Another attempt at a collective sale for Horizon Towers has been priced at S$1.1 billion

Sep 08, 2022

A reserve price of S$1.1 billion has been set for the sale of Horizon Towers, which is located in prestigious district 9 and sits on a land that is 1.9 hectares in size and has a 99-year lease.

According to the information provided by the exclusive marketing agency JLL, the unit land pricing for the collective sale works out to about S$2,049 per square foot per plot ratio (psf ppr) for the 204,742 sq ft site. This figure takes into account an expected lease top-up premium of S$277 million. The unit land rate is calculated to be S$1,862 psf ppr after taking into account the ten percent bonus gross floor area that is a result of a high development baseline. The land improvement charge, often known as the development charge, does not need to be paid because the site is not being intensified.

Both Leonie Hill and Leonie Hill Road serve as frontages for the 211-unit housing development that occupies 1.9 hectares of land. The property features dual road access. The land is residentially designated according to the 2019 Master Plan, and the maximum height that is permitted is up to 36 storeys. The "as-built" gross plot ratio (GPR) of the site is around 3.28.

Orchard Road, a popular retail district, is easily accessible on foot from Horizon Towers, while the Great World MRT Station, which will serve the future Thomson-East Coast Line, is about 150 metres away on foot to the south.

According to Tan Hong Boon, executive director (capital markets) at JLL Singapore, "in the most recent few quarters, we have seen private residential prices breaching new highs in both the Outside Central Region (OCR) and the Rest of Central Region (RCR)," rising significantly faster than the relatively flattish price trend of the Core Centre Region (CCR). Tan believes that price movements in the CCR, which have been behind those of the OCR and RCR, will get a lift from the other 2 segments, which will drive prime residential prices towards new peaks. In the midst of geopolitical certainty and in light of Singapore's image as a safe haven, JLL is seeing demand from both locals and international investors.

Tan continued by saying, "With the decreasing unsold stock of new residential units in the CCR, and the projected incoming high demand for quality and bespoke apartments, we expect the Horizon Towers site to attract a good number of discerning developers capable of delivering an exceptional quality development comprising approximately 560 luxurious units at an average size of 1,200 square feet."

The tender closes Oct 20 at 3 pm.

This is not the first time that Horizon Towers has been offered for sale; the most recent effort to do so was in the year 2019.

Just a few days before the July 6 price controls were implemented in that year, Horizon Towers was put up for sale in July 2018 with a reserve price of 1.1 billion Singapore dollars. In September 2018, the solicitation was closed without receiving any proposals. It was again relaunched for sale at the beginning of 2019, however this time it was unsuccessful while maintaining the same pricing.

As a result of a disagreement among the building's owners in 2009, a collective sale of Horizon Towers for S$500 million was unsuccessful. In the end, the Court of Appeal came to the conclusion that the way the sales procedure was done was handled incorrectly.

The tender for Orchard Bel Air, which is located on Orchard Boulevard in the premium district 10, was terminated earlier this week without a bidder being found. The owners of the 71-unit, 99-year leasehold development, who were trying to sell at S$587.5 million, are now going into negotiations with possible purchasers in an attempt to sell their property.

Other developments in the neighbourhood, such as 5 Oxley Rise and Oxley Garden, also saw their tenders expire without a successful sale taking place. The owners of the freehold property located at 5 Oxley Rise were anticipating offers that were more than S$300 million. Its sellers are now having private conversations with a select few interested parties.

In the meantime, Oxley Garden, which is located right next to 5 Oxley Rise, was looking for a starting price of at least S$200 million. The company's proprietors are working on a new marketing strategy for the relaunch of their en-bloc sale.