Record year in the offing for good class bungalow sales

(SINGAPORE) Good times continue to roll for the Good Class Bungalow (GCB) market, with some high-profile business personalities involved in the latest transactions. They include palm oil giant Wilmar International’s chairman and CEO, Kuok Khoon Hong, and Prima Group boss Bernard Cheng.

The latest deals have boosted the volume of GCB transactions between January and August this year to about 60 deals with a total value of around $900 million, surpassing the $830 million transacted in the whole of last year, latest figures from CB Richard Ellis (CBRE) show. The actual year-to-date numbers could be higher if caveats for some deals done in August have still not been lodged, suggest property market watchers.

CBRE’s director, luxury homes, Douglas Wong is now predicting record GCB sales totalling $1.2 billion to $1.4 billion for the whole of this year, encompassing 80-90 transactions – up from his earlier forecast of around $1.1 billion-$1.2 billion made just three weeks ago. Up to now, the highest full-year value of GCB transactions was achieved in 2006 – involving $1.23 billion across 119 deals.

Savills Singapore director of investment sales & prestige homes Steven Ming said that while the GCB market remains active, ‘buyers continue to approach purchases with measured optimism and are sensitive to price increases’.

Wilmar’s head honcho, Mr Kuok, and his wife are said to have bought two adjoining GCB properties on Victoria Park Road last month for a total of about $44.17 million. The couple paid about $24.5 million for No. 35 Victoria Park, a two-storey bungalow with a swimming pool; the price works out to $750 per square foot (psf) based on the land area of 32,688 square feet. The sellers are believed to be members of the Khoo family linked to Kimly Construction.

Mr Kuok and his wife also picked up the next-door property at 37 & 39 Victoria Park, an old single-storey bungalow, for $19.65 million or about $660 psf. The seller is said to be Ng Cheong Bian, son of the late Ng Bok Eng, dubbed ‘king of cloves’.

Both properties – Nos. 35 and 37/39 Victoria Park – have 999-year-leasehold tenure.

Bungalow market watchers say they would not be surprised if the Kuoks amalgamate the two plots for redevelopment into a plush new GCB on sprawling grounds of more than 60,000 sq ft.

DTZ is understood to have brokered the sale of both properties.

Last month, Prima Group boss Bernard Cheng is believed to have sold his freehold bungalow at Queen Astrid Park for $24 million or about $877 psf to Zain Fancy. A person bearing the same name was formerly head of Morgan Stanley Real Estate Investing for Asia Pacific and who late last year joined Och-Ziff Asia Real Estate as executive managing director and is based in Singapore. The entity is part of New York-based fund management giant Och-Ziff Capital Management Group.

Ho Tian Yee, managing director of Pacific Asset Management, is said to have picked up a bungalow at Astrid Hill in July for $20.5 million or $654 psf on its land area of about 31,360 sq ft. Meanwhile, 12 Bishopsgate, with a land area of around 16,550 sq ft, changed hands last month for slightly more than $19 million or about $1,150 psf.

The year began slowly for the GCB market with just three deals worth about $27.5 million in the first quarter. However, things soon gained momentum with around $432 million worth of deals done in Q2 and about $436 million in July and August.

GCBs are the creme de la creme of Singapore’s housing market, with stringent planning requirements. There are only about 2,400 such bungalows in Singapore’s 39 gazetted GCB Areas. ‘Liquidity, cheap financing and the general belief that the worst of the economic crisis is over are fuelling this run,’ says Savills’ Mr Ming.

‘Furthermore, it appears the wealthy are allocating a greater proportion of their investments to real estate. GCBs, being limited in nature but highly desired amongst the rich, become highly sought after.’

Source: Business Times, 4 Sep 2009

With only about 2,400 units of good class bungalows in the market, almost any GCB would be a rare find

THEY are wealthy and successful people who can probably afford to buy any home they want, but many of them are being drawn towards good class bungalows (GCBs). There are only 39 designated GCB areas in Singapore and Binjai Park is one of them. However, these areas are not all equal. Douglas Wong, director of luxury homes at CB Richard Ellis says: ‘Some GCB locations are more prestigious than others.’

For instance, the current asking price for GCB land in the Nassim area is between $1,500-$2,000 per square foot (psf) whereas in Chestnut Drive, GCBs have been known to have transacted at around $550 psf, says Mr Wong.

