Regent Garden owners trying to scrap sale

Regent Garden owners trying to scrap sale

 

Majority owners go to court claiming collective sale price undervalues site

 

By Lee Su Shyan

 

ANOTHER collective sale dispute is brewing, but this time, those locking horns with the developer are the majority owners. Usually, the minority owners are the ones who take the lead in contesting such sales.

 

The majority owners of Regent Garden, a 31-unit development in West Coast Road, are trying to back out of a deal with Allgreen Properties.

 

Quite often, collective sale disputes have been triggered by unhappiness on the part of minority owners, as with the ongoing Horizon Towers case.

 

The Regent Garden owners inked a sales agreement in April last year to sell their property to mainboard-listed Allgreen for $34 million.

 

However, in a statement from Allgreen to the Singapore Exchange yesterday, the company disclosed that the majority owners are asking the High Court to release them from the agreement.

 

Alternatively, the owners want to get damages of between $5.7 million and $6.685 million from Allgreen.

 

Allgreen said in the same announcement that it intends to ‘vigorously contest this action, and the claims and allegations made by the majority vendors’. The firm maintains that the deal remains valid and binding at the original sale price of $34 million.

 

 

Allgreen has also gone to the High Court, to ask it to order the majority owners to complete the transaction by Feb 28.

 

According to documents seen by The Straits Times, the majority owners, who own 25 of the 31 units, signed the deal last April. By November, the minority owners had agreed to the deal and withdrawn the objections they had filed with the Strata Titles Board.

 

However, the majority owners, through their lawyers, wrote to Allgreen last month, claiming the sale price of $34 million was a ‘mutual fundamental mistake’.

 

It arose because the sale proceeds assumed a development charge payable of $7.2 million when the owners had expected a charge of only $950,000. So the sale price was at ‘a gross undervalue’.

 

The minority owners also appear to have been paid extra. But the majority owners say Allgreen has refused to give them these details.

 

To this, Allgreen points out that its bid of $34 million was the highest among all the bids. It was also $4 million higher than the reserve sale price.

 

It disagrees that a mistake was made. It says the sales committee had made a conscious decision not to obtain the actual baseline plot ratio – which affects the development charge – from the Urban Redevelopment Authority before the deal was struck.

 

According to Allgreen, it had even offered a floating sale price, which would be subject to the development charge, but the sales committee wanted to fix the price – in order to be guaranteed certainty of sale.

 

Only later did the majority owners ask a property consultancy to put together a valuation report using the actual baseline plot ratio. This resulted in a higher valuation of Regent Garden.

 

Allgreen says such assertions are ‘nothing more than belated attempts to rewrite the bargain in the hope of extracting a higher price for Regent Garden’.

 

Source: Straits Times

Owners sue Regent en bloc buyers

Owners sue Regent en bloc buyers

 

Weekend • January 19, 2008

 

Loh Chee Kong

cheekong@…

 

SINGAPORE has seen several ugly en bloc tussles but this is a first. The majority owners, having agreed to sell their condominium, are now suing the buyers.

 

A group of 25 at the 31-unit Regent Garden (picture) is alleging that developer Allgreen Properties has breached the sale and purchase agreement by grossly undervaluing the condominium.

 

The owners filed a claim last Monday with the High Court to declare that they are no longer bound by the agreement, which saw the condominium sold for $34 million last April.

 

On Friday, Allgreen struck back. It announced that it will “vigorously contest this action and the claims and allegations made by the majority vendors”, and has applied for a court order to force the majority owners to complete the transaction.

 

According to court documents obtained by Today, the dispute centres on two issues. The majority owners, represented by Senior Counsel Molly Lim, allege that Allgreen had overstated the development charge by more than $6 million, thereby depressing the sale price by that sum.

 

They also claim the developer gave “disproportionately high” proceeds to the six erstwhile minority owners to secure full consent. The latter have since agreed to the sale and have applied to withdraw their objections, set to be heard Jan 30 by the Strata Titles Board (STB).

