PAPsmear - Remember the Iluma?

The Iluma is this building with a queer-looking facade along Victoria Street opposite Bugis Junction. It was designed by WOHA Architects and opened for business in 2009.

But it has a past that needs some answers in squeaky clean Singapore.

The building sits on 8,919 sq mtr of land in an area designated for entertainment and tourism related business. URA tendered it out in 2005 with a 60 years lease for 'integrated development for entertainment uses'.

Jack Investment Pte Ltd put up a bid for S$46m and being the only bidder, won hands down. The fact that JIPL was the only bidder was most likely a matter of entertainment complex development not being an attractive proposition for property developers in Singapore. JIPL is owned by Mr Han Chee Juan and not much is known about both the company and owner when googled, except that the company also owns Kallang Leisure Park, West Coast Recreation Centre, Woodlands Point and 600@Toa Payoh and developed The Teneriffe in Bukit Timah, and condominiums like Gilstead Mansions.

JIPL poured in altogether $160m to develop a 10 storey complex with 185,190 sf ft lettable area. In 2011 JIPL sold Iluma to Capital Land for $295m, netting $135m in under 3 years of operation.

In their news release, Capital Land states:

"Iluma is a new shopping mall in Singapore located at Victoria Street opposite the popular Bugis Junction, one of CMT’s existing properties. The mall has a net lettable area of 185,190 square feet and is connected by an overhead link-bridge to the second storey of Bugis Junction."

Capital Land has renamed the building Bugis ++ and its current valuation is S$355m.

The questions are:

• Why was JIPL allowed to operate Iluma as a mix entertainment-retail building when the site was tendered for entertainment use?
• Why is the building suddenly a 'mall' after Capital Land takes over?

The difference between 'entertainment' and 'mix commercial' use can be in hundreds of $million. So why was it tendered low and then quietly allowed to be used as a higher valued property?

There is nothing seen nor heard in the public domain regarding any change of use. If there was an official change of use, then it calls into question unfair practice as all other developers were disadvantaged at the tender which allowed backdoor conversion of use. This amounts to deliberate control of specifications to favour some parties at a tender, a common sleigh of hand malpractice in procurement processes. It remains a mystery. Anyone who can throw light on this would be most helpful.

We know who the loosers are -- mediocre taxpayers. Who are the winners?

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