There are also pros and cons to buying either an old bungalow or a newly built one. ‘Some old GCBs have unique architectural features and come with a rich heritage. Buyers, however, have to be prepared to set aside some money to refurbish and upgrade the building and fit it out with modern conveniences,’ says Mr Wong.

New buildings, he says, can be tailored to specific tastes but also be expensive. But what usually pushes up prices is the location.

A martial arts movie star who picked up a GCB at Binjai Park for $19.8 million at around $871.36 psf earlier this year appears to have gotten a good buy.

It was reported that the seller of the house had incurred a loss of $1.2 million on the deal, having bought the property in early 2007 for $21 million, or $924 psf.

William Wong, managing director of RealStar Premier Property Consultant says that the selling price for a newly built GCB will generally be higher than that of an old GCB. ‘The choice normally depends on whether the buyer is price sensitive,’ he says.

Mr William Wong also points out that a new house might take as long as two years to build although it is more likely to be built to the owner’s precise specifications.

If one is looking for exclusivity, the most expensive GCBs are generally in the Nassim and Lady Hill areas, says Mr William Wong. This is followed by those in the Tanglin vicinity such as the Rochalie, Bishopsgate and Chatsworth areas.

On the prices, GCBs in the Tanglin vicinity range from $1,200-$1,400 psf for the top of this category. ‘Other popular GCB areas are in the Swettenham, Pierce, Dalvey, Cluny Park areas where prices can range from $1,100-$1,300 psf,’ he added.

’1,000 psf is the standard price for an average GCB. Prices have been moving up over the last six months. Now is a good time to buy as there is a huge demand with many permanent residents trying to purchase GCBs of 15,000 sq ft in size,’ added Mr William Wong.

Permanent residents are permitted to buy landed property, but only with permission from the government. Foreigners cannot easily buy a GCB or any other landed home here as the government restricts foreign ownership of residential property. However, foreigners who take up Singapore citizenship may buy landed property.

The exception to the restrictions is the gated residential enclave of Sentosa Cove, where ownership rules were eased to allow foreigners who are not permanent residents to buy landed homes or land plots, though permission is still needed.

Apart from some restrictions on ownership, CBRE’s Douglas Wong says that one of the common misconceptions when buying a GCB is that some buyers unknowingly pay a premium for a home that actually falls outside the designated GCB areas. ‘Some buyers think that as long as a bungalow has a land area of 15,070 sq ft, it is considered a GCB, not knowing there are only 39 designated areas,’ he added.

Before buying any home, it is also useful to do some checks. For instance, Mr Douglas Wong says that it is useful for a surveyor to be called in to assess and ascertain the site boundary for issues such as encroachment.

A structural surveyor or engineer can also be engaged to assess the structural integrity of a house, especially if it is an old or conserved bungalow. It is also important to check with the relevant authorities about possible drainage and road reserves as this could affect the the boundary setbacks.

Finally, the terrain, shape of the site and frontage are other physical characteristics that are important, especially if one is going to build a new house.

But with only about 2,400 units of GCBs in the market, almost any GCB would be a rare find.

Donald Han, managing director of Cushman & Wakefield, points out that GCBs represents just 3.5 per cent of total landed housing and a mere one per cent of total private residential stock.

‘The majority are owned by the who’s who – and are seldom placed for sale in the market. On the contrary, there’s an increasing pool of buyers made up of high net worth individuals, GCB collectors as well as permanent residents who are looking to buy GCBs for their own use,’ he adds.

GCB buyers are a discerning group of investors who also have a different view on what makes a good investment. ‘Yields are not part of the investment criteria – which is typically less than 2 per cent,’ said Mr Han.

Instead most see GCBs as a good long-term asset class of investment, ‘especially in land-scarce Singapore where land value appreciates over time’.

And Mr Han believes that the outlook for GCBs is also good. ‘Generally, GCB prices have fallen by 35 per cent since the peak last year; and with the improved outlook in real estate sector, we expect further price upside in this sector,’ he said.

