Action Needed

Dear fellow owners,

The Sale Committee has now called for another EOGM, and is seeking proxies for its position. It would appear that they are determined to begin the collective sale process, starting off with an increase of the recommended Reserve Price (RP) to $xxx million (figures removed for confidentiality reason). This is despite some of the serious misgivings that we, and other owners, have raised in the last EOGM and through written feedback, all of which have not been addressed.

Before deciding whether to sign the Collective Sale Agreement (CSA), we urge you to consider the following issues:

1. All owners need to be aware of the contingency clause 4.1.4 which allows the Sale Committee to go for a lower sale price. In other words, it does not matter if the RP is $xxx million, or $xxx million (figures removed for confidentiality reason), or even $888 million. So long as the CSA gives the Sale Committee the power to accept a lower sale price, there is absolutely no guarantee to any owner that the amount stated in Schedule 2 (Method of Apportionment) is exactly what you will get.

2. While the contingency clause 4.1.4 might reflect ‘common practice’, it contradicts the very bullish and positive signals and rhetoric of the Sale Committee and ultimately expresses a lack of confidence in achieving the recommended RP of $xxx million. A more ‘realistic’ sale price might be offered to the Sale Committee, one that is far below $xxx million, and clause 4.1.4 gives the Sale Committee the power to accept such lower sale price. We have advocated the removal of Clause 4.1.4 from the CSA but this has been ignored.

3. We also questioned, during the last EOGM and via written feedback, the exact and detailed process by which clause 4.1.4 would be executed. What happens if a lower sale price is offered? How will owners be contacted? Who will be contacted? How will the signing of the supplemental agreement be conducted and for how long? What happens if 80% is not reached? Shouldn’t an EOGM be required? The actual process remains vague and ambiguous, which contrasts with the very precise legal nature of the rest of the CSA.

4. We understand that the proposed 60:40 method of allocation of sale proceeds is not acceptable to many owners, who want it to be on the basis of 50% strata area and 50% share value. This would be a fairer basis, as all owners have been paying the same amount towards maintenance and sinking funds all along, regardless of the size of their apartments. Again, this has been requested at the previous EOGM and in written feedback, but the Sale Committee has not acceded to owners' feedback.

5. Another major issue is the exclusion of liability and indemnity clauses in favour of the Sale Committee. These effectively provide that even if the Sale Committee makes mistakes or is negligent, it is excused from liability to the Sellers. If you sign the CSA, you will not be protected at all from any mistakes or negligence of the Sale Committee, and you will have to bear any losses or damages due to such mistakes or negligence yourself. For example, in the Horizon Towers case, when the owners who signed the collective sale agreement were sued for damages by the buyer, they had no recourse against the sale committee. We had previously asked for these provisions to be removed, for owners' protection.

These are very serious problems we have found with the CSA and with the collective sale process. We have repeatedly raised them to no avail. Whether you are for or against the sale is irrelevant when you consider the consequences of these 5 points in the event that a lower sale price is the best offer on the table, or when close legal scrutiny is made of the entire sale. If you agree with us - that the CSA is insufficient, that the conditions are not right, that you worry you might not get what is declared in the method of apportionment, that the method of apportionment of proceeds is not fair, or that there is insufficient legal protection for owners – and you are unable to attend the EOGM, then we request you respectfully to consider giving us your proxies for the EOGM. If you are unsure whether you will be able to attend the EOGM, you may wish to send us the proxy form first. In the event that you are able to attend the EOGM, your proxy will automatically be void by law, and you will be able to exercise your vote personally.

A proxy form is attached for your use. Please pass the completed and signed form to Mr Tan Lai Huat (at Blk 1 #xx-xx) or Ms Wong Hwei Ming (at Blk 9 #xx-xx) or to the Management Office at your convenience, but by no later than Wed, 1 Sep 2010 (as the forms have to be deposited at the Management Office by 2 Sep 2010).

