Third Time Lucky – Dunearn Gardens Sees Success in Collective Sale
The excitement around collective sales refuses to die down and we have another property joining the list. Residential development Dunearn Gardens which has 114 units located at Newton Road has been third-time lucky with a collective sale.
The property was picked up by EL Development Pte Ltd’s wholly owned subsidiary for a sum of S$468 million. The realty player is a part of Evan Lim Group.
The 114 units at Dunearn Gardens is spread across an area of 95,442 sq ft. (8,866.9 sq m) and has three residential blocks with their sizes ranging between 75 and 306 Sqm.
The existing site has many high-rise condos, landed houses and good class bungalows in its surroundings. It is only 150 meters walk from the busy Newton MRT Station.
Taking into account the value of the deal the residents of the property are expected to earn between S$2.69 million and S$7.98 million depending on the size of their units as was stated by Knight Frank, agents for this sale.
As per the terms of the agreement EL Development will have to spend an additional S$43.6 million as development charges to intensify land use at the site.
The 2.8 GPR (gross plot ratio) would allow the company to redevelop the site into maximum 267,239 sq ft GFA (gross floor area)
Going by the price of the deal EL Development have paid a price of S$1,914 psf ppr according to Knight Frank. If the 10% balcony bonus is accounted for the company the land rate would come down to S$1,841.
There is possibility to raise this plot ratio to 3.08 but that would depend upon the approval from the concerned authorities.
Lim Yew Soon who is the MD at EL Development seemed optimistic about the deal and said that the company plans for a 34-storey redevelopment. The luxury condo is expected to have 348 residential units that would range from one-bedroom units to spacious four-bedroom units.
Ian Loh, Head of Investment and Capital Markets at Knight Frank said that unrestricted view of city’s skyline would be a major incentive for the buyers.
He further added that the redevelopment would attract both people who want to occupy the apartments as well as those of whom are looking purely from investment perspective given its attractive location.
Petras Tsui, Deputy Chairman of the Collective Sales Committee revealed that it was their third attempt at an en bloc sale and thanked fellow residents, lawyers as well as consultants who have helped in this endeavour.
For EL Development this marks second major buy this year after it took over Singtel’s site at Hill Street in the month of January in a deal valued at S$118 million according to Mr Lim.
The company plans to redevelop it into a business hotel in the mid-to-high range category that would have 300 rooms.
As far as residential buildings are concerned its last deal came way back in the August of 2015 located at West Coast Vale where work is already going on to redevelop it into a 752-unit condo named Parc Riviera. Only one returned unit is available at this property as is the case with Yishun located Symphony Suites, a 660-unit condo.
For Knight Frank it is a job well done as they move towards another en bloc sale – Kemaman Point to be launched early May. This freehold condo is located in close proximity of Shaw Plaza and Balestier Plaza.
The collective sale fervour is just growing in the city and Dunearn Gardens located near Newton Road is the latest to join this list.
The high-rise residential property which is eligible for redevelopment has been launched for S$488.8 million reserve price but the 114 owners of the estate expect to fetch well over that figure according to Knight Frank Singapore the agents marketing this sale.
Developers would have to bear another $35.7 million as development charge that would go towards intensifying estate’s maximum permissible GFA (gross floor area). At psf ppr (per sq ft per plot ratio) rate of S$1,962 the property is attractive from the price point of view.
And it becomes even more attractive as developers would get bonus balcony GFA of 10% subject to approval from the authorities making $1,861 as the effective price psf ppr in such a case.
The freehold site measures around 95,442 square feet and has a gross plot ratio of 2.8.
Mr Ian Loh who is the executive director for Knight Frank Singapore as well as heads its Investments & Capital Markets said that in past few months the demand for high-end residential properties has picked up.
He cited 1,374 caveats for both new homes and resale properties in CCR (Core Central Region) which is a record high considering the slump in the property market in the last five years. And when this is compared to less than 1000 units in terms of projected supply for 2018-20 as per data released by the URA (Urban Redevelopment Authority) this kind of opportunity looks lucrative.
Mr Ian Loh added that there is a huge shortfall between demand and supply in high-end residential projects and given the location of Dunearn Gardens any new development on this site would attract new buyers.
Dunearn Gardens has a frontage of 90 meters on the Dunearn Road and its rectangular shape adds to the incentives. The tender for this property would close at 3:30 PM on February 13
It is interesting to note that in 2017 there were over 27 collective sales valued at more than $8 billion an eight-fold increase over such sales in 2016.