Source: Business Times, 13 Aug 2009

You can always ask an architect to see how rooms and spaces can be transformed with simple changes

WHEN one buys a landed property, it is more than likely that it will come with a house attached.
Quite often, however, new owners will demolish the existing house and build a new one from scratch, adding to the money invested in the property. And at an average of $500 psf for construction cost, this can add up to quite a hefty sum. So it may pay to consider the potential of the existing old bungalow instead.

Anyone with a good eye for architecture should be able to see how rooms and spaces can be transformed with simple changes. But for those without, the best person to ask is an architect.

Transforming old buildings is something architect Mink Tan has had experience with, having won the URA Heritage Award for the Waterboat House on Fullerton Road in 2004.

By reconfiguring the spaces and adding some new ones, he converted the formerly dark and airless Waterboat House into a light and airy lifestyle F&B destination.

Similarly, when Mr Tan was shown around a 14 year old colonial style bungalow that a client was interested in, he could see that it was a building that had potential.

The large house has a built-up area of about 7,500 sq ft house and sits on nearly 16,000 sq ft of prime land. But with a house of this size and design, the rooms tend to be dark.

To address this, Mr Tan simply replaced many of the windows with French windows which are just glass-panel doors that can be opened to let more light in.

‘The spaces also didn’t feel right,’ says Mr Tan. So he created an ‘enfilade effect’ by opening up the rooms and establishing view corridors that did not exist before.

By simply knocking down some of the bedroom walls to give access to existing ledges, the architect also converted ‘dead space’ into balconies. Even the roof of the car porch was converted into a terrace simply by introducing new doors.

In other areas of the house, like the kitchen, all it took was some space-planning to turn what was previously a small kitchen into a bigger, wet and dry kitchen.

Not all houses will be as easy to transform, especially if the house happens to be gazetted for conservation, as many of Singapore’s grandest bungalows are.

Old bungalows that have been gazetted for conservation can be transformed and remodelled but strict guidelines set by the Urban Redevelopment Authority (URA) must be adhered to.

Many of the conserved bungalows are within the Good Class Bungalow Areas of Chatsworth Park, Holland Park/Ridout Road and Nassim Road/Whitehouse Park and Mountbatten Road.

Bungalows usually consist of the main building and an outhouse for the kitchen, toilets and servants’ quarters. For conserved bungalows, only the main house needs to be retained. The outhouse can be demolished to make way for new extensions to the main house.

New extensions may be permitted for additional floor area but this will be subject to Development Control guidelines, the allowable building height of the area, and the requirements of relevant technical departments.

The potential of some of these conservation bungalows also lies in the land on which it is built. Often, the land area can be large enough to be subdivided into smaller plots.

According to the conservation guidelines, in the Good Class Bungalow Areas, a concession to facilitate the subdivision of land allows for one sub-standard plot size of not less than 1,000 sq m to be considered provided the total land area together with the conservation bungalow plot is not less than 2,800 sq m.

Perhaps the most challenging aspect of owning a conservation bungalow is restoring it.

Architect Chan Soo Khian of SCDA Architects has restored several conservation homes and he advises that potential conservation home owners should be happy with the overall spatial quality of the building before buying it because quite often, the buildings are too old to undergo extensive construction work. ‘Quite a few of the colonial bungalows have load bearing brick walls on footings that have constrains from guidelines and a structural point of view,’ he explains.

The guidelines on conservation are extensive. Apart from restoring design features in the facade, it could also include having to restore original windows, doors, balustrades and even roof tiles.

Even the existing structural system has to be retained and restored.

However, as Mr Chan points out, many are prepared to pay a premium for these old bungalows. ‘The clients that buy the conservation properties do so because they love aspects of the heritage properties such as the mature landscape that usually surround the properties,’ he adds.

Indeed, such bungalows fall into a niche market that is popular with discerning home buyers. It is a niche that some developers have begun to take notice of.

Boutique developer Satinder Garcha’s company Elevation focuses on unique properties in very prime locations. One such property it has recently restored is at Swettenham Road.

The old bungalow was designed by Frank Brewer and built in Late Arts and Crafts style during the colonial era. Frank Brewer incidentally also built the late president Ong Teng Cheong’s house in Dalvey Estate.

Mr Garcha added that these old bungalows do certainly have investment potential, more so than regular Good Class Bungalows, ‘because of the rarity value and the desirability of these bungalows, especially by foreigners and now increasingly Singaporeans’.

