Missing PA letter

The property agent sent an email to majority owners on 14 April. Since not all owners are computer savvy, especially the older crowd, I wonder just how many owners it actually reached.

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Since it is 'Confidential and subject to legal privilege' I shall not be reproducing it here. There's not much in it, to tell you the truth, anyway. All stuff we know already.

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They have a blogspot blog! - using my choice of template, too. I guessed as much with that letter I published for them :) They are not accepting comments, though, - I tried, but they promptly deleted it. Aw, no reciprocation, guys?

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So, we are to expect the selective sending of information to continue. I'm sure, all owners, regardless of their affiliation, would like to know what's going on. It may not be mandatory for them to inform anyone who is not for the sale, but it is good manners.

Botanic Garden View has the same problem - see their latest blog post.

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April 30

One of the comments below said: - "Enbloc sale affects all owners. Hence, they have the right to be kept updated regardless of their affiliation."

Another asks:- "any obligation on the sales agent part?"

Believe me, if it were mandatory to inform every owner about every little thing that happens, then you can be sure every owner in Tampines Court would have received double copies!

Let's look back at Lincolnsvale Condominium, a couple there claimed they were not informed of the sale.

Condo sold en bloc, but family won't move out - Straits Times 20 April 2007

Gans may be hauled to court for staying put Today - 24 April 2007

Well, the Gans were taken to court by the developer and I have dug out the Lincolnsvale High Court decision, 25 May 2007 to see what Justice Paul Tan had to say. The respondents' case raised inter alia 9 points to claim that the process of the sale was defective. Point (v) read:

"(v) They (ie. the respondents) were not fully informed, if at all, about the sale of Lincolnsvale until everything had been signed. Notices should have been sent to their Post Office Box address rather than any other address since they were constantly moving between apartments."

Justice Paul Tan wrote:

"69 ....First, when an en bloc sale is initially proposed, the LTSA does not make it compulsory for each subsidiary proprietor to be personally informed. While personal notice is eventually required, there is nothing mandating a sale committee (so long as it is able to garner the requisite shareholding) to publicise the sale to each and every subsidiary proprietor personally, save that a notice of who has assented to the collective sale agreement must be affixed in a conspicuous part of each of each building in the development every eight weeks (para 1(b) of the Schedule to the LTSA).............

70 The short point is this: as long as the sale committee (who may be composed of anyone) has been able to amass the requisite majority, it is under no obligation to bring the sale to the individual attention of all the subsidiary proprietors. Of course, in practice, it would be difficult to get a majority without some active publicity. But that may still leave a significant minority of owners whom, for instance, may not actually reside in their units on a daily basis, completely out of the loop."

So, there you have it. Your personal code of ethics might not be in alignment with the current law, but it's the Law that must be applied - and it's not unlawful to keep even a significant number of people out of the loop.

The aftereffects of a failed enbloc

Some upside in failed en bloc deals
Business Times - 15 April 2008
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What if my condos's en bloc sale fails?

Defaulting parties stand to lose their deposits and can be sued for non-completion of the sale; it’s also risky to buy a new home before a collective deal is closed
Some owners of condominium units may still be keen on selling en bloc, but developers’ interest in collective sale sites has more or less dried up.
No residential sites have been sold en bloc in recent months. And given the market uncertainty these days, completion may not be a given for sites that have been sold.
Several collective sales have fallen through, with a few – Tulip Garden, Makeway View, Finland Gardens and Pender Court – already axed, regardless of whether approval from the Strata Titles Board (STB) was obtained.
A collective sale requires an 80 per cent minimum consent from owners before it can be sold. Unless there is unanimous consent, owners will have to get an order from the STB for the sale after they find a buyer.
After getting the order, they will have to wait for the buyer to complete the sale, which is when they will get their sale proceeds.
They have six months after the sale completion date to move out of the property.
The Sunday Times takes a look at what happens if your collective sale deal falls through.
If the STB throws out your sale
The onus is on the majority owners – those who have signed off on the sale – to obtain the STB order.
‘If they do their part and get the STB order, they are not in breach of contract,’ said Credo Real Estate’s managing director, Mr Karamjit Singh.
If they cannot get the STB order, they have failed to fulfil their part of the sale agreement with the buyer. The buyer can thus take back his 5 per cent deposit, a sum he had to pay when he inked the deal.
Most sale and purchase agreements have a standard provision that stipulates that if the purchase fails to be completed, the deposit or option money will be forfeited.
The buyer can also ask the majority owners to appeal against the STB decision in the High Court, said Mr Singh.
If they are not satisfied with the High Court decision, they can proceed to the next and last level, the Court of Appeal.
This is where the Airview Towers case went. The Court of Appeal overturned the High Court’s decision to reject the sale, putting the case back in the STB’s court.
In another collective sale, that of Finland Gardens, the buyer and sellers decided to withdraw their case in the High Court and terminate their agreement.
But as the sale had been thrown out by the STB, the developer remained entitled to keep its deposit.
It was a unique situation, and both sides negotiated on the terms, with the developer agreeing to bear most of the costs such as the litigator’s fees and advertisement costs.
If the buyer defaults on the deal
Whether owners can or cannot get back some money depends on which party is the one which has not fulfilled the contract.
Last year, developers were frantically buying sites and pushing to complete them.
But as the market slowed this year, it has so far seen a buyer, Bravo Building Construction, let go of three collective sale deals – Tulip Garden, Makeway View and Pender Court.
As it was the buyer that did not fulfil its part of the agreement to buy Tulip Garden for $516 million, it had to forfeit its 5 per cent deposit of $25.8 million.
The same developer also did not go ahead with the purchase of Makeway View and had to forfeit its option deposit of 1 per cent.
Owners from the 48-unit Pender Court got to keep the buyer’s 10 per cent deposit of $8 million, as well as a $4 million payment for granting a deadline extension. They had negotiated for an additional payment of $4 million to extend the deadline as the buyer had missed the completion deadline.
‘If the buyers default, sellers can sue them if the sale and purchase agreement does not contain a clause that limits the buyer’s liability to forfeiture of the deposit,’ said Mr Henry Heng, a director from law firm Tan Peng Chin LLC.
Or they could sell to another buyer and then go after the original buyer for the losses incurred, if any, again provided the agreement does not have the above clause.
While going after the buyer may sound logical to some, it depends on whether the company has enough funds to pay up, property consultants said.
Few would consider it as developers usually create shell companies for their property purchases, said DTZ executive director, consulting & research, Mrs Ong Choon Fah.
If you have committed to a property purchase
Last year, many owners bought replacement properties way before their collective sales were completed, in an attempt to beat the rising market.
This can get tricky. If the collective sale fails, the owners are basically left to their own devices. The risk is certainly much greater if the owners are dependent on the sale proceeds to finance their new property.
‘It’s a commercial risk, which is why property consultants and lawyers always advise owners not to take the risk,’ said Mr Singh.
All collective sellers have a six-month rent-free period after the completion of their collective sales, during which they can safely source for a property.
While it is uncommon, an owner could try to negotiate a deal with the seller of the new property where it becomes a done deal only if his estate’s collective sale is completed, said Mr Singh. The other party may agree if he is offered a higher price, he said.


