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The Big Read: En bloc wars erupt once more, turning neighbours into foes

SINGAPORE — Seven years after the last en bloc fever, many Singaporeans living in condominiums scattered across the island are once again caught up in a world where neighbours become millionaires or bitter enemies overnight, and a pot of gold awaits, literally, at the cost of their home.

Braddell View residents during their EOGM to vote on clauses regarding the enbloc sale on Feb 6, 2018. Photo: Nuria Ling/TODAY

Braddell View residents during their EOGM to vote on clauses regarding the enbloc sale on Feb 6, 2018. Photo: Nuria Ling/TODAY

SINGAPORE — Seven years after the last en bloc fever, many Singaporeans living in condominiums scattered across the island are once again caught up in a world where neighbours become millionaires or bitter enemies overnight, and a pot of gold awaits, literally, at the cost of their home.

While there were initial signs that homeowners — having been scarred by earlier experiences — were steering clear of ugly spats this time despite opposing views towards collective sales, it seems like the truce was short-lived.

Bruising, emotionally-wrought battles are taking place at several developments, reminiscent of the spats that made headlines notably in 2007, where the issue eventually made its way to Parliament and laws were changed to inject greater transparency into the en bloc process and enhance safeguards for owners.

At Cashew Heights in Upper Bukit Timah Road, for example, it has become a “war zone”, as resident Andy Goh Siak Joo, 49, put it.

Apart from his family, his parents and his sister all own units at the 999-year leasehold development. And the electrical engineer declares that he wants to “protect” their homes against the latest en bloc bid, which was launched last October. The 26-year-old condominium had gone through two rounds of unsuccessful collective sale attempts, the last about a decade ago.

The sales committee was initially chaired by his next-door neighbour before she stepped down in January due to health reasons, according to Mr Goh. But for three months, there was tension in the air whenever the two found themselves waiting for the lift at the common corridor. While they used to exchange pleasantries, not a word was spoken, and they avoided eye contact, Mr Goh recalled.

Mr Goh said he has wasted no time in printing flyers to urge residents opposing the collective sale to attend the extraordinary general meetings (EGMs), in a show of force against the pro-sale camp.

Although he is being seen as a troublemaker, Mr Goh said he would not be backing down, and was ready to “pick a fight”. “I am prepared for my cars to be scratched,” said the 49-year-old who owns three cars. “I already declared openly during two meetings,” he told TODAY. “My car is monitored (by camera) 24/7, so I hope somebody would come and then we will see who is the one (caught) on the camera. They can always leopard-crawl there and puncture the tyre if they want.”

Above: (L-R) Cashew Heights residents Lai Fook Kim, Tee Ling Zhi and Andy Goh, are against the collective sale of the condominium. Photo: RaJ Nadarajan/TODAY

Joining hands with about 70 other owners who are part of a “Protect Cashew Heights” WhatsApp chat group, Mr Goh has helped to print more flyers, and organise meetings among the minority owners.

On the same side is corporate counsel Tee Ling Zhi, 50, who has been living in Cashew Heights for five years. He described the en bloc war at the development as a “David and Goliath situation”.

Above: A notice seen at Cashew Heights. Photo: Raj Nadarajan/TODAY

Their efforts to put up flyers at the condominium’s notice board was thwarted, with the security guard taking them down. Undeterred, they put the flyers up again, only to be threatened with allegations of vandalism.

“They have the resources. They have (access to) the notice board,” said Mr Tee. “They have the cooperation of the Management Council. And they have the law on their side – all they need to do is to hold the requisite EGMs… It’s a completely one-sided battle.”

An elderly resident, Mr Lee S C, said the minority owners were given roughshod treatment at the meetings. “We’re not even given enough time to ask questions… we are rushing through almost 600 families’ affairs,” said the 70-year-old, who worked with some younger neighbours to put together a presentation to help residents understand the value of their property.

As of Saturday, about 54 per cent of the owners have agreed to the collective sale at a reserved price of S$1.88 billion.

The acrimony engulfing the 599-unit condominium has not spared even its gardening groups. One of the groups used to meet once a month over potluck, but this practice has stopped since last December, said a member who wished to be known only as Madam Chua. Conversations in their WhatsApp chat groups have also become “tense”, said the 52-year-old housewife.

HEATED EXCHANGES, POLICE REPORT AND LAWSUIT

Such a scenario is being played out at other developments, several of which are seeking to revive failed en bloc attempts as residents try and capitalise on the current frenzy.

TODAY file photo

Over at the 660-unit Pine Grove near Ulu Pandan, a third collective sale bid is underway. Heated meetings have taken place, with residents split into different factions. There is also a lawsuit pitting the former head of the management council against the chairman of the committee set up to manage the sale.

Ms Cheryn Chan, who recently stepped down as chairman of the management council, is suing Ms Singaram Kogilambal for alleged defamation. Ms Kogilambal heads the collective sale committee.

A resident, Madam Audrey Chua, 51, said she has also filed a police report against Ms Kogilambal for intimidation. 

When contacted, Ms Kogilambal said her lawyers are handling the matters, and declined further comment.