He added that the most coveted are those which are conserved with historic value but restored and modernised with modern conveniences – offering the best of old and new.

Source: Business Times, 6 Aug 2009

Actor’s new Binjai Rise home was once owned by FJ Benjamin founder

MARTIAL arts movie star Jet Li and his wife, former actress Nina Li Chi, have bought a sprawling bungalow in Bukit Timah for $19.8 million.

The freehold property is a 22,723 sq ft good class bungalow (GCB) in Binjai Rise – a house with past links to another global celebrity, football star David Beckham.

GCBs are a prestigious class of bungalows in limited supply here, found only in gazetted prime residential areas such as Nassim Road and Ridley Park. They have a minimum land area of 15,000 sq ft.

Li, 46, who is taking a break from acting to focus on charity work, launched the Jet Li One Foundation Project in April last year jointly with the Red Cross Society of China to raise funds for victims of natural disasters worldwide.

The Beijing-born actor, whose Chinese name is Lianjie, then set up a branch of One Foundation in Singapore last year.

In 2007, he had moved his wife and two younger daughters to Singapore. He is now understood to be a Singapore citizen, according to the Business Times, which broke news of the sale yesterday.
The two younger daughters – he has two other teenage daughters from an earlier marriage – attend the Singapore American School.

Li, who previously lived in Los Angeles, has starred in numerous Hollywood and Chinese movies. Recent releases include The Mummy: Tomb Of The Dragon Emperor (2008) and Fearless (2006).
His first Hollywood leading role was in the hip hop, gongfu film Romeo Must Die.

A check yesterday showed that Li’s GCB deal was sealed in the middle of last month. The seller had suffered a loss of $1.2 million on the deal.

The seller, who has a pre-school childcare business, had bought the property in the fast-rising market of early 2007 for $21 million, or $924 per sq ft (psf). The sale price to Li works out to $871 psf.

Market sources said the previous owner had bought it from the founder of luxury goods retailer FJ Benjamin, Mr Frank Benjamin, who had lived there for many years. He now lives in the high-rise condominium Ardmore Park.

In 2001, Mr Benjamin hosted a party at this Binjai Rise house, where two models claimed in media reports to have met football star David Beckham and later had separate trysts with him. The football star did not comment on the allegations.

Market observers said the price that Li paid for the GCB is fair. With prices rising amid improved property market sentiment, the value of the Binjai Rise GCB could even be a bit higher now, said one.

Li’s purchase and the 2007 deal are the only occasions the bungalow has changed hands since 1995 – the period when records are available.

Foreigners cannot easily buy a GCB or any other landed home here as the Government restricts foreign ownership of residential property.

Permanent residents are permitted to buy landed property, but only with permission from the
Government. Foreigners who take out Singapore citizenship may also buy landed property.

The exception to the restrictions is the gated residential enclave of Sentosa Cove, where ownership rules were eased to allow foreigners who are not PRs to buy landed homes or land plots, though permission is still needed.

Other Asian movie stars living in Singapore include Chinese actress Gong Li, who is married to a Singaporean. She became a Singapore citizen late last year.

Another famous gongfu star, Jackie Chan, also owns properties here, though he is not based here.

Source: Straits Times, 18 June 2009

They include Belmont Road bungalow, Fernhill Road site and condo units

(SINGAPORE) As action in the property market drifts up to the high end, more top-notch properties are surfacing at auctions.

A good-class bungalow (GCB) on Belmont Road, a 7,000-square-foot freehold site on Fernhill Road and condo units at St Regis Residences, Leonie Towers and Gallop Gables are among properties that will go under the hammer next week.

The GCB at 62 Belmont Road has been put up for sale at an indicative price of $26 million to $30 million. This works out to $797 to $919 per square foot (psf) based on the sprawling site of 32,627 square feet.

The existing single-storey bungalow, which will be offered at Knight Frank’s auction on June 23, is more than 30 years old.

‘The property can be rebuilt into a new two-storey bungalow with a basement. And there’s space for a tennis court and swimming pool,’ says Knight Frank executive director and auctioneer Mary Sai.

Colliers International’s auction on June 24 will feature a recently renovated two-storey freehold bungalow with six bedrooms and a maid’s room at 2 Branksome Road, off Tanjong Katong Road.