DEALS EASING OFF


The market slowdown has resulted in one buyer, Bravo, giving up three collective sale deals – Tulip Garden, Makeway View and Pender Court.

• In the case of Tulip Garden, Bravo had to forfeit its 5 per cent deposit of $25.8 million.
• It also did not go ahead with the purchase of Makeway View and had to forfeit its option deposit of 1 per cent.
• Owners from the 48-unit Pender Court got to keep the buyer’s 10 per cent deposit of $8 million, as well as a $4 million payment for granting a deadline extension.

Sunday Times - 27 April 2008

Goodbye, en bloc sales
Sunday Times - 27 April 2008

He's glad the 2 year saga is finally over
Mr Micky Sim was overseas when he first heard that his estate, Finland Gardens, was going to be sold en bloc two years ago.
The first thing he did was to call his contractor who was renovating the unit he had recently bought there.
‘I cut back by at least 30 per cent. Forget about partitions. And we made things movable, rather than fixed,’ said Mr Sim, 38.
He bought the apartment before the deal was announced.
Two years on, he can finally go ahead and finish the renovations.
As one of the minority owners who contested the sale of Finland Gardens, he is delighted that the estate will no longer be sold.
But he feels that most of the majority owners will not be unhappy either, as the deal was made before the upswing in the property market last year.
Mr Sim, who works as a director in a shipping company, thinks that even if the owners sell the apartments themselves, they can do better than the $504 per square foot price offered by the en bloc buyer – even though the market has since been cooling.
Still, he is happy to stay put at his home and will sell only if the price is right.
The two-year saga has hurt the spirit of the community somewhat, he conceded.
But he feels that most neighbours are still on good terms.
“It’s time for everyone to move on. Let bygones be bygones,” he added.
Sunday Times - 27 April 2008

Couple's dream turns to nightmare
Sunday Times - 27 April 2008
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Deals off but she still lucked out

For housewife Jane (not her real name), the no-go on the en bloc deal at Tulip Garden, where she has a flat, proved a blessing.
Worried about spiralling home prices when talk of a collective sale started last year, she liquidated all her stocks in August to help pay for a $3 million apartment near Holland Road.
‘Prices in the area were going up by $200,000 every month. I got scared,’ Jane, 58, told The Sunday Times.
But selling her stocks was the right move – she cashed out before the stock market took a hit late last year.
If there had been no en bloc push, she probably would have held on to the stocks, she admitted.
Her family got a $120,000 share of the deposit the buyer had forfeited for Tulip Garden.
She noted that she was lucky. Her finances allowed her to buy another home without depending on money from the collective sale.
‘Those who do – and I know a few residents in this situation – may have some problems,’ she said.
Jane thinks Tulip Garden is still a good property because Farrer MRT station will be up in a few years. That could drive prices even further up, she said.
She will keep her unit and rent it out and move to her new home. She has an added reason to do so.
‘This en bloc issue has soured relationships between myself and some of the neighbours here because I didn’t want to sign for it initially. So I don’t want to stay here any more,’ she said.
Sunday Times -27 Apr 2008

PENDER COURT

Pender Court en bloc sale fails, owners keep $12m

Flaw in en bloc mediation process

IN A collective property sale, minority objectors create uncertainty, resulting in hardship for the 80 per cent majority owners, as follows:


They cannot commit to a new home and property prices may rise against them;
They may commit to a new home but are unable to get the sales proceeds to pay for the new property;
They lose interest on the sales proceeds (which may be a substantial amount) while the minority holds out; and
They are unable to rent at market rates because of the long sale process.To add insult to injury, under the mediation process, minority objectors are legally allowed to negotiate with buyers for higher compensation, which can run into millions of dollars.When successful, such payments to minority objectors are kept ’strictly confidential’.As the law should be equal for all Singaporeans, the authorities should remove this legal loophole by abolishing the mediation process. Objectors should object on the grounds of whether the sale process is fair, transparent and handled in good faith. There must be transparency in the legal system.

Ong Boot Lian (Mdm)


 ’I think 99 per cent, as she suggested, is too high. Perhaps 90 per cent is more reasonable.’ – MR WILLIAM TAY, responding to Ms Susan Prior’s suggestion to increase the percentage required before a collective property sale can be approved. The current rate is 80 per cent

Source : Straits Times – 23 Apr 2008

FINLAND GARDENS SAVED

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THEY'VE WON

HURRAY FOR

FINLAND GARDENS MINORITY

&

everyone is happy

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Finland gardens en bloc sale called off

Today - 22 April 2008

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Buyers, sellers call off sale of Finland Gardens.

ANOTHER collective sale has fallen through. This time, however, there were smiles all around – a reflection of how sharply sentiment has changed in the property market.
Both the majority sellers at Finland Gardens in Siglap and the intended buyer, Sing Holdings, agreed yesterday it would be best to just let the deal die. And the minority sellers, who were against it from Day One, were thrilled.
The sellers rung the death knell when they halted a High Court appeal yesterday.
They went to court last year to overturn a Strata Titles Board (STB) decision made in November last year.
The STB had thrown out the $49.5 million sale, ruling the deal lacked 80 per cent approval and that the price had not been obtained in good faith.
Sing Holdings initially backed the court appeal but withdrew yesterday its application to intervene in the appeal.
Managing director Lee Sze Hao said Sing Holdings told the sellers late last week that Sing Holdings no longer wanted them to continue with the appeal.
‘The key determining reason for us is the uncertainty of the timing of the sale and market conditions,’ said Mr Lee.
He added that the sale had dragged on for a long time and, considering market uncertainties ahead, it did not make sense to continue waiting.
The Sing Holdings statement said it considered uncertainties over the time needed to procure the order for the sale and market conditions, coupled with the rising costs of construction.
The sellers from 40 units met on Saturday. ‘We agreed to the buyer’s request to call off the deal amicably,’ sales committee chairman Song Koon Poh told The Straits Times. ‘Current market prices for our estate are still favourable… and the long waiting time has worn everyone down.
‘We don’t know how long this will drag on. Assuming the appeal is successful, we will need three months for final completion and another six months to vacate.’
The developer is said to be bearing most of the legal costs.
The minority owners, who fought hard against the sale and won the STB decision last year, were happy that it was over.
The deal for the freehold estate, with 48 units of walk-up flats, is now off. The move comes amid a flat market for private homes, with both buyers and sellers now cautious.
Sing Holdings bought the 98,309 sq ft Finland Gardens for $504 per sq ft on the land area in November 2006, just before prices surged in the first half of last year.
When the estate was launched for sale in July 2006, the owners were hoping for between $50 million and $55 million.
Meanwhile, Sing Holdings has completed the purchase of two collective sale sites – Bellerive and Hillcourt Apartments. Both are at the demolition stage.
Source : Straits Times – 22 Apr 2008

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ANOTHER collective sale has fallen through. This time, however, there were smiles all around - a reflection of how sharply sentiment has changed in the property market.
Both the majority sellers at Finland Gardens in Siglap and the intended buyer, Sing Holdings, agreed yesterday it would be best to just let the deal die. And the minority sellers, who were against it from Day One, were thrilled.
The sellers rung the death knell when they halted a High Court appeal yesterday.

