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"I am a BLOGGER NOT an expert. This is a BLOG not a 'go-to' website for official information. I represent no one's view save my own. I have neither legal nor financial training, nor do I have anything to do with the real estate industry. My understanding of the Collective Sale Process is from a layman's position only. My calculations, computations and tables are homespun and may contain errors. Please note that nothing in this blog constitutes any legal or financial advice to anyone reading it. You should refer to your lawyer, CSC or financial adviser for expert advice before making any decision. This disclaimer is applicable to every post and comment on the blog. Read at your own risk."
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There is one thing worse than an Enbloc ----- and that is an Enbloc done badly. Since the majority have the necessary mandate to sell, then they owe it to all SPs to make a success of it. Minority SPs can only watch and wait, if they sell then lets pray it's at a price we can move on with, if they don't sell, then we are happy to stay for a few more years.

We need to see the MA's calculations

The Marketing Agent put forward a few slides at the EGM 3 to explain his Reserve Price.

I sent an email off to the sale committee requesting a copy of the data on the screen.

Naturally, they gave no answer.

Anyhow, I did note down a few figures and have waited until now to plug them into the equations.    If you ask me, they just don't make sense. 
Their claim that 10% in size does not amount to much difference flies in the face of logic.

I wish I could post the figures here for you to see, but obviously I can't.
>First of all, 'RP1' and 'RP2' is a misnomer, because they are the same in both instances: $xxx.
The Sale Price $xxx is the RP.

Comparing $A and $B the marketing agent said there was 'not much difference'.The difference ($A-$B) being around $27 psf ppr. The Purchaser pays $27 psfppr less for higher GFA. $27 * 2,162,659 = ~$57m, so is the purchaser getting a discount of $57m even with a higher DP/Top up? Huh? Do they understand how nutty their rationalization looks?  If the 10% was factored into the residual calculation, the benefit would go to the owners, and they would see the RP raised and about $100k added onto the sales proceeds of each unit.

I could reproduce $A and $B easy enough... they seemingly did not recalculate the actual residual calculation.  Do they want us to believe that a 10% difference in GFA is only a figure used as a denominator after the other residual calculations have been done? That it will have no effect whatsoever on the Gross Development Value (and subsequently the Sale Price)? I have checked back with the two independent residual valuations given at the STB in round 1 and the larger potential GFA and DC for Balcony bonus was incorporated in their workings.  Looking at the MA's original residual calculation in their original proposal, it is not clear what they did as they just gave a lump sum for DP/Top up and did not factor in the 10% Bonus GFA. Their 'justification' now does nothing to correct this.  So, it remains a mystery as to why they tweaked the DP/Top-up and have not produced a proper residual recalculation for us all. What are they afraid of?

Therefore, without their complete workings, these figures mean absolutely nothing and their justification remains highly questionable. I am just a regular owner who knows nuts about these things, but I do know when I don't have enough info to draw concrete conclusions. I really dislike being thrown snippets of data at EGMS and having to try and paste a complete picture by filling in the blanks afterward.

Owners should be able to see these NEW calculations on request, since they differ from the original proposal.  Just because 137 owners in the estate voted for this RP doesn't make it correct.

3 comments:

  1. The RP value was first thrown out at the first AGM using on the "honey, I shrunk Tampines Court" value. In the subsequent AGM, the GFA was restored (10% more ), however the RP remains the same , some fancy mathematics is involved.
    Sorry, that mathematics is beyond me, may be the SC should answer, they are close to the MA.
    In short, I can say that the MA has metaphorcised from: Honey, I shrunk TC to CoverUp , to Magicial Mathematician in the span of 2 AGMs. Bravo the magician!

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  2. They juggled the DC/DP for one.
    Original proposal/EGM 2: $282m approx
    EGM 3/RP1 : $267m approx
    EGM 3/RP2 : S325m approx

    Goodness knows what else they tweaked because there is no breakdown.

    ReplyDelete
  3. In round one, you got DW and now this.

    This is what you get when you pick a MA that specialises in HDB resale, private sale and launches.

    Did the more establish enbloc agent back out of TC?

    ReplyDelete