Frequently Asked Questions

An en-bloc or collective sale is a combined sale by the owners of 2 or more properties to a common purchaser. The most common form of an en-bloc sale is the sale of all the units in a strata or flatted development to a common purchaser. Another variation of an en-bloc sale is the collective sale of several units of landed properties to a common purchaser.

If the land value of the property is higher than the total value of the individual apartments, offices or houses combined, it means the property has redevelopment potential and owners may well profit from an en-bloc sale. These are the most common situations where an en-bloc sale might be possible:

(a) Where the land use has been changed. For example, when use has been changed from landed to high-rise, as a result of re-zoning under the Master Plan. Changes were made to the Master Plan by the Urban Redevelopment Authority in 1993/1994 which sparked a series of collective sales.

(b) Where the Master Plan provides for an increase in plot ratio.

(c) Where the existing development has not fully utilised the allowable plot ratio. This is especially true of older apartment buildings built before 1985.

A group of interested owners can get together to form the pro-tem sale committee (PTSC). They can then contact a property consultant to help evaluate the potential for an en-bloc sale. If feasible, then the PTSC can appoint the property consultant and lawyers, who will then advise the PTSC on the next steps forward. Note: During the budget debate for 2007, the government is proposing that en-bloc sale committees be formed only at extraordinary general meetings convened by management corporations.

Where a strata or flatted development is involved, not all the owners must agree before an en-bloc sale can take place. The Land Titles (Strata) Act was amended in 1999 to allow for such a sale if a 'super-majority' of the owners in a strata or flatted development agree to an en-bloc sale and meet the requirements of Part VA of the Land Titles (Strata) Act. An application to a Strata Titles Board for an order that all the units and the land in the development be sold is also required.

If a development is less than 10 years old, the owners of 90% of the share values, share in land, or notional share in the land must agree in writing to sell all the units and common property or land to a purchaser under a sale and purchase agreement.

If a development is 10 years old or more, the owners of 80% of the share values, share in land, or notional share in the land must agree in writing to sell all the units and common property or land to a purchaser under a sale and purchase agreement.

If the en-bloc sale involves landed properties, the Land Titles (Strata) Act does not apply. As such all the owners of the properties involved must agree to the en-bloc sale.

This is calculated from the date of the issue of the latest Temporary Occupation Permit (TOP) or from the date of the Certificate of Statutory Completion (CSC) if the development has no TOP. The date of issue of the TOP or CSC may be obtained from the Building Plan Department, Building and Construction Authority.

There is no specified manner in which such a sale can be conducted. It can be by private treaty, tender or auction. In some situations, 'collective swaps' or 'exchanges' of old units for new units can also take place.

There are two main legal documents - the Collective Sale Agreement (CSA) and the Sale and Purchase Agreement (S&P). If the en-bloc properties are sold by tender, then the S&P will take the form of a Tender Document.

The Collective Sale Agreement (CSA) is an agreement signed by the owners of the en-bloc properties agreeing to sell their respective properties collectively as a block.

The common terms found in most CSAs are:

1. Reserve Price: The minimum price that owners will agree to sell.
2. Method of Sale: Whether by auctin, tender or private treaty. Even collective swaps can be specified.
3. Method of Distribution: The manner in which the sale proceeds are distributed among the various owners.
4. Validity Period: The CSA expires once this period is over.
5. Vacant Possession Date: The date when the owners surrender their properties to the developer. The term also specifies how much is to be retained by the purchaser pending the delivery of vacant possession.
6. Subject To Tenancies: Whether the sale will be subject to existing tenancies where some of the owners cannot deliver vacant possession by the specified date.
7. Appointment of Professionals: The owners agree to appoint the Property Consultants and the lawyers. Usually their fees/commissions are also set out.
8. Indemnities: Owners agree to indemnify the Sales Committee and other owners should anything unexpected happen.
9. Authority of Sale Committee: Owners authorise the Sale Committee to sign plans submitted by the authority, make application to the Strata Title Board, negotiate with brokers/purchasers and appoint professionals for the en-bloc sale.
10. Strata Title Board Application: Provisions for 80% or 90% majority agreement and undertaking to pay all costs relating to the application.