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He's glad the 2 yr saga is finally over

Mr Micky Sim was overseas when he first heard that his estate, Finland Gardens, was going to be sold en bloc two years ago.
The first thing he did was to call his contractor who was renovating the unit he had recently bought there.
‘I cut back by at least 30 per cent. Forget about partitions. And we made things movable, rather than fixed,’ said Mr Sim, 38.
He bought the apartment before the deal was announced.
Two years on, he can finally go ahead and finish the renovations.
As one of the minority owners who contested the sale of Finland Gardens, he is delighted that the estate will no longer be sold.
But he feels that most of the majority owners will not be unhappy either, as the deal was made before the upswing in the property market last year.
Mr Sim, who works as a director in a shipping company, thinks that even if the owners sell the apartments themselves, they can do better than the $504 per square foot price offered by the en bloc buyer – even though the market has since been cooling.
Still, he is happy to stay put at his home and will sell only if the price is right.
The two-year saga has hurt the spirit of the community somewhat, he conceded.
But he feels that most neighbours are still on good terms.
“It’s time for everyone to move on. Let bygones be bygones,” he added.
Source : Sunday Times – 27 Apr 2008

Couple's dream turns to nightmare

From en bloc dreams to endless nightmares – that was how Madam S.L. Chia and her husband described their experience these past two years.
It became a nightmare because the promised $1.1 million from the sale of the couple’s Finland Gardens flat never came, as the deal became snagged in a dispute.
They were still servicing the loan on their flat, in Siglap, when the couple went ahead and took a loan on a second property.
Thus, closure of sorts came for them when, last week, the collective sale was called off. It had been sold in November 2006.
Madam Chia, 47, her husband, 55, and their son, 15, will be staying put in Finland Gardens, which has been their home for the last 14 years.
She felt that the collective sale had rushed her into buying a second flat.
A friend had advised them to buy another place quickly because he expected that property prices would go up further.
‘He was right. Within six months of our new home purchase, prices went crazy,’ said Madam Chia, who works in the media industry.
The new flat, further away in Upper East Coast, cost $800,000. Madam Chia took a 10-year loan that resulted in her having to pay $4,000 – effectively, her monthly salary – every month.
What the couple did not expect was that minority owners would successfully object to the sale.
The couple had ended up so strapped they could not afford to renovate their new house – something they can finally do now.
“And enough of the term ‘en bloc’ please,” Madam Chia said.
Source : Sunday Times – 27 Apr 2008

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Out of hundreds of en blocs, the few lucky ones so far are:

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Tulip Garden -saved - developer (Bravo) pulled out

Tulip Garden en bloc may be called off

Buyer Bravo will ‘accept costly missed opportunity’ if it’s not granted payment extensions
The owners of Tulip Garden met over the weekend and BT understands that most of them have taken the view to rescind the $516 million collective sale to an associate company of Bravo Building Construction – if the second 5 per cent instalment due to them is not paid by the deadline of midnight yesterday.
BT understands the owners could not accede to the Bravo unit’s request for another extension to pay up the second 5 per cent instalment which was to have been paid yesterday, to June 7, as well as to extend the completion date of the transaction, which is when it would have to pay up the remaining 90 per cent of the purchase price, from May 28 to Aug 7.
However, Tulip Garden’s owners, through their lawyers, are understood to have informed Bravo yesterday that the payment deadline will not be extended and that they reserve their rights to rescind the sale.
A Bravo spokeswoman said yesterday the consortium buying Tulip Garden is seeking an ‘unconditional extension of time’ for making the two payments, that is, it is not prepared to make any further payment to the sellers in exchange for the extensions, until June 7.
If the sale is rescinded, Tulip Garden owners will keep the $25.8 million or 5 per cent of the purchase price they had been paid so far, BT understands.
‘If these extensions are not obtained, the consortium will accept this costly missed opportunity to develop a stunning 350-unit condo with unmatched features in a prominent Holland Road corner,’ Bravo said in a statement.
Bravo has a minority stake in the consortium buying Tulip Garden. The en bloc sale of Tulip Garden was approved by Strata Titles Board in February.
In its statement, Bravo said that it and its majority consortium partners for the purchase of Tulip Garden intend to complete the purchase. Bravo did not identify the consortium partners. ‘Since December 2007, major foreign institutional investors and a few local investors have expressed strong interest to form the consortium. The current turmoil in financial and stock markets matched with sporadic bad news have caused unforeseen delays in securing ultimate approvals to commit funds,’ Bravo said in its statement.
Bravo also indicated that approval for Tulip Garden’s sale from Strata Titles Board in February came earlier than anticipated. ‘Coupled with the consortium’s strategic decision to significantly increase equity to balance the current cautious lending by banks, the current deadlines for next payments have become too constricted and no longer practical,’ it added.
BT understands that Tulip Garden owners declined to further extend the completion date of the sale of Tulip Garden as the STB had already given its order for the sale, binding all owners to a sale, and the sales committee does not have the powers to vary the completion date of the sale beyond the originally agreed May 28. The date was based on three months from receiving the STB order for sale, as stipulated in the sale and purchase agreement for Tulip Garden inked last year.
Assuming Tulip Garden’s sale is rescinded, it may be a while before the prime District 10 site is back on the en bloc bandwagon. If owners wish to do a fresh en bloc sale, they would have to do it under revised collective sales rules that took effect in October last year and which are more stringent.
The $516 million deal for the property worked out to a unit land price of $1,018 psf per plot ratio. No development charge is payable.
Last month, the $162.8 million collective sale of Makeway View in the Newton area to another associate of Bravo was rescinded. BT reported that one per cent of purchase price paid by Bravo so far was forfeited.
Source : Business Times – 8 Apr 2008
 

