Project Spotlight: River Place

The 509-unit condominium River Place located at Havelock Road has long been a favourite among property investors and expatriate families largely because of its location – just at the edge of the CBD and overlooking the Singapore River, say property agents. It’s also within walking distance to the nightspots in the Mohammad Sultan neighbourhood, Robertson Quay, Boat Quay, as well as the Clarke Quay MRT Station.

“River Place typically attracts local investors, as well as foreign investors, particularly those from China, Hong Kong and the UK,” says Regina Chung, deputy head, business unit at Knight Frank. Chung estimates that there have been at least a handful of transactions each month in recent months, and properties sold are a mix of studio units and larger three-bedroom apartments.

Completed in late 1999/early 2000, the studio apartments at River Place are sized from 688 to 925sqft, while two-bedroom units are from 1,033 to 1,045sqft. There are also three- and four-bedroom apartments, as well as penthouses with sizes ranging from 2,109 to 3,648sqft.

The studio apartments at River Place can command monthly rental rates of $3,600, while a partially furnished four-bedroom unit can fetch $17,000 a month, according to rental listings on propertyguru.com.sg. Investors are looking at rental yields of 4% to 5% a year based on current prices, she reckons. According to Chung, there are no completed residential developments in River Place’s immediate vicinity that has River Place’s high density, large units and full condo facilities. “Most of the properties in the Robertson Quay area, which is some distance away, are boutique developments and they’re usually smaller when compared with a property such as River Place,” says Chung. For instance, Watermark at Robertson Quay, which was completed in 2008, has 206 units with its largest unit sized at only 1,800sqft.

There are 41 large units at River Place that are still available for sale, according to the developer Far East Organization. Asking prices for the units range from $2.17 million for a 1,218sqft three-bedroom unit on the second floor, to more than $6.3 million for an 11th floor four-bedroom 3,649sqft unit.

Built 12 years ago, River Place provides full condo facilities such as a large swimming pool, Jacuzzi, tennis courts, gymnasium, as well as a putting green and even an outdoor giant chessboard in the garden. It therefore attracts a good mix of expatriate singles and couples, as well as families with children.

Of late, investors have been paying attention to the new condos along the Singapore River, and on their radar are sizeable condos such as River Place. From July 12 to 19, three units were sold at prices ranging from $1,390 to $1,425psf, according to URA Realis data.

All three units have changed hands three times since the project was launched in 1997, and the fortunes of the sellers mirrored the ups and downs of the property cycle. For instance, a 9th floor studio unit of 797sqft was first purchased in May 1997, which was at the peak of the property boom just months before the Asian financial crisis. The price the original buyer paid was $980,580, or $1,231psf. In March 2002, when the economy was in recession, the unit changed hands for $660,000 ($829psf), 32.7% below the purchase price. It changed hands a third time last month, and based on the transaction price of $1.14 million ($1,425psf), the seller saw a capital appreciation of close to 72%.

A three-bedroom 1,582sqft unit on the 6th level was first purchased in September 2000 for $1.46 million ($923psf), not long after the project was completed. The unit was sold in August 2006 for $1.09 million ($686psf), 25.7% below the original purchase price. The second owner, on the other hand, saw prices double when he sold the apartment last month for $2.2 million, or $1,390psf.

An 8th floor 721sqft unit that changed hands in July for $1.02 million ($1,414psf) was purchased in April last year for $850,000 ($1,179psf). Hence, the seller saw a 20% capital appreciation in just over a year. The original buyer had bought the unit in January 1999 for just $537,000 ($745psf), he saw a 58.3% appreciation in over a decade when he sold it last year.

Source: THEEDGE SINGAPORE

What stood out at us after reading the above article are:

• Only developer like Far East can have deep enough pockets to sustain a relatively high number of unsold units in a 99-year leasehold project that is more than a decade old, and still asking for prices that are substantially higher than what were transacted in the market. And this is not limited to River Place alone!

• Those who think that property prices are unlikely to fall below their initial launch prices, think again…

For those who are interested, below are transacted prices at River Place for the past 4 months:
River Place - Prices

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Condo by "designer architects": A ST reader's perspective

Below is taken from today's Straits Times Forum.

We cannot articulate the views any better...

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Enbloc news: Grand Tower sold for $88.5m

Grand Tower located near Novena MRT station sold en bloc for $88.5 million. This reflects a land rate of $1,376psf ppr based on a plot ratio of 2.958.

Marketing agent for the site Savills said the buyer is 27MR Pte Ltd, a wholly owned subsidiary of boutique developer New Century Real Estate.

New Century Real Estate is also the developer for 8Rodyk condominium.

Grand Tower is a freehold development with a site area of 21,742 sqft. The site can potentially accommodate a new high rise residential development with a maximum permissible Gross Floor Area of approximately 64,310sqft.

