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Thread: Kim Eng's Ronald Ooi cuts losses on condo deal

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    Default Kim Eng's Ronald Ooi cuts losses on condo deal

    Published April 16, 2008

    Kim Eng's Ronald Ooi cuts losses on condo deal

    He is said to have led group which backed the purchase of Tulip Garden


    (SINGAPORE) Kim Eng Holdings managing director Ronald Ooi, in his personal capacity, is believed to have led a group that backed Bravo Building Construction on its failed $516 million purchase of Tulip Garden.

    BT understands from market sources that Mr Ooi and the group were instrumental in raising the initial $25.8 million or 5 per cent deposit on the Tulip Garden sale which has since been forfeited.

    Mr Ooi, who is said to be worth some $300 million, is said to have decided to cut losses on the acquisition in the face of weakening sentiment on the prime property front. 'It had become more challenging to raise the necessary funds under current market conditions to complete the deal,' a market watcher said.

    Mr Ooi could not be contacted.

    The deal, which worked out to $1,018 psf per plot ratio, was inked in July last year when the Singapore property market was enjoying one of its strongest bull runs in recent memory.

    The collective sale was approved by Strata Titles Board in February this year.

    But last week, lawyers representing Tulip Garden's owners sent a notice of rescission of the sale and purchase agreement for Tulip Garden to Bravo's lawyers and notified them that the owners would be forfeiting the 5 per cent of the transaction price paid to them so far as deposit.

    This was after Bravo failed to pay the second 5 per cent instalment by the deadline on April 7.

    Bravo had requested another extension of this deadline to June 7, as well as to extend the completion date of the transaction (which is when it would have had to pay up the remaining 90 per cent of the purchase price) from May 28 to Aug 7.

    Tulip Garden owners had a meeting and most decided they wanted to cancel the sale if Bravo missed the payment deadline on April 7.

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    Default Re: Kim Eng's Ronald Ooi cuts losses on condo deal

    Quote Originally Posted by mr funny
    Published April 16, 2008

    Kim Eng's Ronald Ooi cuts losses on condo deal

    He is said to have led group which backed the purchase of Tulip Garden


    (SINGAPORE) Kim Eng Holdings managing director Ronald Ooi, in his personal capacity, is believed to have led a group that backed Bravo Building Construction on its failed $516 million purchase of Tulip Garden.

    BT understands from market sources that Mr Ooi and the group were instrumental in raising the initial $25.8 million or 5 per cent deposit on the Tulip Garden sale which has since been forfeited.

    Mr Ooi, who is said to be worth some $300 million, is said to have decided to cut losses on the acquisition in the face of weakening sentiment on the prime property front. 'It had become more challenging to raise the necessary funds under current market conditions to complete the deal,' a market watcher said.

    Mr Ooi could not be contacted.

    The deal, which worked out to $1,018 psf per plot ratio, was inked in July last year when the Singapore property market was enjoying one of its strongest bull runs in recent memory.

    The collective sale was approved by Strata Titles Board in February this year.

    But last week, lawyers representing Tulip Garden's owners sent a notice of rescission of the sale and purchase agreement for Tulip Garden to Bravo's lawyers and notified them that the owners would be forfeiting the 5 per cent of the transaction price paid to them so far as deposit.

    This was after Bravo failed to pay the second 5 per cent instalment by the deadline on April 7.

    Bravo had requested another extension of this deadline to June 7, as well as to extend the completion date of the transaction (which is when it would have had to pay up the remaining 90 per cent of the purchase price) from May 28 to Aug 7.

    Tulip Garden owners had a meeting and most decided they wanted to cancel the sale if Bravo missed the payment deadline on April 7.

    So the industry is NOT a level playing field.

    When the Horizon Towers were contracted at a very cheap price, the owners could not get out of the contract, they lost.

    Now in the Tulip Garden's case, the buyers can simply walk out and lose only a miserable 5% when market prices might have fallen by 20% to 30%.

    Sure, Tulip Garden's owners can sue the buyers, but what can they get since housing developers are all companies with limited liability.

    This is a one-sided game, heads seller lose, tails, buyers win.

    Dare to en bloc anymore?

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    Default Re: Kim Eng's Ronald Ooi cuts losses on condo deal

    Quote Originally Posted by James Tan
    So the industry is NOT a level playing field.

    When the Horizon Towers were contracted at a very cheap price, the owners could not get out of the contract, they lost.

    Now in the Tulip Garden's case, the buyers can simply walk out and lose only a miserable 5% when market prices might have fallen by 20% to 30%.

    Sure, Tulip Garden's owners can sue the buyers, but what can they get since housing developers are all companies with limited liability.

    This is a one-sided game, heads seller lose, tails, buyers win.

    Dare to en bloc anymore?

    Just ask the lawyers for the owners to include conditions in the contract so that you can pull out if you are not happy with the price 3 months later. But then you must be prepared to compensate the buyer if you pull out.

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    Default Re: Kim Eng's Ronald Ooi cuts losses on condo deal

    Quote Originally Posted by jsh
    Just ask the lawyers for the owners to include conditions in the contract so that you can pull out if you are not happy with the price 3 months later. But then you must be prepared to compensate the buyer if you pull out.

    Thanks for the suggestion. If I do ever get involved I will implement your advice by putting a waiting period -- say 3 mths -- for both parties such that either party can pull out with the same penalty -- buyer forfeit 5% deposit, while seller refunds the 5% deposit plus penalty equals to the deposit so that it is fair for both sides.

    But the real estate industry in Singapore is more of an oligopoly with only a handful of players, particularly if your site is worth $50m. or more. If you set such a condition in the contract, the developers would simply gang up and walk away.

    So we may be back to square one -- no enbloc from now on.

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    Default Re: Kim Eng's Ronald Ooi cuts losses on condo deal

    Quote Originally Posted by James Tan
    Thanks for the suggestion. If I do ever get involved I will implement your advice by putting a waiting period -- say 3 mths -- for both parties such that either party can pull out with the same penalty -- buyer forfeit 5% deposit, while seller refunds the 5% deposit plus penalty equals to the deposit so that it is fair for both sides.

    But the real estate industry in Singapore is more of an oligopoly with only a handful of players, particularly if your site is worth $50m. or more. If you set such a condition in the contract, the developers would simply gang up and walk away.

    So we may be back to square one -- no enbloc from now on.
    how to walk away? developer need land.. we have land. supply and demand. at most developer petition gahment for compulsory acquisition of land lor. then everything developer want to buy must buy from gahment.

    no more headache with en-bloc sale!

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    Default Re: Kim Eng's Ronald Ooi cuts losses on condo deal

    Hooray...! No more enblocs!

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    Default Re: Kim Eng's Ronald Ooi cuts losses on condo deal

    Quote Originally Posted by Norman
    how to walk away? developer need land.. we have land. supply and demand. at most developer petition gahment for compulsory acquisition of land lor. then everything developer want to buy must buy from gahment.

    no more headache with en-bloc sale!

    Hey, Norman, not a bad idea. My security guard, who lives in Pandan Garden's 3R HDB, went gahment style en bloc or SERS. And he is so happy about it because he will get back a brand new 3R HDB when the new estate is ready, plus removal fees and the differential value between the new and the old unit (something like that, lah), in cash amounting to about $47,000.00. Thereafter, he will sell the new flat and move in to live with his son in Marine Parade.

    Yes, why not -- sell to gahmen and let gahmen en bloc using SERS style and we can stop all those fights and cheating, etc. In this way, we can eliminate the greed factor in en bloc and only focus on the buildings' renewal.

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