Freehold residential land in Orchard sold for $72 million

Land in Singapore seems to be selling like hotcakes in recent months. As the flow of plots made available under the government land sales (GLS) programme languishes, developers have been eyeing and snapping up plots sold privately. En bloc deals have been monopolising the real estate scene and the latest private land sale was of 1 Draycott Park to Selangor Dredging to the tune of $72 million.

DraycottPark

Photo credit: Google Maps.

What currently stands at the 17,422 sq ft site is a 7-storey apartment block with 8 apartments ranging from 860 to 6,200 sq ft. After a development charge of $15.3 million, the sale translates to $1,787 psf. As the site is zoned for residential development, it could potentially yield 36 new storeys of new apartment units.

Situated in the exclusive yet primely located Claymore Hill and Ardmore Park enclave, near Orchard road and the American Club, the new properties to be built on site are likely to go for between $2,700 and $2, 800 psf just to break even. Thus it will not be unusual to expect prices starting from $3,300 psf, about 10 per cent above recent transacted prices in the area, from the future launch of the new project.

TheClaymoreWhile foreigners account for about 50 per cent of the luxury property transactions in Singapore, the stamp duty rate which now stands at 15 per cent has somewhat kept demand at bay. However, from developers’ recent responses to en bloc and private land sales, the prices they are willing to fork out may signify a quicker than expected recovery to the high-end property segment.

Luxury properties popular with investors once more

Luxury property seekers are coming back into the market as transaction figures show. Robust sales of units at Gramercy Park on Grange Road certainly seems to attest to that.

gramercyparkThe high-end luxury apartment project near Orchard road has sold almost half of its 174 units. Across its two 24-storey towers, 81 units have been sold, 11 of which were from the launch of its South Tower last onto. Most of the buyers were foreigners and Singapore permanent residents from China, Indonesia, Malaysia, Hong Kong, Taiwan, India, France, Britain and the United States. 24 per cent of the buyers were Singaporean.

As the bottom of the cycle seems more clearly in sight, buyers are picking off properties which might be priced rather differently from a few years ago. Property investors are also showing increased interest in luxury developments and the early bird prices at the launch of Gramery Park’s South Tower has drawn quite a few. Prices start at $3.4 million for a 2-bedder and study, $5.1 million for a 3-bedder and $6.8 million for a 4-bedroom apartment. The 2-bedroom units seem to be popular with investors as all of the same in the North tower were sold out. A 5,533 sq ft 5-bedroom penthouse in the North Tower has also been sold at $16.88 million. Properties in prime districts are once again leading the private residential real estate sector and riding on the positive sentiments, things could truly be looking up.

Condominium rents up, HDB rents down

A brieft respite in the rental market presented itself in January and February as increases in condominium rental rates were recorded for 2 consecutive months. HDB rents however slipped slightly.

Draycott8Condominium rents rose 1.1 per cent in February as demand from expatriates is usually high in the first few months of the year. Private residential properties in the prime districts were particularly in demand with a rise of 1.2 per cent in rental rates, while the city fringe and suburban sectors saw a 0.8 and 1.2 per cent rise respectively.

Property analysts are seeing an increase in leasing demand not only due to the influx of a foreign workforce in the beginning of the year, but also because rents are now at a affordable levels and more tenants may be willing to take on larger properties or properties in a more expensive location. Though rents are still 18.1 per cent lower than the peak in 2013, sales volume has increase by 12.6 per cent in comparison to the same period last year.

JurongWestCentralHDBFLatThe number of HDB flats being leased has also increased by 1.2 per cent with 1,477 units rented in February. HDB flat rents have however slipped by 0.8 per cent overall, falling 1.3 per cent in mature estates and 0.3 per cent in non-mature estates. Industry experts are expecting further decline in rents this year, while harbouring hope that 2017 will stabilise the market and bring about a recovery early next year.

Freehold site to yield potential landed homes in Orchard road

The Orchard road belt has not seen landed homes in its midst, or at least new ones, for quite sometime now. They are few and far in between and usually cost more than an arm and a leg. But a freehold residential site near Orchard road worth $72.8 million might potentially yield landed homes.

OneTreeHillGardensThe One Tree Hill Gardens site measures at 39,063 sq ft and currently consist of 6 maisonettes and 7 apartment blocks or $1, 864 psf in asking price. The units here are of considerable sizes, ranging from 1,916 to 4,682 sq ft. Should the development succeed at a collective sale, each home owner could receive anything between $4 to $11 million. What the site could potentially yield are 13 detached and semi-detached houses. Considering the prime district, the rarity of landed homes across the board and more so in the centre of town, and the lack of sizeable residential sites readily available for redevelopment, marketing agent Knight Frank is confident of the interest the site will garner. Recent sales of sites in Grange Road, Cuscaden Walk and Hullet Road have all drew considerable bids of $190.5 million in total.

The area surrounding the One Tree Hill Gardens site is in itself an exclusive enclave of high-end apartments and some landed homes. Add on its future proximity to the upcoming Orchard Boulevard MRT station along the Thomson-East Coast Line and up goes its value.

