Horizon Towers Sellers Vote To Extend Sale Deadline

Source : The Straits Times, Friday, September 21, 2007

New sale committee formed and they hope to avert potential lawsuit.













A LARGE group of Horizon Towers sellers voted last night to extend a deadline for the sale of the condominium, in a bid to head off a lawsuit over an earlier $500 million sale that fell through.

The sellers last night voted to do everything ‘reasonably necessary’ to effect the collective sale of their estate, which has been mired in uncertainty for months.

The sellers hope to avert a lawsuit filed by a Hotel Properties-led (HPL-led) consortium, which is trying to buy the condo. The case is due in court next week.

At a meeting on Wednesday between HPL chief Ong Beng Seng and about 50 sellers, it was made clear that the buyers would adjourn the court hearing if there was an extension of the sale deadline.

Yesterday, HPL spokesman Christopher Lim reiterated this position. ‘If the Horizon Towers transaction goes through, we will drop the lawsuit as well as claims for damages,’ he said.

The buyers are seeking hundreds of millions of dollars in damages for an alleged breach of contract by the condo majority owners.

Last night, the sellers also elected seven members to form a new sale committee - their third so far in the drawn-out saga.

The new committee is to be headed by Mr Lim Seng Hoo. The team includes one person from the old sale committee.

‘The meeting was very well organised and amicable,’ said an owner who attended the meeting.

Sellers of 135 units - out of 177 units - gathered at Raffles Town Club yesterday to attempt to resolve its botched collective sale after their previous sale committee quit.

Only one unit did not vote in favour of the resolutions passed yesterday. Horizon Towers has 199 apartment units and 11 penthouse units.

The 7.30pm meeting ended after 10pm, even though owners were still streaming in from 8pm to 8.30pm. Many owners at the meeting refused to speak to the media.

HPL and its two partners, Morgan Stanley Real Estate-managed funds and Qatar Investment Authority, want to buy Horizon Towers at the $500 million price it inked in February. But the collective sale application was thrown out by the Strata Titles Board (STB) early last month because of a technical error.

The agreement then lapsed because the sellers did not extend an Aug 11 deadline that was written into their contract. Meetings followed and the sale committee eventually quit.

Sellers from 21 units had then called for yesterday’s meeting to pass a few resolutions such as forming a new sale committee and to vote on an extension of the sale deadline to seek an STB order for the sale to go through.

This is ahead of a High Court hearing next Thursday and a High Court appeal to quash the STB order next Friday.

Also yesterday, a group of more than 80 owners represented by lawyers from Wong & Leow engaged a public relations consultant to help them with media relations.

Tighter Building Controls, Heavier Penalties

Sep 21, 2007

New rules passed include making licensing a must for contractors

A COMPREHENSIVE set of changes to building controls, passed in Parliament yesterday, aims to keep the construction industry on its toes.

This comes three years after the Nicoll Highway collapse exposed systemic flaws.

Builders will now be required to get themselves licensed, while underground work will be subject to tighter controls. Heavier penalties will also be imposed on those who flout the rules.

Outlining the changes yesterday, Minister of State for National Development Grace Fu stressed the need to raise standards at a time when the building industry faces a hike in construction demand.

The industry has an estimated $19billion to $22 billion of work this year compared to about $16.1 billion last year.

The changes have drawn mixed reactions from the industry, which acknowledged the need for greater professionalism and safety standards, but also questioned the heavier penalties.

There were also concerns that over-regulation might stifle the growth of certain firms.

Those who flout the rules would generally face stiffer penalties.

Someone who carries out building work without a permit, for example, would face a maximum penalty of a $200,000 fine and/or two years' jail, as opposed to half of each before.

This drew fire from Ms Lee Bee Wah (Ang Mo Kio GRC) yesterday, who felt the jail sentence should be scrapped altogether as the tighter rules would raise standards. Having jail sentences would deter newcomers from joining the industry, she said.

Ms Fu argued, however, that the penalties would serve to weed out bad hats. Similar legislation exists in Hong Kong, California and New York City, she pointed out.

Meanwhile, the licensing requirements for building contractors are expected to kick in by July next year.

Currently, only contractors working on government projects need to register with the Building and Construction Authority (BCA).

Under the new regime, builders will be issued licences based on their track record, financial health, as well as the qualifications and experience of key personnel.

Sole proprietorships, partnerships and limited liability partnerships, however, would be limited to jobs of up to $3 million.

Based on the BCA's records, more than 90per cent of its existing 2,500 general builders could qualify under the licensing scheme.

