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Ruling comes after 3 days of intense hearings to meet en-bloc deadline

ANY hopes of collecting a windfall for their flats by the more than 400 owners of Tampines Court were dashed yesterday when their collective sale was thrown out by the Strata Titles Board (STB).

While the majority owners were devastated, minority owners sobbed in relief when the STB read out its decision to a packed room at its Maxwell Road office.

STB deputy president Alfonso Ang said: ‘From the evidence…the transaction is not in good faith, taking into account the sale price and the method of distributing the proceeds of the sale.’

Lawyer N. Sreenivasan, who represented the minority owners, had argued on Tuesday that the sales committee had not obtained an updated valuation of the 560-unit estate when the deal was signed last year. The valuation used was dated from 2005.

The controversial $405 million deal also involved an amount of $10 million called the beta sum that is meant to compensate owners for financial loss.

Mr Sreenivasan said this was unfairly distributed among owners at the discretion of the sales committee.

The arguments seem to have struck a chord with STB, whose decision was considered unusual by industry analysts as the board is perceived to generally approve sales.

Yesterday’s ruling came after three intense days of hearings as the board fast-tracked a conclusion.

The High Court had ordered the STB to bring forward an Aug 7 hearing to Monday so objectors could be heard before the sale agreement expired yesterday.

A decision by yesterday was crucial as the buyers - Frasers Centrepoint and Far East Organization - would not grant an extension. The STB’s ruling now means the sale is dead.

Lawyers from Phang & Co, who represented the majority owners, said they were ‘discussing options’. But with no sale extension, an appeal to overturn the STB ruling will be futile.

Meanwhile, unhappy majority owners are wondering what went wrong. They stood to collect a payout of about $700,000 each - as much as $300,000 above the purchase price, depending on when they bought their home in the 99-year leasehold estate. One majority owner who declined to be named said she was frustrated that the sale took so long.

‘We don’t understand why the sales committee was dragging its feet,’ she said.

The committee seems to have shot itself in the foot. The sale conditions had all been met by July 25 last year, yet the committee delayed seeking standard STB approval until Jan 7 this year.

It said it wanted to wait for an STB ruling on the Gillman Heights sale as its fate could have had a bearing on the Tampines Court deal as both were former Housing and Urban Development Company estates.

But another majority owner, Ms Irene Cheang, was more forgiving towards the committee: ‘It’s a thankless job, and we cannot blame them for taking this up.’

Minority owner Niamh Choo, who had tracked the sale process on her blog, tampinescourt.blogspot.com, was ‘ecstactic’ at the result.

‘It was an inevitable decision. We had a very strong case,’ she said.

‘Now that we get to keep our homes, I hope residents will band together and can be neighbours once again.’

The STB has yet to disclose the grounds for rejection. It may do so at a later date.

FINAL VERDICT

‘From the evidence…the transaction is not in good faith, taking into account the sale price and the method of distributing the proceeds of the sale.’

STB DEPUTY PRESIDENT ALFONSO ANG

NOT SURPRISED

‘It was an inevitable decision, we had a very strong case. Now that we get to keep our homes, I hope residents will band together and can be neighbours once again.’

MINORITY OWNER NIAMH CHOO

NOT AT FAULT

‘It’s a thankless job, and we cannot blame them for taking this up.’

MAJORITY OWNER IRENE CHEANG, who was more forgiving towards the sales committee
 
Source : Straits Times - 26 Jul 2008

CAPITALAND, the lead buyer of Gillman Heights, has asked the Court of Appeal to review one point of a High Court ruling that allowed the estate’s collective sale to proceed.
 
Its move comes after a group of 10 minority owners from the estate filed an appeal over the sale earlier this week.

CapitaLand bought the $548 million Gillman Heights site together with Hotel Properties and two private funds. The sale was opposed by some owners but was eventually given the go-ahead by the High Court.

But in dismissing the objecting owners’ appeal, the Court also ruled that the sale committee could not agree to extend the deadline for obtaining the Strata Titles Board’s approval to Feb 5.

This was despite a supplemental collective sale agreement that had made a valid extension of the deadline to this date.

It is this point that CapitaLand is focusing on. Its legal move is to protect itself if the point is raised by the minority owners at the court hearing.

A spokesman said: ‘The filing of the cross-appeal is primarily technical and the aim is to preserve and strengthen our position in the Court of Appeal hearing.’

Source : Straits Times - 26 Jul 2008

Elsewhere, Straits Trading asking $162m for Gallop Gables apartments

A DISTRICT 10 collective sale site at Robin Drive, off Bukit Timah Road, has been relaunched for sale - with a new asking price as much as 40 per cent lower in view of the current market sentiment.

The two properties on the site are now being sold for $964-$996 per square foot per plot ratio (psf ppr), a downgrade from the initial asking price of $1,500- $1,600 psf ppr when the site was first launched in December 2007.

The property was not the only one to be put on the market yesterday. The Straits Trading Company has put up for sale two blocks of apartments at Gallop Gables with a price tag of about $162 million, or $1,500 psf.

The Robin Drive site now consists of two properties - Robin Court and No 1 Robin Drive. Robin Court is an apartment block with 15 units while No 1 Robin Drive is a detached house now occupied by a preschool.

The indicative price of the combined plots is now $58-$60 million. If the developer maximises the potential of building up to 10 per cent of gross floor area (GFA) for balconies, the land rate works out to be about $964-$996 psf ppr, said Credo Real Estate, which is marketing the sites.