The property is being offered at an indicative price of $9 million or $815 psf of land area, says Colliers deputy managing director and auctioneer Grace Ng. The bungalow has a swimming pool and Balinese-style decor.

A trustee sale of a 7,232-sq-ft freehold vacant site in Fernhill Road is indicatively priced at $6.5 million to $7 million, which reflects a unit land price of $641 to $691 psf of potential gross floor area (GFA). This excludes any development charge that may be payable.

The site is zoned for residential use with a 1.4 plot ratio – the ratio of maximum potential GFA to site area. It can be developed into a small apartment project or a landed housing development.
Jones Lang LaSalle (JLL) is auctioning the property on June 26.

Another property at the event will be a sheriff’s sale of a maisonette on the 12th floor of Leonie Towers, a freehold condo at Leonie Hill. The indicative price is $2.6 million to $2.8 million or $895-$964 psf of strata area.

The sheriff’s sale is being held to recover a debt owed by the owner, which is a company, to two individuals. The unit will be sold with vacant possession.

Colliers is also offering at its auction an apartment with four bedrooms plus a maid’s room on the 13th floor of St Regis Residences. It is also selling a two-bedroom unit with a utility room on the third level at Gallop Gables.

The Gallop Gables unit, which is leased until August 2013, has a prospective price of $1,400 to $1,500 psf of strata area, working out to $1.6 million to $1.7 million. That translates to a net annual yield of about 2.7 per cent.

The St Regis unit’s indicative pricing is $5 million or $2,358 psf. The property is subject to a two-year tenancy starting this month, with a monthly rental of $11,000.

If all of the above properties are sold at the various auctions next week, it would provide a fillip to auction sales this year, which totalled $47.7 million in the first five months.

The figure for the whole of last year was $83.7 million – an 11-year low.

JLL’s head of auctions Mok Sze Sze says ‘the competitive method of auction bidding is the best way to fetch the optimum price for owners of high-end properties, especially if they are rare and few in supply’.

Source: Business Times, 18 June 2009

7 good class bungalows sold in April and May, more deals in the works

(SINGAPORE) The most prestigious segment of Singapore’s residential property sector has picked up over the past two months.

Seven good class bungalows (GCBs) were sold in April and May – up from just two transactions in Q1 2009 – according to Savills Singapore’s analysis of caveats captured by URA Realis.

The numbers are for bungalows with the minimum plot size of 1,400 square metres (about 15,069 square feet) stipulated for GCBs in the 39 GCB areas (GCBAs) here gazetted by the Urban Redevelopment Authority (URA). However, if bungalows with land areas below 1,400 sq m are also included, the April-May period saw 10 caveats – again significantly higher than the three caveats lodged in Q1.

‘The higher GCB sales in April and May reflect the general improvement in investment sentiment on the back of the stockmarket rally. Some GCB buyers could also be savvy investors who made money in the stock market. Going ahead, they may feel that there’s more upside than downside for GCB prices,’ says Savills’ director for prestige homes Steven Ming.

The biggest GCB transaction in May (and also so far this year) was the $30 million sale of 2A Ridley Park, which has 27,233 sq ft land area. The price works out to $1,101 per square foot (psf) of land area – also the highest on a unit land price basis in 2009.

At least one other transaction has been done at above $1,000 psf recently, although it has yet to be reflected in caveats: 1 Cluny Hill, which was sold for $16.2 million or $1,081 psf based on its 14,985 sq ft plot size. Forbes Property Realty Network brokered the deal.

Douglas Wong, director, luxury homes at CB Richard Ellis, notes that GCB investors in Singapore often own two or more such properties – one for their own residence and the rest for investment.
‘With the recent increase in activity, they may consider it opportune to liquidate some of their GCB holdings and get some cash back to plough into other investments or their business,’ he said.

Compared with just three GCB transactions in Q1, Mr Wong expects some 14-17 deals in Q2. ‘Assuming the stock market is able to hold up till the end of 2009, we estimate that some 38-45 GCBs could be sold for the whole of 2009, amounting to a total quantum of some $700-800 million,’ he added. This would not be far off from the $827 million from the sale of 51 GCBs last year.

