RIVER-VIEW BLUES

       The copy in the sales brochures sounded heavenly enough, over 8 rai of land on the banks of the Chao Phraya River with a soaring view of the Bangkok skyline.But for a group of condo owners of the luxury Chatrium project on Charoen Krung Road, the reality has been much different, after they discovered that their title contracts contain less land than originally promised in the original sales contracts and pre-sales brochures.
       The case stands as a prime example of the importance for property buyers to protect their interests, know their consumer rights and read the fine print before signing final contracts.
       The Chatrium project envisioned from the start three buildings located just off the river, one a hotel, the second a serviced-apartment building and the last one, closest to Charoen Krung Road, a 260-unit condominium.
       But the condo buyers, who committed to their purchases in 2004, found that their title deeds for the condo juristic person covered six rai of land, not the 8-2-75.4 rai as promised in the original project developed by City Realty.
       The missing land was split away from the juristic person covering the condo and serviced apartment to a City Realty subsidiary to run the Chatrium Suites Bangkok hotel. For the condo buyers,the concern is that the hotel property covers most of the riverfront area splitting up the overall plot means there is no guarantee that the condo owners can continue to enjoy access to the river area.
       The split between the condo residents and the hotel has already led to some conflicts.
       "I first found out that something was unusual from another unit owner last year. But I didn't really think about it until the hotel started operations late last year," one condo owner said.
       The owner said that on Loy Kratong day (Nov 12,2008), the hotel set out dinner tables in the riverfront area, which was blocked off from the condo residents.
       "When I walked up, a hotel security guard asked me whether I had a table reservation," the owner said indignantly.
       A handful of owners raised the issue with City Realty, a major property developer owned by Chali Sophonpanich. No formal response has yet been received.
       The disgruntled condo owners visited the land office for Bang Kho Laem district to examine the official deeds for the property. To their surprise, they found that the total site of 8-2-75 rai had been subdivided into five plots in December 2006, just before the condo units were transferred to the buyers. A three-rai plot was separated for the hotel, leaving a little over five rai for the condo itself and an adjacent serviced-apartment building. Of the total property, one rai was carved out to form a four-metrewide path running 180 metres lengthwise to the river.
       A group of condo owners, speaking to the Bangkok Post on condition of anonymity, said they felt deceived.
       "The developers took the cream of the property away [at the river] and added a path. Why did they do this? What about the value of our assets?" asked a working mother who moved into her condo earlier this year with her family.
       She said she was attracted to the project's design and its proximity to the Shrewsbury International School next door, also operated by City Realty. The developer's reputation and prominent shareholders were also key selling factors.
       "Yes, the project was completed as promised. But I think the developer was also selfish, regardless of what the sales contract says," another owner said.
       "What happens if this hotel or the riverside plot is sold to someone else?Will [the condo owners] be banned from using the riverside area?"
       The owners, mostly well-educated,well-off white-collar professionals, said the relatively high prices of the units -70,000 baht per square metre on average in 2004- were due largely to its riverside location and access.
       One owner named Chaiyos, a lifeinsurance executive, said he hoped the experience could be used as a lesson to others."There are other issues as well,such as the common area and expenses,that the [condo] juristic person manager needs to clarify," he said.
       When asked whether the condo owners, upon transfer of their units,verified the land plot assigned to the juristic person, they mostly acknowledged that they focused on their unit deeds rather than that for the overall site.
       "We were stupid. What can we say?But we didn't imagine that [City Realty]would do this," one buyer said.The developer perspective
       For City Realty, however, the separation of title deeds splitting the hotel property from the condo was necessary under the law.
       Sathorn Chanruangvanich, a first executive vice-president of City Realty, said the hotel simply could not operate if it was located on the same plot as the condo.
       The one-rai "path" was added to the five-rai plot reserved for the condo building to help secure a building occupancy permit and meet floor-area-ratio requirements, a rule under the building code that limits the building space that can be constructed on a plot of land.
       Mr Sathorn said the company had intended to develop the hotel from the start, but it did not formally inform the condo buyers of its plans as it had yet to receive approval for its environmental impact assessment study.
       "If we advertised the building [closest to the river] would be a hotel and we could not develop it, we might be sued by customers for breaking our promise,"he said.
       From City Realty's perspective, the hotel can only enhance values for the condominium and its owners.
       Mr Sathorn acknowledged that the company failed to clarify sufficiently to condo buyers when the units were transferred about the overall project direction.It "understood" that customers knew about the project, as a questionnaire on the hotel plan was distributed to the condo buyers, a survey that mostly showed support for the hotel.
       "We certainly never had any bad intentions or sought to deceive or cheat our customers. But there might have some miscommunication or lack of communication between us and the [condo buyers]," Mr Sathorn said.
       But the condo owners argue that while they understood from the start that a hotel would be part of the site, City Realty never communicated that the riverfront area would be split from the holdings of the condo juristic person.
       In any case, City Realty, as manager of the condo juristic person, plans to meet with all the condo owners to discuss the situation next month to find a solution.
       City Realty vice-president Vatchara Bunnag said the company tried to clearly outline issues regarding the common areas and fees in a regulation handbook distributed to all condo owners during the transfer period.
       The increase this year in commonarea fees stemmed from the higher expenses carried by the juristic person as more units have been occupied.
       "The higher fee affects us too as we own all the serviced-apartment units,representing half of all the co-owners [of the juristic person]," Mr Vatchara said.
       "Some of the co-owners might be worried that since we hold a majority vote, we may vote for something they don't agree with. But we want to say that this way facilitates management and decision-making in the project."
       City Realty itself has a strong vested interest in ensuring that the overall property is well-maintained.
       Mr Vatchara also pointed to City Realty's track record as proof that it is committed to running a quality, reputable business."We have extensive experience in property management. All our projects are well-managed and taken care of,"he said.
       City Realty's projects include Bangkok Garden on Soi Narathiwat 24, Royal Cliff Garden Condo in Pattaya, I-House Building 4 and 5 in Royal City Avenue and and Floral Chiang Mai.
       Mr Sathorn echoed the sentiment."Trust us," he said, adding that aftersales management was a priority for City Realty.
       "This project is not [and will not be]our last one. We have never thought to end the company with this one project.And we are certainly very cautious about the company's and the [Sophonpanich]family's reputation," he said.
       "Real estate is all about a developer's reliability."
       TIMELINE
       Mid-2004: Riverside Garden Condominium, later known as Chatrium, launched for sale, offering 260 units of 62-188 sq m, 80% of which are sold. First sales brochure says riverside site would exceed 8 rai with three buildings: a hotel next to the river, serviced apartment in the middle and condominium at the back near Charoen Krung Road. Only the condos would be for sale. October 2004: First customers sign sales contracts with title deeds specifying size of 8-2-75.4 rai. Map on deed show s almost rectangular plot adjacent to river. December 2006: Construction completed and developer seeks permission to open building for usage. Title separation done. January 2007: Condominium and serviced apartment buildings registered as a juristic person. Late 2007: Condo unit transfers start and residents start moving in. Late 2008: Hotel opens, operated by Dusit Thani Group. April 2009: First juristic person meeting held.