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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.

EGM 4


UNOFFICIAL RESULTS
Meeting Scheduled start: 1pm
Quorum reached : 1.57pm
30% (168 units)
Total Quorum at 2pm: 33.4% (187 units)

EGM 4 scraped through by the skin of it's teeth. The 1 hour deadline for the 30% quorum was reached with just 3 minutes to spare.  In the end there was just 33% attendance.
168 units is a very poor showing.   What can be gleaned from this is the core group of owners keen on a sale number no more than 25 to 30% of the estate. Even after making changes to the draft CSA, texting, garnering proxies etc, they were unable to boost attendance  significantly from EGM 3.  Around 67% of owners remain in the silent majority.

The legal presentation was short and they added 2 amendments
  1. Clause 4.4.10 : they claimed there was a typo error in this NEW clause (they had 3 months to check!) .. now it is a meeting of Owners and not Sellers. Hmm, methinks they track this blog to see how the wind is blowing with these last minute changes.
  2. Clause 8.1.3 : they now say the phrase 'a sum at or below' is now 'redundant'. Redundant just means there is no need to expand on the meaning ...so is there a real change here? Methinks 'at or below' is now hidden.  Think of it as a cat withdrawing it's claws; you can't see them but we know they are there. 
Resolution 2.1: To consider and approve the terms and conditions of the draft Collective Sale Agreement
There were no questions from the floor, I  did not speak as there was just too much to question and I have said it all on this blog. The people who don't even bother to read the CSA are hardly going to comprehend objections. This crowd was going to pass the CSA, warts and all. And so they did.

Result: For 84% Against 12%  Void 4%
So, 145 units have decided to accept this CSA, but will the other 415 agree?

Resolution 2.2(a): To include a one-for-one exchange as a second option for payment in the Collective Sale Agreement and that owners select their preferred mode of payment at time of signing the CSA
The marketing agent for the collective sale gave a slide presentation on the matter, a presentation that was strongly against the proposal. His objections were:
  • too many variables - please list them out
  • not possible because planning parameters not 'approved'. Developers typically will have an architect assess the 'design volume' that can be gotten from land plot/shape/terrain. Developers even commission an architect to do up the design to take advantage of every square inch they could squeeze out of the plot. - based on planning guidelines and prevailing regulations. Because they are very experienced, they know the rules well and the final approval is not likely to have a huge variance. BCA approval can be obtained within 2 weeks, usually.
  • owners' expectations = nightmare for buyers
  • cpf factors, bank discharges, buyers' stamp duty for new apt, The CPF monies have to be paid back, so the owners who are keen would have to have enough money to pay it back or be able to get a bridging loan. The MAS rules are tight so the banks would only be able to lend a little without collateral. 
  • developer might go bust (examples given:  Pender Court, Tulip Garden) The developer in both cases was Bravo Building Construction and it bit off more than it could chew. It didn't go bust, it cut it's losses.   It dropped 3 sales and forfeited the deposit. No buildings were torn down, no owner was left homeless or penniless.
  • administrative issues with 560 owners
  • hard to satisfy 560 individuals preferences
  • higher risk of long drawn out court battles
  • no development has ever done 1-4-1  There have been at least 2 to date in Singapore and plenty in Hong Kong which doesn't seem to have a problem working out the logistics. The HDB also has SERS which is a form of 1-4-1. for HDB-ers.  Recently, those living in Rocher have been promised replacement homes in Kallang . A good lawyer would be able to iron out  the details, don't expect the layman to know all the answers though it is easy to frighten people off with generalities.
An owner stood up and pointed out he sounded more like the marketing agent for a developer rather than for the owners.

When the proposer, Mr XX requested to do the same, that is, give a slide presentation that would show the advantages of the proposal, he was flatly refused. He was not prepared to give a presentation by any other means. The floor was thereby denied the opportunity to see graphs and slides that would have been helpful for a balanced deliberation on the matter.

