BT : Fast track for en bloc deals - 24 Jul 07

[Dan @ 94 777 977]

Published July 24, 2007
Fast track for en bloc deals
By ARTHUR SIM

CREDO Real Estate will market two prime properties for collective sale
through expression-of-interest (EOI) exercises - and it could just prove to
be the faster way to get a sale done.

Each of the properties - The Hillpark off Dunearn Road and Chateau Eliza at
Mount Elizabeth - has less than 80 per cent of owners' approval for sale at
the indicative prices, so the process of a collective sale cannot officially
proceed.

However, by launching an EOI exercise, owners who are undecided may be
swayed by bids from interested developers, even though the bids will not be
legally binding offers.

But as Credo's managing director Karamjit Singh notes: 'It can be faster
because you can secure a bid at an earlier threshold.'

The Hillpark sits on 77,646 sq ft of land and is zoned for two-storey
bungalows. The indicative asking price is $106 million to $110 million,
which works out at $1,365 to $1,416 per square foot.

Chateau Eliza sits on a 17,997 sq ft site and has a designated plot ratio of
2.8. The height limit is 36 storeys and the indicative price is $120 million
or $2,223 per square foot per plot ratio.

Both developments have achieved around 70 per cent of owners' approval for
collective sale, an important consideration when proceeding with an EOI.

Giving an idea of how EOI can work, Credo's executive director Tan Hong Boon
revealed that for a recent collective sale deal it brokered through an EOI -
Watten Heights off Dunearn Road - Credo received 16 bids.

One was high enough to convince undecided owners to agree to sell quickly.

An Offer to Purchase was then drawn up with the highest bidder and the
collective sale was done within days, without having to proceed with a
public tender.