Eunosville second attempt at an Enbloc sale

Rio Casa reaches 80% Consent

Screenshot taken from ST

Original data found on-line

Reserve price said to be about S$450m; it will cost another S$200m to top up the lease and intensify the plot ratio (Straits Times 15 Mar 2017)

This works out about $565 psfppr by my calculation based on the original site area (found on-line) 

From Anonymous26 March, 2017

From BT: $61M top up lease

$141M intensify plot ratio to 2.8

Site area: 396231 sqft

works out to: $590 psfppr.

From authoritive sources, Rio Casa original site area reduced to present value when adjacent condo 'Evergreen Park' was developed and needed access road to HDB car park.

With the smaller site area my spreadsheet now looks like:

The smaller land area now pushes the psfppr to $588 based on the figures given. 

The SC must have done a reasonable stab at a RLV to get this price. 

The rule of thumb for most new developments is that the psf of the new development is around twice the psfppr paid for the site. So, the potential new condo will be priced at $1180 psf and above. In 5 years time, that is not an unreasonable assumption to make. 

Next to Nothing

Well, the Minutes of the 17th SC Meeting are on the Notice Board.

They contain absolutely nothing of  interest.  Four short paragraphs; 2 of which  were dedicated to telling us in detail that the Strata Roll is not up-to-date ( it never is). One line would have sufficed.

3rd paragraph: the SC asked Huttons when the next scheduled signing session would be. They replied that they would contact SPs who had not signed and arrange signing sessions for these SPs. To me, that sounds like there would be no more mass signing sessions at the void deck but targeted door-to-door sales tactics.

4th paragraph: could have been just one line: Let's put posters up on the Notice Boards - but said posters to be provided by the CSC, not Huttons who think it's a waste of time.

No update on signing %

Meeting was 1.5 hrs long.  Was this all there was to report? They must have talked really slow.

Neptune Court Defamation Suit Legal Fees

Oral Judgement - 22 March 2017

This Judgement says that MC members cannot use MCST funds to settle Defamation Suits against themselves and that any money used in the past must be refunded. They cannot simply add the expense under 'Legal fees or Privatisation' in the budget.

Nothing

The last minuted Sale Committee meeting was on the 24 Nov 2016. Their communication with SPs is non-existent, no one knows what is going on. Their fig-leaf of a Facebook page tells us nothing - obviously they are too scared to put a toe out in case someone might step on it. Theirs is a deafening silence. 

Will they issue a few scant lines about their meeting on the 18th March? 

Braddell View Privatisation

Finally - and the last HUDC - to Privatise

Sellers Stamp Duty (SSD) Revision

Useful Websites:

https://www.iras.gov.sg/IRASHome/Quick-Links/Calculators/
https://www.iras.gov.sg/IRASHome/Other-Taxes/Stamp-Duty-for-Property/

https://www.iras.gov.sg/irashome/uploadedFiles/IRASHome/e-Tax_Guides/etaxguides_SD_imposition%20of%20stamp%20duty%20on%20sellers%20for%20sale%20or%20disposal%20of%20res%20property%20_2011-09-15.pdf

https://www.iras.gov.sg/irashome/Other-Taxes/Stamp-Duty-for-Property/Working-out-your-Stamp-Duty/Selling-or-Disposing-Property/Seller-s-Stamp-Duty--SSD--for-Residential-Property/

http://www.iea.sg/news-66

GLS Follow Up

Here is a summary of the raw data of 7 Government Land sales nearest Tampines Court. I can add a few more to the list when I have time - but looking at the data you can see a semblance of a trend - a Rule of Thumb, as it were. 

It seems the developer aims to sell the units at an average of twice the $ psf ppr. In other words a minimum ratio of 2:1.  Anything higher (say 2.5: 1 and they are in clover. To those who don't know what $psfppr means it is the Purchase Price /(site area*plot ratio). 

GLS sites do not have any Differential Premium or Lease Top up to add to their costs, they are clean sites. Two of the sites (The Alps Residences & The Santorini) are newly launched so the data is not solid there.

Q BAY RESIDENCES (TAMPINES AVE 10 PARCEL B)

It's very strange, but QBay Residences New Sale details seem to be largely absent from the Realis website. so what is happening here? The Condo is 100% sold yet I can find details on only 37 sales. Why is information being withheld? Is it something to do with the pricing of their mew next-door  condo to be launched soon (The Alps)?  