An en-bloc sale can usually be divided into 8 stages:

1. Determine If Property Is Suitable For En-bloc Sale: Strata Developments under the Land Title (Strata) Act and similar type flatted developments which are within the provisions of Part VA of the Land Titles (Strata) Act are suitable for en-bloc sales.
2. Appointment of Pro-tem Sales Committee (2 to 4 weeks): Owners come together to appoint a pro-tem sale committee (PTSC). This PTSC should comprise of a good mix of the owners of the units in the development. This is so that all views are taken on-board in the en-bloc sale process. Please note that the pro temp committee is different from the committee required under the Land Titles (Strata) Act.
3. Engage the professionals (2-4 weeks): The PTSC will then be tasked with appointing the property consultant and the lawyers.
4. Work out the pre-sale considerations (1-2 months): The property consultant will advise on the development potential of the property, the current market sentiment and how they intend to market the property. The lawyers must advise the pro temp committee on the applicable legislation and how to apply to the Strata Titles Board for approval of the collective sale. The Collective Sale Agreement is also prepared for unit owners to sign. The property consultant usually prepares a feasibility report and valuation report covering the recommended reserve price and method of distribution of the sale proceeds among the unit owners to assist owners make an informed decision.
5. Getting the requisite majority to say “yes” or better yet, the unanimous “yes” (as long as it takes but should not be more than 4 months): This is often, the most difficult stage of en-bloc exercises. The PTSC and other interested owners have to work to pursuade other owners to sign the collective sale agreement so that the requisite majority can be obtained.
6. Public Tender Stage (1-6 months depending on market conditions): Project is up for Public Tender, and developers submit their bids. The property consultant will usually have begun to market the project to get developers interested. After the tender is closed, it will be necessary to evaluate the bids and negotiate with developers, if necessary.
7. Preparations for the application to the Strata Title Board if there is no unanimous decision to sell (6-8 months): Details of what the application requires are in the answer below.
8. Legal Completion (3-6 months): If there is any objectors, more time is needed for the application to the Strata Titles Board (STB).

The Singapore Institute of Surveyors recommends the following methods:

1. Share value Method: the apportionment for each unit is proportionate to its unit’s share value in relation to the total share value for the development.
2. An average of the strata floor area and the share value method – the apportionment is according to the unit’s strata floor area in relation to the total strata floor area. The figures derived from the share value Method and floor area method are then averaged by taking 50% of each method.
3. General valuation – a value is estimated for each typical unit. This valuation is on an individual market basis, ignoring collective sale potential, floor level, facing etc.. The valuation of each typical type of unit would vary according to the floor area of each unit on the basis that the larger the unit, the lower the value per square foot. The apportionment for each unit would then be in proportion to that unit’s value in relation to the total value for the whole development.
4. The combination of general valuation and share value Method – a value is estimated for a typical unit of each type as in (c), and the total value is computed. This total value is then deducted from the sale price, and the balance is distributed to each unit according to each unit’s share value as a proportion of the total share value for the development.

The number of collective sales for mixed developments is limited to date. The share of apportionment is more complicated to determine in mixed developments where there are residential, retail and office components. Many factors need to be considered carefully so a combination of the aforesaid methods may be used. A good property consultant will be very useful in such a situation.

1. The required majority owners have signed the Collective Sale Agreement.
2. The sale and purchase agreement with the purchaser has been signed and the proposed method of distribution of the sale proceeds specified.
3. Not more than 3 persons must be appointed by the required majority owners to act jointly as their authorised representatives in the application to the STB.
4. The required majority owners give an undertaking to pay the costs of the Strata Titles Board,
5. Hold an extraordinary general meeting to consider the collective sale.
6. Obtain a valuation report for the whole development which must not be more than 3 months old when the application is made.
7. Obtain a report by a valuer on the proposed method of distributing the sale proceeds.
8. Advertise the particulars of the proposed application in the local newspapers, as approved by the Board, in the 4 official languages. The advertisement must include:
   (i) information on the development;
   (ii) the names of all the unit owners and their addresses, unit addresses and their strata lot numbers, if any;
   (iii) the names of the mortgagees, chargees and other persons with an estate or interest in the units;
   (iv) brief details of the sale proposal; and
   (v) the place at which the relevant parties can inspect the documents for the en-bloc sale.
9. Prepare the application to be made to the STB.
10. Serve a notice of the proposed application to all the owners of the units by registered post and by placing a copy under the main door of every unit and to the mortgagee, chargee or other person (other than a lessee) with an estate or interest in the unit and whose interest is notified on the land register for the unit by registered post. The notice must include a copy of:
    (i) the advertisement referred to in paragraph 8 above;
    (ii) the sale and purchase agreement;
    (iii) a statutory declaration made by the purchaser on his relationship, if any, to the unit owners;
    (iv) the valuation report referred to in paragraph 6 above;
    (v) the report by a valuer on the proposed method of distributing the sale proceeds referred to in paragraph 7 above; and
    (vi) the minutes of the extraordinary meeting referred to in paragraph 5 above.
11. Affix a copy of the notice, in the 4 official languages, to a conspicuous part of each building in the development.
12. The notice to be served by registered post shall be served on a party:
    (i) where the party is an owner of a unit registered under the Land Titles (Strata) Act, at the address as shown on the strata roll;
    (ii) where the party is an owner of a unit not registered under the Land Titles (Strata) Act, at the last recorded address at the Singapore Land Authority;
    (iii) where the party is a mortgagee, chargee or other person with an estate and interest in the unit whose interest is notified on the land register, at the address on the strata roll or last recorded address at the Singapore Land Authority; and
    (iv) where the party is a management corporation, at its address as shown in the Singapore Land Authority.

