SINGAPORE - The landmark collective sale of Gilstead Court could be blocked after objections from five owners unhappy they may have to pay up to $27,000 each, after failing to agree to the sale.
The $150.2 million sale of the Newton freehold condominium to developer Tuan Sing went through on June 17 - but the deal still needs the approval of the Strata Titles Board.
The five minority owners have filed objections with the board in the past month.
The other 43 owners have consented to the sale, meeting the 80 per cent requirement for such a sale.
If the board is unable to find a solution to approve the sale within 60 days from the first day of mediation efforts, the board is empowered to issue a "stop order" to block the sale.
The collective sale of Gilstead Court is set to be the first of its kind, as it was brokered entirely by the sales committee. Usually, a property firm does this job.
The five objecting minority owners have not signed the collective sale agreement (CSA). They say they object to clauses which would penalise them financially. Under the clauses, sellers who consented to the sale will have to contribute a sum of $2,000 towards a common fund set up for the purposes of the sale effort.
However, owners failing to consent by the closing date of the tender have to fork out twice the contribution amount, to be withheld from the net proceeds of the sale, and to be shared equally among all consenting sellers.
Minority owners are further angered that the CSA also stipulates that all other costs related to approval proceedings before the board will be withheld from their share of the net sale proceeds.
Under the Land Titles (Strata) Act, if the tender achieves the sellers' reserve price, an application to the board must be made for the approval of the collective sale.
An application for a sale approval was made to the board on July 4.
The Straits Times understands that each non-consenting owner could have to fork out a total of $27,000, taking into account all the extra charges outlined in the CSA clauses.
Leading the collective sale effort is Mr Warren Khoo, former Supreme Court judge, who is also the executive committee's secretary. Mr Khoo drafted the terms and conditions of the tender and collective sales agreement.
The Straits Times understands that the minority owners have made it known to the sale committee that they are willing to sign the CSA, on the condition that the relevant clauses are removed.
Mr Khoo declined to comment when contacted by The Straits Times, citing the ongoing proceedings.
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