Finally, we would respectfully urge that you take some time now to consider the effect of the CSA on your position and take any professional advice you deem appropriate, rather than wait and see what happens.

This is very important because although you may choose not to sign the CSA now, if the CSA is passed in its current form at the EOGM, and if it later becomes binding on all owners by reason of an order of the Strata Title Board, it will be too late to change any terms at that time. You will then become subject to all the terms of the CSA as it stands, including the sale price, the method of apportionment of sale proceeds, and the indemnity and exclusion of liability in favour of the Sale Committee. Please act now.

Thank you for taking the time to read and consider the points we have raised.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en-bloc, enbloc, singapore, csa, Collective Sale Agreement, EOGM, Reserve Price, collective sales committee, sales committee, CSC, apportionment, indemnity, liability, STB

Problems with a Lower Reserve Price

Here's another letter sent to the CSC with regards to the draft revised CSA. Names have been anonymised at the request of the authors.

31 Dec 2009

To the Collective Sale Committee and Credo Real Estate:

Dear Sirs/Madams,

I am writing on behalf of owner of Blk 1 of Botanic Gardens View, who has appointed me as representative on the matter of the collective sale of Botanic Gardens View (BGV).

During the Extra-ordinary General Meeting (EGM) dated 23 August 2008, I and others, have raised a number of critical issues that are seen to be highly problematic both in the collective sale process, and in the Collective Sale Agreement (CSA). Since then, an amended CSA had been sent out to all owners dated 18 October 2009. In the letter from the Mr John Lee, Chairman of the Collective Sale Committee (CSC), it was stated that:

"After deliberations and taking into account the various proposals raised by a few owners at the EGM, the Collective Sale Committee (CSC) agreed with the amendments as proposed by Mr. Norman Ho. A set of the amended pages of the CSA is enclosed for your reference."

I note that the amended CSA included several changes made to Clause 4.1.4 (on the matter of the lower reserve price), with minor changes elsewhere. While this appears to indicate that the CSC may have taken into consideration the “various proposals”, upon closer reading of the amended Clause 4.1.4, I am very disappointed that majority of the issues raised on the 23 August 2008 EGM were not addressed. In fact, my reading of Clause 4.1.4 is that the revision serves to tighten a possible loophole to prevent Sellers who withdraws from the CSA because of the lower sale price from seeking legal action against the CSC and other Sellers.

I wish to reiterate the issues that I raised during the 23 August 2008 EGM, and which is still relevant now, on the following points of the apportionment method and the CSA:

Proposed Apportionment Method

1. I am unclear on how some of the figures were obtained in the powerpoint slides printout provided by Credo. For example, on the slide titled “Apportionment Method – A Comparison” which compares between the 70/30 method (Credo) and the 1/3+1/3+1/3 method offered by CBRE, the values for the latter method are dissimilar to my own calculations. Using CBRE’s apportionment method (which is stated at 1/3 Valuation, 1/3 Strata Area, 1/3 Share Value), these should be:

[Table inserted here has been removed due to its sensitive content.]

Firstly, the values on the powerpoint slides for the 1/3 CBRE method shows deceptively similar values to the 70/30 Credo method. Owners might think that there is not much of a difference between the two methods when for owners of 117sqm units, the difference is substantial at over -$114,405 if we compared CBRE values against Credo values (see pdf file with calculations). I would like to know how Credo derived their 1/3 method apportionment of proceeds, which is quite different from those calculated using CBRE’s apportionment values.
Secondly, using the argument of narrowing the variation between upper and lower bands of premium over valuation is incorrect. In the example of 1/2SA+1/2SV used in the letter dated 12 Sep 2008, a 1% premium increase for a 117sqm unit size amounts to $29,756, whereas a 1% premium increase for a 163sqm unit size is $46,097. In other words, a 2% increase in the smallest unit is almost equivalent to a 1% increase for the largest unit. So, saying that the smallest unit gains 135% premium compared to the largest unit’s 103% premium is deceptive when looking purely at the percentage increases, as it might look to the reader that the smallest units gain proportionately more relative to the biggest units, when that simply isn’t accurate.
The better approach is to look at the apportioned amounts offered by Credo (70/30) and by CBRE (1/3 method) and consider the differences between the two methods. When viewed this way, the 38 units that are 150sqm and above have a positive difference, whereas over 108 units have a negative difference ranging from from -$82,231 to -$114,405. In other words, 108 units will stand to lose the equivalent cost of buying a car if they go with the Credo method. This is untenable and unfair. Given that the argument of using variation is questionable, I would like to see further justification of why the 70/30 method is a ‘fairer’ option for all owners. I would like to see evidence that other estates of similar configuration as BGV have adopted the 70/30 method, or failing that, why this estate is more suited to the 70/30 method over all other methods, without using the variation argument.

