Should buyers get more excited over relatively ‘cheap’ freehold Newport Residences?

[SINGAPORE] City Developments Ltd’s ( CDL ) group CEO Sherman Kwek described the response to the launch of the group’s freehold Newport Residences early this year as positive.

As at 5 pm on Jan 31, 146 units or 57 per cent of the development’s 246 units, were sold. 

Located along Anson Road in District 2 in Singapore’s Downtown Core, Newport Residences spans levels 23 to 45 of the 45-storey Newport Plaza, which will also have Grade A offices, F&B spaces and branded serviced apartments.

Should CDL be disappointed with the project’s take-up rate at launch – and more importantly, the prices fetched for Newport Residences?

Data from Urban Redevelopment Authority (URA) Realis as at Monday (May 25) showed that 192 caveats have been lodged for units at Newport Residences.

Based on The Business Times’ computation, the average selling price of the caveats was S$3,129 per square foot (psf).

Such a price for new condo units seems cheap versus prices of office spaces in or near the Central Business District (CBD).

Strata office spaces at Suntec Tower 3 on the 36th floor and 23rd floor were sold at S$3,897 psf in January and S$3,200 psf in March, respectively, based on URA Realis data. Suntec Tower 3 sits on leasehold land with over 61 years of land lease remaining.  

Meanwhile, strata office space at Samsung Hub along Church Street in the CBD, which sits on an initial land lease of 999 years, saw transactions in 2025 and 2026 at between S$4,129 psf and S$4,502 psf.

Additional buyer’s stamp duty (ABSD) does not apply to a buyer of non-residential property, whereas Singapore citizens and permanent residents buying multiple homes and non-PR foreigners buying any home have to pay hefty ABSD.

Underperforming River Modern

Looking at new housing launches in the Core Central Region, Newport Residences appears to have underperformed next to 99-year leasehold River Modern.

River Modern, along River Valley Green in the River Valley area in District 9, sold 90 per cent of its units – 410 of the 455 in total – at an average price of S$3,266 psf over its launch weekend in March.

Based on URA’s data on developers’ sales, 11 units were sold at River Modern at a median price of S$3,363 psf in April. 

Sure, River Modern’s developer, GuocoLand , has a strong Singapore residential property development track record. And River Modern is shaped by a team of award-winning architects and designers, including Yip Yuen Hong of ipli Architects.

Still, compared with GuocoLand, CDL has arguably an even more extensive track record in building homes here and is a larger company. Also, Newport Plaza is designed by leading Japanese architecture firm Nikken Sekkei in collaboration with ADDP Architects.

River Modern will be directly connected to Great World MRT station and to Great World mall via an underground walkway. Its two towers are orientated such that about 70 per cent of its units overlook the Singapore River.

However, Newport Residences scores well on location and connectivity, too. It is within walking distance of Tanjong Pagar MRT station, as well as the new Prince Edward Road MRT and Cantonment MRT stations, which will begin operations soon. It will have direct access to Prince Edward Road MRT station via a link bridge.

Residents of Newport Residences will enjoy easy access to the Marina Bay financial district, as well as dining and entertainment options spanning hawker fare at Lau Pa Sat and Maxwell Food Centre to restaurants and bars in Tanjong Pagar and Duxton Hill.

Homes at Newport Residences offer views of the CBD and the future Greater Southern Waterfront. And owners could see upside from the waterfront’s transformation: 2,000 hectares of prime land will be transformed into a premier waterfront destination with abundant recreational and entertainment offerings.

All things being equal, freehold property should be more valuable than 99-year leasehold property.

Based on a widely used table expressing leasehold value as a percentage of freehold value, a 99-year lease term is worth 96 per cent of freehold value. And as a 99-year lease runs down, the leasehold land becomes increasingly less valuable versus freehold land.

Transforming the CBD

Newport Residences’ success matters not only to CDL’s shareholders but also to the CBD’s evolution. 

Newport Plaza is the first freehold mixed-use development under URA’s CBD Incentive Scheme, which encourages the conversion of existing, older office buildings into new mixed-use developments in the CBD. The redevelopment of the former Fuji Xerox Towers site increased its plot ratio and obtained a gross floor area uplift of 25 per cent.

URA introduced the CBD Incentive Scheme in 2019 to better support the CBD’s continued growth and evolution as a dynamic global hub, and reposition the CBD as a 24/7 mixed-use district that is not just a place to work, but also a vibrant place to live and play in.  

The incentives aim to encourage existing older office developments to convert into mixed-use developments that will help to rejuvenate the CBD by among others providing a wider diversity of uses, including more homes, hotels and creative lifestyle possibilities. 

More older buildings in selected parts of Anson, Cecil Street, Robinson Road, Shenton Way and Tanjong Pagar could become redeveloped under the CBD Incentive Scheme if the Newport Plaza project does well. And this project’s success depends to a large extent on how its residential component fares.

Having a CBD that is vibrant throughout the week and in the daytime as well as at night will represent optimal use of valuable prime land in land-scarce Singapore.

Still, it takes time to change the mindsets of local residents such that they give the premium that is probably warranted for homes in and around the CBD.

While there are more singles and couples without children, such demographics may baulk at buying a CBD home as the lack of sought-after schools which are located in or around the CBD could adversely affect home prices.

Doubtless, shifting the location preferences of homebuyers is tricky. Nonetheless, a patient owner of a freehold home in the vicinity of the CBD can rightly hope for a location rerating some time down the road.

Today, the CBD is getting more lively and is undisputedly the leading office destination. If Singapore continues attracting human talent and investments, supported by great transport connectivity islandwide and good urban planning, the CBD can become a vibrant 24/7 mixed-use district to live, work and play in.