Other notable GCB transactions in May include a property at Jervois Road that sold for $13 million ($862 psf), and another bungalow at Binjai Rise that was sold for $19.8 million ($871 psf) to international action star Jet Li.

The highest ever psf price attained for a bungalow in a GCB area is $1,899 psf for 32H Nassim Road in October 2007. But the area of that plot is 13,423 sq ft, less than the minimum GCB plot size. That’s why the GCB benchmark is generally considered $1,308 psf – the price obtained for 15 White House Park, with 22,012 sq ft land area, in August 2007.

Activity in the landed housing market first started picking up this time around in the ‘low-end’ segment – meaning terraced and semi-detached houses – about three months ago, said Michael French, MD of Asia Premier Property Consultants.

‘We have not seen such buying levels in the market for a long time,’ he said.

The activity then filtered up to smaller bungalows of about 4,000-8,000 sq ft. Then, about four weeks ago, demand for GCBs took off, with several large deals being concluded in May.

More big GCB deals are on the cards. BreadTalk founder and chairman George Quek is looking to sell his 2 Swettenham Road GCB and the price tag could be as high as $33 million, or $991 psf. Mr Quek bought the property, with 33,293 sq ft land area, with his wife last year for $27 million or $811 psf. He has appointed Newsman Realty to handle the sale, and the firm’s managing director, KH Tan, hopes to get $33 million for the 1960s bungalow.

The property will be sold through a closed tender on June 30. Mr Tan has pre-selected 30 prospective buyers whom he intends to invite to view the property and to participate in the bidding exercise. Part of the proceeds from the sale will be donated to charity.

Source: Business Times, 18 June 2009

Tommie Goh acquires GCB from neighbour Sam Goi

(SINGAPORE) Action star Jet Li seems to be sinking deeper roots in Singapore. He and his wife, Nina, bought a good class bungalow (GCB) on Binjai Rise for $19.8 million last month. The price works out to $871 per square foot based on the freehold land area of 22,723 square feet.

Mr Li is understood to have become a Singapore citizen.

Last year, he announced plans to set up a base in Singapore for his charity and disaster-relief group One Foundation. The Jet Li One Foundation Singapore was registered in June 2008.
Mr Li had said at the Forbes Global CEO Conference here in September last year that Singapore offers the right conditions for grooming future NGO leaders.

He was spurred to set up his charitable foundation after a narrow escape from the 2004 tsunami. According to earlier media reports, Mr Li moved his two daughters and wife to Singapore in 2007 for his children’s education.

The Beijing-born Mr Li led a life of hardship as a child (his father died when he was two) but persevered to emerge as China’s overall national wushu champion for five consecutive years in the 1970s. He began his acting career in the early 1980s, starting with Shaolin Temple and today has about 40 movies under his belt.

Mr Li became a US citizen in the 1980s.

When contacted, a spokeswoman for Singapore’s Immigration and Checkpoints Authority declined to confirm if Mr Li is now a Singapore citizen. ‘Due to reasons of confidentiality, the ICA will not discuss individual cases publicly,’ she said.

Mr Li was not the only luminary who picked up a GCB here in May.

2G Capital co-founder Tommie Goh bought 2A Ridley Park, next to his existing home, for $30 million or slightly over $1,100 psf.

The seller was ‘popiah king’ Sam Goi, executive chairman of Tee Yih Jia Food Manufacturing and an established investor in the GCB market.

Mr Goi is expected to move to a new palatial home that he has built on Nassim Road. BT understands that the two neighbours had been discussing the sale of 2A Ridley Park on and off for the past few years.

GCBs, with their stringent planning requirements, are the creme de la creme of Singapore’s housing market. There are only about 2,400 such bungalows on the island.

Source: Business Times, 17 June 2009

A total 49 Good Class Bungalows changed hands in Singapore for a total $785 million (US$532 million) last year, down from the 87 transactions worth $1.15 billion in 2007 and 119 deals at $1.23 billion in 2006, according to latest figures from property consultancy CB Richard Ellis.

On a dollar per square foot (psf) value based on land area, the average price of GCBs rose to $822 psf last year, from $681 psf in 2007 and $501 psf in 2006.

These figures reflect a 64 per cent increase in GCB prices in the two years.

Source : Business Times – 7 Jan 2009