Lower Reserve Price Amendments

2. What are the detailed procedures on the dissemination of information on the lower reserve price and the process of the “signing of a supplemental agreement”?
a. This is not clearly defined and stated in the CSA, and needs to be done in as explicit a manner. I fail to see why such procedures are not explicitly described in a legal document such as the CSA when procedural matters are clearly explicated in the Land Titles (Strata) Act’s First to Third Schedules. For example, the LTSA requires that a general meeting be held “to provide information on the number of offers received for the collective sale and the respective amounts” (Third Schedule, 7.1.f, LTSA). By law, therefore, the CSC is required to hold at least one EGM to inform all owners of offers received, and subsequently, if they wish to accept a lower sale price. It is unclear, however, how and when will owners be notified of the opportunity to sign any supplemental agreement. Neither does it provide any information on how long will this process of signing the agreement take.
b. The revised Clause 4.1.4.a where “if the proposed sale price is lower than the Reserve Price, the Seller’s Approval shall be required (by way of signing of a supplemental agreement) before accepting such lower sale price” must be taken to read that not less than 80% share values in the Management Corporation and with not less than 80% of the total strata title area of all Units (excluding area of any accessory lot), ie the “Seller’s Approval”, must sign the supplemental agreement. Is this the case – that should a lower sale price be proposed, the CSC must obtain the signatures of owners that would constitute the Seller’s Approval in the supplemental agreement, before such a sale price can be accepted?
c. If (b) above is correct, then it should be included within the CSA, that the signing of the supplemental agreement must begin at the same EGM to inform owners of the offers received. A deadline must also be stipulated on how long could this collection of signatures for the supplemental agreement take. Otherwise, this supplemental signature collection can in theory last a year from the first signature on it. A reasonable length of time to collect the required Seller’s Approval signatures for a lower sale price, should be not more than 1 month, given that all owners would be aware and the CSC is able to keep everyone informed. This will set owners at ease that there is a reasonable and tangible outcome to this round of collective sale at a lower sale price, whether it is successful or not. Likewise, developers will also be assured that their offer will be taken seriously and not be dragged out for a lengthy period of time while the CSC collects the required signatures. A short and practical deadline will ensure that any change in market circumstances will not affect the proposed lower sale price. Any lengthier period of time will only complicate matters and any argument not to include a deadline needs to be justified to all owners.

3. Does the supplemental agreement required for a lower sale price supercede the signatures on the original CSA, as signed by Sellers? How does this have bearing on the Notice of Rescission fully entitled to Sellers by law which states that all Sellers are only allowed to rescind once from the CSA (also in Clause 6.1.37). So, if a Seller rescind once in the original CSA, signs back on the CSA, finds out the sale price is lower than the RP, can he rescind again? It should be clearly specified in the CSA that in such a situation, the Seller is entitled to his right of rescission.

