Jun 30, 2011

Property Agents

New rules today for Property Agents, applicable from Aug 1, but I think we can demand them of any MA now as en bloc stretches over 2 years. If they don't then delay their engagement until after 1st August.

MUST read:

Go to the Council for Estate Agencies website and scroll down to the  
  • Practice Guides and Circulars. 

Jun 23, 2011

EGM 2



EGM 2 REQUISITION FORM











 EGM 2 AGENDA

No. of requisitionists: 117 (unconfirmed)

Resolutions 3,4,5,6  from requisition form are absent from the agenda.
Is the requisition still valid?

Jun 20, 2011

Brookvale Park

SINGAPORE : Brookvale Park, a four-storey condominium nestled in the Sunset Way estate, has been put up for sale by public tender.

Marketing agent CB Richard Ellis (CBRE) said the 999-year residential site has a land area of 373,000 square feet and a permissible building height of up to 12 storeys.

It is located close to amenities and is a short drive to education institutions like Ngee Ann Polytechnic and the National University of Singapore.

It also has easy access to Orchard Road via Holland Road; as well as the Central Business District (CBD) and Marina Bay area via Ayer Rajah Expressway (AYE).

CBRE said the asking price for Brookvale Park is S$550 million.

Charles Hoon, director of investment properties, CB Richard Ellis, said: "Developers can take advantage of the site's unique hilly characteristics to incorporate balconies into their design scheme.

"The additional 10 per cent bonus balcony (subject to paying a Development Charge) will bring the land price to S$892 psf per plot ratio."

This means a potential break-even price of below S$1,400 psf.

New residential launches including The Trizon, Jardin, The Floridian, and The Cascadia have transacted between S$1,600 and over $2,000 psf, Mr Hoon said.

He added: "We expect strong local and foreign interest, in particular, parties who are considering a 'freehold equivalent' site in prime District 21. Brookvale Park is likely to be the only condominium site available in this locality."

The tender will close on July 28 at 3pm.

June Media

CEA issues new guidelines for estate agents - CNA 29 Jun 2011
Increase in private home prices 'has accelerated' - Today 29 Jun 2011
Non-landed private home prices up 2.5% in May - CNA 28 Jun 2011
Resale of private homes continue to rise - CNA 27 Jun 2011
River Valley apartment sold en bloc for S$70.5m CNA 27 Jun 2011
Collective sale market to remain healthy: Credo  - CNA 27 Jun 2011
Balmoral Condo sold for $141m - CNA - 22 Jun 2011
Tulip Garden back in collective sale bid - CNA 22 Jun 2011
Braddell Park sells for 85m - PropGuru, 22 Jun 2011
Brookvale Park put up for sale by public tender

With a lower RP, Whitly heights is on the market againToday, 16 Jun 2011
Expect bubble to burst in 2013 - New Paper 11 Jun 2013
New condos demand fat premiums - BT Jun 11 2011
2013. Market crash or ghost towns?- 10 Jun 2011
Property prices worry National Development Minister - CNA 9 Jun 2011
More Government Land Sales slated for 2nd half of 2011- CNA 9 Jun 2011

Today, 7 Jun, 2011 


More Government land Sales - Today 1 Jun 2011
As supply of new flats is ramped up.. - Today 1 Jun 2011

Jun 18, 2011

Method of Apportionment of Sales Proceeds for TC

Tampines Court is lucky in that the units do not vary greatly in size (154 - 161 sqm) and  all enjoy equal share value of 4. There is no one size fits all method of disbursement, it typically can range from full strata area to full share value or some percentage of both . At the end of the day, it is a judgement call.

A more  factual method would be to calculate the common area separately from the strata area:share value. The common area is 21.13% of the Development baseline and the Strata area is 78.87%. So, 21.13% of the sales proceeds would be divided equally between 560 units and the remainder divided by the 50:50 method of apportionment.  But let's not go there as TC does not throw up a huge  problem in this area.

The formula for the 50% strata area 50% share value method is quite straightforward*, and when you apply it to a Sale Price - then this is what each unit will receive before deduction of costs and expenses of the sale.  The Sale Price does not include the DP/DC which is payable by the developer-buyer. I have given some examples of unit proceeds based on different ballpark sale prices. The tables below are my own *, I have not seen the detailed proposals given by the shortlisted MAs, and I do not know what values they might have used.


*The initial formula is  (E + F) / 2  whereby E = a unit's percentage by share value (ie. it's share value / total share value),  F =a unit's percentage by strata area.  (ie, its floor area  / sum total of  floor area of all units). This total floor (strata) area can be ascertained by doing a SLA search, or in my case,  a  URA website, crosschecked with documents from Round 1. The total strata area is 87974 sqm and the total share value is  2240

Jun 16, 2011

The shocking price of new HDB

DBSS flats Centrale 8 at Tampines launched

June 16, 2011
Centrale 8 is a public housing project developed under the Housing and Development Board’s (HDB) Design, Build and Sell Scheme (DBSS). The project covers a total land area of 227,461.6 sq ft.