Tulip Garden sale off? How the deal went

Condo owners likely to call off $516m en bloc deal after developer misses payment deadline
THE $516 million collective sale of Tulip Garden condominium near Holland Road seems to be dead in the water after the developer missed a payment deadline yesterday.
The condo owners appear poised to formally call off the deal and pocket a cool $25.8 million – the original 5 per cent deposit paid by developer Bravo Building Construction.
LOSS AND GAIN: Bravo will forfeit its $25.8 million deposit if the Tulip Garden sale is axed. Each owner could pocket over $100,000.
Bravo would forfeit the sum if the deal is scrapped. That would mean each of the 164 unit owners could pocket more than $100,000 on average.
The cancellation of a collective sale because of a cash crunch is a rare event. Bravo and its partners say they have had trouble raising the necessary funds.
Earlier this year, the $162.8 million collective sale of Makeway View in the Newton area was ditched by an associate of Bravo. The firm said a higher-than-expected development charge was the reason for backing out. A deposit of $1.63 million was reportedly forfeited.
Last Saturday, Tulip Garden owners held a meeting and indicated in an informal show of hands that they wanted to cancel the sale if Bravo missed the latest payment, also $25.8 million. This payment had already been delayed at Bravo’s request from the middle of March.
By late yesterday, no payment had been made. Bravo was putting on a brave face but it was, in effect, accepting that the deal appeared to have been lost.
The developer had asked for more payment extensions – to make the next 5 per cent payment by June 7 and then complete the deal by Aug 7.
But based on last Saturday’s meeting, the owners appear unlikely to agree.
Almost all the owners at the meeting indicated that they wished to call off the sale and keep the deposit if Bravo did not pay up by yesterday, according to the people present.
A Bravo spokesman said yesterday that the firm is now seeking an ‘unconditional’ extension of time.
‘If these extensions are not obtained, the consortium will accept this costly missed opportunity to develop a stunning 350-unit condo with unmatched features in a prominent Holland Road corner,’ she said. The condo is on the corner of Holland Road and Farrer Road.
Bravo inked a deal to buy the freehold site in July last year. It was due to have been completed late next month.
The Bravo spokesman said the firm has been seeking partners since November last year.
‘The current turmoil in the financial and stock markets matched with sporadic bad news have caused unforeseen delays in securing ultimate approvals to commit funds,’ said Bravo. It added that the Tulip Garden owners had consented to the sale earlier than anticipated.
‘Coupled with the consortium’s strategic decision to significantly increase equity to balance the current cautious lending by banks, the current deadlines for next payments have become too constricted and no longer practical,’ it said.
Bravo added that it has tied up with two local and two foreign parties to buy Tulip Garden. But unless an extension is given, they will not be offering more money, said the spokesman.
She said that if Tulip Garden owners still want to attempt to sell en bloc, they may face an ‘unwelcome lower bid price’ given weaker market conditions.
Tulip Garden sold for about $1,018 per sq ft (psf), more than its earlier guide price of $900 psf in January last year. The development has 164 units comprising 96 flats, 66 maisonettes and two shophouses.
If the sale works out, flat owners stand to reap $2.5 million to $4.2 million while maisonette owners would receive about $3.4 million each. The shop units would get about $1.1 million each.
Amid last year’s booming market, Bravo also made two other fairly large collective sale deals: Pender Court, off Telok Blangah Road, at $80 million in July last year, and Makeway View.
Bravo has postponed the completion of Pender Court’s sale until late this month.
Given the slower market, more sellers are now open to lower prices. Yesterday, Royalville, a freehold mixed development off Sixth Avenue, was relaunched for sale en bloc at a lower indicative price of around $305 million.
It was offered for sale in a Nov 9 tender, which failed to attract bidders at its earlier guide price of $330 million to $350 million.
How the deal went
July 2007: Bravo Building Construction decides to buy Tulip Garden en bloc for $516 million. It later pays a 5 per cent deposit of $25.8 million.
February 2008: The Strata Titles Board approves the sale. The sale completion date is set for May 28.
March 13: Bravo is due to pay another $25.8 million, but asks for – and is granted – an extension of time until yesterday.
March 18: Bravo asks to extend the payment deadline from yesterday until May 5. It also asks to set back the sale completion date from May 28 to July 23.
March 24: Before agreement for its earlier requests can be given, Bravo asks for further extensions of time to pay by June 7, instead of yesterday, and to complete the sale by Aug 7, instead of May 28.
April 5: Owners indicate in an informal show of hands to cancel the sale and take the $25.8 million deposit if Bravo misses the payment deadline yesterday.
Source : Straits Times – 8 Apr 2008

Confirmed: Tulip Garden’s en bloc sale to Bravo rescinded

T’S official. Tulip Garden’s owners have rescinded the $516 million en bloc sale of the estate to a unit of Bravo Building Construction.
Lee & Lee partner Ow Yong Thian Soo, representing ‘Tulip Garden’ owners, confirmed that the firm yesterday sent a notice of rescission of the sale- and-purchase agreement for Tulip Garden to Bravo’s lawyers. ‘We also informed them that the sellers will be forfeiting the 5 per cent of the transaction price paid to them so far. And our clients reserve all rights,’ he said.
The notice of rescission was sent to Bravo after it failed to pay the second 5 per cent instalment by the deadline on April 7. Bravo had requested another extension of this deadline to June 7, as well as to extend the completion date of the transaction (which is when it would have had to pay up the remaining 90 per cent of the purchase price) from May 28 to Aug 7. Tulip Garden owners met over the weekend and most indicated they wanted to cancel the sale if Bravo missed the payment deadline on April 7.
Source : Business Times – 9 Apr 2008

$516m deal: Tulip Garden owners call off collective sale

OWNERS at Tulip Garden have called off the $516 million collective sale of their 164-unit Holland Road condo, but they will keep the $25.8 million deposit.
Mr Ow Yong Thian Soo of Lee & Lee, who is representing the owners, told The Straits Times yesterday that a notice rescinding the sale was given to the intended buyer – a consortium led by Bravo Building Construction.
The owners also told Bravo that they would retain the 5 per cent deposit, a right allowed under the sale and purchase agreement.
They decided to cancel the sale after Bravo missed Monday’s deadline – which had already been extended from last month – to pay a further 5 per cent of the purchase price. The developer wanted even more time to pay and complete the sale.
The deposit will now be distributed proportionally. Owners who were due to receive $2.5 million to $4.2 million from the sale will now get 5 per cent of these sums once the estate pays expenses of possibly $1 million or more. These include half the conveyancing fees, half the fees of consultants Savills Singapore, plus litigation and administration costs.
Bravo bought Tulip Garden last July and was due to complete the sale late next month. It also has unfinished business at Pender Court, where it missed the $80 million collective sale completion date but has an extension until later this month.
Source : Straits Times – 9 Apr 2008

Was Bravo too ambitious?

Analysts point to bad timing for developer in 3 en bloc attempts
ONE construction and property development firm, troubled by the cooling property market and credit crisis, has left three en bloc sellers’ hopes of a cash windfall in shambles – and some analysts wondering if it is a victim of circumstances, or a player that bit off more than it could chew.
Since April 1, Bravo Building Construction has made the news for rescinding the sale of Makeway View, and for delaying payments for the purchase of Tulip Garden and Pender Court.
Pender Court’s 48-unit owners are now waiting until April 29 to see if payment is made. If they do not see their cheques of over $1 million each by then, most would “take it that the sale is off”, a resident told Today.
Tulip Garden’s 164 unit owners also look certain to call off the sale, as they voted in a show of hands over the weekend not to give Bravo a longer time to pay.
Bravo has problems raising funds and is seeking an unconditional extension of time.
The company is likely to forfeit its first payment of $25 million, and owners would receive their share of about $125,000 each by this month, a Tulip Garden resident said.
Some market-watchers are sympathetic of Bravo’s plight – going ahead with en bloc purchases last year, seeking partners to come on board since November, and now facing trouble raising funds to pay the sellers.
“It’s unfortunate things didn’t work out. It was because of the timing and all the bad news in the financial markets,” said Mr Eugene Lim, assistant vice-president of ERA Singapore.
Noting that the property market has been relatively quiet since September after the boom earlier, analysts said Bravo may have “just missed the cycle”.
They said the company’s woes showed that dabbling in en bloc was not for everyone – especially not smaller, less experienced players.
Bravo, whose office is in Geylang Lorong 23, was set up in 2002. It ranked fourth in collective sale purchases last year, outbuying City Developments and Hotel Properties.
A lawyer dealing in collective sales found Bravo’s performance “very strange”, because compared to the big players such as United Overseas Land, CapitaLand and Guocoland, it was “nobody at all”.
Smaller companies would have problems securing funds from banks in the current credit crisis, he said.
While it is common for developers to make purchases before roping partners into the project, small players should secure partners before buying sites, said Mr Colin Tan, head of consultancy and research at Chesterton International.
For example, CapitaLand bought Gillman Heights last February, but later sold half its stake to Hotel Properties (HPL) and two private funds.
“It is common for one party to go in first, but for less experienced parties, they might over-reach,” said Mr Tan.
Meanwhile, residents at the Makeway View, Tulip Garden and Pender Court seem quite happy to stay put.
One Tulip Garden owner said the money forfeited by Bravo was some consolation for the “hassle we had to go through”.
Another owner said she gave up her car after moving to Tulip Garden seven years ago, and found its location hard to beat.
A Pender Court resident said she was happy to remain in her home of 22 years “where my children grew up”.
Makeway View resident Mark Devilliers, 31, who has been living there for over a year, did not know that its en bloc had fallen through.
Rejoicing when told of it by Today, he said it would be “sad if a nice building such as Makeway View went en bloc”.
Source : Today – 9 Apr 2008 

