Ex-HUDC Serangoon Ville up for collective sale
Home owners at Serangoon Ville have struck while the iron is hot and put their estate up for collective sale.
Owners of the privatised Housing and Urban Development Company (HUDC) development in Serangoon North Avenue 1 expect the property will sell for $400 million to $430 million amid a resurgent market. Marketing agent ERA Realty Network said the winning bidder will have to fork out an additional $200 million to $220 million in estimated charges for intensifying the use of land and to top up the lease to a fresh 99 years.
The asking price plus the extra charges work out to a land rate of $720 per sq ft per plot ratio.
“I think the response to the tender will be good, looking at deals like Rio Casa and Eunosville recently. The owners want to hit the market while it is hot,” said ERA division director Stanley Koo.
Serangoon Ville comprises 244 units of apartments and maisonettes across seven blocks. Each owner is expected to receive about $1.6 million to $1.7 million from the sale, depending on unit sizes, which range from 1,625 sq ft to 1,733 sq ft. Serangoon Ville, which sits on a 296,913 sq ft plot, was privatised in 2014 and has 69 years of its lease left.
Mr Koo said the site can be redeveloped to offer 750 to 900 apartments with an average size of 750 sq ft.
This tender comes amid brisk collective sale activity. There have been four sales this year – One Tree Hill Gardens, Goh & Goh Building and the former HUDC estates Rio Casa and Eunosville. Rio Casa in Hougang sold last month for $575 million. Eunosville in Sims Avenue went for $765 million in a deal finalised this month. Both were done above the owners’ asking prices.
“Now the home owners (at Serangoon Ville) are hoping the same goes for their tender too,” Mr Koo said. The Serangoon Ville tender closes on July 25.
Analysts expect collective sale activity to pick up this year amid developers’ hunger for sites, healthy new home sales and positive sentiment in the private residential market.
Two other former HUDC estates in Tampines and Hougang could also be put up for collective sale. The Straits Times understands that owners at the 560-unit Tampines Court are asking for at least $960 million, with the intention to launch the tender early next month. Owners at the 336-unit Florence Regency in Hougang plan to commence signing of the collective sale agreement next month.
Adapted from: The Straits Times, 22 June 2017
Commercial site at Beach Road triggered for public tender
A commercial site at Beach Road with at least a 70 per cent office component has been triggered for sale under the Reserve List of the government land sales (GLS) programme, reinforcing analysts’ perception that a recovery in sentiment for the office market is underway.
The Urban Redevelopment Authority (URA) said on Wednesday that it has accepted an application from a developer to put up the site for public tender. The unidentified developer has committed to bid at a price of no less than S$1.138 billion.
This two-hectare land parcel, which has a 99-year leasehold tenure, will have a maximum permissible gross floor area (GFA) of 88,313 sq metres.
At least 61,820 sqm has to be for office use. The remaining GFA can be developed for additional office, retail (subject to a maximum GFA of 3,000 sqm), hotel, serviced apartment and/ or residential uses.
The triggering of this site comes in tandem with positive investment sentiment in the office property market and also at a time when office rents appear to be firming after two years of decline.
It would not be surprising if the unsuccessful bidders for the Central Boulevard site last November contest again for the Beach Road site. If residential use is incorporated in the development, it would coincide with an expected upturn in the residential market.
Most consultants expect at least 10 bids from a mix of local and foreign developers, with the winning bid in the range of S$1,400-1,700 per square foot per plot ratio (psf ppr).
The Central Boulevard white site last year drew a bullish top bid of nearly S$2.57 billion or S$1,689 psf ppr from Malaysia’s IOI Properties Group, which roped in Hongkong Land this month through a joint venture to jointly develop the site.
The public tender for the Beach Road site may cause an upward adjustment of expectations of what values should be for CBD Grade-A offices.
With office rents of newer buildings stabilising and sentiment in the residential market improving, it is a good time to enter the market.
There is much capital due to the low interest rate environment and limited supply of developments available in the market.
The keen interest in CBD office developments has also spilled over to the Beach Road area, as it is anticipated that new developments such as DUO and South Beach will rejuvenate the area, with more companies willing to relocate there.
The former Beach Road Police Station sits on the site and the developer is expected to conserve and restore the building. The developer is also required to build an underground pedestrian link to the nearby Bugis MRT station.
Apart from any GFA for hotel, serviced apartments or residential use, the rest of the development’s GFA cannot have more than three strata lots, thus prohibiting strata sub-division of the commercial and retail components.
Some consultants felt that the conservation of the former Beach Road police station on the site will enhance the character of the development.
While the conservation element may cap building efficiency of the project, this conservation building fronts the main Beach Road, allowing the developer to introduce some highly visible and attractive retail concepts.
The Beach Road/ Ophir-Rochor area is envisaged to shape up as a business enclave with this commercial development, along with DUO, South Beach and Suntec City. This location has its distinctive uniqueness, being near Bugis with its attractive array of recreational, retail and hospitality amenities.
The office development at the Beach Road site will shore up critical mass of new office buildings in the vicinity. Gross rents of newer office buildings in the area – namely DUO Tower and South Beach Tower – ranged from S$9.80 to S$11 per sq ft, comparable to Grade-A offices in Raffles Place.
The Beach Road site was first made available for sale on the GLS Reserve List in November 2014. URA said the public tender will be launched in about two weeks with a tender period of 12 weeks.
Adapted from: The Business Times, 22 June 2017