Pearlbank to launch at S$728m; How Sun Park going for S$78m

Singapore

MORE residential properties are joining the collective sale bandwagon. Pearlbank Apartments in Outram has garnered enough backing from owners to launch a public tender with a reserve price of S$728 million, while How Sun Park, a development of 20 townhouses in Bartley launched on Tuesday, with an asking price of at least S$78 million.

This marked the fourth collective sale attempt for Pearlbank Apartments, and the third attempt for How Sun Park.

Alex Poh, chairman of the collective sale committee for Pearlbank Apartments, said that it has taken owners less than four months since July 8 to achieve the necessary signatures crossing an 80 per cent consensus, significantly faster than the previous rounds.

"The owners understand that it is time to sell, given the age of the property and hence have shown great commitment to ensuring a smooth and quick process," he said.

The owners' reserve price of S$728 million for Pearlbank Apartments works out to a land cost of S$1,505 per square foot per plot ratio (psf ppr), after factoring in an upgrading premium of about S$195 million for the lease top-up. There is no development charge payable.

Colliers International, the sole marketing agent for the collective sale, said on Monday that preparations for the launch of a tender exercise are under way. The tender is expected to be launched in two weeks' time and to close before the end of the year.

Pearlbank Apartments, the iconic horseshoe-shaped building located on elevated grounds near Pearl's Hill City Park, has 280 apartments and eight commercial units on a land area of 7,653 sq m (about 82,376 sq ft). The development has a 99-year leasehold tenure from June 1970 and is located next to Outram Park MRT interchange.

While the development has a gross plot ratio of 7.2, under the 2014 Master Plan, it has an existing gross plot ratio of 7.4479. The site has the potential to be re-developed into a residential development with a total gross floor area of 613,530 sq ft or 730 new residential units with an average size of 800 sq ft, subject to approval from the relevant authorities, Colliers said.

The apartment owners, who own units ranging from 1,323 sq ft to 3,993 sq ft, each stand to receive minimum gross profit of between S$1.8 million and S$4.9 million. Owners of the commercial units, which range from about 700 sq ft to 5,630 sq ft, can potentially receive S$1.2 million to S$6.9 million.

As for How Sun Park, each owner of the 20 townhouses will likely get at least S$3.9 million, or more than double the property's current value of S$1.9 million if they have sold in the open market individually. The tender will close on Nov 28.

Marketing agent Teakhwa Real Estate said that the owners of 19 units (or 95 per cent approval rate) have consented to the collective sale.

The freehold residential site along How Sun Road in district 19 is near the new Bidadari township and within walking distance to the Bartley MRT station along the Circle Line. It has a land area of 54,942.7 sq ft zoned "residential" with the plot ratio of 1.4 and allowable height of up to five storeys. With a potential GFA of about 76,919.8 sq ft, some 102 apartments of 753 sq ft each may be built on the site.

The land rate works out to S$1,052 per square foot per plot ratio (psf ppr) if the estimated development charges of about S$2.92 million are included. Also, it will be pared down to S$1,014 psf if the 10 per cent bonus balcony GFA (gross floor area) is included.

Teakhwa Real Estate's managing director Sieow Teak Hwa noted that developers have been bullish about the Bidadari location, with 99-year leasehold government land sales in the area being hotly contested.

The Woodleigh Lane site was acquired by Chip Eng Seng in July for S$700.7 million or S$1,110 psf ppr; the nearby freehold Sun Rosier was also sold in a collective sale in September to SingHaiyi Properties and Huajiang International Corporation for S$271 million or S$1,325 ppr.

"Well-located freehold sites are getting hard to come by and have become more and more valuable, and we expect strong developers' interest for the site," Mr Sieow said.

Year-to-date, the total 19 collective sales worth S$6.76 billion that have closed consist of 16 pure residential developments, one mixed-use building, a commercial building on a site zoned residential/institution, and an industrial freehold property.