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I am not signing.

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 hopeless 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.

Statutory Notices

LTSA, First Schedule 1(b) affix to a conspicuous part of each building comprised in the strata title plan or the development to which section 84D or 84E applies, as the case may be, a notice in the 4 official languages specifying —..   (ii).......within 4 weeks after the start of the permitted time and thereafter at intervals of not more than 4 weeks from the date of the last notice under this sub-paragraph;

As of 24 Nov 2016 , 46.25% of the total share values and making up 46.27% of the total area of all lots have signed the CSA

That is 259 units out of 560


Minutes of the 16th SC Meeting

First off:


I only saw a hand-out by the former SC member Mr, Vasan who was not present at the meeting and who had resigned the day before: 'He (the MA) also presented the RLV table that was presented by Mr Vasan during the 15th CSC"

'They (MA & myself) agreed that all of the factors used in their calculation were basically similar, except one, which had already been discussed during the 15th CSC meeting.'

This is quite true - but the exception was quite a major one.

I have highlighted in RED where we differed (though I have not put in the Vasan figures, just my own which were already on this blog for quite a while)

We differed on the Efficiency- but I don't see that as a major problem as my figure was more generous to the developer

We differed on the Average selling price psf of new development.

I insisted that the 10% Bonus would be included in the GDV calculation by the Developer. Why? because :

  • Majority RLV in RD 1 at the Strata Titles Board included the 10% in their calculation

  • Minority RLV in Rd 1 at the Strata Titles Board included the 10% in their calculation

I take these 2 official RLVs as my gold standard - as they were presented for scrutiny by Marketing Agents and picked apart by a 5 member panel of experts and 2 Senior Counsels at the Strata Titles Board.   I rest my case on this. 

(The full RLVS can be found on my RLV post ).

Afternote: Mr Glen found out that one enbloc site which was developed into a private estate utilised 85% of the total gross floor area (GFA), which means the net saleable area is 15% lower than the available GFA. This information was presented in an email circulated to SC members, Mr Terence and Ms Naimh Choo. 

I pointed out to Mr Glen that one swallow does not make a summer.
Many moons ago I started a little 'discovery' of my own into the efficiency using a rather crude method: I added up the SQM of the new sale caveats lodged and compared that with the GFA allowed. The results were indicative only but it has spurred me on to finally do the WATERFRONT COLLECTION . I shall post the results when completed.

My old crude efficiency table:

What awaits us....

I am following another estate and the goings-on in that collective sale could be duplicated in our estate the way things are going.

Their initial RPº garnered 65% signatures before stalling. They churned out a Supplemental CSA with a higher RP1 and managed to get the extra 15% needed to reach 80% the DAY BEFORE the expiry date. How magical.

They went for a public tender on the strength of the 80% and received no bids.

They then churned out a second Supplemental agreement to lower the reserve price to RP2 and garnered only 35% support. Not happy with this they went for a third Supplemental agreement with a higher RP3 (but lower than the initial RPº). This final RP3 only garnered 55% signatures.

They went for a Public Tender again ... on the strength of the first 80% (RP1) ... and received no bids.
I think they went for a second Public Tender .... and again received no bids.

One more fact: the valuation at close of tender was substantially lower than even the lowest RP2. When the marketing agent is the one calling the shots with regard to recommending/selecting an 'independent'  Valuer - then this will always be the case.

After the failed public tender, a Developer came in with a private bid which equaled the RP3. This offer came with do-or-die conditions attached. The SC held an EOGM to discuss this offer and used the RP3 55% as a stepping stone and managed to persuade a further 25% to sign.

So the SPA was signed and an application made to the STB just days within the 1 year time period. (Though I would argue that the RP2 is a new contract and starts a new 1 yr from date of ... see post here).

Anyway the extra time was not needed as the application was in time from date of first signature of RPº.

This is very worrying.
1) A higher RP is used to bait SPs into signing and this is used to make multiple attempts at a public tender, even after lower supplemental agreements have been entered into.

2) The Developer is obviously privy to the RP as he made an offer equal to the second lowest RP3.