THE ALPS (TAMPINES AVE 10 PARCEL D)

A new condo coming up soon on the awful Tampines Ave 10 location. Try as they might , they can't think of many points of praise to sing about (see here). One selling point is apparently 10 bicycle slots (I kid you not - look under 'facilities')!  

Just imagine 9 fifteen storey blocks crammed into an area approx ONE QUARTER the size of Tampines Court. Out of the 626 units, only 3 are the size of a TC unit - a full 70% are shoeboxes under 700 sqft. 

No price list yet - but worth a gander when the show room opens :)

MA SALES PITCH

What is our MA's sales pitch to TC owners like? Well, from my single rather confusing experience it goes something like this (not verbatim):

I asked to see the RLV.

He ignored the question and proceeded with the following patter:

'HDB is our references prices in Singapore, it sets the benchmark for all the condo prices that follow. 4 room, 5 room Bishan, alright, this is the medium price from HDB website, 3Q 2016, 4 room 561, 5 room is 730, Toa Payoh... the 2 enbloc Shunfu & Raintree, 178, Toa Payoh is higher 190, alright, so it's about 6% higher than Shunfu. The  HDB price also reflects the same; the 4 room flat is slightly higher, the 5 rm flat is about 200k lower. Ang Mo Kio is lower. Shunfu is our reference because Shunfu is their first enbloc attempt, alright. So Ang Mo Kio is about 18% lower for a 4 room , 5 room 10% lower, Sengkang is lower, alright, Hougang, alright, so this is Tampines; between 15% lower... so average about 25% lower than Shunfu and lower than ... So for the enbloc price payout, at $1.X m,  alright, is about 15.8% lower than these two. Furthermore, looking at the trend is actually in line with the estate pricing, location pricing in Singapore'

Shunfu High Court Written Decision

Okay, it is out - the written decision to the Originating Summons No 1014 of 2016

I think this decision might be overturned at the Court of Appeal; it has the feel of a square peg in a round hole about it.

Important dates:

The Decision

28          The LTSA only requires that the requisite consent for the original collective sale agreement be obtained within 12 months of the date of the first signature to that agreement. Variation of that agreement can permissibly take place in the run up to the application to the STB, which is given an additional 12 months. There is in effect a 24 month period for the collective sale process as a whole to be played out. Accordingly, there was in the present case compliance with the provisions of the LTSA in respect of the statutory timelines and thresholds. 

Limits on Variation

47             I would note, however, that there may be limits as to what can be varied or amended, and what details may be specified in the variation. The ability to vary does not mean that there is carte blanche for matters to be left vague or indefinite, and postponed for specification later.   
51     It may be that there are other limitations or controls on the variation of a collective sale agreement, and some of these may need to be considered on a case by case basis.  

(1) Private Treaty Sale

58               I disagreed with the Defendants that there was anything procedurally improper or unfair about the fact that the eventual sale of the Property was conducted by private treaty. In particular, there was no requirement that, subsequent to a failed public tender, another public tender must be sought at a lower price before a private treaty sale could be concluded at that lower price. In the circumstances of this case, given the two failed public tenders preceding the private treaty sale, and the fact that requisite approval of the subsidiary proprietors had been obtained for the private treaty price (i.e. execution of the 2nd SA providing for $638 million), I do not agree that the Sale Committee failed to explore its sale options and seek the best possible sale price.

I respectfully disagree with this Judgement in part for the following reasons:

This decision hasn't broken any new ground, it just rubber-stamps a loophole in the 80% timeline.

The SC can now legitimately spend up to 24 months securing the 80% to their desired RP. The initial 80% on a dream RP  serves as a springboard to a second 12 months of signature procurement on a lower RP. This procurement can continue right up until the last minute before application to STB , even after failed public tenders and conditional sales agreements have been entered into, I presume.  

So much for LTSA limits - they are so poorly defined that they may as well be eLasTicSA .  

I would argue that the original intention of LTSA was to limit the 80% to12 months, not 24. 

Depending on the terms on the CSA, the owners may or may not lock themselves into subsequent RPs without further authorisation. 

So, I see it like this:- public tenders on the back of a dream RP are like throwing a weighted dice that are guaranteed to turn up snake-eyes.  The SC can use that initial 80% to continually prove the dream RPs worthlessness, comply with the annoying public tender requirement  and feign 'good faith' into the bargain. 

At the end of the day, 80% of owners still must agree to the 'whatever' RP. 