 

Now it is the majority owners who want to be heard by the STB, which an experienced en bloc lawyer, who declined to be named, said puts the STB in an “interesting” position.

 

The law now gives STB power to hear all objections, but the Regent agreement was signed before the legislative change.

 

According to Knight Frank managing director Tan Tiong Cheng, he has “never come across a case where the majority owners sought to rely on the fluctuation in the development baseline gross floor area to renege on their agreement with the developer”.

 

“It is also my experience that it is not uncommon for the developer to contribute to the payment of a premium to minority owners in order to procure their consent to the collective sale,” he said in a court document.

 

Bernard and Rada Law Corporation associate director M Kumaran, who oversees his firm’s en bloc cases, said the majority owners would have a case if the buyers had misrepresented the development charges.

 

“This sort of matter has been taken up to court but not in the context of en bloc sales,” he said.

 

Source: Today Newspaper

RECESSION DENIAL IS OVER

RECESSION DENIAL IS OVER

 

Weekend • January 19, 2008

 

Ambrose Evans-Pritchard

— The Daily Telegraph

 

Fund managers across the world have turned “super-bearish” over the last month, abandoning hope that Europe and Asia can escape contagion from the United States housing crisis.

 

A Merrill Lynch survey found that a fifth of big investors now expect an outright global recession, an occurrence not seen since the 1930s. Some think the world is already in recession.

 

“The period of denial may be over,” said Mr David Bowers, who put together the closely-watched report.

 

“This month’s survey is the first in which investors have really started to recognise that the ‘credit crunch’ could lead to a major recession. The vast majority expect profit margins to shrink in 2008.”

 

The report said global cash balances had jumped to 32 per cent of the average portfolio from 20 per cent as recently as November, with both bonds and equities falling out of favour. The survey covers 195 funds managing US$671 billion ($964 billion) across the three main regions.

 

The asset managers no longer want firms to take on more debt or pay out bigger dividends — the twin abuses at the height of the credit bubble.

 

They increasingly want them to batten down the hatches for a long storm by using cash flow to repair balance sheets.

 

What is striking is the broad perception that the US is no longer the sole epicentre of the crisis.

 

Indeed, most now think the US dollar is poised to rally as the trouble shifts increasingly to Europe.

 

A net 55 per cent view the euro as “overvalued”, and a net 61 per cent think the sterling is too high.

 

Asia is turning pessimistic as well. A net 29 per cent think China’s economy will slow and most are now underweight Chinese equities — preferring the Hong Kong stocks, which offers arbitrage opportunities against over-inflated Shanghai.

 

None of the regional managers thinks China’s growth rate will rise this year.

 

The Asian investors expect the region (excluding Japan) to face an unhealthy drift into stagflation, with growth slowing and price pressures rising at the same time. They are massively underweight on autos and media, but like staples and oil.

 

A net 50 per cent expect emerging markets around the world to deteriorate. A fifth seem to expect the bubble to burst altogether.

 

Bank and financial firms are the new pariahs.

 

Merrill Lynch’s credit strategist Barnaby Martin said the banks now faced much the same plight as telecom companies in 2002. “Their efforts to de-leverage will be bad for shareholders, but good for bondholders,” he said.

 

One glimmer of light is the rising — if small — number who think a fresh cycle of global growth is already beginning, despite the near-panic mood among their peers.

 

Ambrose Evans-Pritchard has covered world politics and economics for a quarter of a century.

 

Source: Today Newspaper

Hong Kong relaxes admission criteria for foreign talent

Hong Kong relaxes admission criteria for foreign talent

 

By Vince Chong

 

HONG Kong yesterday opened its doors wider to foreign talent by relaxing the admission criteria for a scheme which lets non-residents settle there without first getting a job.

 

Previously, applicants had to be under 50. The age limit has now been abolished.