4. Why is there Clause 4.1.4.b that effectively prevents any owner who previously agreed to the sale (at the expected RP) but decides against accepting a lower sale price, from taking action against any of the Sellers who signed on the supplemental agreement? By law, if a subsidiary proprietor (SP) has not agreed in writing to the sale, he or she may file an objection with the STB. Is a SP who has decided against a lower sale price still entitled to file an objection with the STB? It should certainly be the case, at the very least. I fail to see why such SPs are not entitled to any action against any Sellers who have agreed to the lower sale price, and I would like to know the rationale for this.

5. Again, I fail to see why the clause for lower sale price (4.1.4) is included in the amended CSA by Credo/Rodyk when it was clearly absent in the CBRE CSA. As Mr John Lee’s letter dated 18 October has clearly cited “positive outlook” where the “high-end market (which is where we are) will likewise improve”, and given the recent push again for the collective sale, the CSC must be seen to be confident enough in achieving the reserve price that there should be no need for clauses for a lower sale price. This clause reflects a certain lack of confidence in achieving what is maximally possible for the estate, and an ambivalence in the collective sale. Given its highly problematic nature and the lack of procedural explicitness, I would strongly argue for the complete removal of Clause 4.1.4 from the CSA. This was also the view of others who spoke up at the EGM.

Seller’s Approval

6. Clause 11.2 allows for sellers to “appoint a representative to attend and vote at a Sellers’ meeting and in respect of His Unit, that representative shall attend and vote at the Sellers’ meetings for and on behalf of that Seller”. I note that the second mention of meeting is in the plural. I hope this is a typographical error and would like to point out that the appointment of a representative is valid for only one meeting and not for any subsequent meetings thereafter. This is to prevent any representative from continuing to exercise their voting power beyond the meeting that they are explicitly entitled to do so.

I thank the CSC for allowing me the opportunity to provide further written feedback, although I must admit that most of these are already voiced to the CSC during the 23 August 2008 EGM. I had assumed, given that the EGM was completely audio recorded and minuted, that issues raised then would be addressed in any future revisions to the CSA or apportionment method. I am disappointed that this was not the case. I can only hope that this formal written feedback will make the CSC consider, very seriously, what has been said both at the EGM and now in this letter. Repeating these objections again will only serve to reflect poorly on the CSC’s claims that they seek to be a reasonable and fair group of owners to represent the estate.

Yours sincerely,
Owner
Blk 1 Taman Serasi
Botanic Gardens View

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, real estate, singapore, csa, collective sale agreement, csc, collective sale committee, feedback, apportionment, RP, Reserve Price

Questions and MORE Questions

Here is a letter by another BGV owner for the CSC with regards to the apportionment method and the CSA. Likewise, this BGV owner is waiting to see if written feedback about the revised draft CSA will be taken into consideration by the CSC...

"Date: 2009/12/31
Subject: MCST 215 (Botanic Gardens View) - Revised Draft Collective Sale Agreement

Dear Sirs,

I refer to your letter dated 18 Oct 2009 and the revised draft Collective Sale Agreement ("CSA") enclosed therewith. In your letter, you asked for written feedback on the revised draft CSA.

I am writing to place on record the following points:

1. Feedback had already been given on the previous draft of the CSA at the Extraordinary General Meeting ("EGM") held on 23 Aug 2008, which lasted for several hours. The feedback given included vigorous opposition to, among other things, the formula for allocation of sale proceeds amongst the subsidiary proprietors, the clause empowering the Collective Sale Committee ("CSC") to enter into a sale below the Reserve Price, the clauses entitling the CSC to amend the CSA and the sale & purchase agreement without obtaining the prior approval of the subsidiary proprietors, and the existence of various clauses indemnifying the CSC and exempting the CSC members from all liability whatsoever. Also, I had requested for the inclusion of provisions to indemnify the subsidiary proprietors and the MCST against damage and liability caused by the actions of the CSC, as well as the provision of a performance bond to ensure performance by the purchaser.

