Case 2: Developers Failed to Finish / Deliver the Pre-sold Condo and Residential Units

A large marketing firm easily sold an eight-story condominium somewhere in Metro Manila, Philippines. The proposed condominium was easily pre-sold because of its strategic location, which is very near a large mall in that city. The developer also had already a good track record in building and finishing their condominium projects. They advertised that the buyers / investors could easily avail of large discounts on the total contract price before the condominium would be built. The problem was in that city, the ordinance for the maximum height of any building or condominium was only up to four stories high. The construction of the condominium stopped at the fourth floor; the developer is still waiting for the court decision whether to allow it to finish the building.

In another condominium case, a developer pre-sold many of their residential units somewhere in Makati City, Philippines. The developer was not able to put up the building because of the Asian financial crisis in the late 90s. The bank foreclosed the property and sold it to another developer.

In a subdivision case, a reputable developer sold and developed their property somewhere in Dasmarinas, Cavite, Philippines. The said property is less than 10 hectares, so the lots were sold out easily. About less than 10 percent of the buyers built their houses on the lots they bought. However, the developer abandoned the project, leaving the homeowners and investors with no water tank no entrance gate, no electricity and the road was basically still dirt and gravel.

In another case, a reputable developer failed to deliver the condominium units to buyers who were paying their monthly amortization fees religiously. One buyer stopped paying her amortization and she demanded a refund for her Php 980,000+ payments. Instead of refunding her, the developer offered a swap for a more expensive unit also scheduled to be finished at a future date. The buyer was apprehensive already; she just wanted her cash back. Even with the Contract to Sell stating that the buyers were guaranteed of a refund in case of non-development, the buyer could not get a refund due to the financial position of the developer. (Philippine Daily Inquirer, 10/26/99, p. B6)

Glance at the lessons to learn from this occurence.

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