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Thread: Farrer Court's price tag expected to hit $1.5b

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    joe
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    Default Farrer Court's price tag expected to hit $1.5b

    Singapore’s largest en-bloc deal ready

    Posted: 14 May 2007 1342 hrs



    Farrer Court en-bloc sale


    Farrer Court has just been put up for sale by tender in what could be Singapore’s largest en-bloc deal in terms of land area, the number of units and the buildable gross floor area (GFA).

    According to the real estate agency leading the sale more than 80% of the owners have inked their consent to the collective sale.

    The 618-unit Farrer Court is expected to fetch an en bloc sale price in the region of $1.5 billion.

    Based on the current land area of approximately 838,488 sq ft and a gross plot ratio (GPR) of 2.8 permitted under the current 2003 Master Plan, the area could be redeveloped into Singapore's largest condominium site with some 1,800 apartments in blocks that can go up to 36 storeys.

    Leedon Heights, a large neighbouring collective sale site allowed up to 12 storeys, was sold for S$1,062 psf/pr to GuocoLand last month while, the Himiko Court further away at Mount Sinai was sold for $821 psf/pr to SingLand. -CNA/sf

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    Default Farrer Court's price tag expected to hit $1.5b

    Published May 15, 2007

    Farrer Court's price tag expected to hit $1.5b

    Asking price is the highest yet for an en bloc site

    By KALPANA RASHIWALA


    THE first collective sale with a price tag of more than $1 billion has now arrived, as Farrer Court goes on offer with an official expected price of about $1.5 billion - around $850 per square foot of potential gross floor area.



    Farrer Court: Based on the $1.2 billion reserve price, owners will receive $1.9 million for the smaller units of 1,453 sq ft and $2 million for the bigger units of 1,615 sq ft


    Sources say the reserve price is $1.2 billion, or slightly over $700 psf per plot ratio (psf ppr) inclusive of around $460 million payable to the state for enhancing the intensity of the District 10 site to a 2.8 plot ratio and for topping up the site's lease from a remaining term of about 69 years to 99 years.

    Market watchers say that more billion-dollar collective sale properties could come on the market this year - including The Claymore in the prime Claymore Road area and Neptune Court at Marine Vista - if some owners in these estates have their way.

    Farrer Court is a privatised HUDC estate. Its $700 psf ppr reserve price and $850 psf ppr official expected price look reasonable compared with the $1,062 psf ppr that GuocoLand paid last month for the freehold Leedon Heights, according to some property players.

    However, the sheer extent of the Farrer Court site and the huge outlay involved mean that it will appeal to only big players.

    Whether at the reserve price of $1.2 billion or the officially expected price of $1.5 billion, Farrer Court has the highest asking price for a collective sale yet attempted.

    At 838,488 sq ft, it has the biggest land area for an en bloc sale site.

    The maximum potential gross floor area of almost 2.35 million sq ft for the site - or about 1,800 apartments averaging 1,250 sq ft - means that a new development on the site would be the largest condominium development yet to be undertaken in Singapore, according to Farrer Court's marketing agent Credo Real Estate.

    The all-in land cost alone to the successful developer will amount to $1.662 billion based on the $1.2 billion reserve price - or $2 billion if the sellers get their $1.5 billion officially expected price. Construction costs, fees, interest and holding costs could add a further $1 billion to $1.1 billion.

    Despite the huge outlay involved, Credo is confident of the site being sold.

    Credo executive director Tan Hong Boon says 'several large developers have been following up closely with us on the progress of Farrer Court for a few months'.

    The property consultancy's managing director, Karamjit Singh, sees bids for the site coming from developers partnering one another or with equity investors.

    'I think larger developers will see the value of what Farrer Court has to offer - the site has the characteristics for an iconic huge development like Reflections at Keppel Bay, involving big-name architects,' Mr Singh said, adding that 'Farrer Court's reserve price is reasonable'.

    Market watchers estimate the $1.2 billion or $700 psf ppr reserve price will result in a break-even cost of about $1,200 to $1,250 psf for a new luxury project on the site.

    They also reckon that achieving an average selling price of around $1,600 psf or even more for a new 36-storey, 99-year leasehold project on the site in about a year's time should be possible, based on current market projections.

    'Farrer Court is very unique in that it is the only private residential site in the Farrer Road and Holland Road vicinity that is accorded a high plot ratio of 2.8 and a height control of up to 36 storeys. Most of the surrounding sites are either landed housing, low or medium-rise developments up to five or 12 storeys,' Mr Tan notes.

    More than 80 per cent of owners of Farrer Court have signed the collective sale agreement (CSA). Rodyk & Davidson is representing the majority owners.

    BT understands that based on the $1.2 billion reserve price, owners will receive $1.9 million for the smaller units of 1,453 sq ft and $2 million for the bigger units of 1,615 sq ft.

    When signing of the CSA began in September last year, the pricing was slightly above $700 million, reflecting sales proceeds of $1.1 million and $1.2 million for the owners of smaller and bigger units.