2. Further, it should be noted that at the EGM, the correctness of the figures presented by Credo in support of the proposed formula for allocation of sales proceeds was questioned by subsidiary proprietors. Credo insisted that the figures were correct. However, Credo subsequently issued a letter stating that there were "typographical" mistakes in the figures presented at the EGM, without specifying what those mistakes were and without clearly informing subsidiary proprietors of the effect of the mistakes, which may make a material difference in the perception of subsidiary proprietors (especially those who had attended the EGM and saw the presentation by Credo) as to the decisions which they should make.

3. The feedback given at the EGM has not been taken into account in the revised draft CSA in any substantive or meaningful manner.

4. In particular, from the revised draft of the CSA, the CSC is intent on using the same formula for allocation of sale proceeds as set out in the previous draft of the CSA, notwithstanding that it has not provided satisfactory explanations as to why there was a change from the formula used in the previous en bloc sale attempt (which involved the same chairman and secretary as the current CSC). The formula for allocation of sale proceeds set out in the revised draft CSA is substantially and materially disadvantageous to the subsidiary proprietors of Block 1, and those of them who attended the EGM were totally against adopting this formula. It is grossly unfair to them as they each have one share in the MCST and have, all along, been paying the same maintenance and sinking fund amounts as the subsidiary proprietors in the other blocks.

5. Further, from the revised draft CSA, it also appears that the CSC is preparing in advance for a sale below the Reserve Price. The provisions in relation to such a sale below the Reserve Price do not adequately provide for the protection of subsidiary proprietors who may have signed the CSA on the basis of a sale at or above the Reserve Price. The revised draft CSA does not satisfactorily meet the many concerns raised by subsidiary proprietors at the EGM on this clause, on which the consensus was that it should be removed entirely, in the interests of the subsidiary proprietors as a whole. If such a clause is included in the CSA and potential purchasers are aware of its existence, no doubt they will utilise this to their advantage to reduce the purchase price.

6. Also, I would reiterate my position that the subsidiary proprietors and the MCST must be adequately protected under the CSA from liability and damage caused by actions of the CSC, as well as from non-performance by an intended purchaser. These protections must therefore be incorporated in the CSA, and the clauses indemnifying the CSC and exempting the CSC from liability for their actions must be removed. This is in the interest of all subsidiary proprietors and the MCST, and is absolutely necessary in view of the problems previously faced by subsidiary proprietors in other en bloc sales in Singapore. It is no excuse to say that this has never been done before, as the CSC is duty-bound to protect the interests of all the subsidiary proprietors, rather than adopt a CSA which is more favourable to purchasers in the hope of an easy sale, which may lead to problems for subsidiary proprietors subsequently.

7. It remains to be seen if any written feedback on the revised draft CSA will be taken into consideration by the CSC, after it has ignored the feedback already given at the EGM on the previous draft CSA. However, the CSC members should bear in mind the duties and obligations (including fiduciary duties and obligations) they each owe to all subsidiary proprietors, in the light of the Court of Appeal decision in the Horizon Towers case.

8. The CSA should be therefore be amended to take in the feedback mentioned above, and in due course be considered and decided upon by the subsidiary proprietors in a properly-convened general meeting. 9. Finally, I would also place on record that although the notice of the EGM specifically stated that the items on the agenda for the EGM were to "consider and decide on" the "apportionment of the sales proceeds" and "the terms and conditions of the draft Collective Sale Agreement (inclusive but not limited to the Reserve Price...)", the agenda was changed at the last minute at the commencement of the EGM, when the chairman of the CSA announced that the meeting would only be limited to a presentation and discussion of the draft CSA, and that the EGM would not in fact "decide on" the apportionment of the sales proceeds or the terms and conditions of the draft CSA.

Yours faithfully,
L.H. Tan"

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, condo, en bloc, en-bloc, enbloc, real estate, singapore, csa, apportionment, collective sales agreement, csc, collective sales committee, sales committee, feedback, reserve price, eogm, egm

Update on 8Napier

Further to the last posting on the new development at Eng Lok Mansion, Business Times has provided new information on "8Napier" on 17 July 2007.