The majority owners of Robin Court had agreed to the collective sale before amendments to the en bloc laws took effect last October. But now, they have begun signing the collective sale agreement to lower the reserve price in view of the current cautious sentiment in the property market, Credo said.

No development charge is payable for redevelopment of the site at a plot ratio of up to 1.4, with a further 5.5 per cent in GFA for balconies, said Yong Choon Fah, Credo’s executive director.

The new development on the site could accommodate a luxurious residential project with a GFA of about 62,398 sq ft and can be configured into 30 apartments with an average size of 2,000 sq ft each, Credo said.

The developer should be able to break even at about $1,470-$1,500 psf, the firm added.

The expressions of interest (EOI) exercise for the two properties will close at 2.30pm on August 14.

Elsewhere, Straits Trading is selling two blocks consisting of 38 large apartments in Gallop Gables. Situated off Farrer Road, Gallop Gables, which was completed in 1997, has seven low-rise blocks with 140 apartments in all.

Straits Trading’s apartments have been retained for investment since completion. The 38 apartments have a total gross floor area of about 108,170 sq ft.

The apartments are tenanted and ‘present an opportunity to purchase an income-producing investment with capital growth potential’, said Knight Frank, the property firm marketing the two blocks.

The EOI for the apartments will close on September 9 at 3pm.

Source : Business Times - 24 Jul 2008

Lexus and Toyota vandalised in the latest attacks in Laguna Park

HUNGER for en-bloc dollars looks to have turned vicious at a quiet private estate in East Coast.

On Tuesday night, two residents of the 530-unit Laguna Park estate discovered that their cars had been doused with a corrosive liquid, possibly paint thinner.

They were among the residents who had not yet agreed to put the seaside development up for sale. Earlier this month, two other cars belonging to the dissenting group were also vandalised.

Residents claim they were the latest of several cases of vandalism that began after the possibility of going en-bloc arose last December.

The estate has until the end of this year to gather an 80 per cent vote to put it up for sale. But so far, residents say less than 65 per cent are onboard.

Residents have been told by a property valuer that an average unit could be worth more than $2.1 million and the penthouses almost $4 million if the estate goes en-bloc. A resident said the market rate for a normal unit now is about $1.3 million.

Some of the holdouts have lived in Laguna Park since it was built in 1977, while others have been there for many years.

Some residents told The Straits Times they were surprised that the sale has fostered so much acrimony.

Five cars have been vandalised in recent weeks, said the outgoing chairman of the condominium’s management committee, Mr Chua SC, who declined to give his full name. Some vehicles were doused with a corrosive liquid while others were scratched and splashed with black paint.

Police reports have been made and investigations are under way.

An independent analyst said residents sometimes do strange things in the hopes of pushing through an en bloc sale.

‘But resorting to criminal acts…this would be the first time,’ said Mr Ku Swee Yong, Savills’ director of marketing and business development.

The vandalism could ultimately be a futile exercise with the cooling property market, said Mr Ku.

‘It’s a bit of a long shot in these market conditions to find buyers.’

Laguna Park residents told The Straits Times yesterday that they believed the vehicle attacks were ‘inside jobs’ committed by people who support the en-bloc deal.

If this proves true, Mr Chua thinks it is a ‘very stupid, silly and naive way of trying to get people to sign’.

‘I don’t think this is the right way to do it,’ said an agitated Mr Chua, who had the logo ripped off his Nissan about three weeks ago.

Mr Robin Sng, a company director, owns one of the cars damaged on Tuesday night. The corrosive liquid ate away the paint on the bonnet, door and bumper of his four-year-old Lexus.

‘I feel frightened,’ he said.

A brand new Toyota parked 50m away was also vandalised on the same night.

A resident diligently went round the estate’s dustbins and found a can of paint remover in a rubbish bin near the carpark. The can was taken away as evidence by the police, who are investigating the rash of vandalism.

Mr Chua said he told residents at a recent annual general meeting that something had to be done about the cases.

Residents earlier shot down the idea of installing surveillance cameras, he said.

‘Now I suppose it has become urgent enough to reactivate the idea.’

Source : Straits Times - 24 Jul 2008

THE owners of a site off Bukit Timah Road are trying again for a collective sale - but after slashing the original price by nearly 40 per cent because of the grim market.

They want $58 million to $60 million for Robin Court, a walk-up block of 15 flats, and No. 1 Robin Drive, a detached house that hosts a preschool.

The new price tag for the 40,518 sq ft parcel works out to $964 to $996 per sq ft (psf) of the total potential floor area of about 62,400 sq ft. This is almost 40 per cent below the $1,500 to $1,600 psf they sought during their first sale attempt last year when the property market was buzzing.

Ms Yong Choon Fah, executive director of Credo Real Estate, which is marketing the District 10 site, said Robin Court’s majority owners had agreed to sell en bloc before collective sale rules were changed in October. They are re-inking the sale agreement to lower the reserve price. A developer could build 30 high-end apartments of 2,000 sq ft each. The breakeven cost would be $1,470 to $1,500 psf of floor area, estimated Ms Yong.

The site was first put up for sale in November along with Robin Star, a 10-unit apartment block that is not included in the latest sale effort.

Meanwhile, buyers are being sought for two blocks of apartments at Gallop Gables off Farrer Road. Property firm Knight Frank is inviting expressions of interest for the 38 tenanted apartments, which have been kept for investment since completion of the project in 1997.

The properties are owned by Straits Trading. The indicative price is $1,500 psf, which works out to about $4.5 million for each apartment, or $171 million in total.

Source : Straits Times - 24 Jul 2008