Sasseur REIT’s manager said Thursday that its wholly owned subsidiary, Hefei Sasseur Commercial Management, or Sasseur Hefei, has reached a settlement with Zhongjian Sanju No.2 Construction Engineering, or ZS2, in a dispute over construction costs.
Following legal proceedings and negotiations, the parties agreed Sasseur Heifei will pay ZS2 55 million yuan (S$10.61 million), compared with its original claim of 148.2 million yuan, the REIT’s manager said in a filing to SGX.
ZS2’s action against Saseur Hefei was over a disagreement over the final construction sum payable for the Sasseur (Hefei) Outlets, which was completed in May 2016, the REIT has previously said.
The settlement amount is due by 29 November and Sasseur Hefei has set aside sufficient cash for the payment, the filing said.
Sasseur REIT had previously included construction accounts payable of 117.5 million yuan in the acquisition of Sasseur Hefei for its initial IPO portfolio, with the settlement making the payables lower by 62.5 million yuan, the filing said.
The settlement wasn’t expected to have an impact on the REIT’s distribution per unit for the current financial year, the filing said.