3) No public tender was held to determine if this was the best price for the estate - the tender was for the higher RP1, and so who knows, there could have been other bids if the tender price was set lower.

In other words, the market was tested at that level, and the SC failed to ascertain if this was the BEST price achievable.

Tampines Court is at the RP1 stage.

(Variation on theme: Venus Fly Trap)

Food for Thought

So, do you still think the setting of the reserve price is is as easy as ABC? That all you have to do is take a low individual unit sale and plonk a 50% on to that and voila - the RP is born? Old men and those keen to sell-at-any-price are happy with this simple methodology, but here is a paper from the National University of Singapore which should make your toes curl.

This 2004 NUS/IRAS paper on Option Pricing Framework is still applicable even after the Residential Property Amendments of 2010 -  IF the developer Buyers are fully Singaporean and therefore do not have to redevelop and sell the site within a strict 5 year timeframe. 

I haven't finished looking at it yet - as it was given to me just today.

Collective Sale flying on Autopilot.

The ex-Vice Chairman, Mr. Vasan, has tendered his resignation from the Sale Committee. 

This is not good news for the collective sale as he was the only SC member with a firm grasp of both the LTSA rules and the importance of doing due diligence on the RLV. There is now no one at the wheel and the collective sale is effectively on auto-pilot. 

Tampines Court owes him a debt of gratitude for getting this far. Perhaps he'll share with us his reasons for resigning, perhaps not. We shall see.

The MA will probably take over the handling of the collective sale from here. The way is clear, the SC are putty in their hands, unquestioning and totally reliant on their expertise.

Hold your Horses

I attended the SC meeting today (5 Nov 2016) and had a chat with those present.

I didn't get to see the RLV (I forgot to ask! Typical!) but things went cordially enough and for me, that is quite a change.

Vasan was not there, in fact no one was there except 4 SC members and around 6 to 7 marketing agents.

I am reluctant to say more about the meeting as on reflection, the sale of 560 homes in the hands of these 4 SC members is a scary thing. I mean really, really scary.  The collective sale is driven by the MA, the SC are mere bystanders with little to no input.  I was under the impression that the RP had been raised but apparently not. The FB page announcing the increase was premature and the MA has not agreed to anything yet.  They are holding off on signing until the matter is finalised. I did not stay for the whole of the meeting so cannot attest to what transpired after.

So, hold your horses on the revised RP..... it is still being discussed and nothing has been confirmed.

The RP stands at $1.32m until further notice.

I may be entirely wrong, but if push comes to shove, I sensed that the MA just might quit .

According to the FB page, the MA has agreed to raise the RP.

Tampines Court Sales Chart (2002-2016)

As of 03 Nov 2016

In May 2013, a unit sold for $1.25M. This is the TC record. 

An ebnbloc price should be considerably higher than the highest individual transacted price because  land is priced differently to units. Apples & oranges.

SC Meeting No.15

*Updated 5 Nov

RP revised to motivate SPs to sign.
Completely divorced from the value of the land.

Most SPs were not concerned about the technical details of how the RP was calculated, rather they cared only for the amount that they would get by the collective sale.  
The few SPs who have expressed interest in reviewing the technical details have only been offered a visual glance and so only the sale committee can do 'due diligence' on the figures. I am not confident in the SCs ability do do so when one of the exco members does not even have a grasp of the correct age of the estate. Decisions as to the accuracy of the calculations seem to be taken on first sight - with no independent verification done by the members themselves - during the meetings. With all due respect, calculations need spreadsheet analysis not eyeball evaluation. 

The Sale Committee members are first and foremost SPs in the estate. Since they have access to the RLV then we all should have the same. We are all equal and favourtism cannot be shown to anyone- not even the sale committee. We all should have the RLV in our email boxes if so expressed.

We will be paying this MA over $7 Million, they are under our collective employ, I don't want to pay for this shabby service.

Mr Terence also stressed that the SPs are protected by an independent valuer’s valuation report at the close of tender.
It is not independent if the marketing agent is allowed to have anything to do with the selection of Valuer, they should not even be allowed to suggest a Valuer to the SC. We need Mr Vasan to help here, to be on the spot and alert SPS to any collusion between the SC and MA in choosing the Valuer.