So far, 70 per cent of Pine Grove unit owners have consented to the collective sale at a reserve price of S$1.65 billion.

At the 920-unit Braddell View, which sits on a sprawling 10-hectare site, an anonymous letter has been making the rounds, expressing dissatisfaction with the method used to divide the gains of an en bloc sale among the owners.

In response, the collective sale committee put up a notice dated last Sunday saying it was “disappointed that someone is trying to sabotage our en bloc (bid) which the majority of flat owners want”.

Addressing the content of the letter, the committee’s notice said: “The difference is only about 4 per cent of the figure you think you should get. It’s a relatively small figure compared to the big picture… Do you want to jeopardise the en bloc and risk losing S$2m to S$2.4m?”

On Tuesday, there were heated exchanges during an EGM conducted on two tennis courts at the former Housing and Urban Development Company (HUDC) estate, where several residents voiced their unhappiness over the apportionment method.

Across several developments, a common complaint among minority owners TODAY spoke to was that the sale committees were trying to bulldoze their way through, without giving proper explanations of the details of the proposed deals.

“They just don’t want you to ask questions… All they tell residents is to just sign and collect the money,” said Mr Goh.

 

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A CLASH OF VALUES: SENTIMENT VS GREED?

For some homeowners, it is a no brainer to sell their units in an en bloc sale: It is all about the money.

A 54-year-old Pine Grove resident, who declined to be named, admits he loves his home for its size and prime location. However, the prospect of a million-dollar windfall if the 34-year-old development goes en bloc is too enticing. “It would probably take people more than 20 years to put S$1.1 million in their bank account,” he said.

In some instances, it is a vicious circle: Speculations of en bloc bids, followed by actual attempts which fail to take off, investors eager to make a fast buck then snap up units and leave these unoccupied and unmaintained. Maintenance issues creep up but there is little impetus to fix them and calls to put up the development for collective sale gather steam, prompting rumours and setting off a new cycle.

At some developments, maintenance or refurbishment work is put off to pile pressure on residents to back en bloc attempts, the opposing camp alleges.

But those on the other side point out the fact that maintenance costs are mounting for older developments.

At a recent meeting at Cashew Heights, residents were informed that maintenance costs are “going to go higher and higher”, and despite spending S$1.4 million on upgrading their lifts, a couple of lifts have broken down. This prompted some residents opposing a sale to lament that the payouts, while lucrative, would not be enough for them to get a home with similar attributes, and they would have to downgrade.

Cashew Heights resident Babu Narayanswamy, 54, is among those who wish to stay put. The director in an environmental engineering organisation said: “You don’t tear down solid structures, solid buildings and communities just because you want to build something glitzy and glamorous.”

Mdm Chua, the member of a Cashew Heights' gardening group, noted that the condo is built with red bricks, which should be able to last “at least 100 years”. “My air conditioning serviceman and contractor (commented) how rare it is to find good old red brick walls nowadays,” she said. “It’s a waste, I find. Why tear down good things?”

Their neighbour, Mr Tee, added: “Of course, everybody wants money. But I bought a home, not a house.”

Property expert Nicholas Mak reiterated the “fundamental real estate principle, where a house is a man’s castle”. The person who owns the property should be able to possess the premises in peace, without disturbance by hostile claimants, said Mr Mak, who is the executive director of ZACD Group.

OF NATIONAL CONCERN

The controversial en bloc process and its impact on residents have made their way to Parliament on several occasions over the years. Several rounds of legislative changes have been put in place, accompanied by spirited debates in the august chamber.

For example, in 2007, new laws were passed in Parliament following a month-long public consultation that threw up over 400 suggestions.

Among other things, the new regime allows a five-day cooling-off period during which an owner can change his mind after signing the collective sale agreement (CSA). The members of the sale committee must also be elected at a general meeting, not just convened freely.

During the 2007 debate, Members of Parliament (MPs) expressed concerns over the social repercussion of such deals: How they were breaking up communities and wreaking havoc on the lives of not just Singaporeans but expatriates as well.

Observing that the en bloc trend “seems to bring out the worst in some people”, then-Tampines GRC MP Irene Ng said she knew of “at least one case where a middle-aged couple divorced as a result of the en bloc sale of their estate”.

Then-Nominated MP (NMP) Kalyani Mehta cited “heartbroken” elderly folk forced to leave their homes of many decades, and of people separated from neighbours they counted on for companionship and support. “Is it a case of economic gain but social destruction? Whole communities that have been built over decades are literally destroyed overnight,” she said.

Nevertheless, then-NMP Siew Kum Hong pointed out that the en bloc process seemed to be meeting its objective of urban rejuvenation, noting that the average age of all developments which applied for collective sale between January 2005 and August 2007 was 25.9 years.

The issue received an airing in the House again just last week, with National Development Minister Lawrence Wong disclosing that nearly one in three developments — or 13 out of 40 — which have undergone collective sales in the past three years were younger than 30 years old. Most of the developments were, however, more than 20 years old at the point of sale and were small developments with fewer than 20 units each, he said.

