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Into Thin Air

Category: , Posted:28 Nov 2009 | 10:05 am

The Phuket Gazette.
The history of civilization has been shrouded in mystery since records began. First there was the mystery of the pyramids. How did the ancient Egyptians manage to engineer such wondrous, gargantuan structures?
Then came the disappearance of the Aztecs and Mayas, something which confounds historians and scientists to this day, lest not forget about the fabled city of Atlantis, the location of the Hanging Gardens of Babylon, Stonehenge or the disappearance of the Colossus of Rhodes; all shrouded in mystery.
In recent times we have had the conundrum of Michael Jackson's nose and how it eventually took on a life of its own.
To quote The X Files – that infamous television program that explained the universe's great perplexities – “the truth is out there”, we just aren't always sure where.
With that in mind, perhaps it's an opportune time to talk about the enigma of the Tamarind Hills condominium project. I've received more questions, comments and opinions on this single topic over the past year than any other. Yep, even more than the recent debate about over development and environmental issues on the island.
To the chagrin of many overseas investors who bought units from the Lersuang Group a number of years ago, the project has been mothballed for over two years and remains uncompleted.
To solve the riddle, I spoke to Dr Metta Visessombat, the new managing director of the renamed Tamarind Hills Layan Co Ltd, who laid out a rehabilitation project for the distressed project.
First a bit of history. The Lersuang Group started out as Holbrook Construction, developing town homes in Surin. Holbrook then became the Lersuang Group, building Club Lersuang in Surin before rapidly expanding, developing Turtle Cove in Mai Khao, Layan's Tamarind Hills, Surin's Infinity Heights and finally Lersuang Village in Cherng Talay.
With the exception of the first two developments, unfortunately none of the other projects have actually been completed and have left a legacy of unhappy purchasers, alleged litigation and consumer complaints in jurisdictions such as Hong Kong.
A recent visit to the company's former head office in Cherng Talay revealed they have relocated and we were unable to speak to the former directors at the time of writing.
Speaking to Dr Metta, the current rescue plan only covers Tamarind Hills and he has relocated company offices to Ban Don Road in Cherng Talay. Aside from his current role, he also heads the energy group Sepco Asia (it should be noted that Dr Metta was a former director and shareholder of the Lersuang Group, something he has been completely transparent about).
Returning to the tale of woe for buyers in the Tamarind project, many payments were made into an offshore bank account linked to the Lighthouse Group – project partners and in charge of sales and marketing.
Unfortunately, the Lighthouse entity went bankrupt. Funds that had reportedly been moved to other offshore accounts for tax purposes were actually spent on project expenses according to a recent report published in the Bangkok Post.
Of a total of 142 condominiums planned, 80 were sold, leaving 62 units for sale. The problem they face now is that the land on which the project sits is divided into separate plots belonging to a number of external parties. This came about when the developers attempted to raise capital to fund projects affected by the 2004 tsunami, the global financial crisis and a spiraling, aggressive expansion plan.
The new plan sees the company working with the Government Savings Bank to buy back the project land and to generate funds to complete construction. Existing buyers have been asked to pay any outstanding amounts and a premium of 15-20 percent over the original contracted selling prices, effectively securing the land and completion of their units.
If the plan is successful, and Dr Metta has stated that a number of buyers are already on board, the first units should be completed by April of next year.
Speaking to a few buyers, a number of concerns were raised about the current team, given that it includes many connected to the previous failures. As an outsider, it's impossible to assess the financial viability of the rehab, the legality of it or prospects for success, but at face value it appears to be a pragmatic process, addressing what are now compelling, time sensitive issues.
Unfortunately, there remains more questions than answers in this entire saga. Many voices who wish to be heard have asked, “What happened to my money?”, “How can land titles for a project be sold without my consent?” and “Why aren't those involved facing legal proceedings?”
While we have been told there is ongoing litigation, one thing's for sure: the road kings of karma will have their day on this one.
As I write this, a number established developers, agents, lawyers and local businesses have expressed concern over this case. The lion's share of property here has been transacted in a professional manner over the years. Yes, Thailand does have laws in place and there remains due process of a significant nature.
At the same time, we empathize with those overseas investors who find themselves caught up in this real estate nightmare. Rest assured, this is the exception rather then the rule and that the industry is not turning a deaf ear.
This continues to be a developing story and certainly much more will be revealed in the coming months ahead, which leads me back to where we came in…wasn't it something about Michael Jackson's nose?

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