GCB deals down in Q3

NINE bungalows in Good Class Bungalow (GCB) areas were transacted at a total of nearly S$177 million in the third quarter, down from 11 deals worth S$282 million in the second.

The Q3 showing was, however, ahead of the seven deals that closed for a total S$167 million in the third quarter of last year.

In the first nine months of this year, the GCB sale tally was 24 deals totalling S$554 million, slightly ahead of the 22 transactions worth S$511 million in the corresponding year-ago period.

Among the deals entered into in Q3 2015 was that for a freehold bungalow in Tanglin Hill that went for S$25 million; the price works out to S$1,539 per square foot (psf) on 16,243 sq ft of land area.

Mapletree Investments chief executive officer Hiew Yoon Khong, the winner of the Outstanding CEO of the Year award at this year’s Singapore Business Awards, is buying the property from a low-profile property development company, a caveats search showed.

The property was previously transacted for S$10 million in 2006.

Singapore Christie’s International Real Estate managing director Samuel Eyo described the recent S$1,539 psf price for the property as “very reasonable” for the location, taking into account that the new owner is likely to rebuild the house.

“Assuming it will cost about S$500 psf on gross floor area of about 10,000 sq ft to build a new home, the break-even cost will amount to close to S$2,000 psf on land area,” said Mr Eyo.

Tanglin Hill is a popular GCB location because of its proximity to Orchard Road, he noted.

Data from URA Realis shows that there has been a general pick up in landed property deals.

DTZ’s analysis of URA Realis data shows that 326 landed homes changed hands in Q3 2015, up from 304 in Q2, and 246 transactions in Q3 2014.

In the first nine months of this year, the value of landed residential properties sold reached S$3.54 billion, up from S$3.07 billion in the same period last year. However, the latest figure is still shy of the S$5 billion transacted in the first nine months of 2013.

Lee Nai Jia, regional head for South-east Asia at DTZ, said:

“Demand for landed homes has increased as buyers find the current prices attractive enough. Most of the buyers are purchasing for owner occupation for their children or for multi-generational family living. Additionally, the limited stock for landed properties makes them an appealing asset to investors for capital appreciation.”

Besides owner occupiers and investors, developers have also been on the prowl for old houses to redevelop.

Last month, Roxy-Pacific inked a deal to buy an old bungalow sitting on 19,474 sq ft freehold site along Sea Avenue near Marine Parade. Roxy’s executive chairman Teo Hong Lim said the group plans to redevelop the site into a five-storey apartment project with about 25 units; the site is zoned for residential use with a 1.4 plot ratio (ratio of maximum gross floor area to land area) under the 2014 Master Plan.

The purchase price works out to S$789 per square foot per plot ratio.

“It is hard to find landed housing sites for redevelopment these days, partly because the government has increased the minimum plot size for apartment development to 1,000 sq metres (10,764 sq ft). Moreover, most of the big bungalows which can be redeveloped into apartments under the Master Plan have already been redeveloped.”

Expectations of owners are are also still ahead of the market, Mr Teo added.

For instance, in the Telok Kurau area, owners would be looking at about S$1,000 psf on land area, or S$700-plus psf ppr, which would translate to a breakeven of more than S$1,000 psf, he said.

Earlier this month, boutique property group Pinnacle Assets picked up an old freehold bungalow at 3, East Coast Avenue for S$46.38 million, or S$1,025 psf on the 45,249 sq ft land area.

The site is zoned for three-storey mixed landed housing and large enough for potential redevelopment into 14 to 18 conventional landed housing units, comprising a mix of terrace and semi-detached houses.

Ian Loh, executive director of investment and capital markets at Knight Frank who brokered the transaction said: “While such big plots for landed housing development are relatively rare, one can still find pockets of smaller plots with an old house on it that can be redeveloped into two to three new homes.”


$25m home off Adam Road for sale

A freehold Good Class Bungalow (GCB) in Chee Hoon Avenue has been put up for sale via a tender exercise that closes on May 20.

The indicative value of the property is $25 million, which translates to $1,399 per square foot (psf) based on a land area of 17,868 sq ft.

