6 steps to an en bloc

What are the various stages, and is a windfall always a given?

Francis Kan

The collective-sale juggernaut that gained steam last year has rolled right through 2018 at an even greater speed. Six months into the year, we have already seen 33 successful collective sales of private residential estates valued at $9.9 billion — surpassing last year’s total of $8.7 billion.

1. GETTING OFF THE GROUND

The owners may decide to sell collectively on their own, or a developer or asset management firm may present them with an offer.

2. SET UP A COMMITTEE

Those keen to sell will establish a pro-tem committee to explore the likelihood of a collective sale happening, and push for it to happen.

3. BRING IN THE LAWYERS

The pro-tem committee will appoint a property consultant and a law firm if it finds there is enough interest among owners for a sale.

4. TIME TO VOTE!

Properties that are more than 10 years old will need an 80 per cent yes vote from owners, while newer developments require 90 per cent. Those who own a bigger share of the property will have more votes.

If the vote required for a sale is not unanimous, a Collective Sale Committee made up also of owners can make an application to the Strata Titles Board, once a property developer has made a bid for the project. Owners who are opposed to the sale can appeal to the board at this point.

5. GET APPROVAL FROM THE AUTHORITIES

If the vote required for a sale is not unanimous, a Collective Sale Committee made up also of owners can make an application to the Strata Titles Board once a property developer has made a bid for the project. Owners who are opposed to the sale can appeal to the board at this point.

6. WAIT FOR THE SALES PROCEEDS

If the Strata Titles Board gives its stamp of approval, the deal proceeds on a specified timeline — and is usually completed in three to six months. Owners will be given time to move out of their homes. All that is left to do is keep the Moët & Chandon on ice while you wait for the cash to roll in!