Tulip garden: Kim Eng's Ronald Ooi cuts losses on condo deal

He is said to have led group which backed the purchase of Tulip Garden
Kim Eng Holdings managing director Ronald Ooi, in his personal capacity, is believed to have led a group that backed Bravo Building Construction on its failed $516 million purchase of Tulip Garden.
Tulip Garden: The $516m deal failed as the buyer’s request to extend the payment deadline was rejected. The $25.8m deposit was forfeited
BT understands from market sources that Mr Ooi and the group were instrumental in raising the initial $25.8 million or 5 per cent deposit on the Tulip Garden sale which has since been forfeited.
Mr Ooi, who is said to be worth some $300 million, is said to have decided to cut losses on the acquisition in the face of weakening sentiment on the prime property front. ‘It had become more challenging to raise the necessary funds under current market conditions to complete the deal,’ a market watcher said.
Mr Ooi could not be contacted.
The deal, which worked out to $1,018 psf per plot ratio, was inked in July last year when the Singapore property market was enjoying one of its strongest bull runs in recent memory.
The collective sale was approved by Strata Titles Board in February this year.
But last week, lawyers representing Tulip Garden’s owners sent a notice of rescission of the sale and purchase agreement for Tulip Garden to Bravo’s lawyers and notified them that the owners would be forfeiting the 5 per cent of the transaction price paid to them so far as deposit.
This was after Bravo failed to pay the second 5 per cent instalment by the deadline on April 7.
Bravo had requested another extension of this deadline to June 7, as well as to extend the completion date of the transaction (which is when it would have had to pay up the remaining 90 per cent of the purchase price) from May 28 to Aug 7
Tulip Garden owners had a meeting and most decided they wanted to cancel the sale if Bravo missed the payment deadline on April 7.
Source : Business Times – 16 Apr 2008 

Deal's off but she still lucked out

    For housewife Jane (not her real name), the no-go on the en bloc deal at Tulip Garden, where she has a flat, proved a blessing.
Worried about spiralling home prices when talk of a collective sale started last year, she liquidated all her stocks in August to help pay for a $3 million apartment near Holland Road.
‘Prices in the area were going up by $200,000 every month. I got scared,’ Jane, 58, told The Sunday Times.
But selling her stocks was the right move – she cashed out before the stock market took a hit late last year.
If there had been no en bloc push, she probably would have held on to the stocks, she admitted.
Her family got a $120,000 share of the deposit the buyer had forfeited for Tulip Garden.
She noted that she was lucky. Her finances allowed her to buy another home without depending on money from the collective sale.  
‘Those who do – and I know a few residents in this situation – may have some problems,’ she said.
Jane thinks Tulip Garden is still a good property because Farrer MRT station will be up in a few years. That could drive prices even further up, she said.
She will keep her unit and rent it out and move to her new home. She has an added reason to do so.
‘This en bloc issue has soured relationships between myself and some of the neighbours here because I didn’t want to sign for it initially. So I don’t want to stay here any more,’ she said.            
    Source : Sunday Times – 27 Apr 2008 

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Makeway View - saved - developer (Bravo) pulled out

Makeway View en bloc deal falls through

Development charge higher than expected, says buyer
The $162.8 million collective sale of Makeway View in the Newton area to an associate of Bravo Building Construction has been rescinded.
BT understands that the one per cent of purchase price paid by Bravo so far has been forfeited.
A Bravo spokeswoman told BT yesterday that it had earlier sought payment extensions to ascertain the quantum of development charge (DC) payable.
Confirming the move to rescind the sale, she added: ‘We decided not to proceed with the Makeway deal as the actual DC turned out to be higher than what we had been told. So the breakeven price would end up being much higher than what we expected. That’s why my partner (in the proposed acquisition) decided not to proceed further.’
She confirmed that the initial information about the DC did not come from Knight Frank, which was the marketing agent representing the owners of Makeway View.
The $162.8 million deal for Makeway View announced in early November last year, reflected a unit land price of about $1,583 psf ppr including an estimated $21.5 million DC at the time.
Bravo group was one of the biggest buyers of collective sale sites last year, with deals like Tulip Garden for $516 million. Bravo formed separate associate companies for the acquisitions of the various collective sales sites, as the plan was to have different partners for each project.
A Bravo associate has so far paid the initial 5 per cent deposit on Tulip Garden, amounting to about $25 million.
Tulip Garden’s collective sale was approved by STB in late February and the Bravo associate was supposed to have made the second 5 per cent payment shortly after that. However, it requested for an extension on this till early April.
Bravo’s spokeswoman said her company is seeking a further extension to early June to pay this sum and to also extend the completion deadline for the deal from late May currently to early August.
‘We need time to sort out an agreement with our partner and at the same time, sort out the financing arrangement.’
Tulip Garden’s owners are expected to meet this weekend to decide whether to give the payment extensions. Tulip Garden’s price works out to $1,018 psf per plot ratio price (no DC is payable).
Source : Business Times – 1 Apr 2008

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Pender Court - saved - developer (Bravo) pulled out

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Finland Gardens - saved - developer/majority didn't appeal STB decision

Cut out the middle-man

Here’s a WILD IDEA.

A lawyer in an en bloc sale is essential.
Property agents, on the other hand, are dispensable.

Let’s take a leaf out of the HDB book. They now run classes for those owners who wish to cut out the middle-man and buy/sell their unit on the open market by themselves; thus reducing their costs.

The govt could run similar classes for private owners who wish to sell their estates en bloc.

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1) Holding EOGMs is a breeze. The managing agent in the estate will take care of all the necessary preparations. Anyone can read up the rules and regulations and follow instructions.
2) Owners can appoint their own Valuer to do a valuation. At least you can be SURE that the valuation is genuine and independent.
3) Owners will not be enticed, seduced, duped, cajoled, intimidated, harassed and/or sweet-talked into signing the CSA.
4) Signing the CSA can be done en mass only after 80/90% have indicated their intention to sell.
5) How difficult can it be to put an advertisement in the newspaper?

