Braddell View can’t be privatised until its leases are harmonised
While the estate has facilities such as a clubhouse and swimming pool – suggesting a private condominium-like status – home buyers are often surprised to find out that it is not fully private. It is the only HUDC estate yet to be privatised or earmarked for the move. — ST PHOTO: DESMOND WEE

HOME buyers who are willing to pay top dollar for a unit at Braddell View for its en bloc potential may face a longer wait than what they bargained for.

The road towards a possible collective sale of the HUDC estate looks like a long and bumpy one, with the unique status of the development throwing up hurdles along the way.

While Braddell View has facilities such as a clubhouse and swimming pool – suggesting a private condominium-like status – home buyers are often surprised to find out that the estate is not classified as fully private.

In fact, it is the only remaining HUDC estate out of 18 such estates that has yet to be privatised or earmarked for privatisation.

This means the sprawling 30-year-old estate, with an area of 106,000 sq m, cannot be put up for collective sale yet. But some property agents have been highlighting its en bloc potential in their listings, in hopes of attracting buyers looking for capital appreciation.

When asked about the background, the Housing Board told The Straits Times that the development has not been designated for privatisation yet as it was developed in two phases, with each phase being issued a separate state lease with a different expiry date.

The issue of lease harmonisation has to be resolved before the estate can be privatised, it added.

A check with the Singapore Land Authority’s (SLA) land information service showed the estate as consisting of two leases which expire about 21/2 years apart.

‘(The lease harmonisation) is currently being reviewed and will take some time as it requires further study and consultation with the relevant authorities.

‘We will look into the designation of Braddell View for privatisation under the Land Titles (Strata) Act once the review is completed,’ the Housing Board said.

The Act governs the issue of strata titles and the collective sale of a development, among other things.

Ms Leong Pat Lynn, a partner at Rodyk & Davidson LLP’s real estate practice group, suggested that one way the two leases can be brought in line with each other is by the Housing Board working with the SLA to either surrender or top up the lease difference.

But this will mean that the two authorities have to work together to resolve any payments needed to achieve the purpose.

In a normal situation, if a lessee decides to top up its lease, it might have to pay the SLA, and if it surrenders part of its lease term to the SLA, it may receive payments instead, Ms Leong said.

The more than 900 homes at Braddell View – consisting of high-rise apartments, low-rise apartments and maisonettes – are considered private property as they are not sold under the Housing and Development Act.

They are also unaffected by policy revisions that affect Housing Board flats, such as the ethnic and permanent resident quotas.

Assuming the leases are harmonised, for Braddell View to be considered a full-fledged private property and be eligible for a collective sale, the titles of its flats, which now fall under the HUDC Housing Estates Act, need to be first brought under the Land Titles (Strata) Act.

This is done through the privatisation process which converts the existing leases to strata titles. But the process itself presents another hurdle as it requires the support of at least 75 per cent of the residents before it can proceed.

Property agents The Straits Times spoke to said serious buyers are mostly aware that Braddell View cannot go en bloc as yet. But many are also drawn to the good location and large unit sizes of the development, they noted.

DTZ sales director Sherry Tang, who markets units in the estate, said there has been ‘very healthy interest’ in the development.

‘The possibility of a collective sale is still there and the lease situation is likely to be resolved one day… so buyers think that, since Braddell View is well-located and of a good size, they can at least enjoy the space and facilities while waiting,’ she added.

Prices at the estate have moved upwards in the past year, in line with the booming property market.

In the first six months of this year, 18 units of Braddell View were transacted at an average unit price of $706 per sq ft (psf), according to caveats lodged with the Urban Redevelopment Authority, compared with the 26 transactions at a lower average price of $604 psf in the same period last year.

The estate was built under HUDC Phases I and II and completed in the mid-1970s to the early 1980s.

Its facilities are managed and maintained by a management committee, which collects maintenance charges from the flat owners.

This is unlike HUDC estates under Phases III and IV – completed between the early- and mid-1980s – which are managed and maintained by town councils instead.

Some HUDC estates, such as Lakeview, Laguna Park and Farrer Court, were also built under Phases I and II. But with the exception of Braddell View, all the estates have already been privatised.

HUDC flats were built as an option for middle-income families, but were phased out in 1987 as demand declined. Privatisation began in 1995 in response to the rising aspirations of Singaporeans to own private housing.

