Development Charge Rate Mar 2018

1 Mar 2018

Development Charge Rate Shoots Through the Roof

(TC is Sector 98 use group B2)

https://www.ura.gov.sg/Corporate/Guidelines/Development-Control/Planning-Permission/Folder/~/link.aspx?_id=654B550206B745E3BF80292AC9CBA29B&_z=z

Bloggers opinion (warning: may be completely off the mark)

The material date of determination of DP will be pegged to the date of Provisional Planning 

Permission (PP) 

Bloggers estimated DP = ~$318m and estimated LUP = $143m 

Total payable by Buyer: $461m

I THINK the land value just shot up from $676 to $728 psfppr

Existing PR (plot ratio) is TBD 

SP MEETING 24 Feb 2018

Venue: Blk 131 void deck, no slide presentation
Present: 2 Lawyers and Marketing Agent. 1 CSC member
Crowd: quite large, I estimated around 300
Atmosphere: Cordial
Heckling: Nil

I know some of you are waiting for me to give a run down on the proceedings and what we learnt today. I will do that, but not today as I am busy with family visiting.  I will do so over the next few days.

In a nutshell:

• Owners will not have to top up the difference in the LUP.
• The end date for Sim Lian to continue/back out of the sale: 27 APRIL 2018
• Date of Completion 27 July 2018 (or sooner).
• Moving out is + 6 months from completion date - so 27 Jan 2019
• Sim Lian wants to reduce the 6 months free rental stay to 4 months. This cannot be done without 100% of owners agreeing, which will never happen, I for one disagree.
• Sim Lian is closely monitoring the social media so we should all keep quiet. 
• Helloooooo Sim Lian, welcome to my blog! 
• If the sale does not go through the Buyer has 6 months from Date of Remission to get his Stamp Duty refunded ( not 6 months form Sale Date)
• SL initially wanted to build 2500 units, now it's 2200
• In Principle Planning Approval (OPP) is outstanding
• SL hoping for OPP approval before 1 March; when the new DC rates come out. 
• SPs are encouraged to pressure our local MP to nudge the authorities to speed up the Approvals.
• MA commits to updating owners through Circulars/Notices/FB
• Owners will go to the Lawyers Office to collect their Bank Draft (Sales Proceeds) minus all the costs, charges & deductions of the sale.
• Lawyer will provide a breakdown of all said costs, charges & deductions.* [the subject of a future post]

Completion Date

I hope the MA does not mind me clipping this tiny bit (15 seconds only) - it pretty much says what we all wanted to hear.
Audio (15.05)

"Yes, that is our deadline. That means the latest they can, you know, delay the whole completion, is up to 27 April., and you have 3 months to complete, 6 months for rent free period."

I hope this puts to bed the confusion sown by the legal letter in Jan. The fear then was that unless Sim Lian expressly withdrew then the long stop deadline would be bypassed like the OPP deadline with or without Approvals. Honestly, they shouldn't have asterisked  the LSD, it put a question mark on it's validity.

Okay, listened to some more today: The female lawyer confirmed the MA completion date.  It may seem like I was asking the same question again and again - I was - I wanted confirmation from both MA and lawyer. I think I even got it confirmed a third time with the main Lawyer... later in the tape, will see.  I won't put it on an audio clip because she might not like that, but this is a transcript of what she said 

(50.57) Me: Can this deal stretch for 6 more months, 1 more year?

Female lawyer: Will the deal keep stretching on indefinitely? As we shared earlier the last date for Sim Lian to confirm whether or not they are proceeding with the deal is the 27th April. there is no extension beyond that. By the 27th, they have to say yes or no. 

Me: Sorry, if they say yes, then it goes on forever?
Female lawyer: If they accept the deal by the 27th April, then the completion will take 3 months from the 27th of April. 
Me: Excellent (meaning: nailed it)

Oh dear, I had to re-listen to the nonsense our CSC member had to say:- 

"I think we have forgotten some very important things. Now there is a rule in Singapore that from the Date of Purchase of any common land, the developer will have to build and sell everything within 5 years. That is a standing rule. From the date of the signing of the agreement about 6 months has passed. They will have to give you 6 months for you to move out and before that date comes there will be another 3 months delay for them to issue cheques blah blah blah blah. So you talking about more than 1 year already gone. Now Sim Lian will not drag you on, they will want to be in as much as a hurry as you. They don’t have a lot of time. They only have 3 years plus left for them to knock down everything here, rebuild and sell every unit, otherwise they will have to start paying additional charges"

-build and sell everything within 5 years: 
Wrong. They have to build within 5 years but they then have a further 2 years to sell all the units. (so 7 yrs in total), though in practice they start selling units off the plans long before the TOP. The last 2 years does not apply to local developers and even if developers have partial foreign ownership there are currently 2 loopholes they can legally utilise to avoid paying the penalties. 