3 City fringe properties exchange hands for $190 million

3 residential properties in the city fringes – owned by 1 group of 3 investment holding firms and sold to 3 different developers fetching $190.5 million in total. Quite the sale, it seems. These 3 sites, situated in Grange Road, Cuscaden Walk and Hullet Road, were launched for sale in October for $185 million and from the interest it drew before the sale closed on November 2, developers and investors seem upbeat about the future of high-end luxury residential projects and serviced apartments or hospitality-based properties in Singapore.

urban-suitesThe luxury property market may have shrunk slightly in the past 3 to 4 years, but buyers are coming back into the market, after letting the effects of the additional buyers’ stamp duty sink in. Despite the authorities being unlikely to budge on the property cooling measures for now, interest is once again growing, with central region properties sales on the rise this last quarter.

The site on Hullet Road with a total strata area of 18,428 sq ft was sold to Hullet Development for $38.2 million. The consortium led by Mr Patrick Kho of Lian Huat Group have plans to build a high-end development in the site, leveraging on its location right in the centre of town. The biggest of the 3 sites on Cuscaden Walk with a land area of 21,560 sq ft, was bought by a consortium led by Sustained Land for $103.8 million. The other plot on Grange Road was purchased by Roxy-Pacific Holdings for $48.5 million.

boulevard-vueThese new sales may ultimately see the introduction of some choice luxury apartment units in and about town, by the time they are launched or built, the market may or may not provide a suitably soft landing for these new properties.

Mixed use properties – Aiming for perfection in Integration

In the past decade, mixed-use developments have sprung up all over the island, in almost every township and with the most popular ones near town centres and transport hubs. As cities become more crowded and space scarcer, these all-in-one properties are finding favour with buyers and investors as rental yields are often considerably higher.

South Beach
Integrated developments consist of a mix of at least 2 uses – transportation, retail, commercial and residential. They offer the benefits of having conveniences at your doorstop and with an emphasis on a balanced lifestyle. Although it may seem like the lines are blurred, developers are clever about giving residents a sense of exclusivity and most mixed-use properties have their own residential parking area, driveway and serviced-lift lobbies.

Some of the more recent integrated properties include North Park Residences, Kensington Square and The Rise @ Oxley just to name a few. There are a growing number of integrated developments in the city centre as well, near the Central Business District (CBD) and Orchard road districts, including Scotts Square Residences and Icon condominium in Tanjong Pagar  Some older properties include serviced apartments connected to malls such as Far East Plaza and Liang Court. There are also quite a few massive integrated developments coming up in the next few years such as DUO Residences in Rochor road, Tanjong Pagar Centre and South Beach.

Icon VillageThough these properties do not come cheap, their potential is considerable and as Singapore progresses into the 21st Century with lesser available land area and increasing population, their value seem very likely to appreciate.

Investors go for smaller freehold private apartments

Properties in prime town-centre district 9 have long been highly-valued and investment-worthy. Recent trends have pointed to increased popularity in smaller apartments in the district as leasing yields are higher and more frequent, possibly as the effect of the Additional Buyers’ Stamp Duty (ABSD) and Total Debt Servicing Ratio (TSDR) is lesser on these smaller properties.

Sophia Hill ResidencesRecent sales figures seem to indicate that location and exclusivity of properties in district 9 sufficiently triumph tenure and size. Freehold and 99-year leasehold properties seem to only have a $30 psf difference and in fact in recent launches, leasehold property prices have exceeded freehold property prices. In the long run however, freehold apartments hold higher potential and reduced risks.

Some freehold private residential developments in district 9 include The Marq on Paterson, Martin Residence, Liv on Wilkie, The Trillium, Reignwood Hamilton Scotts and Hilltops, just to name a few. The most recent addition to the 99-year leasehold properties list include Cairnhill Nine. Other similar leasehold properties in the area are Sophia Hill Residences, UP at Robertson Quay, Orchard Residences and Leonie Gardens.

UP @ Robertson QuayAs expatriates’ housing allowances shrink and as Airbnb becomes an increasingly common and popular choice for travellers, property investors are looking more into completed smaller, well-located units to start their investment dollar rolling sooner rather than later.

Luxury properties – Pushing through the fog

Despite the sharp fall in interest and sales in the high-end luxury property market, developers are pushing through the bad times and focusing on the light in the horizon, however far.

Cairnhillnine CondoPhoto credit: cairnhillninecondo.sg

This year, CapitaLand is leading the way with their integrated 99-year leasehold Cairnhill project which consists of the 268-unit CairnHill Nine condominium and the 220-unit serviced residence Ascott Orchard Singapore. The development will stand at what used to be Somerset Grand Cairnhill and will connect to Paragon Shopping Mall via a link bridge.

Prices at the prime district property can expect prices to hover around $2,500 psf, which is competitive considering the recent market landscape. Most of the units are one- and two-bedders from 592 to 1,325 sq ft, which might make for easier leasing. One-bedroom apartments here will start from $1.35 million and a good 90 per cent of the units will be priced affordably below $3 million.

By merging residential apartments and serviced residences, CapitaLand is hoping to offer unique suite of services including concierge or housekeeping services even to privately-owned residential units. To be completed by end of 2016, the project looks sets to attract local as well as international investors. Other launches to look forward to from the same developer include The Nassim and Victoria Park Villas.