There are 18 HUDC estates comprising 7,731 residential and 23 shop units built under four phases.

Source: Straits Times, 3rd Aug 2011

Only half of 65 sites sold in first half, with bigger estates left on the shelf

Big estates which failed to attract buyers in the first six months of the year include Hawaii Tower in Meyer Road (above) and Pine Grove in Ulu Pandan. — PHOTOS: CB RICHARD ELLIS, NURIA LING

COLLECTIVE sales in the first six months totalled $1.81 billion, but only around half the 65 sites on the market found buyers.

While smaller blocks were snapped up, the big estates – with big price tags – stayed on the shelf.

That meant the $1.81 billion sales value represented only 15 per cent of the total value of sites on sale, according to a Credo Real Estate report yesterday.

Small was beautiful in the first six months of the year, with 20 of the 23 sites of $50 million or under being sold. But no sites with indicative or estimated values above $300 million were bought.

These consisted of 11 estates with a combined value of $8.1 billion, including Hawaii Tower, Tulip Garden and former HUDC estate Pine Grove.

There were 33 sales in all, with the average deal size of $55 million being just up on the $49 million average last year.

Mr Ong Teck Hui, Credo Real Estate’s head of research and consultancy, said demand for larger sites was soft due to their hefty asking prices.

The aggressive government land sales (GLS) programme – typically large plots with high absolute values – has also attracted major developers, leaving them with less appetite for the larger high-value collective sale sites.

‘The suburban mass market where most GLS sites are located is relatively more active than the prime and mid-prime markets where the larger collective sale sites are,’ said Mr Ong.

‘The smaller developers priced out from the GLS market also tend to favour smaller collective sale sites which they find more viable.’

Private residential prices have moderated in recent months, with second-quarter flash estimates showing a gain of just 1.9 per cent. They rose 2.2 per cent in the previous three months.

With the residential property market at the upper end of its market cycle, Mr Ong warned that collective sales will likely face a more challenging period.

Buyers are more selective, while sellers remain eager to dispose of their homes at optimistic prices, he added.

‘There has been a trend of collective sale sites, especially the larger ones, being unsuccessful and having to review their asking prices and relaunch for sale again,’ he noted.

But Credo expects the momentum of collective sales to continue, with smaller sites staying more popular while larger ones will be down to price.

New sites will have to be more decisively priced as buyers have more options, the firm added.

The $1.81 billion in collective sales in the six months to June pipped the $1.77 billion in the same period last year, but it pales against the boom of 2007, when 87 sites worth $11.4 billion were sold.

Source: Straits Times, 22nd July 2011

$70.5m deal brings total for first half to $1.73b, as market gathers pace

The 40-unit block, one of the first residential projects in the 1960s, has a lease of 999,999 years. Each owner will get gross proceeds of $1.75 million to $1.77 million. — PHOTO: CREDO REAL ESTATE

A WALK-UP apartment block in River Valley Road has sealed its collective sale, bringing the total value of en bloc deals for the first half of the year to $1.73 billion – just below last year’s total.

Alliance Land paid $70.5 million, or $1,035 per sq ft (psf) per plot ratio (ppr), for the 40-unit project. This included a 10 per cent balcony allocation.

Each owner will get gross proceeds of $1.75 million to $1.77 million.

Marketing agent Credo Real Estate said yesterday that the 22,107 sq ft site can be redeveloped into 130 apartments of about 500 sq ft each. The block, one of the first residential projects in the 1960s, has a unique lease of 999,999 years.

The en bloc market has gathered pace from last year, when 36 deals worth $1.77 billion were sealed after a slow 2009. But the $1.73 billion so far is still low compared with the boom of 2007, when 87 sites worth $11.4 billion were transacted.

Credo managing director Karamjit Singh said the 32 deals completed in the first half of this year are relatively small, with low absolute values. The buyers have tended to be small to medium-sized developers unable to bid for larger government residential sites, he noted.

‘In 2007, the top five deals were worth over half a billion dollars each. Over the last 18 months, each of the top five deals ranged from $137 million to $214 million only,’ he said.

The average collective-sale deal this year is $54 million, up slightly from last year’s $49 million. In 2007, the average deal size was $131 million.