From the date of the signing of the agreement: Wrong, the 5 yr clock does not start ticking until the date of STB Sales Order (see SLA Circular). It's only been 2 months, hardly time to panic yet.  3 months completion is normal in all property sales and 6 months to move out is also normal in collective sales, We have not asked nor been given the moon. All is normal.

In fact, the Objections- far from delaying the sale -  have actually bought the Buyer some precious time. Think about it: had there been no objections, then the STB would have issued the Sale Order sooner, and the Buyers PCP (5yr Project Completion Period) would have started earlier. The Approvals have nothing to do with the STB process and  would still be outstanding.

Got fed up listening
Moving on

SP Meeting

Not a word about this on FB...

TC in the News

ENBLOC WARS

https://www.todayonline.com/singapore/big-read-en-bloc-wars-erupt-once-more-turning-neighbours-foes

Shh now

Okay, the countdown is on for 27 April 2018.

If the buyer does not rescind by that date then the SPA 'remains in force'. For how long?

I am putting the blog on a slow down. I have the Colls of Clondavaddog to sort out this weekend (don't ask, it's my other time consuming hobby).

Just because SL can take forever to close the deal does not necessarily mean it will. We can still live in hope that SL will do the proper thing and finish the deal as quickly as possible. 

The Question on everyone's mind:

Is the deal dead on the 27th April 2018 if the Buyer does not rescind? 

Some people say Yes, it is dead, others say No, the sale will go on at the buyer's pleasure. I am not going to answer this question conclusively (though I am in the No camp) so we desperately need this confirmed or denied by the Lawyer. It is too important to leave hanging in the air. It is not enough that they use unambiguous legal language like 'remains in force' when even that is interpreted differently by different people. Just tell us in simpler terms if it is Dead or Alive. 

Mr Tan posted this query on FB today (6 Feb 2018) so let's see if they answer him. I don't know how many TC owners have committed themselves to a new home, but it must be quite a number. They deserve a STRAIGHT answer.

Slip Road to the PIE

Just when I want to sit back and relax - out comes a piece in the Business Times about LTSA roadblocks and Tampines Court.

According to the report. Sim Lian submitted it's OPP Application in Dec, it should have the approval any day now.

LTA wants them to build a slip road at the market side to ease the congestion caused by a 2000 unit estate. Understandable and this will surely enhance the marketability of the new development; super easy access to the PIE & TPE. What the developer loses on the swings he gains on the roundabouts. Perhaps there can be a co-sharing with LTA on the cost, after all, this will be a public road. Interesting development.

https://www.srx.com.sg/singapore-property-news/45782/en-bloc-projects-running-into-technical-road-blocks

Sorry folks, I just don't have the time for all this, I am putting the blog into draft again.

We just have to sit tight and wait.
The Approvals should be finalised by 27 April
The Completion Date by 27 July
Or hopefully earlier
Or possibly later
Or maybe never

The ball is in the Buyer's court


..... and along comes someone with a different perspective for me to mull over

I am not a lawyer, ust a simple SP, so take what I say with a pinch of salt:-

May I point to Clauses 8.0 & 9.0 about Purchaser delaying and/or failing to Complete in the SPA.  They are crossed out in their entirety.  Now read what is crossed out ....basically all our rights as Vendors to seek redress.

Now look at the Clause 10.0 Qualifying Certificate / RPA Approval 

This is the only remaining Clause which mentions the vendors having any right to rescind, and it's quite laughable really, because it is moot. If the Buyer did not get RPA Approval then there is no sale anyway. (RPA Approval is the Gov giving the Developer permission to build).  The wording in this clause is what should have been placed in ALL the clauses with deadlines. It is pretty standard wording found in Round 1 SPA, too. It goes something like this-

'...Approval not obtained on or before the ...date...either party shall be entitled to rescind the SPA by written notice to the other party ...'

The total absence of 'either party' in other clauses is positively glaring and can only mean it's the Buyer's prerogative to rescind and not the Vendor's. There is no firm date by which he has to complete. 

So, I still disagree with you, if the Buyer does not rescind then he is legally bound to complete the sale... but at no specific date in the future.  

5 years to build? Not a problem; the average condo goes up in 2+ years. 

2 years to sell all the units? Not a problem : two loopholes in the Law exist.

So why am I angry at the SPA at this late stage?
I am angry at myself  for being lazy and not going through it with a fine tooth comb when I should have. I only gave it a quick glance before the SP meeting and missed the lot! At the very least, I should have requested for a clean copy and not that garbage sent out to us all. But that's history now. Who cares. All this SPA is good for is to serve as a template for other estates on what NOT to do. 

Speaking in GENERAL TERMS - it isn't all about getting the deal done no matter what it takes, it should be about getting the best deal possible whilst protecting your flanks as well. If a Buyer tries to strong arm you with unfavourable / detrimental / weakening conditions then have the courage to walk away. Remember,  when push comes to shove, the unpaid professionals are not there to protect your interests at negotiation, they are there to protect their commission. If Round 1 didn't teach you that basic fact, then nothing will.

I'm rambling again

gtg

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