The application for en-bloc sale must be made using the approved form within 14 days of the publication of the advertisement. The application is to be made by way of a statutory declaration by the representatives appointed by the required majority owners, stating that the relevant provisions of the Act have been complied with. The application is to be submitted at the office of the STB at:
45 Maxwell Road, #01-11
East Wing, The URA Centre,
Singapore 069118
Tel: 6325 1585/6
Fax: 6325 1607

The application must include the following:
(i) the documents set out in Item 10 in the previous answer;
(ii) a list of the names of the unit owners who have not agreed to the sale in writing, their mortgagees, chargees and other persons (other than lessees) with an estate or interest in the flats whose interests are reflected in the land registers;
(iii) such other documents that the STB may require; and
(iv) an undertaking to pay the costs of the STB in relation to any valuation or other reports called for by the STB.

6 copies of all documents mentioned above are to be submitted to the STB. After submitting the application to the STB, the applicants must lodge a copy of the application, in the approved form, for registration at the Singapore Land Authority.

An owner who has not agreed to the sale in writing may, within 21 days of the date of the notice for en-bloc sale, file an objection in the prescribed form with the STB. The objection must state the reasons why the owner is objecting to the sale.

The STB will, within 5 days of the filing of an objection, forward a copy of it by registered post to the representatives appointed by the majority owners and their lawyers, if any.

The STB will approve the application and order a sale unless, after going through the application, it is satisfied that the transaction is not entered into in good faith, after taking into account:
(i) the sale price for the whole development;
(ii) the method of distributing the sale proceeds; and
(iii) the relationship of the purchaser to any of the flat owners.

The STB will not approve an application if the sale agreement requires any owner who has not agreed in writing to the sale to be a party to any arrangement for the redevelopment of the property.

After considering the application and the objection, the STB may call for a mediation between the parties or call for a further valuation report or other report which the majority owners have to pay for. If mediation fails, the STB will then conduct a hearing to determine if the application for a sale be approved. The STB will not approve an application if it is satisfied that:
(i) the unit owner who objects to the sale will suffer a financial loss; or
(ii) the sale proceeds to be received by a unit owner, his mortgagee or chargee, are insufficient to redeem any mortgage or charge against the flat.

A unit owner will be considered to suffer financial loss if the sale proceeds for his unit, after any deduction allowed by the STB, are less than what he paid for the unit. A unit owner will not be considered to suffer financial loss because his net gain from the sale will be less than the other unit owners.

In the Waterfront View case, the STB decided that:
(a) where the CPF Board waives or does not require the owner to top up any shortfall to his CPF account, it is not considered financial loss;
(b) penalty paid to the bank is not an allowable deduction;
(c) interests and renovation costs are not allowable deductions;
(d) costs of the legal fees and stamp duty at the time of the purchase of the unit are allowable deductions; and
(e) costs of the conversion/privatisation fee to convert the HUDC development into a private development is an allowable deduction.

Examples are where owners of larger units agree on a certain method of apportionment which favours them and try to force the minority to agree to it. Other questionable methods include collusion between the majority owners and the developer, and sellers being coerced into a joint venture with the developer.

The sale and purchase agreement with the developer is usually conditional upon the approval of the STB. Pending the approval of the STB, the deposit paid is usually held by the vendors' lawyers as stakeholders with instructions to release the deposit to the vendors once the STB approval is obtained and legal completion takes place. Otherwise, the deposit is refunded to the developers.

It depends of the type of development. For:

• Owners of units and land, an order for en bloc sale issued by the STB is binding on all the unit and land owners of the development (including their successors in title and assigns), their mortgagees, chargees and persons with an estate or interest in the units and land (including lessees). Under such an order, all the unit owners must sell their units (together with the land) to the purchaser in accordance with the sale and purchase agreement. They must produce the certificates of title and relevant title deeds to the representatives appointed by the majority owners for the purpose of the sale.
• Unit owners of a 999-year registered leasehold estate who do not own a share in the land, when the STB makes an order for the en-bloc sale of the units and the land, the owner of the land (or reversion) will be deemed to have transferred his estate and interest to the land to the purchaser upon the registration by the Registrar of the transfers of all the units in the development and the Registrar shall enter a notification of the vesting of the land in the purchaser on the land register.

Upon an order of the STB, such a tenancy is determined on the date on which vacant possession is required to be given to the developer. However, the tenant can ask for compensation from the unit owner/landlord. Only owners who have not agreed to the sale in writing or their lessees can apply to the STB to determine the amount of compensation payable. Such an application for compensation can only be made before the STB has approved the sale.