When you put the cart (public tenders / private deals) before the horse (Final RP) then shenanigans rule the day.

No wonder our MA is back on board - probably banking on a Shunfuvillesque scenario. 

TC HEIGHT RESTRICTION

Tampines Court has a height restriction of 49 AMSL - in other words a new development can build up to about 16 floors - not the usual 36 for a plot ratio of 2.8

This is a restriction from the CAAS (Civil Aviation Authority of Singapore)

What awaits us Part 2

It is my guess that only those following the sale committee's Facebook page would have known about the drama of the marketing agent quitting and returning to the collective sale. No minutes of any meeting regarding the matter was ever put on the Notice Board for general viewing - so the SC raising the RP must just seem like a welcome surprise.

What I found out today.

This is the part I hate: I wandered down to the signing session to ask a few questions of the MA, SC and Lawyer. (They were in the void deck, just outside the conference room. They preferred that to the Activity room))

Mysterious Missing Minutes and Goings-On

The last minuted meeting held by the Sale Committee was on 05 Nov 2016.

Since that meeting, we have been informed through the SC Facebook page that:

• The Marketing Agent gave notice of their intent to resign on 21 Nov 2016.  
• The SC held a meeting with Huttons on 24th Nov 2016
• Huttons officially resigned on the 30th Nov 2016
• An undated, unsigned and modified letter of resignation was posted on FB
• The SC said they would write to other property consultants to act for TC
• Other SC discussions were held- again without any minutes being issued
• The Chairman wrote a begging letter to Huttons on 8th Dec 2016
• An undated and unsigned  reply by Huttons in the affirmative.
• Facebook announcement of signing sessions... without any apparent meetings beforehand

All of this is so irregular. 

Ooops

The Sale Committee have committed 2 more errors against the BMSM and Bye-Laws:-

1. Posting the Statutory Notices on the walls instead of on the Notice Boards. I have requested the managing agent to remove them as posting on walls is not permitted in the estate. The 'notice board was full' is a lame excuse because once you remove the old Notices, voila, you have room for the new. Perhaps they are just too lazy to ket the keys from the office.
2. The upcoming signing sessions are scheduled to be held in the Conference Room. Sorry no. The conference room is part of the office and is not open to SPs. The SC can hold their meetings there but signing sessions are out.  The proper venue is the Activity cum Function Room or the void deck if unavailable.

I have emailed my concerns to the Managing Agent who seemingly was not aware that the conference room had been earmarked.

Back in the saddle

Well, here's a turn-up for the books - the marketing agent has decided to continue it's involvement with the collective sale of Tampines Court after all.

The Chairman of the SC sent a begging letter to Huttons and after 'discussion with the various stakeholders on their continued involvement' they replied in the positive. Who might those stakeholders be, I wonder? Are they merely referring to themselves or someone else?

Perhaps, after thinking about it long and hard, they realised it might not be good for their enbloc credentials to be known as quitters in the field, liable to give up half way through. Who would want to hire such a firm? No, better to slug it out half-heartedly to the end.

Anyway, the pain continues. The news will bring cheer to some and a groan of despair to others.

Curtains call

Since we have had no news since 30th Nov concerning the plight of the collective sale attempt, I am assuming it is curtains for enbloc round 3.

How does it end legally, you may ask. Well, according to the LTSA Third Schedule :

Resignation of Marketing Agent

So, it has finally happened. The MA has handed in it's notice. I had an inkling this would happen at the last SC meeting - they were not happy campers at the prospect of a higher RP and were palpably despondent.

So, what is going to happen next? The sale committee should just disband and let the clock reset for another try in 2 years. To continue is madness but they seem to think they can attract another MA to take over at the higher RP. A sheer waste of time an energy - and MCST money. 

What about the lawyers? Didn't they come bundled with Huttons? Will they also resign?

My advice to the SC:

Guys, just bow out with a respectful letter to the 46% of owners, thanking them for their support.

Anonymous said:

I was surprised to discover in MA's resignation letter that Mr Vasan had offered to pay for a valuation report, and Hutton's endorsement of this proposal. This pertinent info was omitted in the minutes.
Hutton's proposal for SC to convene a General Meeting was also not reported.
Has Secretary faithfully reported all that's transpired in CSC Meetings? Has this SC been totally transparent with us?
If this SC wants to continue with this Enbloc please address this issue, Mr Secretary.
Without trust, you will not get the necessary mandate from remaining SPs.


From FB