“With its frontage of about 39m and an average depth of about 42m, it is suitable for additions and alterations or redevelopment to optimise the potential of this land,” CBRE said in a news release yesterday.

CBRE is the sole marketing agent for the tender exercise.

The property is located in Chee Hoon Avenue, in a cul-de-sac, off Adam Road.

It comprises a part one/part two-storey detached house, which was originally built in the 1960s and renovated in 2005.

The property’s built-up area is about 3,300 sq ft (excluding car porch and rear terrace of about 1,000 sq ft) with two bedrooms and a study.

– See more at: http://business.asiaone.com/property/news/25m-home-adam-road-sale#sthash.s3jHvSLx.dpuf

Belmont Road GCB Bungalow sold for $33.5M

FORMER Singapore Land chairman SP Tao has sold a Good Class Bungalow (GCB) on Belmont Road for S$33.5 million or S$1,266 per square foot of land area of 26,456 sq ft. As recently as a year ago, the asking price for the freehold property was around S$50 million.

BT understands that earlier this year, the price tag was lowered to S$39 million before last month’s transaction at S$33.5 million. The existing property on the site was re-built in 2009 and comprises two levels and an attic. The main house is said to have five en suite bedrooms in addition to several function rooms; while a pool, entertainment room for guests and a maid’s room are located in the annexe.

Mr Tao, a near centenarian, redeveloped the bungalow five years ago. He is now said to have a Singapore residence in a prime-district apartment.

Agents told BT that while transacted prices of GCBs generally have softened, additional reasons for the relatively low psf price fetched for Mr Tao’s property could be due to it being located on a downslope, having a small car parking area and a layout that may not appeal to some buyers.

It would not be surprising if the new owner redevelops the property, said market watchers.

Savills Singapore director of prestige homes Samuel Eyo estimates that current market values along Belmont Road are in the S$1,300-1,400 psf range for properties on a downslope and around S$1,500-1,600 psf for upslope properties.

In January this year, Enviro-Hub Holdings boss Raymond Ng disposed of a downslope GCB on Belmont Road for S$30.5 million or S$1,392 psf on land area of about 21,900 sq ft. In July last year, an upslope property along the road was sold for S$22.88 million or S$1,525 psf by seasoned investor Thomas Chan. Each site has an existing bungalow on it.

Also noteworthy is the August 2013 sale of a 21,388 sq ft vacant piece of flat land in Leedon Park nearby for S$1,724 psf, amounting to S$36.88 million.

The Leedon Park area still holds the record psf price for GCBs. This was set in October 2012, when bungalow investor George Lim achieved S$2,110 psf when he sold a newly-built bungalow. Standing on 15,640 sq ft of land, the bungalow spans two storeys and a basement. It has six bedrooms and a pool. The property, which Mr Lim completed building in 2011, obtained Building and Construction Authority’s Greenmark Gold Plus award.

Including Mr Tao’s recent sale of his Belmont property, the tally of deals so far this year in GCB Areas stands at 21 transactions totalling S$503 million. For the whole of last year, there were 29 deals amounting to S$682 million.

Realstar Premier Group CEO William Wong said: “Prices of some GCBs have come down slightly over the past few months and those properties that are reasonably priced then tend to attract buyers. There is still a price-gap between buyers and sellers, but the difference is getting smaller and will continue to be so till end of the year.

“Some sellers’ pricing is realistic, but buyers tend to give lowball offers hoping to secure a bargain. It’s a buyer’s market now.”

A pick-up in transactions is expected in the fourth quarter, with the momentum likely to continue next year. “Owners of GCBs that have been in the market for a long while may have to adjust pricing downwards if they wish to seal a deal. There are still many buyers in the market; the only thing is most are waiting for prices to drop further.”

Mr Eyo said that most owners have the ability to hold as those who bought in the past few years are owner occupiers, while those who bought for investment in earlier years are generally not in a hurry to sell given their low entry cost and the low interest environment. “Buyers looking for a GCB on an upslope or flat land and a regular-shaped site have to be prepared to pay a premium as the supply of such bungalows is not high”.

GCBs are the most prestigious type of landed housing in Singapore, with strict planning constraints.