SB Reit Management, the manager of Soilbuild Business Space Reit, will be commencing proceedings in the High Court of Singapore regarding additional land rent payable to JTC corporation, which amounts to some S$3.5 million per annum, it announced on Friday.
The property, Solaris, was acquired by Soilbuild Reit on Aug 16, 2013, and the rent payable to JTC comprised of land rent of S$405.10 per square metre per annum and subterranean rent of S$23.48 psm per annum, said Soilbuild.
In April 2014, JTC wrote to DBS Trustee Limited, the trustee of Soilbuild Reit, to inform of an error on the rent charged and said that the correct rent should be S$855 psm per annum for land rent and S$70 psm per annum for the subterranean rent.
Consequently, JTC is seeking to adopt the revised rents and claim back payment to make up for the difference between the revised rates and the applicable rates with effect from the completion date.
Based on that difference, the additional rent would be approximately S$3.5 million per annum (excluding goods and services tax), said Soilbuild.
"The manager does not agree with the imposition of the revised rates by JTC as it has relied on JTC's determination on the applicable rates and proceeded to complete the acquisition of the property.
"After numerous attempts to resolve the issue with JTC, the manager has decided to seek a determination of this matter in the courts to resolve this in an impartial manner and to safeguard the interests of its unitholders, Soilbuild said.