The developments that were less than 30 years old thus accounted for about 6 per cent, or 240 units, of about 4,000 units sold en bloc in the last three years.

Mr Wong was replying to questions filed by Nee Soon GRC MP Lee Bee Wah. Among other things, she wanted to know if the Ministry of National Development will consider imposing a minimum number of years before a development can qualify for collective sale, and whether the ministry saw such sales as “a waste of resources”.

Mr Wong said the government’s approach is to allow collective sales to proceed if the market feels it is “economically viable”, but with certain safeguards in place — such as the consent thresholds, and approval from Urban Redevelopment Authority (URA) for the development plans. The URA will go through the plans and ensure that height and unit sizes are kept to regulations, and adequate provisions are made for parking, for example.

The Land Titles (Strata) Act was also amended in 2010 to impose stricter restrictions such as the enforcement of a two-year hiatus after a failed first attempt, to prevent harassment of homeowners who had refused to sell their properties.

Speaking to TODAY, Dr Lee, who is a civil engineer, reiterated that it would be a “waste of resources” if buildings are torn down after a short period — a point echoed by several experts and residents. “Furthermore, we have stepped up our discussions on environmental sustainability and protection in recent years,” she said.

However, she cautioned against swinging towards “over-regulation”. “I respect that en-bloc sales are a commercial decision and I don’t think we should over-regulate,” she told TODAY. “I think we can try to find a balance through a minimum number of years before a building can undergo an en-bloc, and progressively reducing the consent requirement.”

STRIKING A BALANCE

Currently, the Land Titles (Strata) Act requires buildings under 10 years old to get consent from at least 90 per cent of the owners for a collective sale to go through. Older developments need to obtain 80 per cent consent.

Before October 1999, an en bloc sale required unanimous consent from all owners. Experts recalled that back then, ugly spats also arose when greedy minority owners held the properties to ransom by asking for higher payoffs in exchange for their consent. Such a situation prevented ageing developments from being rejuvenated, they noted.

A 100-per-cent requirement is only sustainable in bigger countries where there are plenty of development opportunities everywhere, but not in land-scarce Singapore where there is a need to constantly look at ways to recycle or optimise land use, they said.

“We need to set certain rules of ‘majority wins’, otherwise everyone is just being held back,” said International Property Advisor chief executive Ku Swee Yong. He pointed out that there would always be owners who are not living in Singapore to approve of a collective sale, and divorcing couples who might not be able to agree on en bloc terms, for example.

However, some experts felt there is merit in raising the bar for consent because of the profile of developments across the island: Most, if not all, of the older, under-utilised sites have been rejuvenated.

ZACD Group’s Mr Mak noted that more than 100 condominiums were sold en bloc between 2005 and 2007 alone. He likened the process to a property going through a “meat grinder”, with the redevelopments offering smaller units as developers seek to maximise profits. If this goes on unchecked, Singaporeans “will be poorer for it”, with fewer homes of various sizes to choose from, he argued.

The lucrative gains involved have also given rise to the unethical practice of groups buying up units at a development with the aim of launching an en bloc sale, said Mr Mak. “It’s a very unhealthy phenomenon because they are asset trading,” he said, noting that this helps the rich get richer.

Following several rounds of legislative changes, Ms Christine Li, head of Singapore research at Cushman & Wakefield, felt it was best to leave the situation to market forces. “Since the government has not increased the plot ratios of many areas for more than two decades, the en bloc process will naturally slow down once the older, under-utilised condos are sold,” she said.

BUCKING THE TREND

Despite the en bloc battles waged in several condominiums spread across the island, there have been examples where the process was smooth sailing and without any drama.

Photo: Google Maps

For instance, on Wednesday, City Towers — at its fourth try — became the latest development to be successfully sold on the red hot en bloc market, fetching about S$401.9 million — or more than 13 per cent higher than the owners’ asking price.

Its sale committee launched the bid last month, after garnering more than 80 per cent approval within three months.

At the 528-unit Laguna Park in Marine Parade, the temperature has also gone down several notches compared to its first en bloc attempt in 2007. Back then, the deep acrimony saw the development become the poster child for ugly en bloc spats between neighbours. Corrosive liquid or paint was splashed on cars and glue was put on residents’ locks, among other things.

But there was none of these this time, although discussions at EGM got heated at times, said Mr Tony Sum, 63, who chairs the collective sale committee.

Mr Sum’s predecessor, businessman Lee Kok Leong, 71, was fined S$4,800 in 2009 for putting glue in the keyholes of two neighbours who were against the collective sale of the former HUDC estate.

Mr Sum, an architect, noted that almost 30 per cent of residents, including Mr Lee, have moved out since those unhappy episodes. On his committee’s work, he said it was clear that its approach had to be different from previous committees.

“We try to keep it transparent and we approach people (by putting up notices and talking to them) at the common areas instead of forcing opinions onto the residents,” he said. “We are just helping the majority facilitate the en bloc. If it does not happen, so be it.”

“You can’t force salvation on people. You have to let them seek it themselves,” he quipped.

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