Credo said the past 18 months have been challenging for larger collective-sale sites, as potential buyers have been daunted by high absolute land values.

The aggressive government residential land sales programme has also diverted interest from collective-sale sites, especially the larger ones.

The new market reality has dawned on the owners of these bigger estates and some have begun readjusting their reserve prices, Credo added.

Pine Grove, Pearl Bank Apartments, Laguna Park, Hawaii Tower and Tulip Garden have all launched en bloc attempts priced at more than $500 million.

Tulip Garden in Farrer Road initially priced its sale at $650 million, but recently relaunched it at $600 million.

New collective-sale sites have continued to stream into the market.

Royalville in Bukit Timah Road expects bids of between $370 million and $400 million, or $1,383 psf ppr to $1,495 psf ppr. The break-even cost is expected to be above $1,900 psf, Credo said.

St Patrick’s Garden off East Coast Road is on the market at an indicative price of $188 million, or $888 psf ppr. Owners expect to receive between $1.55 million and $2.1 million each, said marketing agent Savills. The break-even price is estimated at about $1,440 psf.

Mr Singh said the outlook for the market for the rest of this year is positive. ‘With owners becoming more realistic on reserve prices and sustained interest from developers, we expect deals in the second half to be at similarly healthy levels.’

Source: Straits Times, 28th June 2011

THE owners of Balmoral Condominium in Balmoral Road stand to receive about $3 million per unit now that their estate has been sold en bloc.

The 45-unit freehold development was sold for $141 million to a consortium comprising the Tong Eng Group, Clarus Corporation and Yuan Ching Development, marketing agent Savills Singapore said yesterday. Yuan Ching is a wholly owned subsidiary of Singapore-listed Tiong Seng Holdings.

The price works out to $1,546 per square foot per plot ratio (psf ppr), said Savills’ director of investment sales Suzie Mok. ‘This transaction should give a boost to the high-end residential segment as current prices are still below the peak levels seen in 2007,’ she added.

Each owner of the District 10 condo is set to reap between $2.85 million and $3.26 million, depending on unit size.

The site has a land area of 57,005 sq ft and a maximum gross floor area of 91,208 sq ft. It can be redeveloped into 80 apartments averaging 1,100 to 1,200 sq ft, Savills said.

The property firm estimates the break-even price for the new development to be about $2,200 to $2,300 psf.

Meanwhile, the owners of another freehold condo in District 10 are relaunching their estate for collective sale at a lower price.

They are hoping to get $600 million for Tulip Garden along Farrer Road, down from their previous price-tag of $650 million.

The owners have noted that over the last 18 months, smaller projects of below $200 million in value have been more successful in going en bloc than larger ones, said Credo Real Estate, which is marketing the 164-unit development.

At $600 million, the 316,708 sq ft site would cost $1,153 psf ppr. This compares with $1,250 psf ppr for a $650 million asking price.

Source: Straits Times, 23rd June 2011

It is believed owners of Laguna Park’s 528 units have been told they could receive up to $2.3 million per unit. — FILE PHOTO

RESIDENTS at Laguna Park condominium have voted for a collective sale, two years after an earlier bid was called off.

The Straits Times understands that the sales committee secured the 80 per cent mandate last Thursday.

While a new asking price has not been fixed yet, it is believed owners of the 528 units have been told they could receive up to $2.3 million per unit.

That would make the price for the 99-year leasehold estate in Marine Parade around the $1.2 billion they demanded in 2009.

A potential deal for the former HUDC estate then was called off when the sales committee was too pressed for time trying to get the minimum consent level from owners for a proposed lower price.

Owner Yup Kim Tai told The Straits Times she would be happy regardless of the outcome of the sale, saying: ‘I’m old and I want to buy a smaller place. If we get the money, I’ll do that, if not, well I’ve lived here since the (estate was built) so what’s another few years.’

Sources say the tender for the 677,463 sq ft site could possibly be rolled out as early as the middle of next month.

There have been a number of large estates put up for sale en bloc in the past three months.

Pearl Bank Apartments at Outram was put on the market for $750 million while the owners of Pine Grove condominium in Ulu Pandan are asking $1.7 billion.

The tender for Pine Grove closed on April 19, but the marketing agents have not revealed the outcome.

The tender for Pearl Bank closes on May 25.