6) Learning the ins and outs of property transactions, the nitty gritty details is well within the intellectual grasp of many.
7) Interested developer-buyers will have to TENDER upfront, thus ensuring the best price possible for owners.
8) It can be very simply executed – whether your estate is plonk in the middle of a busy housing estate or in district 10, it will sell itself.

Too long, estate owners have been brainwashed into thinking their estate needs to be ‘marketed’ before anyone will be interested in buying. Says who? Property agents! That you need their ‘expertise and professionalism” …. but do we really? Older estates in choice areas market themselves.

Do we really need to approach developers – or will they naturally come to us, after all, Singapore is tiny, they have no choice, land is more precious than gold and developers should be grateful that the owners are offering them a second bite at the cherry through redevelopment.

“Hey-hup! 702,162 sq ft of land smack in the middle of a booming housing estate, regional hub, walking distance to two MRTs, shopping centres, hospital, markets, CC, 7 minutes to the airport, 2 minutes to PIE etc……..any takers?”

They need your land more than you need to sell.

So what if they don’t bite the first time, genuine homeowners can wait, the false sense of urgency is created by the property agent and speculators in your estate. Take a step back - don't believe all their spiel.

It is time for owners to wrest control from those professional outsiders who have vested interests in the sale of their homes- and save themselves millions of dollars to boot. No doubt, it is more expedient and easier to delegate to a 3rd party - but how sure can you ever be that they will perform their duties in your best interests? Knowing that their on-going (repeat) business relationship with developer-buyers is more important than any one-off arrangement they have with you. Knowing that the faster they sell, the quicker they get their commission. Knowing that their commission is pegged to a wide sale price, ie, they will get the same commission if they sell at $X dollars as opposed to $XX dollars... so why should they put in the extra work for no return? This is one of the reasons why so many estates are sold at the minimum reserve price, much to the chagrin of the majority owners.

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I can hear property agents everywhere guffawing at the idea -

but think about it.

'It's so crazy it just might work'

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NUS Role in Gillman Heights Saga

NUS played critical role in Gillman Heights en-bloc sale Straits Times 19 April 2008

I REFER to Mr Nicholas Kong's response on behalf of the National University of Singapore ('NUS: No conflict of interest in property deal', April 2). We minority owners - who have no wish to hawk our homes - of Gillman Heights in which estate NUS, by virtue of its 50 per cent ownership (303 units out of a total of 607), is the Goliath, wish to share our experience in the collective sale of Gillman Heights and, in particular, the critical role played by NUS.

The owners were relieved by NUS' reassurance at an owners' meeting on Feb 18, 2006 that it would refrain from casting its vote unless the 'majority' of individual owners decided to sell. We assumed, in the case of a collective sale, majority must be at least 80 per cent, or 90 per cent, depending on the legal age of the estate, but definitely not 51 per cent.

Just over 32 per cent (or around 65 per cent of owners of the 304 units) chose to sell. The owners assumed that that should put paid to the collective sale. However, the sales committee left us in suspense. In June 2006, it announced that NUS had decided to join the sellers. With NUS' 50 per cent, the total percentage jumped to 82.7 per cent.

In May last year, we learnt that Hotel Properties Ltd and two private funds had taken up stakes in the buyer of Gillman Heights, Ankerite, a subsidiary of CapitaLand. CapitaLand would retain a 50 per cent ownership of Ankerite. However, owners of the two funds were not identified.

Only during the High Court appeal in March this year was it revealed that NUS owns one of the private funds. It has a 16 per cent stake in Ankerite. The Strata Titles Board did not have this material information during its hearing of objections in September and October last year and before it issued its ruling in December. Thus, it could not be aware of NUS' direct financial interest in Ankerite at earlier mediation sessions held in June and July last year.

Mr Kong asserts: 'The financial interests of the university are aligned with those of the Gillman Heights owners seeking the best sale price for their units.' In 2006, after the individual owners had made their choice and before the June announcement that NUS would sell, much was going on while the owners were kept in the dark. It belatedly come to light that the delays had much to do with NUS' 'suggestions' that the reserve price be slashed by a hefty 20 per cent (a letter to this effect, dated May 16, 2006, was sent by NUS to the chairman of the Gillman Heights sales committee). Was that NUS' idea of 'aligning' its financial interests with those of the owners?

Lam Seng Mingand three other owners

Developers cutting prices

"Different strokes for different segments if developers cut prices"
Business Times - 18 April 2008

"In cutting prices by 3-5 per cent at three existing projects and achieving encouraging sales, property giant Far East Organisation may have set the cat among the pigeons.

Other developers must now ask themselves whether to embrace this strategy. Of course, the bigger ones have the financial muscle to hold back launches and sales for months and don't need to chop prices to entice buyers in the face of weaker market sentiment.

But there are opportunity costs involved in letting projects linger on the market and in holding on to sites -especially ones with 99-year leasehold - instead of launching the project.

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Still the months ahead may prove fruitful for bargain hunters"

REGENT GARDEN

The High Court reversed the decision of the STB which threw out the sale of Regent Garden in January this year and ordered the owners to complete the enbloc sale with Allgreen Properties.
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"Regent Garden owners ordered to complete enbloc sale to Allgreen"
" Allgreen had already 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 sell.

The court agreed, ruling that allegations of mistake and breach of contract were without merit and that the STB's decision to halt the sale of the West Coast Road estate was irrelevant. it also ordered the 25 owners to pay Allgreen's costs."
Straits Times 17 April 2008

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"Court directs Regent Garden sale to Allgreen to proceed"

Business Times 17 April 2008

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Regent Gardens En bloc will go ahead

Today-17 April 2008

Property Agent voice

Since I frequently post letters from minority dissenters in full, it is only fair that I post an property agent viewpoint received today through a comment.

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Dear Owners,

The Tampines Court en bloc has the overwhelming support of the owners. If there was a general election in any democratic country, the en bloc would be said to have received a landslide victory from amongst the owners. Surely the wishes of the overwhelming majority in any democracy must prevail over the wishes of the minority! The minority owners are exactly what they are, that is, they are in the minority.

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The owners of Tampines Court own the land according to their share values - they are joint owners of the land. If the majority owners of the land wish to sell the land, should the minority owners hold all of us up? The minority have lost the fight to prevent the majority from obtaining the 80% consensus. They have failed, and now they try to block the process in the STB, against the will of the majority. Only a minority of the minority objects at the STB Of the ....minority owners who have not signed the CSA, there are only....objectors. Obviously the other minority owners are prepared to let the objectors fight the futile fight, whilst they watch the fire from a safe distance.

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If the STB orders costs against the objectors, the objectors alone will have to bear the costs. Do all the objectors appreciate that they are risking their money for the good of the non-objecting minority owners? Some of the minority (and the objectors) have themselves bought alternative flats!So why are the objectors still objecting? Surely the thing to do is to get the en bloc STB order as soon as possible, so that completion could take place as soon as possible. In another en bloc case, some of the owners bought alternative units and the objector 'fought' all the way.The objector lost the case, and had to pay huge costs to the majority. In the process, the owners who had contracted to buy alternative flats were sued by the sellers of the alternative flats, because of the delay in the completion of the en bloc. The objector caused much misery to himself and all the other owners.