I just tried to remind owners that 1-4-1 is a safeguard for all in case the RP is devalued over the next 2/3 years. Our near death experience should have been enough but I suspect many on the floor were new to en bloc, bo-chap or  just wanted to cash out. One old guy stood up repeatedly and said something like 'if the price is right, then just sell, no need to talk'.   Anyway, I knew it was a lost cause with that crowd. 

Result: For 16%   Against 80%   Void 4%

Resolution 2.2(b): To compel the SC to seek reaffirmation from the sellers before the sale tender is awarded or before a private treaty is signed.
Some heckling during this part. Whilst owners views were sought there was a definite air of impatience when those views were given. The debate was very minor. The marketing agent thought 10 weeks to decide was too short with no time for an EGM.. He also highlighted that requisitioning was troublesome (I can't remember his exact argument here, or maybe it was the V-Chairman who chipped in).  My response was that they had no trouble having EGMs up to now, and have factored in EGMS for minor things (such as removing minority member from SC) in the CSA. Also, their whinge that it was hard to requisition was meaningless, as the CSA does away with the need for laborious requisitioning altogether ; the SC can 'convene' EGMs. The tender date is known and they could plan ahead and book the hall weeks in advance. The MA also made an erroneous statement when he said the sale committee would have no power to enter into a sale contract... it isn't a sale contract,  it is a CONDITIONAL sale contract, it is not a done deal, and is conditional on STB approval and what is the big deal of making it conditional to Sellers approval, too.
I might as well have been talking to a wall. En bloc round 1 here we come again.

Result: For 19%  Against  75%  Void 6%

Resolutions 2.3: To seek approval of the SPs for collection of $220.00 to meet the costs of valuation, advertisement and other incidentals
Just information, no questions
Result  For  84%   Against  16%   Void 1 unit

Resolution 2.4: To consider and approve the Enbloc Sale Fund (ESF) shall be administered by the Sale Committee (SC). All monies in the ESF are to place in a bank account to be opened by the SC in the name of the ESF. In this regard, to permit the SC to open the bank account with a bank to be identified by the SC

Result  For 87%   Against  8%  Void 5%



Other points
One owner pointed out that the floor area of his unit set out in Schedule 2 was incorrect as it did not include the 2m recess area he had purchased.

The Vice Chairman informed the floor that Signature Collection would start on Thursday 12 Jan 2012 (tentative) at the management office. Owners were to bring their chequebooks.

I believe the last minute changes to the CSA meant those who brought their chequebooks today went home not a penny poorer.

6 comments:

  1. Alfred Chong10 January, 2012

    Hi,Alfred here. Just wondering. how are they, the SC, going to collect the $220 from ALL SPs? You mean those like me who will not sign the csa also got to pay? Why should I? Can they really get us to pay up? Got law that said that? And are they going door to door to collect or what? I presume the MC got nothing to do with this? Can I slam my door in their faces if they come? I am serious.

    ReplyDelete
  2. I won't sign the CSA.
    I won't pay for the valuation.
    Why should I - if I don't want to en-bloc at such lousy CSA???

    ReplyDelete
  3. I learn this trick from my friend in East Coast.

    She refuse to sign the CSA until the Agent relent & waive the fee.

    Agrred that fee will be deducted from her proceed if en bloc sale go thru.

    She signed. Enbloc didn't go thru. She save $xxx

    ReplyDelete
  4. It's not just about the money, it's the CSA, it's not good enough to protect sellers.
    Check with your own lawyers or lawyer friends before you sign. Because after you sign you have only 5 days to check, and busy Singaporeans don't have time. And then after 5 days, regret....

    ReplyDelete
  5. Even if your lawyer points out many weaknesses in the CSA, it is too late to request for any amendments. So there is no benefit of engaging one? In short, the risk is shifted to you if you sign

    ReplyDelete
  6. @Even if your lawyer..
    Agree. So if your own lawyer points out any issue, then the simple logical action is don't sign.
    Unless you want to take the risks in this very uncertain economic environment...
    I wouldn't risk my home.

    ReplyDelete