Wednesday, December 1, 2010

En bloc news: Hawaii Tower

The BT today reported that one of the biggest collective sale sites in dollar terms so far this year is expected to be launched for sale next week.

Hawaii Tower, on Meyer Road, has a reserve price of $700 million. This works out to about $1,401psf ppr inclusive of a development charge (DC) of about $55 million. The all-in investment for the successful developer of the 192,340sqft freehold site is expected to be around $1 billion.

Based on the unit land price of $1,401psf ppr, the breakeven cost for a new luxury condo project on the site could be about $1,950 - $2,100psf. A 25th floor unit at the nearby Aalto was transacted at $2,373psf this month. Over at Seafront @Meyer, units on the 17-20th floors have traded at $1,875-$2,501psf in the past few months.

The Hawaii Tower site is zoned for residential use with a 2.8 plot ratio (ratio of maximum gross floor area to land area) and height of up to 36 storeys. The plot may potentially be developed into a new condo project with about 345 units of an average size of $1,500sqft or 430 units averaging 1,200sqft.

A new development on the site will boast unobstructed views towards the sea, Marina Bay Sands and the city skyline as well as the Mountbatten landed housing estate. The regular-shaped plot has frontage of 130 metres along both Meyer Road and the East Coast Parkway.

CB Richard Ellis is marketing Hawaii Tower’s collective sale through a tender which will close on Jan 26.

Owners controlling slightly over 80% of share values and strata floor area have signed the collective sale agreement. They stand to receive about $5 million-plus per apartment and $8.8 million-plus per penthouse. Hawaii Tower comprises three blocks holding 129 apartments of about 2,200sqft each and six penthouses of about $4,300sqft each.

For Hawaii Tower, this would be the third attempt at an en bloc sale. The two previous attempts were in 2007. The initial effort began in the first half of that year, starting at $700 million and rising to $800 million; about 70-odd % consent level from owners were secured before the deadline for obtaining the minimum consent passed.

Another attempt was launched in late 2007 at $800 million but this soon petered out as market sentiment began to weaken and developers lost their appetite for land.



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