Temporary earth-retaining structures used during excavations will also need to be designed and reviewed by qualified experts, while specialists in geotechnical work will need to be involved for major underground building work.

The changes are expected to raise construction costs by just 0.06 to 0.1 per cent, estimated the BCA.

In Parliament yesterday, Ms Lee asked for the $3 million project value cap on smaller contractors to be raised, as many projects such as bungalows or upgrading work cost more than that these days.

When contacted, the president of the Singapore Contractors Association, Mr Desmond Hill, expressed similar concerns, adding that the cap may stifle the growth of these small firms.

But Ms Fu said the cap was reasonable, as it was adjusted to fit the capability of firms in that category. Raising the cap may make it harder for the builders to be licensed.

But Ms Fu agreed with a suggestion by Dr Muhammad Faishal Ibrahim (Marine Parade GRC) yesterday for the Government to work to improve the image of builders to attract more talent into this field.

Key features of changes to the Building Control Act

# General builders will need to be licensed. This is likely to be mandatory from July next year. Sole proprietorships, partnerships and limited liability partnerships, however, will be limited to jobs of up to $3 million.

# Specialist contractors, including those doing piling, earth-retaining work and structural steelwork, will also need to be licensed.

# A set minimum number of registered tradesmen must be deployed for large projects.

# Temporary earth-retaining structures used during excavations will be subject to the same checks as permanent structures.

# Site supervisors will have to be accredited and undergo continuous vocational training.

# Specialists in geotechnical work need to be involved for major underground building work.

Key Features Of Changes To The Building Control Act

Source : The Strait Times, 21 September 07

* General builders will need to be licensed. This is likely to be mandatory from July next year. Sole proprietorships, partnerships and limited liability partnerships, however, will be limited to jobs of up to $3 million.

* Specialist contractors, including those doing piling, earth-retaining work and structural steelwork, will also need to be licensed.

* A set minimum number of registered tradesmen must be deployed for large projects.

* Temporary earth-retaining structures used during excavations will be subject to the same checks as permanent structures.

* Site supervisors will have to be accredited and undergo continuous vocational training.

* Specialists in geotechnical work need to be involved for major underground building work.

New, Tighter Rules For En Bloc Sales Passed

Source : The Strait Times, 21 September 2007

Further changes may follow if necessary, Jaya tells MPs who want more to be done

A SLEW of intensely-debated changes aimed at making the red-hot collective sales market fairer was passed in Parliament yesterday.

The revisions - keenly watched since they were mooted in March - will make it harder for residential developments to go en bloc as they must fulfil more conditions.

And further changes may be in the works if they are necessary, said Deputy Prime Minister S. Jayakumar, also Law Minister.

He was responding to spirited appeals by several Members of Parliament yesterday, who peppered him with suggestions on how to further tighten the rules.

Most felt more could be done to protect the interests of minority owners and the elderly, who are often strongly opposed to selling en bloc but find they have no choice.

In response, Prof Jayakumar said that while their suggestions were not 'without merit', he was also concerned about not 'micromanaging the process'.

Related Video Link - http://tinyurl.com/22tfdy
En bloc sales to be more transparent
Changes to laws governing en bloc sales were passed in Parliament today with several MPs appealing for even stricter rules.

But Deputy Prime Minister and Law Minister S Jayakumar said while his ministry will consider the suggestions, it also has to be mindful about not micro-managing the en bloc sales process.

'We have to...strike a balance between trying to make the process more transparent...while at the same time not making it unduly unmanageable or too onerous.'

But he added that the ministry is not going to 'close shop and forget about the process of en bloc sales'.

It will 'monitor very closely' the new laws and make further amendments if needed.

The changes have already had some effect on the en bloc market, even before they are due to come into effect next month.

Property players say they have spurred a rush among homeowners to go en bloc before the new rules make it harder.

But some consultants, like Knight Frank director of research and consultancy Nicholas Mak, say the changes may not have a large impact on the market.

'They will add more procedural hurdles, but on the whole, they were not designed to slow down en bloc sales and they are unlikely to do so,' he said.

More than 30 amendments were approved yesterday, after extensive public and industry feedback. They are meant to introduce more regulation into the market and 'minimise complaints of harassment, unfairness and lack of transparency', said Prof Jayakumar.

Key revisions include a five-day period for owners to change their minds after signing the collective sale agreement. Also to come are new rules on setting up a sale committee and new powers for the Strata Titles Board, which governs collective sales.

