Mad Dash Before New En Bloc Rules Took Effect

Source : The Sunday Times, October 7, 2007

With just one day’s notice of the start of new rules, agents scrambled to secure last few owners’ signatures to seal collective sales.

IT WAS real estate’s version of The Amazing Race: In just five frantic hours on Wednesday, Mr Jeffrey Goh had to convince eight people at three different properties to back a collective sale.

Fall short and months of hard slog by the head of investment sales at Newman & Goh would have been for nothing.

With the clock ticking down to midnight - when new collective-sale rules would be enforced requiring uncompleted sales to be restarted - Mr Goh and his team scrambled like fighter pilots.

Mr Goh worked the phones from the office, concentrating mainly on a conference call with an owner based in Shanghai, while his colleagues fanned out to the other locations on a charm offensive.

At 10.45pm, the last owner from a River Valley estate gave his consent.

At 11.30pm, the Newton Lodge owner in Shanghai faxed the collective-sale agreement with his signature on the dotted line.

There was still a hold-out at an Orchard Road estate but, finally, the word came through - it was a ‘yes’!

Said Mr Goh: ‘You won’t believe it, we got that signature at 11.35pm.’

By midnight, they had secured the required 80 per cent owners’ consent for all three properties.

The mad dash was triggered by the surprise announcement last Wednesday that new collective-sale rules, which were passed by Parliament two weeks ago, would take effect the next day.

The new rules make the collective-sale process more transparent. For example, members of a sale committee have to be elected at a general meeting, and the sale agreement must be signed by owners in the presence of a lawyer.

But it also meant that those who had not gathered consent from the required number of owners - 80 per cent of owners by share value, or 90 per cent for estates less than 10 years old - would have to restart the entire process.

The lack of much notice about the start date for the new rules caught out many in the industry.

‘It came as a total surprise,’ said Mr Goh, who found out only at 5pm on Wednesday about the new laws kicking in. ‘We thought it was going to be in mid- or late October.’

Marketing agents were knocking on doors, cajoling owners right up to the last minute.
‘We had to go over matters of apportionment again and slowly explain to owners why things were done in a certain way,’ said Mr Goh.

Credo managing director Karamjit Singh said:

‘For the last few signatures, it’s about going and reaching out on a personalised basis.’

His company was hoping to close six deals in the last few months. Four made the deadline.

Among them was Chestnut Ville in Upper Bukit Timah where the last signature was secured at 10pm on Wednesday.

Sale committee chairman Tan Bak Choon, 59, was relieved that they made it.

With the new rules, he said, ‘lawyers and agents are definitely going to charge more’.

Some estates, such as Robin Court in Bukit Timah, did not take any chances. Mr Ivan Chua, 36, chairman of its sale committee, said the last signature was secured on Sept 20, when the amendment Bill was being pushed through Parliament.

He had been working for two years to get the sale of the 15-unit estate through and reckons it was the impending change that finally tipped the scales.

The Sunday Times has learnt that at least five properties made the midnight deadline - but others fell short.

Mr Steven Ming, director of investment sales at Savills Singapore, said his team missed out on a couple of signatures for one development despite working up to midnight.

‘We were one or two units shy. It was very disappointing,’ he said. He declined to name the development.

But for Mr Goh, the adrenalin rush in the hour leading to midnight was one to savour: ‘It was nerve-wracking and exciting. Just like the last 50m dash in a race.’

They made it in time

Robin Court
Newton Lodge
Amber Park
Thomson View
Villa delle Rose

They missed out

Clementi Park
Pine Grove
Botanic Gardens View

That personal touch

‘For the last few signatures, it’s about going and reaching out on a personalised basis.’

MR KARAMJIT SINGH, managing director of Credo, which was hoping to close six deals in the last few months. Four made the deadline. The last signature was secured at 10pm on Wednesday

Narrow miss

‘We were one or two units shy. It was very disappointing.’

MR STEVEN MING, director of investment sales at Savills Singapore, whose team missed out on a couple of signatures for one development despite working up to midnight

RACE AGAINST TIME

Mr Jeffrey Goh, head of investment sales at Newman & Goh, found out only at 5pm on Wednesday about the new laws on collective sales kicking in the next day. He had three deals to tie up.

10.45pm
The last owner from a River Valley estate gives his consent for a collective sale.

11.30pm
The Newton Lodge owner in Shanghai faxes the collective- sale agreement with his signature.

11.35pm
A hold-out at an Orchard Road estate finally says ‘yes’ - less than half an hour before the deadline.