The project comprises 708 units of three- to five-room flats. The three-room flats range in size from 61 sq m to 62 sq m, the four-room flats from 83 sq m to 84 sq m and the five-room flats from 108 sq m to 109 sq m.

Three-room flats are available for between S$397,000 and S$510,000, four-room units between S$531,000 and S$683,000 and five-room flats between S$685,000 and S$880,000.

The development comprises seven residential blocks, fully-equipped with communal spaces, a central precinct pavilion, children’s playground, inter-precinct open spaces and a fitness area. It also features commercial facilities, such as an eatery, two shops and a mini-mart.

Centrale 8 is strategically located near the Tampines Regional Centre, Tampines MRT Station, Downtown Line 3 MRT Interchange, Tampines Mall, Century Square, Tampines One, major banks and the upcoming Tampines Town Lifestyle Hub.

The showflat will be open for public viewing from 16 to 21 June, 2011.

3 Room HDB ~ 667 sqft / $765 psf!!!
4 Room HDB ~ 904 sqft / $756 psf!!!
5 Room HDB ~ 1170 sqft / $750 psf!!

17 Jun 2011
Looks like I'm not the only one surprised by the new price of HDB. I opened  the Straits Times today and....














The rationale given behind the high price for this new HDB flat is that the location is excellent .... (for all the same reasons why Tampines Court's location is excellent).

With this new benchmark for HDB,  private mass market developments - which are not hamstrung by HDB rules and regulations-  are securely set in the $1000+ psf bracket.




23 June 2011
Tampines DBSS project two times oversubscribed 
The controversial expensive Design, Build, and Sell Scheme project at Tampines, Centrale 8, has been two times oversubscribed.
1,431 applications were received for the 708-unit project by the deadline on Tuesday.
This is despite the hullabaloo created by the indicated price earlier announced by property developer Sim Lian Group, who said during the launch that the biggest 5-room flats will cost up to $880,000.
It has since slashed the prices by up to $102,000, bringing the maximum price down to $778,000.
The Straits Times reported that this news surprised some industry observers, who said that the number of times a project is over-subscribed is not a good indicator of how well it will actually sell eventually.
PropNex Chief Mohamed Ismail told the paper that it is more likely that that people are hoping to buyer lower-end units within their price range, and that if they are offered a flat beyond their budget they will reject it.
Similarly, when the first DBSS project was launched, also by Sim Lian Group, the 616-unit Premiere@ Tampines received 5,700 applications. However, only 500 flats were sold initially, although, as the Straits Times reported, there were long queues when the remaining units went up for sale.
AsiaOne  
Jun 23, 2011

Jun 11, 2011

Sale Committee Meeting

How many legal presentations will there be?

Not too many, I predict. TC is a very large estate and a lot of hassle for any en bloc lawyer. I would like to see a legal firm that stipulated a non-refundable up-front fee from signatories to the CSA. This will keep the lawyer honest as the no-sale-no-fee basis of engagement is fraught with conflict of interest. I would also like to see a legal firm that conducted either monthly mass signings  or require owners to visit the legal office. What is NOT acceptable is for en bloc lawyers showing up at doorsteps alongside marketing agents at midnight goading owners into signing on the spot. It is a dubious practice and highly unprofessional. This kind of behavior is akin to touting.


From a previous post: No Sale No Fee
It is no surprise that lawyers and marketing agents readily agree to this contingent fee whereby they are not paid until after the sale has been approved and after the buyer has deposited the sale proceeds into the owners' bank accounts. After all, the chances of the sale NOT being approved are minimal and the rewards of a successful en bloc are great indeed. It is almost a certainty that they will be generously recompensed for their costs and expenses at the end of the day. The substantial reward is therefore worth the risk. The owners have agreed to a minimum sale price in advance which becomes the target price at which they can sell.  The CSA is a veritable straightjacket of clauses pinning owners down without indemnity. It is in the en bloc lawyer and marketing agent's best interest that the sale be swift and trouble free.

The legal profession in Singapore in general does not work on the American style contingency basis - that is, lawyers getting paid only if they win the case. It is forbidden here in order to discourage frivolous litigation and inflated claims; and it works. The Law clearly understands how neither the Law nor a client's best interests are served well if the lawyer has a financial stake in the outcome of the case. Basically, it keeps people honest and their motivation pure.

But the Law does allow a 'form' of contingency payment in en blocs. Granted, it's not quite the same as the en bloc lawyer's fee is set out in advance in the CSA (see First Schedule 3.(c)) - the only unknowns are the disbursements and possible extra costs such as High Court expenses, Senior Counsel fees etc. But it's still No-Sale-No-Fee, and provides a powerful reason d'etre to push a sale through.

In the past, normal practice would have the en bloc lawyer, as stakeholder, being entitled to the interest derived from the monies held - and when you are dealing with multi-millions, you are talking about a very big sum indeed. The longer he held onto he money, the more interest accrued. A reason to stretch out the process, perhaps. But no more.