No of units: 46
Price range: $4000-$4500 psf
Developer: Napier Properties. Director Mark Wee & Tony Tan, former Parkway boss.
Details: 10 storeys, 40 apartments of 3-4 bedroom units, and 6 penthouses. All penthouses are duplex ranging from 4000 sq ft to 6000 sq ft and are expected to be sold by auction. Smallest 3 bed unit is just over 2000 sq ft and priced at about $8 million. Some units are already sold to a mix of Singaporean and foreign buyers. Current plan is to limit sales to just 10-12 units.

'We may sell another dozen or so apartments when our showflat is ready on site in a few months' time. But we plan to keep the rest of the project, including the six penthouses, for sale after the project is completed, which will probably be around end-2009' said Mark Wee.

'All the units come fully loaded with top-notch lighting, sound system and kitchen equipment, bathroom fittings and the like, so that our buyers do not have to do any renovations as we are fitting the units to the highest standard currently available in the Singapore market. This should minimise the hassle of moving in' said Mark Wee.

Points to note:-

• A replacement unit for owners if they want to stay in the same location and have to buy a unit in 8 Napier will cost only $8 million for a 3 bedroom 2000 sq ft unit. In the latest offer from CBRE, how much more will you have to pay out of your own pocket to buy a replacement unit?
  
• $4000-$4500 psf currently. That is the market benchmark for the area and I'd doubt any developer who buys BGV will attempt to sell new units at anything less than what 8Napier is marketing.
• Napier Properties are holding back units till end 2009, especially the prime penthouses. This shows their confidence in the market, and their expectation that they will achieve even more than $4000-$4500 in 1 and a half years time. Given the latest estimate of 20% increase in property price per annum, it would be fair to say they should be targeting about $5000 psf by end 2009.
• In a Business Times report dated 10 Nov 2006, they priced the units at a 'high $2000 psf' but 6 mths later, revised it to $4000-$4500 psf.
• That report also cited Mark Wee as stating that some of the priciest real estate in global cities like New York and London is around famous parks, and 8 Napier, which is just two minutes' walk to the Botanic Gardens, will be in that league. If 8Napier is in this league, what about BGV which is 30 seconds away from the Gardens?
• Profit to developer? They bought Eng Lok at $128million ($1218ppr) in Mar 2006 but they stand to gain a cool $344million (less development costs and proceeds). This for an estate half the size of BGV. What a steal for Napier Properties. Will this happen to us as well, to be sold on the cheap?
• To say that we have a goldmine on our hands, a piece of real estate around a famous park, is an understatement. But some people don't really care.
  

Tags: 8 Napier, 8Napier, Eng Lok Mansion, Napier Road, Botanic Gardens View, Botanic Garden View, en bloc, singapore, en-bloc, collective sale, enbloc

$4000 at Eng Lok - What's Our Reserve Price?

LianHeZaoBao on 12 June (Singapore News p5) reported on the Eng Lok Mansion redevelopment. They said the developers plan to build high end luxury boutique apartments. The article disclosed that each unit will be at least 2000 sq ft, of $4000 psf. Target buyers are overseas tycoons. Specifically, it would consist of 26 3-bed units (2000 sq ft), 14 4-bed units (2800 sq ft) and 6 penthouse units (6000 sq ft), along with an Olympic-sized pool.

$4000 psf.

If that's the case, and given that Eng Lok was one of the highest en-bloc sale of its time, what should our Reserve Price at BGV be?

(Updated with more information from the article)

Tags: botanic gardens view, botanic garden view, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, real estate, singapore

The Question of Reserve Price

It all boils down to this - the Reserve Price. What is the value of our home, and by this, we don't just mean the individual unit prices, but the land value. Taking advice from Dr Minority, I looked through the URA caveats lodged website (from his blog) and found that in the past year, only 2 units in BGV were sold.