 

Also, under the revised Quality Migrant Scheme (QMS), those proficient in either Chinese or English would score higher points than previously.

 

The scheme allows up to 1,000 applicants a year to be residents in the city without having to secure a job beforehand. It was introduced in 2006, but came up for review after just 322 successful candidates emerged from around 1,250 applicants. Most of the successful applicants were from the mainland.

 

‘Modifying the QMS will help Hong Kong compete better with the world in attracting foreign talent,’ Mr Henry Fan, who chairs the city’s advisory body on foreign talent admission, said in a press briefing.

 

Hong Kong, like many developed cities such as Tokyo, Seoul and Singapore, is looking to foreign talent to maintain its competitiveness as it grapples with a low birth rate and an ageing population.

 

The scheme involves a scoring system based on age, work experience, professional qualifications and language proficiency.

 

Other changes announced yesterday included lowering the minimum period of work experience from five to two years. The government has also scrapped the need for successful candidates to find a job within a year after being admitted to Hong Kong.

 

Candidates can now stay for as long as they like – so long as they can support themselves and their dependents.

 

Hong Kong’s scheme has no direct equivalent in Singapore, but the Republic is trying similar ways to lure talent, and for similar reasons.

 

Last year in Singapore, a new Personalised Employment Pass (PEP) was introduced for selected employment pass holders and for foreign students from institutions of higher learning in Singapore.

 

The PEP lets them stay for up to six months while between jobs. Unlike the regular employment pass, it is not tied to a specific employer, which means the PEP holder can change jobs with greater ease.

 

Hong Kong’s new QMS rules come after Chinese Premier Wen Jiabao told the territory’s Chief Executive Donald Tsang in November that the city’s need to boost its talent pool in the face of competition from countries like Singapore was ‘urgent’.

 

Analysts say that among the key obstacles to attracting talent to Hong Kong are the city’s high cost of living, high levels of air pollution and a lack of places at international schools.

 

Source: Straits Times

Regent Garden en bloc sale contested

Regent Garden en bloc sale contested

 

By UMA SHANKARI

 

(SINGAPORE) Allgreen Properties’ purchase of Regent Garden via a collective sale is now being contested by the majority sellers of the property, the company said in a filing to the Singapore Exchange yesterday.

 

BT understands that the majority owners, who together own 25 of the 31 units and over 80 per cent of the share value in Regent Garden, are saying that the sale price of $34 million was agreed to as a result of a mistake regarding the development charge.

 

Based on subsequent valuation reports – they claim that the true market value of Regent Garden should be between $39.7 million and $42 million.

 

BT understands that Regent Garden’s sales committee did not officially ascertain the development charge before entering into the agreement with Allgreen.

 

There is also some unhappiness at the higher prices the minority owners walked away with.

 

The majority owners now want the High Court to declare that the collective sale is no longer binding.

 

Alternatively, they are asking that they be paid an additional sum of $5.7-$6.7 million, ‘be placed in the same position’ as the minority owners of the property’, or be paid damages, according to Allgreen’s statement.

 

Allgreen said that it intends to ‘vigorously’ contest the claims. ‘The company’s position is that the agreement is and remains valid and binding at the original sale price of $34 million,’ it said.

 

Regent Garden‘s sales committee filed the originating summons in the High Court on Jan 10. Allgreen was served with the summons on Jan 14.

 

Allgreen had previously obtained unanimous consent to the sale of Regent Garden, it said.

 

Allgreen also said that it commenced legal proceedings in the High Court yesterday for an order that the majority sellers complete the transaction in accordance with the terms of the agreement. The minority owners, who have agreed to complete the transaction, have joined these proceedings ‘because they have an interest in the matter’, Allgreen said.

 

Allgreen is being represented by Davinder Singh of Drew & Napier, while the minority sellers are represented by Ang Cheng Hock of Allen & Gledhill.

 

The majority owners are being represented by Molly Lim of Wong Tan & Molly Lim LLC.

 

Source: Business Times