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The Property Market has fallen! At the time that the en bloc process was started, owners were looking at a substantial premium. Now, if Tampines Court is to be tendered out, the price would have fallen. The subprime losses are said to be in the region of $1,000 billion! The whole market is uncertain, and developers are looking more at state land sales instead. There are so many sites available, and developers do not have to wait for the troublesome process of the STB. Just look at the following examples:Royalville, a 174,176-sq ft freehold residential property located along Bukit Timah Road, will be put up jointly with an 8,420-sq ft drainage reserve for collective sale. The combined indicative asking price is S$305 million. Including a development charge (DC) of S$6 million, the price works out to S$1,106 per sq ft per plot ratio (ppr), which is 10 to 15 per cent lower than the previous indicative. (The Business Times, 8th April 2008)

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The S$516 million collective sale of Tulip Garden, a freehold residential property located along Farrer Road, to a unit of Bravo Building Construction has been officially rescinded. The collapse of the en bloc transaction was down to the majority owners’ refusal to accept the developer’s request for an ‘unconditional’ extension of time of the next 5 per cent instalment payment due to them. (The Business Times, The Straits Times, 9th April 2008)

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Amber Glades, a freehold residential property located along Amber Gardens, has been relaunched for collective sale at an indicative asking price of S$127 million. Including of a DC of S$3.5 million, the price works out to S$1,140 per sq ft ppr, which is 15 per cent lower than the previous indicative. (The Business Times, 9th April 2008)

Replacement units are available if the STB order is obtained quickly, then we would all be paid quickly as well.Then we would be able to use that money to buy alternative units.
April 15, 2008 4:35 PM

In reply

"If there was a general election in any democratic country, the en bloc would be said to have received a landslide victory"
Alas, this is not a general election where a simple majority of 50%+1 is required to win. This is the compulsory acquisition of other people's homes which requires 80% of the total share value by LTSA rules. So 79.99% is not a majority. Justice Lee (in his 19 March 2008 decision) stated “it is therefore not for the court to water down the protection afforded by the legislation in its present form in favour of the majority, vast though it may be."

“the wishes of the overwhelming majority in any democracy must prevail over the wishes of the minority!”
-only if they comply with the rules

“there will be adequate safeguards to protect the interests of minority owners. These safeguards are found in the procedures as well as in the substantive powers of the Strata titles Board".(Parliamentary Speech 2007)

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The High Court does not condone the brutish 'might is right' position - in the Horizon Towers High Court decision Justice Choo Han Teck wrote in his 11 Oct 2007 judgement that "...

"fairness requires that the law is applied consistently to everyone in similar circumstances. It gazes upon the horse as it does the horseman. It may be the appellants today who slipped, and tomorrow, the respondents. If the majority succeeds it is because it is right, not because it is the majority. Likewise, if the minority succeeds it is because it is right and not because it receives favours granted only to the underdog"

In a High Court decision on 06 Nov 2007 Justice Andrew Phang Boon Leong wrote:
'It is axiomatic that every party ought to have its day in court. This is the very embodiment of procedural justice. The appellation “procedural” is important. Procedural justice is just one aspect of the holistic ideal and concept of justice itself.'

'However, the court must be extremely wary of falling into the flawed approach to the effect that “the ends justify the means”. This ought never to be the case. The obsession with achieving a substantively fair and just outcome does not justify the utilisation of any and every means to achieve that objective. There must be fairness in the procedure or manner in which the final outcome is achieved.'

"The minority have lost the fight to prevent the majority from obtaining the 80% consensus."
That has yet to be determined. The STB hearing is in June.

"Only a minority of the minority objects at the STB"
That is true – not everyone is of the same mindset; some will persevere where others fall away, still others prefer to remain on the sidelines. This is human nature.

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"If the STB orders costs against the objectors, the objectors alone will have to bear the costs." The objectors proceeding with the hearing are fully cognizant of the costs involved, not just at the STB level but the High Court and the Court of Appeal. A court case is inherently dangerous for both sides, you just never know…

"Do all the objectors appreciate that they are risking their money for the good of the non-objecting minority owners?"
There comes a point where you have to put your money where your mouth is, regardless of the action or inaction of others. You make a stand and go forward, win or lose.

"Some of the minority (and the objectors) have themselves bought alternative flats! So why are the objectors still objecting?"
As far as I know, people are free to own as many homes as they like if they can afford to do so. Buying an alternative flat does not signify agreement to the sale, nor is it a declaration of defeat – the substantive objections to the sale remain. I believe the minority owners who have bought second homes would prefer to rent them out rather than move.

"In the process, the owners who had contracted to buy alternative flats were sued by the sellers of the alternative flats, because of the delay in the completion of the en bloc"
Any owner who buys a replacement unit before completion runs this risk. That is why it is imperative that you do NOT buy a unit if you need to use the sale proceeds for the purchase. Our en bloc lawyer has repeatedly cautioned everyone against this inherent danger and those who buy before completion and then find themselves in this predicament if the sale is delayed (for whatever reason, and there can be many) have no one to blame but themselves. Do not blame others for your own foolhardiness.

"The objector caused much misery to himself and all the other owners."
I believe you are talking about Mr.Yeo from Waterfront View. He had a very strong point to argue and it was unfortunate the ruling went against him. He did not regret his actions. Alternatively, we have Mr. Ken Lee of Airview Towers who went all the way alone and won at the STB and High Court, but lost at the Appellate Court.

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"The Property Market has fallen! At the time that the en bloc process was started, owners were looking at a substantial premium. Now, if Tampines Court is to be tendered out, the price would have fallen"
I find this statement highly amusing. I don't know if the market has fallen significantly, but we'd need to have our own sub-prime woes for it to reach TC levels. Show me an enbloc that is presently going for $260 psf pga! Tampines Court wasn’t sold, it was given away.

I notice how you didn't and couldn't say that 'at the time of sale, owners reaped a substantial premium'. It was a case of now you see it, now you don't. Not quite a case for Hercule Poirot, but definitely 'The case of the disappearing premium'.

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"Developers are looking more at state land sales instead."

This sounds like typical agent scaremongering - developers will buy land whenever and wherever they can. How much state land is left in the middle of mature housing estates? That's the whole purpose of en bloc - freeing up land in choice locations for developers to build more intensely and for huge profits. It's still all about location, location, location. As Mark Twain once said " The reports of my death have been greatly exaggerated." so too the demise of enbloc.

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"The collapse of the en bloc transaction was down to the majority owners’ refusal to accept the developer’s request for an ‘unconditional’ extension of time of the next 5 per cent installment payment due to them"
And all's well that ends well; it was the majority owners who happily scuppered the sale, and the group backing the developer decided it was best to cut their losses – The developer (Bravo)forfeited the 5%.

"Tulip Garden: Kim Eng's Ronald Ooi cuts losses on condo deal" Source Business Times 16 April

In the Finland Garden's case, the deposit was returned to the developer (Bravo) as the STB had not approved the sale. So they win some, lose some.

