Thomson View sold for S$810 million to UOL, CapitaLand

THOMSON View has been sold for S$810 million to UOL, Singapore Land (SingLand) and CapitaLand Development (CLD), after the condominium’s owners on Friday (Nov 22) green-lit a deal for an en-bloc sale. 

At least 80 per cent of owners have consented to lower their reserve price to S$808 million, allowing them to accept the offer that had come in 12 per cent below their original reserve price of S$918 million.

Developers UOL, SingLand and CLD signed a conditional call-and-put option a month ago to acquire the 99-year leasehold development at S$810 million. The deal hinged on consent from at least 80 per cent of owners to the lower price.

On Monday (Nov 25), UOL announced that it had exercised the call option for the en-bloc purchase.

The sale of Thomson View, brokered by Edmund Tie & Co, is the largest en-bloc deal done in Singapore since the S$890 million sale of Chuan Park got the go-ahead in May 2023, after months of legal wrangling over the sale price.

It would also be the first major residential collective sale to be inked since Meyer Park was sold in February 2023 to a UOL and SingLand joint venture for S$392.18 million – under the original asking price of S$420 million.

At S$810 million, the developers’ unit land cost for Thomson View’s 5-hectare site translates to S$1,178 per square foot per plot ratio (psf ppr), which market watchers have described as “attractive”.

The land cost includes charges to intensify the land use and a lease upgrading premium to top up to a fresh 99-year lease. The current lease started from 1975.

“Over about the past 17 years, owners of Thomson View Condominium have persevered through four collective sale attempts,” said Swee Shou Fern, head of investment advisory at Edmund Tie.

On the current fifth attempt, “the realignment of the reserve price hits a sweet spot between pricing and the complexities of redeveloping a site of this scale – reigniting developers’ interest”, she added.

A plot ratio of 2.1 can yield total gross floor area of about 1.2 million square feet on the site, which now houses 200 apartments, 54 townhouses and a shop unit. 

Owners stand to gain gross sale proceeds of about S$2.22 million to S$4.94 million, depending on their unit size; the sole commercial unit will receive about S$3.87 million from the collective sale, Edmund Tie said on Monday.

UOL, SingLand and CLD have plans for a 1,240-unit project at the location straddling the Bishan and Upper Thomson areas, nestled in a popular residential district near landed housing, the MacRitchie Reservoir Park and the prestigious Singapore Island Country Club.

Based on the land cost of about S$1,178 psf ppr, breakeven cost for the new project in that location could be about S$2,100 psf, analysts reckoned.

Selling prices would likely go over S$2,500 psf, they added.

Collective sales

The successful closing of the Thomson View sale could revive interest in collective sales, and bring developers back to the table at a time when buying momentum appears to be returning to the home sales market.

Residential en-bloc deals have, in recent years, been hamstrung by a gap between owners’ asks and developers’ offers. Rapidly rising new home prices led owners to price in a premium, which developers have resisted as they face increasing risks due to higher land costs and slowing new home sales.

New projects on the two large collective sale sites that were sold in 2023 – Chuan Park and Meyer Park – have already come to the market.

UOL Group’s freehold project Meyer Blue sold 114 units – slightly more than half its 226 units – at its launch in October at an average price of S$3,260 psf. It acquired the Meyer Park site for about S$1,668 psf ppr.

Kingsford’s 99-year leasehold Chuan Park moved 76 per cent of its 916 units at its November launch, at an average price of S$2,579 psf. The site was acquired at between S$1,200 and S$1,300 psf ppr.

Thomson View, located on Bright Hill Road, was put up for tender in February at S$918 million, but did not close a sale at the asking price. Owners moved to reduce the reserve price in October. The latest tender followed numerous unsuccessful attempts to shop the site over the years since an initial attempt in 2013. The condo was marketed at S$950 million in 2021 and 2022.

As a trio, UOL, SingLand and CapitaLand have been buying land for joint projects in the last two years. UOL Group units and CapitaLand topped bids for a Holland Drive state land site in May 2023, with a S$805.39 million bid or S$1,285 psf ppr.

The same three partners bagged a mixed-use plot in Tampines for S$1.21 billion or S$885 psf ppr last year. Some 1,200 residential units are planned on the site.