Hawaii Tower and Tulip Garden, with reserve prices of $700 million and $650 million, respectively, have yet to seal any concrete deals.

Property market observers doubt any collective deal will surpass the $1 billion mark this year.

The East Coast area has seen some success but on a smaller scale. Two condominiums near Laguna Park – Marine Point and Amber Glades – were sold earlier this year for under $120 million each.

Some analysts say developers may be shying away from larger sites, preferring smaller, more affordable plots that carry a lower risk if the market turns.

Mr Nicholas Mak, SLP International’s research head, said: ‘The amount of money you pay for such big sites could be used to buy maybe two other sites under the Government Land Sales Programme.

‘Another factor developers will have to consider is that there are a lot of new homes slated to come onstream in the next few years so they might not want to get caught up in that either.’

Source: Straits Times, 27th April 2011

Observers expect this year’s sales to beat last year’s in volume, value

EN BLOC activity has gained momentum in the first few months of this year with 12 successful deals totalling $37.1 million, according to analysts’ estimates.

And plenty more are in the pipeline. Credo Real Estate’s deputy managing director Tan Hong Boon said around 24 collective sale tenders have entered the market this year. Yesterday, another project – Pearl Bank Apartments – went on sale at an expected price of $750 million. This translates to $1,495 per sq ft per plot ratio. The tender will close on May 25.

Observers do not expect any slowdown in activity in this segment. Some say between 10 and 20 more sale sites could hit the market this month and next.

Others expect the total number of collective sales this year to beat last year’s figure in terms of volume and total value. Last year, 34 sales worth $1.7 billion were sealed, said Credo Real Estate.

Some insiders argue that while January’s property market cooling measures have dampened sentiment, developers are set to maintain a healthy appetite for such deals. Smaller sites are expected to do well this year, said HSR’s head of investment sales Jeffrey Goh: ‘Developers could be finding it too risky to commit to larger sites, especially with all the uncertainty in the market.’

This year has seen no shortage of mega en bloc sites. But projects such as Tulip Garden are yet to secure concrete deals.

Buyers of en bloc sites range from foreign developers like China Sonangol Land to smaller boutique developers like Heeton Holdings, with even big players like Far East Organization and CapitaLand gunning for a slice of the action as well.

But chasing sites under the Government Land Sales programme comes with more certainty, said Mr Goh, and a shorter, more straightforward process.

Knight Frank’s executive director of investment sales Nicholas Wong said many attractive sites in mature, well-established estates are taken by older projects: ‘The only way developers can access these sites is through a collective sale.’

Mr Tan said sites from a wide range of districts might go on sale this year.

Analysts agree that this year could see the rise of more high-end collective sales.

Credo’s Mr Tan said prices of en bloc sites in suburban and mid-tier markets have risen: ‘High-end sites on the other hand, haven’t made as much progress so we could see developers paying more attention to them as the price gap between high-end and mid-tier sites narrows.’

Source: Straits Times, 12th April 2011

Arcadia residents plan appeal after SLA rejects bid to extend lease of 33-year-old condominium

Residents (from left) Edwin Khew, Uttam Kripalani, Anand Danani and Stewart Yen of Arcadia condo, which was the first estate here to feature vertical landscaping. — ST PHOTO: NURIA LING

No en bloc, please, even if we’re residents of one of Singapore’s oldest condominiums.

But we’d like a lease top-up.

Residents at Arcadia, an early-generation condominium completed in 1983, feel so strongly about this that all have agreed to pay the cost of topping up the lease if the nod is given.

Mr Anand Danani, 58, who has lived for more than 20 years at Arcadia, said residents are seeking a top-up to conserve the estate – which has 66 years left on its lease – and to preserve its value.

Mr Danani, a private banker, said his family, like many others in the estate, has built precious memories and solid relationships with neighbours in this spacious estate nestled amid lush greenery in Arcadia Road. His daughter and son spent their formative years there.

Ask him if he would want a collective sale – the choice of many residents of other leasehold condos here that have reached this age – and he would tell you without missing a beat: No way.

The residents of the condo are seeking an extension of lease for their ageing estate, not for the sake of a collective sale but to conserve its three buildings on environmental and heritage grounds.

If they succeed, Arcadia will set a precedent in Singapore’s history.

