Developer plans to sue Yangon government
A property developer says he intends to sue YCDC for halting his project after he had sold apartments to clients based on the original design.
A YANGON high-rise developer says he is planning to sue Yangon City Development Committee for K50 billion (US$39.9 million) in compensation after YCDC instructed him to reduce the number of floors on a residential project.
U Kyaw Kyaw Naing said he was informed by YCDC’s high-rise inspection committee (HIC) on October 6 that designs for a 12-storey project yet to begin construction would have to change.
The development in question is a planned residential apartment block on Dhamma Thukha Kyaung Road in Hlaing township, for which U Kyaw Kyaw Naing received a permit-inprinciple under the previous YCDC administration.
The terms of that permit allowed for 12 floors and basement, which U Kyaw Kyaw Naing said would have provided some 264 apartments. But YCDC’s high-rise committee has instructed two serious alterations be made to the design.
Both the building coverage ratio (BCR) – the area of the building’s base relative to the area of the project site – and the floor area ratio (FAR) – the building’s total floor space relative to the project site – are to be cut.
By lowering the BCR and FAR, the high-rise committee has reduced the number of floors from 12 to seven, and halved the building’s total floor space, U Kyaw Kyaw Naing said.
Only around 164 apartments can be built under the new design, but U Kyaw Naing said he has already presold more than 250 apartments in the project. Pre-selling units is common in the Yangon construction market, and often used to help fund projects.
U Kyaw Naing said that with a permit-in-principle he thought it was safe to start selling units.
“If I have to do as I’m being told, then I need to be compensated K50 billion for our losses and to give compensation to buyers that have already bought apartments,” he told The Myanmar Times.
The developer said he was called to the HIC offices on October 6 and informed of the changes by U Aung Than Oo, the head of the high-rise inspection department. U Kyaw Kyaw Naing was also given a written instruction and told to sign it as an acknowledgment, which he refused to do.
“It’s totally impossible,” he said. “I want what was approved by the previous government.”
U Aung Than Oo said he was unaware of U Kyaw Kyaw Naing’s legal plans, but that the instruction had been delivered in the correct way and the developer was free to pursue a legal case if he wished. The department head declined to comment on exactly why the HIC had instructed the changes be made.
This is not the first time U Kyaw Kyaw Naing has run afoul of changing regulations in the high-rise construction sector. He sent design plans for the Dhamma Thukha Kyaung Road project to the HIC for approval in May. That same month marked the start of a contentious and hugely disruptive review of all Yangon’s high-rise buildings – whether already under construction or not – by the new Yangon Region government.
U Kyaw Kyaw Naing would only discuss his planned lawsuit on condition that the company he owns – a prominent local developer – was not named. But his firm also had projects under construction that were heavily affected by the city-wide high-rise review. In July, the Yangon Region government told his firm to cut the number of floors on condominium project that was already under way from 12.5 to six. That also prompted problems with presold apartments, and U Kyaw Kyaw Naing told The Myanmar Times that month he intended to ask the government to cover losses.
Many of the drastic changes handed down during the review, however, were later rescinded after complaints from developers and government officials.