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Thread: Shanghai Road en bloc hoo-ha

  1. #1
    studio3
    Guest

    Default Shanghai Road en bloc hoo-ha

    There is a big hoo-ha about this potential en bloc in Shanghai Road. Read about it in Sunday's The New Paper. Currently there are two low-rise villa-like apartment blocks on the sites of 38 and 48 Shanghai Road. The disputed property is 48 Shanghai Road.


    Subject: Re-devt Site for Sale : 48 Shanghai Road
    Message: Re-development Site For Sale - 48 Shanghai Road

    COLLECTIVE SALE
    * Land Area 899.3 sqm (apprxo 9,380sqft)
    * MP 2003 PR 2.1
    * Maximum permissable GFA : 1,888.53 sqm
    * Tenure : Freehold
    * Located near cul-de-sac
    * Within minutes walk to Valley Point


    Closing on 25 April 2007 (Wed) , 3.00pm

    For more information , please contact : Samuel Eyo 9815 3223 / Philip Peh 9798 1812 / Main Line 6536 5022
    Date of Listing: 27/3/2007 12:00:00 AM
    Company Name:
    Country: Singapore
    Tel: 6536 5022
    Fax: Nil
    Contact Person: Savills
    Last edited by studio3; 15-04-07 at 23:48.

  2. #2
    Unregistered
    Guest

    Default Re: Shanghai Road en bloc hoo-ha

    I read the article. It is about one resident owner of the apartment who didn't even know that his block has been put up for en bloc. What happened was a developer (I think Fortune, same as Studio 3, East Mews and Arthur 118 developer) used his relatives names to buy up this resident's neighbours' units to achieve an 80% consensus, then put it up for en bloc sale.

  3. #3
    studio3
    Guest

    Default Re: Shanghai Road en bloc hoo-ha

    Yup, I believe this is the article... slight mistake in the article.. Shanghai Rd is actually district 10, not 11

    I WAS NOT TOLD ABOUT SALE
    By Desmond Ng
    April 16, 2007 Print Ready Email Article

    You may object to your residence being sold en bloc, as many have been known to do.

    But can you imagine what it must feel like when it's already put up for sale and you don't even know about it?

    That's what happened to veteran lawyer Goh Aik Chew, 65. And he has had almost 40 years' experience in handling property transactions.

    He owns a freehold private apartment off River Valley Road, where he lives with his wife and two children.

    Last November, he was offered $1.25 million for his 1,500 sq ft home by an interested party.

    Mr Goh turned that down, along with a subsequent offer of $1.45m in January this year.

    These offers, he claimed, were from agents representing buyers of his neighbours' units.

    Then, about a month ago, an agent from Savills Singapore reportedly offered to get him a higher price. But Mr Goh did not respond because he wasn't sure what the market price was for his unit.

    Mr Goh thought that was the end of the matter until he received a call late last month from a friend.

    The friend asked him excitedly about his place being put up for sale on a notice tender in The Business Times.

    Mr Goh said: 'It was a complete shock to me. How can the sellers do that without informing me? It's very unfair.'

    Mr Goh's unit is part of a small district 11 property at Shanghai Road.

    There are only six apartments.

    Mr Goh bought his three-bedroom apartment for about $900,000 in 2001.

    The advertisement his friend saw was on 27 Mar, put up by real estate agency Savills Singapore, which is marketing the property for redevelopment. The ad appeared again earlier this week.

    The land area of the development is about 9,680sqft, about the size of three basketball courts.

    The tender will close on 25 Apr.

    Mr Goh is unhappy with the way the en-bloc sale process was conducted.

    He claimed there was no management committee (MC) meeting held to discuss the issue, nor was he informed about the en-bloc plans.

    Everything moved so swiftly that, he claimed he had no opportunity to react.

    FAIR PRICE

    He said: 'I didn't ask for, nor did I say okay to an en-bloc sale. I just want a fair price for my place, and I also want to know what's a fair price for the whole project, too.'

    He recounted how a housing agent approached the MC back in 2005 and said a buyer was keen to pay about $1.1m for each unit.

    But the MC thought the offer was too low and turned down that offer.

    That agent then approached each homeowner separately instead, MrGoh said.

    After the sale ad was out, Mr Goh did his checks.

    Caveat searches showed that five units there were sold for between $1m to about $1.4m since last March.

    All the five units were sold to individuals with links to a company called Fortune Shanghai Road.