The condo’s management committee told The Sunday Times it applied to the Singapore Land Authority (SLA) last year to top up the lease back to 99 years.

This was after they worked hard to get the 100 per cent consent from residents, required by the authorities. But the application was recently rejected.

The owners are all too aware that the condo is approaching the 60-year milestone left on its lease.

In Singapore, private properties that fall below this level typically depreciate quicker in value as there is a smaller pool of interested buyers. Central Provident Fund (CPF) Board rules dictate that Singaporean and permanent resident (PR) CPF members cannot use their CPF savings to buy private homes with less than 60 years on the lease. Similarly, banks are reluctant to finance loans for buyers of such properties.

Arcadia’s management committee said that in its application to SLA, it stressed its intention to conserve the estate for its architectural value.

The condo was the first building in Singapore to feature vertical landscaping, which was inspired by the Hanging Gardens of Babylon, one of the original seven wonders of the ancient world. It was built with generous garden terraces on every level and features unusual pyramid-shaped buildings that narrow towards the top.

It was designed by local architect Chua Ka Seng of Chua Ka Seng & Partners Chartered Architects, who built in planter boxes of almost 12km in length throughout the buildings. The road it sits on, Arcadia Road, is a heritage road where trees are preserved and no development is allowed within a 10m-wide buffer.

‘Arcadia epitomises the green lifestyle that the Government is encouraging and we feel that this estate deserves to be conserved, rather than let it become vulnerable to en bloc sale, which leads to demolition and further wastage of resources,’ said the condo council’s treasurer Edwin Khew, 62, a former nominated MP.

The Government has, in recent years, made efforts to ‘green’ buildings by providing incentives for owners to integrate greenery on their rooftops or walls.

Arcadia was a pioneer in such vertical landscaping and was ahead of its time, say its residents.

It was even featured – as ‘one of the most dramatic green developments in Singapore’ – in an exhibition ‘Singapore 1:1 – Island, A Gallery of Architecture & Urban Design’ by the Urban Redevelopment Authority (URA) in 2008.

SLA had told the residents in a letter that ‘we are unable to accede to your request at this point in time. The conditions for lease extension include land use intensification and urban rejuvenation’.

When asked by The Sunday Times about its decision, a spokesman said: ‘SLA declines to elaborate further because answering the questions asked would be a breach of confidentiality obligations.’

SLA added that it ‘evaluates each application on its merits and in consultation with the other government agencies’.

‘The specific circumstances of each development determine if a lease extension should be granted and, if so, the length of the extension.

‘For residential uses, the Government may allow lease extension if it results, for example, in land use intensification and mitigation of property decay,’ it said.

Arcadia residents are not giving up and intend to appeal against the decision. Mr Khew and Mr Danani are hoping Arcadia can set an example of how residents who look after their estate ‘do not have to go through the wasteful process of en bloc sales’.

Property experts such as Credo Real Estate managing director Karamjit Singh said it was rare for SLA to grant a lease top-up if it was not for redevelopment or for extensive refurbishment.

Chesterton Suntec International research and consultancy director Colin Tan said: ‘Topping up a lease on conservation and environmental grounds is untested… Planners generally like to keep their flexibility so they can rezone the land for other uses in the future if there’s a need.’

If the residents are all willing to pay the development charge to top up the lease, and show that the buildings will be kept in line with urban renewal, then there could be a case, added Mr Tan.

If Arcadia does not get a lease top-up, it might then attract collective sale investors. It features large units, from 3,800 sq ft to 7,000 sq ft in size, that could potentially be redeveloped into smaller units.

Resident Stewart Yen, who is in his early 60s and CEO of a security business, dreads such an outcome.

‘The buildings here have stood the test of time. We also have a diverse mix of people here who have gained many memories in this estate. We take pride in maintaining this as our home, and we want to keep it that way.’

Source: Straits Times, 10th April 2011

A 10-UNIT boutique development at Robin Road has been sold to Sing Holdings for $47 million.

With each unit fetching on average $4.7 million in gross proceeds, the sale of Robin Star off Bukit Timah Road understandably had the unanimous agreement of all the owners.

As the owners chose to ink the collective sale agreement by private treaty, approval from the Strata Titles Board was not required.

