The Present Atria En Bloc is flawed

The CSA contains unfair apportionments, which do not reflect market value, especially to the higher and sea-fronting units; the unique location not fully valued (Meyer Golden Strip); the freehold status that will appreciate in value perpetually. Therefore, the present CSA is not a good deal to all.

As such, we recommend the following actions:

1)     Do attend all EOGMs

If you were not present at the last 4 EOGMs, decisions have already been made for you. With the Quorum at just 30%, and the majority needed to pass resolutions is 50.1% of those present, whether in person or by proxy, it means that just 15.1% of owners can decide to sell YOUR home and at price which only benefits them. The present rules acceptable to the though Strata Title Board (STB) is easily exploited by speculators

This applies to all the EOGMs. It is not enough to just ignore the proceedings, especially the ones where the CSA terms are approved.

      2)     Reject the CSA approved at the 4^th EOGM.





Would you sell your home using a contract with terms that are not favorable to you? This is the case now for all penthouse, higher floor and sea-fronting units. This happened because most of the Subsidiary Proprietors of high-level/sea-fronting units were not present at the CSA EOGM. The CSC held approximately 44% of the Shared-Value votes, which includes 19 proxies, during the passing of the Motion.

We will need to commence a thorough review before owners again consider the En Bloc.

3)     Prevent lowering the reserve price.

With the current apportionment, high-floor and sea-fronting owners are already in danger of the inability to get replacement homes. If, because some owners are desperate to sell and the reserve price is lowered, the already short-changed owners will be in for a downgrade! There is every danger of it happening as long as the 80% (who have already signed the CSA) agree.

Unjust Apportionment of the Sale Proceeds

The current apportionment does not take into account the premium of storey levels, facing or penthouse units in such a unique sea-fronting site. All unit prices are calculated based on Strata Area and Share Value only.

Apportionment can definitely be calculated otherwise, the current apportionment is biased against the higher sea-fronting and the penthouse units, resulting in these units incapable of obtaining a replacement property in the adjacent area.

As illustrated in the current Masterplan (Appendix 1), The Atria sits on one of the many high-end freehold sites along Meyer Road, forming a unique belt of single-loaded, high-rise residential properties with both sea and city views, making the location impossible to be duplicated elsewhere in Singapore. Along this unique belt, the older properties (such as Hawaii Tower, Casa Meyford and Meyer Park etc.) should not be considered as choices for replacement properties since their design and environments are inferior to that of The Atria. Furthermore, they may be subjected to en-bloc in the near future.

 

This leaves us with the newer developments such as Aalto, The Seafront at Meyer and The Belvedere. The current sale prices range from $1300psf (for the lower non sea-fronting units to as high as $3500psf (for some of the premium penthouses).

The current sale proceeds apportionment will definitely render the owners of higher-level sea-fronting units, especially the penthouse units, incapable of obtaining a comparable replacement property in the immediate area. Not to mention by the time the Collective Sale completes in 1-2 years, these property prices are bound to rise further. This likely scenario is shared by most past En-bloc exercises.

Process in Passing the Motion for Approval of Apportionment of Sale Proceeds

During the 2nd EOGM, when the Motion for Apportionment of the Sale Proceeds was passed, there were questions raised from the House on the decision for adopting the current Method of Apportionment and even proposals to withdraw the voting on the Motion due to the non-disclosure of details of the discussion on the current Proposal of Apportionment. However, the Sale Committee proceeded to call for a vote on the motion, resulting in the Motion for the Approval of Apportionment at (For: 71.8%; Against: 28.2%), and details of the discussions and objections on this subject were left out in the minutes.

Points to note are; as stated in the attendance list, Mr. John Yeo, one of the 5 CSC members, was assigned the Proxy to 19 units. With the rest of the CSC, they held approximately 44% of the value votes during the passing of the Motion, not forgetting, that most of the Subsidiary Proprietors of high-level/sea-fronting units were not present at the meeting.

What is at Stake now?

With the passing of the various motions at the EOGMs, the Collective Sale Agreement (including the unjust apportionment of sale proceeds) is now in place. The CSC has 12 months from 5 March 2011 to achieve 80% shares to get the en bloc going.

With the current less favorable property market, due to the recent property cooling measures initiated by the Government, many owners are eager to ink on the current CSA. By then, it will be too late to fight for more justice in the apportionment of the sale proceeds. If the sale were to go through with a successful bidder, most of the owners of high-floor/sea-fronting and penthouse units will be incapable of getting replacement properties/homes.

The Atria, a 15-year old property with intrinsic qualities, unique to its location, market conditions, superior design of its public spaces and freehold status, transcends mere monetary considerations. With its prestigious address and exclusiveness, it means so much more to its owners and those who have resided in it from day one.

With plans of an MRT station at Katong Park, and Kallang Sports Hub in construction, this unique, mere 15 year-old freehold property will definitely perpetuate beyond its current value in the near future. Besides, with the new Masterplan in the works to contain a larger population in Singapore, the value of The Atria can only continue to appreciate and the constant reviews on en bloc rules for more equitable system can only further protect the assets of the genuine property owners from the property speculators.