Amber Glades,….. S$1,140 per sq ft ppr…..Replacement units are available
How, pray, to buy a replacement unit at $1000+ psf ppr when Tampines was sold for $255 psf ppr?*

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*My understanding in this area is not strong; but this is how I estimated:

(a) Estate size = 702,162 sg ft

(b) Sale price = $395,000,000

(c) Developmental charge + Differential premium - $107m

(d) Psf = $395m + $107m / 702,162 = $715 psf

(e) Plot ratio = 2.8

(f) Psf ppr = $715 / 2.8 = $255

(g) Psf pga - $260 (as stated in newspaper reports)

Forfeit

"Some upside in failed en bloc deals"

"It would, of course, be much simpler if the potential units from a large en bloc site like Gillman Heights or Tampines Court were removed from the market.
But this is unlikely as it has become almost a mantra that big developers have holding power, even if they are losing money at the same time"

Business Times 15 April 2008

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You never know which way the wind will blow. It is not entirely impossible that the big developer-buyers will let one of their 2007 acquisitions slide; after all they can pick it up again at a future date through another en bloc (and there could be endless rounds of those). If $600k is considered peanuts to a certain strata of society, then $20m should be coffee money to a multi-million dollar company. You can't hold on to leasehold properties indefinitely. I have not come across a single person in our estate who has bought a new property or is thinking of buying a new property with the en bloc sale proceeds. Everyone is either downgrading to HDB or buying into old estates.

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So if the developer-buyer of Tampines Court is listening - consider giving us up. Come back in another 10 years when large plots of land in booming estates are really scarce and the plot ratio is 4.0. Think of the cost benefits. You currently have Waterfront Waves within stone throwing distance of TC - and 1600 units there to off-load at a price not many mass market potential buyers find appealing. Sales have stalled.

A bird in the hand is worth two in the bush. One project sold is better than two half-sold.

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"Consider wider interests of society, not just economic payoffs"

Source -Business Times 15 April 2008

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EUNOSVILLE

A comment:-

"I'm residing at Eunosville, where we just had the qualifying 75% vote for privatisation. It is indeed very sad. And I must say I was angered by Mr Lau's letter to the forum. Like some people may feel, I think he has no idea what it is like for us. Eunosville is indeed like a kampung. Neighbours' children play with each other and even the adults will stop to chat with each other under the block and while washing their cars. I don't think money can buy you such neighbours, such community spirit." Eunosville resident, 13 April.

Comment on Enbloc and Good Neighbourliness post
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How sad, it looks like the juggernaut that is en bloc will be rolling over his estate soon. Privatisation was the carrot which all the HUDCs bit - they were supposed to upgrade themselves by building a swimming pool, clubhouse etc. Instead, privatisation was just a wolf in sheep's clothing and turned out to be nothing more than a land-grabbing exercise, enforced downgrading, loss of community, a lowering of standard of living, loss of savings (for some) and the most important of all, loss of home. Knowing the hell other HUDCs have gone through, Eunosville should be very careful about how it proceeds. They have better safeguards in place than their forebears (I particularly like the 5 day cooling off period) -and more info at their fingertips.

The law ministry is thinking about tweaking the rules once more - lets hope they listen to the people and not just property agents. You can read about it here.

Of course, new rules and possible amendments to new rules do not apply to TC,

Meet your MP

I just updated the "Meet your MP" link in the sidebar. They have a fancy new website replete with bells and whistles and something new:- you can now email direct to any of our 5 Tampines GRC MPs with your questions/grouses/complaints etc.

Of course, there is also the face-to face approach every Monday, if you so choose.

Harbinger of things to come?

It's wait and see for Pender Court & Tulip Garden Owners"
Straits Times 4 April 2008
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"Makeway View enbloc deal falls through"

01 April 08 | The Business Times by Kalpana Rashiwala

(SINGAPORE) The $162.8 million collective sale of Makeway View in the Newton area to an associate of Bravo Building Construction has been rescinded. BT understands that the one per cent of purchase price paid by Bravo so far has been forfeited. A Bravo spokeswoman told BT yesterday that it had earlier sought payment extensions to ascertain the quantum of development charge (DC) payable. Confirming the move to rescind the sale, she added: 'We decided not to proceed with the Makeway deal as the actual DC turned out to be higher than what we had been told. So the breakeven price would end up being much higher than what we expected. That's why my partner (in the proposed acquisition) decided not to proceedfurther.' She confirmed that the initial information about the DC did not come from Knight Frank, which was the marketing agent representing the owners of Makeway View. The $162.8 million deal for Makeway View announced in early November last year, reflected a unit land price of about $1,583 psf ppr including an estimated $21.5 million DC at the time. Bravo group was one of the biggest buyers of collective sale sites last year, with deals like Tulip Garden for $516 million. Bravo formed separate associate companies for the acquisitions of the various collective sales sites, as the plan was to have different partners for each project. A Bravo associate has so far paid the initial 5 per cent deposit on Tulip Garden, amounting to about $25 million. Tulip Garden's collective sale was approved by STB in late February and the Bravo associate was supposed to have made the second 5 per cent payment shortly after that. However, it requested for an extension on this till early April. Bravo's spokeswoman said her company is seeking a further extension to early June to pay this sum and to also extend the completion deadline for the deal from late May currently to early August. 'We need time to sort out an agreement with our partner and at the same time, sort out the financing arrangement.' Tulip Garden's owners are expected to meet this weekend to decide whether to give the payment extensions. Tulip Garden's price works out to $1,018 psf per plot ratio price (no DC is payable).

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"Tulip Garden enbloc may be called off"
Business Times 8 April 2008
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"Owners say enbloc sale of Tulip Garden has been called off" Owners say enbloc sale of Tulip Garden has been called off

Posted on April 8, 2008 by luxuryasiahome
 

The enbloc sale of Tulip Garden, a freehold development in District 10, appears to be off.

Tulip Garden was sold in July 2007 in a collective sale valued at S$516 million. The property is along the prime Holland Road and Farrer Road area.

Channel NewsAsia understands that owners are now waiting to hear more details from the developer.
Bravo Building Construction bought Tulip Garden at more than S$1,000 per square foot and the sale was scheduled to be completed by May.

However, earlier reports stated that Bravo Building Construction was delaying the completion date and there was some talk that it was trying to arrange for alternative financing.

Some owners of Tulip Garden have already received their share of the deposit for the sale.

According to earlier reports, Bravo Building Construction has called off another enbloc sale – that of Makeway View in the Newton area and is also said to be delaying the completion date of the sale of Pender Court off West Coast Highway. – CNA/vm
Source : Channel NewsAsia – 7 Apr 2008

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"Tulip garden off? How the deal went."
Straits Times 8 April 2008
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"En Bloc market suffers double whammy as investors look elsewhere"
Said Dr Phang: "The long timeline has to be shortened; it's too long, the whole en bloc process. The law allows you 12 months to get 80 percent. And after that, the law allows you 12 months to file the ST (strata title). And when you do, the STB (Strata Title Board) may take short of 4 months or a long time of a year. "Of course not every case is that long but if you look at the historical maximum permissible time, you're looking at something about 2 years plus. And that's a long time to wait for the money. Given the volatile market conditions in Singapore, if it goes up, owners get concerned with replacement. If it goes down, developers (become) concerned. So we should try to manage the timeline and shorten it."

Source: Channel NewsAsia 08 April 2008

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"Property agents in race against clock".

Business Times 8 April 2008

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"Issues of cost, procedures bubble up in new en bloc rules"

Business Times 12 April 2008

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