Another major change addresses an imbalance in voting rights in a mixed development. It adds an extra level of owner consent, by floor area, before a sale can proceed.

The amendments were beefed up in recent months after 400 suggestions from the public and discussions with about 40 industry experts.

They follow months of grievances from homeowners over a lack of clarity in collective sales, which have seen a spectacular record run in the last two years.

The need for more regulation has also been thrown up by cases such as that of Horizon Towers, where owners are being sued by the estate's buyer over a botched collective sale.

Not to be outdone, MPs weighed in with their own proposals yesterday.

These ranged from not allowing 'young' buildings below 10 years of age to go en bloc to offering a one-for-one exchange of units in the new development.

More than one MP also spoke of the non-monetary losses felt by owners forced to sell en bloc, and condemned 'condo raiders' who buy units in a development and push for a collective sale.

Nominated MP Kalyani Mehta suggested that only residents who have stayed in an estate for more than two years can sit on the sale committee.

Prof Jayakumar took these outpourings in his stride.

A two-year residency condition, he said, would discriminate against new bona fide homeowners. Replacement units are sometimes offered, but turned down by sellers for various reasons.

As for those concerned about younger buildings, he offered this statistic: since 1999, almost 70 per cent of developments that have been sold en bloc were more than 20 years old.

But he agreed to look into some proposals, such as a best practices guide and standard forms to help en bloc players.

More Accountability, Stricter Regulation With Building Bill

Source : The Business Times, 21 September 2007

Key amendments in place for underground works, high-rise buildings

Ms Fu: Nicoll Highway collapse in 2004 was a 'wake up call'

THE Building Control Bill was passed by Parliament yesterday, paving the way for a stronger regulatory framework to raise professionalism, quality and safety standards in the construction industry.

Speaking in Parliament, Minister of State for National Development Grace Fu said the Nicoll Highway collapse in 2004 was 'a wake up call for the construction industry'.

The Building and Construction Authority (BCA) consulted industry stakeholders and the public over the past two years on possible measures, she said. 'The feedback has been considered and some suggestions have been incorporated into the Bill or will be taken up when drafting the relevant subsidiary legislation.'

The Bill puts in place the recommendations of the Ministry of National Development-Ministry of Manpower Joint Review Committee (JRC) on Construction Safety, which was formed to examine the regulation of construction following the Nicoll Highway collapse.

Key amendments arising from the JRC's recommendations include more stringent regulation of underground building works, licensing of general builders and specialist builders, provision of accredited site supervisors, ensuring independence of parties in construction projects and raising of penalties for non-compliance with building control regulations.

In addition, there are also new provisions to set minimum standards of environmental sustainability for buildings and require the continual maintenance of barrier-free provisions in buildings.

Explaining the first of these, Ms Fu said major underground building works, in particular temporary earth-retaining structures such as those that failed in the Nicoll Highway incident, will now need to be designed by a professional engineer (PE) and must be reviewed by an accredited checker (AC). Works going deeper than 6m must be designed and checked by PEs and ACs who are specialists in geotechnical engineering.

Geotechnical specialists will also now be required for tunnels greater than 2m in diameter, underground structures deeper than 6m and complex foundations for buildings of more than 30 storeys.

The Bill was debated, with Ang Mo Kio GRC MP Lee Bee Wah, a PE, raising the issue of ultimateresponsibility. 'When there are two engineers involved, accountability can never be clear,' she said.

She also said it is unclear whether the services of a specialist in geotechnical engineering would have made much difference in the only known case of a faulty high-rise building in Singapore - 3 Church Street.

It is understood that despite a PE and a geotechnical specialist being involved with construction work on the Nicoll Highway, it still collapsed.

Replying to Ms Lee, Ms Fu said: 'I am sure by formalising these requirements and doing so judiciously for a very limited number of buildings, we believe the PE Civil (professional civil engineers) and PE Geo (professional geotechnical engineers) will come up with some amicable working relationship because these relationships already exist at the present day.'

Ms Fu said only one per cent of new buildings in 2006 were more than 30 storeys and that there are currently more than 50 specialist geotechnical engineers in Singapore.

Asked to comment on the Bill, a spokesman for the Institute of Engineers of Singapore said: 'Our opinion is that there is no need for this statutory requirement to be extended to cover foundation works that exceed 30 storeys, as most civil professional engineers are sufficiently competent to handle such designs.'

M Sivakumaran, a PE with SMS Consulting Engineers, said: 'The amendment will certainly put some pressure on contractors and engineers. Construction costs are already escalating. And they may go up further.'