And in the First Schedule, the CSA must state:
3 (e) the person entitled to any interest derived from moneys held by any stakeholder; and
.
Nevertheless, owners should be very wary of the vested interests of the en bloc lawyer and marketing agent and take each step with caution. No one is on your side but yourself, and it is wise not to put too much faith in the integrity of strangers where money matters are concerned. The temptation to cut corners, devise ways to concentrate control, manipulate sentiment on the ground and ply pressure especially in the final stages is strong and are all means to an end - the end being securing their own fees and commission. 
,
Let me cite from the transcripts of the Tampines Court STB Tribnal proceedings, dated 16/17 June, 2008. (cross examination of marketing agent by minority lawyer, names are deleted)
.
Q. I’m putting it to you that all you were interested in was closing some deal to get your $1.9 million in commission; agree or disagree?
A. Ultimately, yes.
Q. I’m putting it to you that you did not help the sales committee get an independent valuation that would give them a chance to assess your reserved price of $389 million; do you agree or disagree?
A. It’s not necessary to do so.
Q. I’m suggesting to you the only reason why it was not necessary to do so was in your interest, (property agency)’s interest.
A. Interest, ultimately, yes, upon the sale completion of the en bloc sale.
.
Marketing agents and serial en bloc lawyers have an ongoing professional relationship with buyer- developers, both big and small. They have only a fleeting, one-off relationship with an en bloc estate. No cigar to anyone who knows which relationship is more important in the long run...
.
At the outset of an en bloc, owners have two choices in the matter:
  1. Stick to the status quo and beware or
  2. Pay legal fees up front
CHOOSE 2!. How else are you to ensure your best interests are being served? How else can a lawyer not find himself betwixt and between his clients' best interests and his own? The marketing agent always works from commission so he can be left to the end. The lawyer is de-linked from the MA and has no pressing reason to sell fast and low. Having an uncompromised lawyer drawing up an owner-friendly CSA, keeping a watchful eye on the process, being present at the negotiation table and at the signing of the S&P can only be to the owners' advantage.

Feed the sharks, and maybe, maybe  they won't eat you.

Jun 9, 2011

GLS 2H2011

9 June 2011
Government continues with strong land supply under the second half 2011 
Confirmed List
Residential sites
1 Upper Serangoon Road / Sungei Pinang (3)




Jul-11 HDB
2 Jalan Loyang Besar / Pasir Ris Rise (3)




Aug-11 URA
3 Flora Drive (3)




Aug-11 URA
4 Yishun Avenue 7 / Canberra Drive (EC) (3)




Aug-11 HDB
5 Pasir Ris Drive 3 / Pasir Ris Rise (EC) (3)




Aug-11 HDB
6 Chestnut Avenue (3)




Sep-11 URA
7 Punggol Central / Edgedale Plains (3)




Sep-11 HDB
8 Yishun Avenue 1 / Miltonia Close (3)




Sep-11 HDB
9 Punggol Central / Punggol Place (3)




Oct-11 HDB
10 Alexandra Road




Oct-11 URA
11 Chestnut Avenue / Almond Avenue (3)




Oct-11 URA
12 Mount Vernon Road (3)




Nov-11 URA
13 Florence Road / Simon Lane (3)




Nov-11 URA
14 Jalan Lempeng (3)




Nov-11 HDB
15 Jervois Road (3) 




Dec-11 URA
16 Bedok South Avenue 3 (3)




Dec-11 URA


Reserve List

Jun 3, 2011

GLENVILLE

Update: High Court: Fri Jul 14 10am

I heard through the grapevine that Glenville may be heading for the High Court ......

Glenville in Serangoon sold for S$39.5m in collective sale

Glenville, a 32-unit apartment block in Serangoon, has been sold to Urban Lofts for S$39.51 million in a collective sale.
Marketing agent Jones Lang LaSalle said the price works out to be about S$740 per square foot per plot ratio including a Development Charge of S$5.3 million, if payable.
Each of the apartment owners stand to receive gross sale proceeds ranging from S$1.179 to S$1.273 million.
The sale is subject to approval by the Strata Titles Board.
The 43,335 sq ft site is zoned for residential use with a gross plot ratio of up to 1.4. It can be built up to 5 storeys, yielding a potential gross floor area of up to 60,670 sq ft.
Jones Lang LaSalle said the site could potentially yield some 57 apartment units with an average size of 1,000 sq ft each.
Glenville is located near Serangoon MRT Station and the upcoming NEX mega mall.
Ms Stella Hoh, national director and head of investments at Jones Lang LaSalle, said: “With the upcoming NEX mega mall, interest in the vicinity has been renewed. This is shown by continued interest with a second site sold in the vicinity within one month by Jones Lang LaSalle.”
The other collective sale site, Naung Court, in Hougang was sold for S$28 million in late September.
Source : Channel NewsAsia – 8 Oct 2010