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The Arcade

Collective Sale

What is a Collective Sale? 

  1. The sale of a development with 2 or more unit owners to a common purchaser. 
  2. It requires a specific majority (by share value and strata area of the property) of the unit owners to agree before the property can be put up for sale. (80% for property 10 years old or more; 90% for property less than 10 years old). 
  3. Consenting owners must sign the Collective Sale Agreement (CSA) which will set out the Minimum Selling Price (MSP) and how the sale proceeds are divided among all the unit owners.
  4. When the specific majority unit owners have signed the CSA, the property can be offered for sale by way of tender or auction. 
  5. Any sale agreement between the majority unit owners and the buyer is subject to the Order of Sale by the Strata Titles Board (STB) or High Court or Court of Appeal, if 100% owners’ consensus is not obtained.
  6. The Sale Order is binding to all unit owners, including dissenting owners. All owners must sell their units (together with the land) to the purchaser in accordance with the SPA. 

Process


  1. At the close of tender, an independent Land Valuation Report commissioned by the majority unit owners will have to be submitted.
  2. A tender would be awarded if it is unconditional and the tendered price is higher than both the MSP and land valuation.
  3. The Collective Sale Committee (CSC) could negotiate terms and conditions with the tenderer but any award could only be made if the terms and conditions negotiated are provided for in the CSA. 
  4. If there is no tender award, then the collective sale will enter into the phase of the 10-week private treaty negotiation period.
  5. The CSC could enter into a SPA with a buyer during the 10-week period. Thereafter, if no agreement has been signed, the CSC must then offer the property for sale by way of tender or auction again. This process of tender launch followed by a 10-week private treaty period could repeat itself up till the expiry of the CSA.
  6. The CSA is valid for a 12-month period. However, the application  for Sale Order must be submitted before the end of the 12-month period.
  7. With 100% owners’ consensus to the sale, legal completion will then take place in 10-to-12-week time, followed by a 3-to-6 month vacant possession period. 
  8. With less than 100% owners' consensus to the sale, an application must be made to the STB for a Sale Order, followed by legal completion and then vacant possession period.

Sale Order

  • Where no objection is filed by the dissenting owners, the Board will approve the application and issue the Sale Order 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.  

  • Where objections are filed by the dissenting owners, the Board will consider all the factors in the above and the objection and may call for mediation. The Board 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.  

Note 1: A unit owner will be considered to suffer financial loss if the sale proceeds for his unit, after any deduction (such as stamp duty and legal fees paid on purchase of the unit, privatization costs and costs incurred in the collective sale) allowed by the Board, are less than what he paid for the unit. 

Note 2: 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.

Note 3: A unit owner will not be considered to suffer financial loss because the proceeds of sale for his unit, after such deductions, as the Board may allow is less than the price he paid for his unit, if he had purchased his unit after the collective sale committee had already signed an agreement to sell all the units and common property in the development to a purchaser.

Source: The 2010 Amendments to Land Titles (Strata) Act 
Singapore