‘An en bloc sale with unanimous consent is not required to adhere to the en bloc law of marketing by tender. They could choose private treaty negotiations,’ said Ms Yong Choon Fah, executive director of Credo Real Estate, which brokered the deal.

This price tag works out to about $1,393 per sq ft (psf) on potential gross floor area, after factoring in development charge, she said.

This is comparable to the price of $1,388 psf per plot ratio (ppr) for Serene House, which was sold last month.

A development charge is payable when a developer redevelops sites to a higher intensity or value use.

With the purchase of Robin Star, Sing Holdings was able to average down the cost by amalgamating the site with the adjoining Robin Court and 1 Robin Drive, which the mainboard-listed company purchased for $77.33 million in a tender exercise last September, said Credo.

The amalgamated freehold site will have a combined land area of 64,878 sq ft.

‘With a plot ratio of 1.4 and including a 10 per cent balcony area allocation, the property can yield a gross floor area of about 99,913 sq ft,’ said Sing Holdings.

The total purchase price of $124.33 million for the sites translates to about $1,297 psf ppr, inclusive of estimated development charges of about $5.28 million.

The site is about 250m to the upcoming Stevens MRT station, part of the Downtown Line, which is expected to be operational in 2015, said Ms Yong.

Sing Holdings chief executive Lee Sze Hao said the acquisitions fit neatly to its strategy of focusing on developing residential projects in prime areas.

‘Properties in this location have a special appeal to both locals and foreigners. The three sites, when amalgamated, will be able to offer a good development size and flexibility to achieve a good layout and design,’ he said.

Sing Holdings currently has two other development projects. One is BelleRive, a 15-storey apartment tower off Bukit Timah Road which is about 94 per cent sold and is expecting to obtain temporary occupation permit this quarter. The other is The Laurels, a 19-storey residential development along Cairnhill Road which is about 90 per cent sold.

Source: Straits Times, 31 Jan 2011

SING Holdings has acquired Robin Star for $47 million. The 10-unit boutique development at 10-12 Robin Road will be combined with previously-acquired Robin Court and 1 Robin Drive to make a combined site of 6,027.4 sq m.

The total purchase price of $124 million for the freehold sites translates to $1,297 per square foot per plot ratio (psf ppr), inclusive of estimated development costs of $5.28 million, Sing Holdings said.

Sing Holdings acquired Robin Court and 1 Robin Drive last September for $77.33 million.

The three sites were first collectively put up for sale in November 2007 by Credo Real Estate, sole owner of 1 Robin Drive and the agent representing the majority owners of Robin Court and Robin Star.

Credo slashed the asking price 40 per cent the following year, putting up Robin Court and 1 Robin Drive for $964-$996 psf ppr, down from the initial asking price of $1,500-$1,600 psf ppr.

Robin Court comprises 15 apartments, Robin Star 10 apartments, and No 1 Robin Drive is a detached house with a pre-school operating on its site.

Sing Holdings CEO Lee Sze Hao said the three sites combined are expected to offer a large enough size for ‘good layout and design’.

The developer currently has two other projects: BelleRive, a 15-storey apartment building off Bukit Timah Road, and The Laurels, a 19-storey residential complex on Cairnhill Road. These have been 94 and 90 per cent sold, respectively, Sing Holdings said.

Source: Business Times, 31 Jan 2011

BARTLEY Terrace, the residential area at 16 Gambir Walk, has been sold for $40 million through a private treaty that was sealed on Jan 17. The deal was brokered by Urban Front Real Estate. 

The property, which is situated near Bartley MRT and Maris Stella High School, was sold to Meadows Investment, which is owned by Neo Tiam Boon, executive director of property and construction firm Tiong Aik Group. With a land area of about 40,482 square feet (sq ft) and a plot ratio of 1.4, the gross floor area works out to 56,674.8 sq ft. 

The price for the site amounts to about $760 per square foot per plot ratio, taking into account an estimated $3 million development charge with 10 per cent balcony that the developer may have to pay. 

Talks for the collective sale started in the middle of last year for the District 19 freehold site, and bids for the tender closed at the end of last year. Thereafter, the deal went into private negotiation. The owners of each of the 32 units at Bartley Terrace will stand to receive sales proceeds that range from $1.14 million to $1.8 million. The majority owners are applying to the Strata Titles Board for a sale order. 

Source: Business Times, 28 Jan 2011