Mr Vasan noted what he opined to be discrepancies in the presented RLV and presented a table
tabulated by himself, which showed the RLV from various sources
I believe a truncated version of my calculations were put forward - but they were incorrectly copied from this blog. My calculations are open for anyone to challenge but, please, get the figures correct first!

the net saleable area calculated by Huttons was 1,907,077 sqft (at 97% efficiency which has already factored in the 10% bonus balconies minus approximately 13% for circulation, facilities,

Site Area = 702,155 sqft
Potential GFA = Site Area x 2.8 = 1,966,,034 sqft
Efficiency is 97% of Potential GFA = 1,907,077 sqft     (using Hutton's figure)

Total Saleable Area = 97% of Potential GFA + Bonus GFA. 

(the following is my understanding of GDV only)
When calculating the Gross Development Value (GDV) - and I see no mention of the all important GDV in the Minutes)  - the Total Saleable area is used - not the Net saleable area. Don't be fooled into thinking the common areas in a new development (lifts, swimming pool etc) are built for free, that the 13% is an un-recoverable cost! . Everything is included in their GDV calculations and the eventual psf of new units will be derived from all costs. It is in the best interests of the Developer to build as many units as possible to spread out the cost and make them more affordable to the mass market. It is up to them to assign as much GFA to these common areas as they wish, to maximise profit - and that is why you see more and more developments with no above ground space, rooftop pools and gardens etc. The Developer is only interested in the GDV.

Interestingly, the Minutes make no mention of GDV.

The Residual land valuation (RLV) - from which the RP should be based is the GDV less (Construction cost + Developer profit + Marketing cost + Acquisition cost + DP&DC)

Selling price of new development. ....... Huttons projected an average $1170 psf as the selling price. 

The SC have confirmed through their FB page that the $1170 psf in new development is what Huttons have proposed. Excellent- they have finally caved in on that point. From day 1 I have said $1200 psf was the correct figure.  

Looking back at the SC Minutes no 12 (20 June 2016):

It will be unrealistic to assume selling price of SGD1200/PSF considering that the prospective development will be large with about 1600 units, and it will not be easy to market the development at such high prices as the average price for projects like Santorini is below SGD 1100/PSF

Location, location, location. You cannot compare the unfavourably located Santorini with centrally located TC with easy access to the PIE and airport. But since they have, lets see if their statement is true:

So, on Oct 16th 2016 - at least 3 units were sold near the $1200 psf mark.   With TC's superior location $1200 does not seem at all unreasonable.

SC then took a vote to determine the revised RP for Huttons to work on. Prior to voting, Mr Glen
suggested that Chairman would have the casting vote should there be a tie and there was no
disagreement from the six SC members who were present.

The Chairman does NOT have a deciding vote. Again this shows total ignorance of the law. We have seen it again and again, they are clueless. They had to call for a second meeting to hold the vote again.

Conclusion: the 'PROPOSED*'  revised RP is better than the old RP for sure - but are we being shortchanged even here? No due diligence was performed as far as I can see and the MA could so easily juggle a few figures to pop out this new sum.

I would be interested in their DC/DP calculations. I think they have hidden a few of our missing millions there... :)


Our SC often finds itself in awkward and embarrassing situations.

First time could be a mistake.
Second misstep is not a mistake, but a choice.
Subsequent mistakes denote a habitual lack of due diligence or gross incompetence.

Selective deletion of FB comments is an unfortunate, belated attempt to cover up past screw-ups.
SC, acknowledge your mistakes or refute and expose the arguments of your detractors.

Transparency and openness is how you win hearts and minds.

Play Fair ! Release MA's previous and current RLV calculations in full. SP's need to know how he manages to miraculously improve on RLV from his previously declared: "Any higher unworkable, impossible" figures.
What has changed in his calculations?
How Professional and Competent is he?
Is he Believable?
Show us BOTH his RLV calculations and let SPs judge. You made that promise on 24 Aug 2016 on your FB. SC, you are both responsible and accountable to ALL SPs.
NOT releasing MA's RLV would be a dereliction of duty on your part.

Can we SP's of Tampines Court trust you, SC?