The site can potentially be redeveloped into a residential development comprising more than 70 apartments averaging 800sqft each.

Savills said the breakeven cost is estimated between $1,900 to $2,000psf.

The existing development comprises 28 apartments with an area of about 1,873sqft each.

Savills said each owner can potentially receive approximately $3.16 million, or $1,688psf on strata area. This is higher than the $1,000 to $1,100psf if the apartments were to be sold individually in the secondary market.

Grand Tower is Savills' fourth collective sale for the year following Newton View at $147.6 million in March.

Source: Channel News Asia

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euHabitat: 181 units sold in the first week!

Property developer Far East Organization has sold 181 units of its 748-unit euHabitat during a preview of the residential development.

euHabitat, located on a site spanning 444,000sqft, is being jointly developed by Far East and Orchard Parade Holdings.

Located at Jalan Eunos, the 99-year residential development comprises suites, condominium apartments, SOHO units and four-storey townhouses with a roof terrace and a basement.

Prices start from $541,000 for one-bedroom suites (538sqft); $593,000 for a one-bedroom SOHO-style apartment (517sqft); $918,000 for a two-bedroom condominium apartment (1,012sqft); and $2.94 million for townhouses (3,380sqft).

“We are happy with the strong take-up during the preview. euHabitat enjoys a prime location in an area that is rapidly transforming,” said Far East’s chief operating officer (property sales) Chia Boon Kuah. “With the strong interest that we continue to see in euHabitat, we will be bringing forward the official launch of the development to Aug 19.”

Close to 70% of the buyers were Singaporeans and permanent residents. 52 out of the 181 units sold were one-bedroom suites. The one- and two-bedroom SOHO units also registered interest with 39 units sold. Aimed at young professionals, the SOHO apartments have floor-to-ceiling heights of about 3.4 metres while the ground-floor units have a floor-to-ceiling height of 5 metres.

Meanwhile, 20 units of the one-bedroom apartments were sold, as were 34 units of the two-bedroom apartments, 25 units of the three-bedroom apartments, and 11 of the two-storey, 4-bedroom townhouses.

Located near the PIE, euHabitat is also accessible via Eunos MRT Station as well as the upcoming Ubi and Kaki Bukit MRT stations on the future Downtown Line 3.

Source: The Business Times

euHabitat sounds like a “Woodhaven” in the East... hopefully with better-quality interior furnishings. The wife and I have been to the actual site of euHabitat and we are less than impressed. The project is located at the corner of a busy traffic intersection (just after the Euno exit of the Pan Island Expressway), and is hardly within walking distances to the three MRT stations mentioned.

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Braddell View: Enbloc potential they say...?!

Home buyers who are willing to pay top dollars 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 a 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 106,000sqm, cannot be put up for collective sale yet. But some property agents have been highlighting the 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 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 2½ 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 payment 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 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% of the residents before it can proceed.

Property agents The Straits Times spoke to said serious buyers are mostly aware that Bradell 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 past 6 months of this year, 18 units of Braddell View were transacted at an average unit price of $706psf, according to caveats lodged with eth URA, compared with the 26 transactions at a lower average price of $604psf in the same period last year.

The estate was built under HUDC Phases I and II and completed in the mid-1970s and 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 Phase 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: The Straits Times

The wife and I have seen quite a number of units at Braddell View over the past few years. We were particularly drawn to the maisonettes and the 1,615sqft, 3-bedroom apartments on the high floors that offer spectacular city/reservoir views. And yes, many agents we have contacted did try to entice us with the “en bloc potential” of the development – which, as one agent has put it aptly, will happen one day.

On the lease harmonisation issue for Braddell View, we were told that another obstacle to the process is the unwillingness of some owners (whose apartments are located on the portion of land with lease expiring 2½ years earlier) to pay for their shares to “top up” the land lease. We suspect that most of these owners are against the estate going en bloc. Given that they already enjoy the autonomy of a privatised estate and its condo-like facilities, minus the opportunity of a collective sale, it makes no sense for them to allow the development to be fully privatised.

And speaking of collective sale: If one is looking to buy for that purpose, he/she should really look across the street to Lakeview Estate. This ex-HUDC estate was fully privatised since 2003, has a smaller land area (22,550sqm) and fewer units (240) – which makes it easier for developers to “digest”.  

One may argue that Lakeview has no facilities to speak of, but units on high floors offer similar spectacular views of the City/Macritchie Reservoir while access into/out of the estate is (in our opinion) much “friendlier” – the entrance/exit for vehicles at Braddell View is via a one-directional road (Lornie Viaduct), which can be quite a bottle-neck during rush hours.     

We may be slightly biased of course, given our vested interest in Lakeview…

Have a great day!

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