought the shop lots, the developers claimed the project was backed by the Taishan government and that some local celebrities also endorsed it," said Wu, who bought a shop for HK$1.1 million.
Now, however, nine in 10 of the shops are empty, he said. "Our investments are going down the drain."
The group petitioned the Taishan police last year but were told there was no evidence the management company or developer had intentionally cheated them. In August this year they marched to petition the police and city government of Jiangmen , which administers Taishan.
The group now want the Guangdong provincial government to look into the matter, Wu said.