    The directors of the company, through their agents, have tried unsuccessfully to get Mr Goh to sell his place.

    Mr Goh said he received the letter from Savills Singapore about the intention to sell only two days after the first ad. Savills was hired by Fortune Shanghai Road about two months ago.

    Now, Mr Goh may find himself booted out of his place soon, whether he likes it or not.

    Under legislation, even without him, an en-bloc sale can proceed because all the other owners combined make up more than 80 per cent of the approval needed.

    And this puts Mr Goh in a very tight spot.

    He may, however, appeal to the STB to stop the sale later.

    Mr Goh is currently seeking legal help.

    BOUGHT 5 UNITS

    The New Paper on Sunday spoke to Mr Richard Tan, a director of Fortune Shanghai Road, who confirmed that the five units in the development were bought by his relatives and friends.

    He said: 'We bought them from the individual buyers and we've put the property up for sale en bloc.

    'If the price is right, we'll sell it away. If not, we may develop the property ourselves.'

    The company recently bought an old seven-unit project next door en bloc and will be redeveloping that, too.

    Savills Singapore claimed Mr Goh was told about a month ago that he could get a premium for his place.

    A Savills spokesman said: 'He (Mr Goh) wanted to see what the market price for his place was. He refused to budge from his position.

    'That's when the other owners got us to advertise the property for sale. If it's put up for sale, we can get a much better price.'

    Savills said that a letter was sent to Mr Goh about the sale on the day of the advertisement.

    The spokesman added: 'If he's not keen on the sale, does it matter if he's informed or not?

    'He has one unit and he's preventing the others from enjoying the collective sale.

    'The other owners have the 80 per cent prerequisite and they have, through agents, made reasonable offers to him, which he feels is not good enough.'

    Mr Goh said he was told that the five owners had the intention to sell the property en bloc when the offers were made to him, but no one told him it was finalised.

    Savills said a valuation of the whole property will be done after the sale is finalised.

    Chesterton International's head of research and consultancy Colin Tan, a neutral party, said that there should be a proper meeting among the homeowners to discuss the reserve price.

    He said: 'The sale must be done in good faith. If there was an intention to go around the homeowner, and things are kept hidden from him, then STB can find a case and may stop the sale.

    'STB will look at all these factors to protect the innocent parties, too.'

    Impending en bloc rule: Will it protect minority and penalise majority?

    IT'S an en-bloc Catch 22.

    Owners may get more say, but they could end up paying to keep their neighbours happy.

    The Ministry of Law proposed some changes to the en-bloc sale legislation earlier this month.

    One is that the Strata Titles Board (STB) may increase the sale proceeds for the minority who have filed valid objections if they are found to have been treated unfairly in the distribution of sale proceeds.

    This applies even if there has been no bad faith on the majority's part.

    The amount will be capped at 0.25 per cent of the sale proceeds or $2,000 from each unit, whichever is higher.

    For a $500,000 property, it means a collection of $1,250 ($500,000 x 0.25) from each household.

    But will this open the floodgates and encourage more people to appeal?

    While STB has been compassionate to the minority, there are many cases where the majority are held ransom by a small group of unhappy people, Credo Real Estate's director Yong Choon Fah said. The firm specialises in collective sales.

    She said: 'There are some who are genuine in their disagreement, but there are those bad hats who want to take advantage of the situation.

    'These people do not have good reasons to oppose the collective sale. They just want more money, over and above the market valuation.'

    In the end, the other owners have to chip in to pay them.

    Ms Yong said: 'The proposed change may encourage more appeals and slow down the process. It can go to that extreme.'

    MsYong, who has come across owners who want to be paid more for no good reason, added: 'There are also others who may feel that the apportionment method is not fair.

    'The Government has to be flexible because situations differ in every estate. These can only be broad guidelines.'

    Still, there are others who feel that the proposal will go a long way in protecting the minority.

    MrColin Tan, Chesterton International's head of research and consultancy, said: 'Some people think that as long as they have the majority consent, they can push for the collective sale. The proposed guidelines are to protect the innocent parties. The guidelines will make STB's stand much more transparent.

    'There have been many people jumping onto the bandwagon in the past few years and the changes will help clear any misunderstanding.'

    These changes are especially relevant today if you consider last year's bumper collective sales - totalling some $7.75billion with 62 deals.

    This year alone, there have been 17 deals worth $2.43b as of last month.

    The consultation paper and the proposed amendments are on the Ministry of Law's website at www.minlaw.gov.sg.

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