Orchard freehold residential plot sold for $72m
Orchard freehold residential plot sold for $72m
JUN 9, 2017
Unit of Malaysian property developer Selangor Dredging buys 1 Draycott Park
Lee Xin En
A unit of Malaysian property developer Selangor Dredging has bought a prime freehold residential plot in the plush Orchard area.
Champsworth Development - 50 per cent owned by SDB International, a subsidiary of Selangor Dredging - paid $72 million for 1 Draycott Park. The sale price includes a development charge of about $15.3 million, translating to about $1,787 per sq ft per plot ratio, for the 17,442 sq ft site.
In a filing with Bursa Malaysia, the developer said it purchased the land via private treaty from Ms Seow Ai Ling and Mr Tang Wee Houe. Mr Tang is an architect.
The developer said it was considering building "exclusive mid-rise apartments" on the site, which now has a seven-storey block built in the 1990s, with eight apartments ranging from 860 sq ft to 6,200 sq ft. The site, zoned residential, can be redeveloped up to 36 storeys high.
The parcel is in the residential enclave of Claymore Hill and Ardmore Park, near the Tanglin Club and American Club. It is also within walking distance of Orchard Road.
The purchase will be 30 per cent paid for with internal funds and the rest with bank borrowings.
This is not the Malaysia-listed developer's first purchase here. It made headlines in December for buying a freehold site in Serangoon Road from National Aerated Water Company for $47 million.
The developer said it was considering building "exclusive mid-rise apartments" on the site, which now has a seven-storey block built in the 1990s, with eight apartments ranging from 860 sq ft to 6,200 sq ft.
Ms Suzie Mok, senior director of investment sales at Savills Singapore, who brokered the deal, said: "This transaction signals to the market the high-end non-landed residential segment has moved on to the next phase of price recovery."
The break-even price for the new development is expected to be between $2,700 and $2,800 psf, said Savills in a press release.
Mr Nicholas Mak, head of research and consultancy at real estate investment firm ZACD Group, said the price paid for the site was bullish, but did not signify an imminent price recovery for the high-end property segment.
"The price of the land may go up, which means the cost for this project will go up, but it does not mean that prices for the segment will increase," he said.
He noted that to be profitable, the developer would have to launch at prices of about $3,300 psf - at least 10 per cent above recent transacted prices in the area.
Foreigners make up about half of high-end property buyers here, and the 15 per cent additional buyers' stamp duty rate imposed on foreigners will continue to curb demand.
Property prices in the core central region have been falling. They fell 1.2 per cent over the course of last year, and posted a 0.4 per cent fall for the first quarter of this year.
Mr Mak forecast that high-end property prices will continue on a gentle slide for the rest of the year.
Selangor Dredging buys freehold site in Draycott Park for S$72m
Selangor Dredging buys freehold site in Draycott Park for S$72m
This reflects a land rate of about S$1,787 psf ppr, inclusive of estimated development charge of S$15.3m
June 9, 2017
LYNETTE KHOO
MALAYSIA-LISTED developer Selangor Dredging Berhad, through its indirect 50 per cent associate Champsworth Development Pte Ltd, has acquired a freehold site in Singapore's prime District 10 for S$72 million.
The purchase of 1 Draycott Park from a Singaporean couple reflects a land rate of about S$1,787 per square foot per plot ratio (psf ppr), inclusive of an estimated development charge of about S$15.3 million.
Savills Singapore, which brokered the deal, estimated the breakeven price for the new development to be between S$2,700 and S$2,800 psf, depending on the quality of the end-product.
In a filing with Bursa Malaysia, Selangor Dredging said it planned to develop exclusive mid-rise apartments on the land, which measures 17,442 square feet.
"This transaction signals to the market that the high-end non-landed residential segment has moved on to the next phase of price recovery," said Suzie Mok, senior director of investment sales at Savills Singapore.
"The sale represents an exciting opportunity for the developer to turn a prized asset underpinned by its excellent location into luxurious compact- sized apartments targeting the well-heeled single professionals, Dinks (dual income, no kids), young families and investors who covet a piece of property in the posh locale," she added.
This marks the seventh property that Selangor Dredging has purchased in Singapore and follows closely on its acquisition of a freehold site in Serangoon last December.
The company said the purchase consideration and development of the property would be 70 per cent funded by bank borrowings by Champsworth Development and the rest by internally generated funds.
"In view of the strategic location of the property, Selangor Dredging is optimistic on the prospects of the proposed development to be undertaken on the property," the company added.
Nestled in the upscale residential enclave of Claymore Hill and Ardmore Park, the land parcel is currently occupied by a seven-storey block. The site is within minutes' walk to Scotts Road and Orchard Road, and is close to various country clubs, Goodwood Park Hotel as well as Shangri-La Hotel.
Selangor Dredging in December bought a freehold land spanning 31,705 sq ft at Serangoon Road from National Aerated Water Company for S$47 million.
As the two-storey disused bottling factory on the site is considered to be one of the last few vestiges from Singapore's industrial past, the Urban Redevelopment Authority said in December that it was engaging the building owner to explore the possibility of conserving the building.
Selangor Dredging told the Malaysian media on Thursday that it is looking to launch the projects in Draycott Park and Serangoon Road within the first half of 2018.