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    Default Re: Farrer Court's price tag expected to hit $1.5b

    May 15, 2007

    Farrer Court seeking $1.5b in largest collective deal

    Property boom lifts asking price way above $900m figure considered earlier

    By Fiona Chan


    COLLECTIVE sale mania is scaling giddy new heights, with home owners at Farrer Court putting the estate up for sale at $1.5 billion - a figure that would smash current records.

    Just three months ago, the former HUDC estate on Farrer Road was said to be considering a collective sale for a far lower $900 million.

    But amid the collective sale frenzy, prices have kept soaring since then - prompting the far more ambitious asking price announced yesterday.

    If Farrer Court is sold en bloc, it would be Singapore's most expensive residential collective sale - a record that has already been broken three times this year.

    Nearby Leedon Heights, sold last month for $835 million, is the current title-holder. It beat the $548 million paid for Gillman Heights off Alexandra Road in February, and the $500 million for Horizon Towers in Leonie Hill in January.

    But Farrer Court is larger than these three sites. It sits on an 838,488 sq ft plot near the junction of Farrer Road and Holland Road, a stone's throw from the upcoming Farrer MRT Station.

    Its owners revised their asking price upwards recently 'due to market changes', said Mr Tan Hong Boon, executive director of Credo Real Estate, which is marketing the estate.

    At $1.5 billion, each owner of the 618-unit condominium stands to reap an average of $2.4 million from the sale, he added. This is more than double the $900,000 fetched by one unit in March.

    Any buyer of the site will also have to pay an additional $500 million or so, which includes the development charge and a premium to top up the site's lease to 99 years from its current remaining lease of 69 years. This will take the estate's total price up to $2 billion, or about $850 per sq ft per plot ratio.

    According to market sources, the owners have agreed on a reserve price of about $1.2 billion, excluding the development charge and lease upgrading premium. But Mr Tan expects to receive offers 'in the region of $1.5 billion'. Some major players have already expressed interest, he noted.

    'Several large developers have been following up closely with us on the progress of Farrer Court for a few months,' he said, adding that after yesterday's announcement, 'we've already received calls from some people'.

    Given the large size and price tag of the estate, he believes developers may team up with other firms, or with funds or major contractors, to bid for the site.

    Farrer Court can be redeveloped into a 36-storey development with 1,800 units at 1,250 sq ft each, said Mr Tan.

    This would make the new project Singapore's largest condominium in terms of number of units, he added. A 36-storey project would be a unique feature in the area, where most surrounding developments go up to only 12 storeys.

    Farrer Court's bid to go for an offer with a higher asking price comes as rising property prices are thwarting other collective sale attempts.

    Owners of Pine Grove, another former HUDC estate in Ulu Pandan, recently rejected a collective sale that would have given them $1.2 million each.

    They said home prices were climbing so quickly that the payouts were not enough to buy a similar-sized replacement home in the vicinity.

    Meanwhile, other former HUDC estates are said to be gearing up to go en bloc as well. Market watchers say the process has begun in estates such as Laguna Park, Neptune Court, Lakeview and Shunfu Ville, even though the last has yet to be privatised.

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    Default Re: Farrer Court's price tag expected to hit $1.5b

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    joe
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    Default Re: Farrer Court's price tag expected to hit $1.5b

    Tuesday, May 15, 2007

    An en bloc record?

    Yes, if Farrer Court bags its asking price of $1.5 billion

    Daryl Loo
    [email protected]

    Former HUDC estate Farrer Court has been launched for en bloc sale, with an asking price of $1.5 billion — making it the largest collective sale on record, if it goes through.

    This surpasses the $835-million sale price set for neighbouring Leedon Heights last month and, if successful, the owners of the 618 units could pocket about $2.4 million each.

    It would also set a record for the most number of units and the largest land area (438,488 sq ft) in a collective sale. The 99-year leasehold privatised complex, located near Holland Road, has a lease of 69 years remaining. According to consultants to sellers Credo Real Estate, the site has potential to hold 1,800 apartments of about 1,250 sq feet each in 36-storey blocks.

    Said managing director Karamjit Singh: "We believe $1.5 billion is possible as it works out to about $850 per square foot (psf) per plot ratio, that's the land rate. Leedon Heights was sold for $1,062psf. Because Leedon Heights is freehold and this is leasehold, we feel the $200psf disparity is justifiable."

    Because of the large number of units involved, the Farrer Court sale committee had to raise its original selling price before it could convince 80 per cent of the owners to sign up for the sale.

    Said Mr Singh: "We managed to chalk up the first 50 to 60 per cent (of consenting votes) very quickly. Thereafter, the process slowed down. Fortunately, the market moved up significantly. That allowed the sales committee to up the reserve price substantially, and motivated many of the remaining owners to come forward to sign."

    The recent spate of record-setting en bloc deals has prompted owners to raise asking prices significantly, including in estates such as Pine Grove and Clementi Park.

    Jones Lang LaSalle's national director of investments Lim Song Hai said: "For the first quarter of 2007, we've seen a rise of reserve prices in the region of about 30 per cent on average." — Channel NewsAsia

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