Pine Grove - Residents May Try To Sell For Record $1.4b

Source : The New Paper, October 04, 2007

LET us sell your estate for about $1.4 billion.

That's what property consultancy CB Richard Ellis (CBRE) is trying to persuade Pine Grove residents to do.

If the residents agree and CBRE manages to find a buyer, it will overshadow current record-holder Farrer Court, which was sold to CapitaLand for $1.33 billion in June.

The $1.4b price tag for the 893,000sq ft estate in Ulu Pandan means an average payout of $2m per unit.

There are 660 units in this 23-year-old estate. They are of different sizes.

Residents had already rejected the $1.2m per unit price tag in February as only 50 per cent voted for the en-bloc sale - well below the required 80 per cent.

A second attempt in May, with an upped price tag of $1.75m per unit, also fell through. Only about 50percent voted for the sale.

Last Saturday, some 500 Pine Grove residents held a meeting with CBRE at NUS Cultural Centre to sign the collective sale agreement (CSA).

CBRE is still collecting signatures from owners.

Close to 50 per cent of the residents have already signed the agreement.

They hope to push for the sale before the proposed changes to the Land Titles (Strata) Act take effect this month, CBRE's executive director Jeremy Lake said.

The various safeguards in the new rules are expected to increase the time taken to get en-bloc sites ready for launch, industry watchers said.

Some of the changes include having a lawyer to be present when an owner signs the CSA.

Madam Debra Lee, who owns a unit in Pine Grove, said: 'The first offer was simply too low for me to even consider. I don't think it was enough to look for a replacement home.

'But the recent payout seems more reasonable. I like this estate but if the offer is good, why not? Who knows when the property bull-run will end?'

The last transacted price for a 1,700plus sq ft unit there was about $1.3m in April, according to recent URA figures.

Another Pine Grove resident, who only wanted to be known as Lawrence, snubbed the latest offer.

He told The New Paper: 'Even with $2m, I don't think I'll be able to find a good replacement unit in this area. Yes, it may be a bit old but the location is great.'

He wants to hold out for $3m.

But Mr Lake believes the $2m individual payout is appealing enough to push the sale through.

He said: 'We are still in the midst of collecting signatures and we believe there's a very good chance we can get the pre-requisite 80 per cent by the end of this month.

'If we don't get the 80 per cent before the new legislation kicks in, it'll be a more prolonged process.'

He said that once they get more than 50 per cent signatures, they'll do some soft marketing and sound out one or two developers to see if they're keen.

'The general view is that the mass market is moving, so there should be no problems finding a buyer,' he said.

But if the estate's reserve price is not met, it could potentially mean going back to the drawing board to get the requisite 80 per cent approval for a lower price, industry watchers said.

Chesterton International's head of research and consultancy Colin Tan said that the increased price is not surprising.

He explained: 'In this instance, holding out for more may have benefited the residents.

'But it remains to be seen if they will really achieve that price. When the market moves, the en-bloc sellers may get more but prices of replacement units will also go up.'