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12 Sep 2022  (1217 Views) 
Ministry of National Dev

A collective sale that failed to be realized
My friend serves in the collective sales committee of a condominium. They managed to get 80% of owners to sign the agreement for a collective sale of the condo.

The advertised to invite developers to tender for the purchase of the condo. There was no response. 

They advertised a tender for the second time. They still did not get any offer on their terms. However, one developer offered a lower price (than the price stipulated in the tender). The sales committee managed to get the owners to agree on the reduced price. 

This appeared to be good news for the owners, but only for a short while. 

During the negotiation of the terms, the developer imposed several terms that were not acceptable to the sales committee. 

One term was that the purchase is subject to the approval of the shareholders of the developer. In the event that approval was not obtained (and that may take several months), the developer could abort the purchase without paying any penalty. 

There were other terms that were not acceptable to the sales committee. I did not get details of these terms. 

In brief, the developer could walk away from the sales agreement after a few months, e.g. on the grounds that the shareholders did not agree, and did not have to pay any penalty. 

It appears that the collective sale has failed again.

It was disappointing to the owners, as they have tried several times to achieve the collective sale. 

It seems that the reserve price asked by the owners was too high, and that the recent cooling measures imposed by the authority made it unattractive for the developer. 

Tan Kin Lian

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