The interesting thing was the price difference:-
Mar 2007 - $848psf
Apr 2007 - $1252psf

This represents a 47% increase in a month alone. Now some may say this is because the buyer in Apr 2007 was anticipating enbloc potential, so paid a premium for it (ie artificially inflated). So I looked at the various properties within 500m from BGV, a fair enough assumption given that land value will be pegged approximately to the prevailing market rates for units around the area. So that includes, Botanic Gardens Mansion, Grange Residences, Nassim Jade, Nassim Mansion, Nassim Park, St Martin Residences, Tanglin Residences, The Loft. The URA site gives prices for units sold from June 2006 to May 2007. Here are some numbers :-

• The average psf for the proximity is $1649 (across the year, across all units)
• Average for BG Mansion is $850 or $200 less than the average for BGV.
• Most expensive estate is Grange Residences = Average of $1979psf
  
• The average psf in the proximity has been increasing steadily from June 06 to May 07, about $70 per mth, from $1161 in 06/06 to $1998 in 05/07.
  
• Eng Lok Mansion, the closest enbloc, was sold at $1218 psf ppr (Mar 2006). Next nearest are Leedon Heights ($1062 psf ppr), Beverly Mai ($1184 psf ppr). If you look further towards Grange Road, you'll get reserve prices at about $1700 psf (Grange Heights).
  

This is not counting the unique site of BGV being close to Botanic Gardens, which will attract a significant premium for any developer hoping to sell units redeveloped in BGV. And since we're talking about land value here, and not estate or unit value, the average pricing for these other nearby developments have to be taken into account, including new estates like Grange Residences.

What does all these mean?

• To buy a replacement new unit in the same area would cost at least $1979psf (based on Grange Residences (GR) average) or ranging from $2091-$2237 psf from Apr 07 prices of GR alone. Given that GR is a few years old now, any developer can easily build and sell new units in BGV for more than $2300 psf. In other words, if we wish to stay in the same place again, near BGV, we're looking at about at least $2000-$2300 psf to buy a new condo unit.
  
• In Nov 2006, Napier Properties said it plans to redevelop Eng Lok Mansion into a 10 storey, 46 unit high end condo, priced "at the top end of the Singapore luxury residential market and possibly a new benchmark". The price cited in Nov 2006 was high $2000 but given the bullish market, one can easily expect it to go up to $3000-$3500. That'll be our new luxury neighbour. We can expect that any developer that buys our estate will be using "Napier 8" (as it will be called) as a benchmark and will almost certainly develop high end luxury condos in BGV. Considering that nowadays developers are touting $4000 psf as the high end pricing for luxury condos, this is not unrealistic.
• Will we be able to get an exchange unit in the new development? Not very likely, given the price difference between a new high end condo of about $3000-$3500 and the average of about $2300psf for the area. I think a major top up will be required, unless the developer decides not to build luxury condos (highly unlikely). It means we'll be hard pressed to get a similar unit in the same area, unless you move further westwards (towards Farrer/Holland) or towards River Valley or Bukit Timah.
• So what should the reserve price be? If we work backwards from the figure of $3000-$3500 as a target price for developers to sell new units, and considering that developers typically factor in about 40-50% for costs and profit, a conservative reserve price would be about $2000-$2500 psf.
  

Are you happy with this RP? Almost certainly you won't be able to buy anything in the new BGV or Napier 8. You might be able to get something in Grange Residences with some topping up, but I've heard complaints about the structural quality of GR (you can hear neighbours from the thin walls).

Agents say you may not be able to afford new properties but there are plenty of slightly older properties nearby that are within reach. True, but how many years before those go enbloc?

I urge you to think carefully, before the agents do the song and dance and try to persuade you to sign the CSA...!

(Thanks to Dr Minority for helping with the numbers)

Tags: Botanic Gardens View, Eng Lok Mansion, Napier 8, Taman Serasi, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, singapore, real estate