Photo of Singapore MBS from AFP

Following Singapore government’s offensive stances against China over the South China Sea, China has responded with a boycott of investments in Singapore, choosing to divert billions into neighbouring Johore instead. Reported earlier this month was Singapore’s casino scene being the first victim of China’s punishment. Today, Singapore property developers are chalking up unsold condo units due to lack of interest from Chinese property investors. As a result of cooling measures imposed in 2011, these property developers are facing up to a total of S$697 million in penalties.

Read: China punishes Singapore casinos: Ban purchase of casino chips using yuan

Condo projects that could incur Additional Stamp Buyer’s Duty (ABSD) penalties in the first half of 2017 are The Trilinq, Mon Jervois, Hillview Peak, Stratum, Vue 8 Residence, Pollen & Bleu and Sant Ritz. Malaysian property group IOI Corp will likely incur a S$52.1 million penalty if it is unable to sold all 267 vacant units at the 755-unit The Trilinq at Clementi. Another developer, Singapore Land, will face a total of S$29.6 million in penalties for 135 unsold units in two developments it owns. Kingsford Devlopment will face a S$31 million in ABSD tax for 7 unsold units at Hillview Peak. Elitist Development faces a S$21.6 million penalty for 14 unsold units at Stratum. Capital Development faces a S$26.9 million penalty for 63 unsold units at Vue 8 Residence, while Santarli Corp faces a S$14.7 million penalty for 8 unsold units at Sant Ritz.

According to reports by Deutsche Bank and , property developers of 17 condo developments with 1,124 unsold units will incur QC extension charges. For ABSD charges, a total of S$697.6 million will be incurred by 20 developments with 1,300 unsold units.

Singapore’s rich are however doing their part helping local developers avoid property cooling penalties by purchasing in bulk of unsold condominium units. Last week, media reports headlined a high-profile bulk purchase of 45 condo units at The Nassim for S$411.6 million by United Overseas Bank (UOB)’s Chairman Emeritus Wee Cho Yaw. The billionaire son of the founder of UOB was helping property developer CapitaLand avoid a hefty property cooling tax called the Qualifying Certificate (QC) extension charge due this year. CapitaLand in return offered Wee Cho Yaw an 18% discount for his help.

According to media reports, two other condo developemnts – iLiv@Grange’s Heeton and Nouvel 18’s City Developments Ltd – have also received similar bulk purchase bailout from unknown rich individuals.

Property developers have to pay 10% to 15% of the land cost as ABSD when they are unable to build and sell all condo units of the development within five years after it was awarded. In addition to the ABSD, property developers with foreign holdings will need to pay QC extension charges.

Singapore’s property prices have hit decade-low and sales volume are not moving due to the lack of foreign interests especially from the wealthy China investors. However, just across the Causeway, China is lavishing tens of billions in infrastructures and investments in Johor Malaysia. Unfortunately not even a fraction of the billions Malaysia received have trickled into Singapore following Singapore Prime Minister Lee Hsien Loong’s offenses against China over the South China Sea territory dispute.

Read: Malaysia to build S$64 billion port with support from China