Ravi Chandran
Flynn Park, a freehold collective sale site off Pasir Panjang Road, has just been relaunched for sale by tender by sole marketing agent, JLL.
Flynn Park was launched for tender in May last year at the minimum price of S$363.8m and the tender closed on 29 June 2018 without a buyer.
Following the announcement of the July 2018 market cooling measures, the Collective Sale Committee (“CSC”) initiated to lower the reserve price by 10% to S$325 million. This was duly approved at the EGM, and owners who are supportive of lowering the reserve price started signing a Supplemental Agreement (“SA”) to effect this.
This process requires owners representing at least 80 per cent by total share value and by total floor area to approve. At this juncture, owners representing more than 75 per cent by total share value and by total floor area have executed the SA.
The 72-unit development has a land area of about 208,443 sq ft. It is zoned “Residential” with an allowable gross plot ratio (GPR) of 1.4 under the 2014 Master Plan. Pre-Application Feasibility Study (“PAFS”) on traffic impact is not required by LTA for redevelopment of this site.
Flynn Park offers excellent accessibility to all parts of Singapore as Pasir Panjang MRT Station is at its doorstep. The Central Business District is just about 10 minutes’ drive away via the West Coast Highway and Keppel Viaduct.
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The development is nestled in the established low-density Pasir Panjang residential neighbourhood. It provides a rare redevelopment opportunity for an upscale low-density living next to the nature. It is just next to the Canopy Walk – an elevated boardwalk linking Kent Ridge Park to Hort Park.
Additionally, the site is in close proximity to a wide range of F&B offerings ar Pasir Panjang Food Centre, Seah Im Food Centre, various earteries along Pasir Panjang Road. Shopping and recreational amenities are readily available a short distance away at VivoCity, Sentosa, Resorts Wold Sentosa/Universal Studios.
At the reserve price of S$363.8 million, the unit land rate at Flynn Park is S$1,331 per sq ft per plot ratio.
At the lower proposed reserve price of S$325 million, the unit land rate is about S$1,198 psf/pr. Both unit land rates are inclusive of an estimated development charge of about S$24.5 million.
The tender for Flynn Park closes on Thursday, 29 January 2019, at 3p.m.
Mr Paul Ho, chief mortgage consultant of icompareloan.com, said whatever decision owners make with regards to the 2nd collective sale attempt, it is better to make it fast so that the sale (or non-sale) can be concluded with minimal delay and maximum benefit to the owners.
One way he said was to conduct a Collective Sales Agreement (CSA) as well as concurrently collect a “Non Collective Sales Agreement (NCSA)”, so that once a NCSA reaches 20%, the collective sale process is called off. There is really no point to drag on.
As collective sale process takes 20 to 30 months to complete, during this time, the owners typically do not have sufficient funds for down-payment and their CPF OA funds are tied up in the property, hence they cannot buy a new condominium early.
By the time the transaction is completed in 20 to 30 months later, the property prices would have already moved up 10 to 20 per cent. This is already evidenced by sellers of older estate asking higher prices. Hence if the process takes 20 months to 30 months, owners may need to consider the cost of a replacement unit by that time, else they may want to hold up a higher selling price.
Mr Ho pointed out that the rules are quite onerous and stringent and is governed by the Land Titles (Strata) Act – section 84A. Over the years, additions and amendments by the Ministry of Law to the en bloc law have made the collective sale rules even tighter.
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He said that many of the home owners who refinanced their home loans to fixed rate home loans or those with 2 years locked-in or 3 years locked-in period will incur full home loan redemption penalty. This penalty is usually 1.5% of the loan amount. This tends to affect those who have bought their properties in recent years as their loan size tends to be bigger and their corresponding home loan redemption penalty higher.
Mr Ho suggested that if one’s home is at risk of en bloc, the owner could consider a home loan where there is no locked-in penalty, but instead entails a higher housing interest rate cost. The next best option is to look for packages with a waiver of locked-in penalty due to sale of property. Such owners may contact a mortgage broker to assist them to find such packages with waiver of locked-in penalty.
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