Regent Garden: 25 year old freehold property on West Coast Road, district 12..
The STB has surprised us yet again by rejecting an enbloc sale - this time Regent Garden
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Valuation wrong, so STB rejects Regent Garden Sale
Straits Times - 31 January 2008
Straits Times - 3o Jan 2008
ST - 31 Jan 2008
Today - 31 Jan 2008
From what I can gather from postings on the Forum page, this is what happened in the Regent Garden’s case:
Regent Gardens was sold for $34m and 6 minority owners objected to the sale saying the property was undervalued.
Regent Gardens was sold for $34m and 6 minority owners objected to the sale saying the property was undervalued.
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The STB ordered a re-valuation by the same valuer on account of the minority objection. The valuation came out to be $39.7m. [I'd like to add that the STB in the past has always brushed aside minority complaints about under value - saying instead that 'valuation is not an exact science'. Just why did they suddenly pay heed to this particular complaint, and is this the first time they have ever ordered a re-valuation?]
The STB ordered a re-valuation by the same valuer on account of the minority objection. The valuation came out to be $39.7m. [I'd like to add that the STB in the past has always brushed aside minority complaints about under value - saying instead that 'valuation is not an exact science'. Just why did they suddenly pay heed to this particular complaint, and is this the first time they have ever ordered a re-valuation?]
As DTZ had made an error, a second opinion from an independent valuer was sought which gave a valuation of $41m.
One of the panel members specifically asked the two valuers their opinion of the $34.0m, and the reply was that the acceptable variation should not exceed 10%.
STB asked the buyer if it would top up the difference, and after an adjournment, the buyer's lawyer agreed to top up to $39.7m, but would consider a request for an additional amount above $39.7m, but not exceeding $41m. The Buyer's lawyer then asked time to prepare a supplemental agreement at $39.7m.
A few days later, the buyer's lawyer suddenly wrote to majority's lawyers and claimed that they, the majority owners, had 100% as all the 6 dissenters had withdrawn their objection, and they therefore required the majority to withdraw their STB application.
STB Vice President, Mr. Alfonso Ang, pointed out that it was the minority who had informed the STB about the under value, it was the minority who vigorously objected to the $34m sale privce, and yet it was also the minority who now wanted to force the majority to sell at the objected price of $34.0m. Something was wrong somewhere, to which the minority's lawyer suggested that the court should not dig further as there was now no objection to the sale.
Court President commented "the tribunal cannot be ostriches".
Update: 17 April 2008
The High Court reversed the decision of the STB and ordered the owners to complete the enbloc sale with Allgreen Properties.
'Allgreen had asked the High Court for an order to get the majority owners to complete the sale. it argued that the STB had no need to even examine the sale as all owners had agreed to it.
The court agreed, ruling that the allegations of mistake and breach of contract were without merit and that the STBs decision to halt the sale was irrelevant.'
Source: Straits Times 17 April 2008
The majority rules! As such the STB has to listen to them when there are irregularities. There are obvious issues with the calculation of development charges. Minority objections are always heard but the majority will obviously have a louder voice.
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