Legal Issues Sales Brief

Owning a Property in Lotus Gardens
Lotus Gardens is based on deluxe condominium structures. Each condominium is built to a standard that would befit a freestanding detached structure. The principal benefit for a buyer is that condominium title, sometimes referred to, as “direct foreign freehold ownership” is available.

Three methods of purchase are available to you:

1. Purchase a direct foreign freehold condominium title in your name (Under Thai law 49% of the condominium units may be sold directly to foreigners).
2. Purchase a freehold condominium title using a Thai company in which the foreign shareholdings have a controlling protected 49% interest with weighted voting rights. This company cannot be a “nominee” company.
3. Purchase a 30-year lease with two 30-year renewable options whereby the leasehold owners holding a controlling interest in the “landlord” company granting the renewals would protect the security of the renewals. This is a standard way of ownership in Thailand.
   
   We expect most of our sales to fall within options 1 and 2 but can easily accommodate option 3 if buyers prefer.

From Reservation to Legal Ownership
In order to own your condominium:

• Complete and return the Reservation Contract with deposit
• Conduct your due diligence into the property and project
• Execute all contracts and make your first payment
• Make payments tied to construction milestones until the transfer date
• Pay the final balance and register ownership of the condominium or lease

Execute Reservation Contract
We will provide to you the reservation contract applicable to your chosen unit. You must sign and return this to us so we can sign and return it to you as an executed contract together with the contractual documents.

As you are purchasing a condominium in Thailand, you should ensure that all remittances of more than the equivalent of US$20,000 are marked “to purchase a condominium”. If you pay direct to our bank account we will obtain the Foreign Exchange Transaction Forms required to register the condominium to you. If you transfer to another bank in Thailand first, then you must obtain the required forms. If you have any doubts, please consult your bank. This allows you to freely remit the money out of Thailand if you sell the property.

Conduct Due Diligence
Most buyers will have their own lawyer or adviser to assist them with a purchase. Our lawyers can provide your lawyers with the information required to satisfy a thorough due diligence process and so that the time required is limited to 30 days:

• we supply pre-prepared contractual documentation.
• we supply you with title information so that your lawyer can conduct a full due diligence of the land title. A good lawyer will recommend that this type of search is undertaken to check the history of the land. We conducted this search before we purchased the land, and our own due diligence is available.
• we supply you with estate management estimates from our chosen property management providers including fees and list of services.

In the event that more than 30 days pass before execution of the contract, the Reservation Contract expires and the property can be re-marketed. The deposit is non-refundable.

Execute Contracts and Make the First Payment
When the due diligence is complete, you must execute the sales contract. Prior to finalizing the contract you should finalize any minor modifications you might wish to make to your condominium unit and settle any additional costs to be included in the contract price.

Payment instructions for the first payment are on the Reservation Contract.

Payments are Tied to Construction Milestones
Each payment you make will relate to the progress of construction. Ultimately, in the contract, there is a “long-stop date” or final date by which legal title must be transferred to you. Throughout this process we can provide you with a construction report at quarterly intervals.

Pay the Balance and Legal Ownership is Transferred
A condominium is a unique and secure type of ownership of property for foreigners in Thailand. In order to comply with the Condominium Act, sellers of condominiums cannot register the final legal title of the condominium until it has been inspected and signed off by the authorities as complying with the relevant law. Therefore legal title cannot be transferred until the end of construction and completion of registration. At the outset, our contractors obtain pre-approval for the condominium to ensure that obtaining final approval for condominium status will be a matter of procedure.

Any buyers who opt for the leasehold route will at this point have their lease registered in their name.

You will have lots of questions! Ask us and your lawyers, who will have handled many similar purchases.