Nearly three weeks after the close of what was marketed as Singapore’s largest en bloc tender, Pine Grove’s marketing agent Jones Lang LaSalle has kept quiet about the outcome.

But MediaCorp understands the development off Ulu Pandan, which has an independent valuation of S$1.25 billion, has received at least one private offer.

Ms Christina Sim, director of Investment at Cushman & Wakefield, said: “A more realistic price would be some 20 to 25 per cent below the S$1.7-billion mark. The agents still have a good 10-week period to negotiate any private treaty sale from the date of the close of the tender.”

According to analysts, S$1.275 billion to S$1.360 billion – well below the original reserve price of S$1.7 billion – would be a realistic price for Pine Grove. But that will translate to smaller gains for residents.

Pine Grove has 660 units of 1,163 sq ft to 1,938 sq ft. Based on a reserve price of S$1.275 billion, residents will receive from S$1.57 million to S$2.06 million depending on the size of their unit.

Analysts said residents of the 27-year-old property should go ahead with a lower offer.

Ms Sim said: “We must remember that Pine Grove is a 99-year leasehold property and, as time goes by, your property keeps depreciating. So right now, it actually makes a lot of economic sense for them to cash out.”

Analysts expect Pine Grove to be turned into a mid- to high-end residential development.

But demand for mid- to high-end projects, which are commonly found in the central regions, remains muted.

According to Urban Redevelopment Authority data, prices of uncompleted homes in the central region grew 0.1 per cent this quarter, slower than the 2.5 per cent for suburban areas.

Source : Today – 10 May 2011

Experts have said Pine Grove’s high development charge (DC) of S$460 million may be a deal breaker for property developers.

They add that the site’s DC has increased by 9.5 per cent, in line with the DC rate hike earlier this month.

Including the DC, analysts said Pine Grove’s total cost for a buyer works out to S$2.16 billion or S$1,152 per square foot per plot ratio.

A lush green view is what Pine Grove resident Lisa Chong is giving up if the site – worth an estimated S$1.7 billion – is sold.

Upon the sale, Ms Chong and her family will be receiving more than S$2 million.

Pine Grove home owners will receive between S$2.1 million and S$2.75 million for each of the units, which range in size from 1,163 square feet to 1,938 square feet.

Ms Chong said: “Probably part of it will go towards our new place, wherever that is going to be, and we would probably try to invest the rest.”

Analysts said Pine Grove’s hefty price tag will squeeze out small and single property developers.

Christina Sim, director of investment at Cushman & Wakefield, said: “For such a huge project, you will be looking at a consortium of developers because it is far too big a risk for a single developer to undertake. We will probably be looking at the big developers who might team up to buy this plot.”

With the market looking robust, experts said property developers are now stocking up on their land banks.

And private property owners are cashing in on the trend.

Currently, there have been at least eight collective sale tenders and two done deals so far this year.

Meanwhile, Ms Chong is positive that Pine Grove’s third enbloc attempt will be a success.

She said: “At the end of the day, it is still a prime location. We are on the major bus routes, we are relatively close to the CBD by expressway and we are also close to town, we are not in an overly noisy neighbourhood so…we hope for the best.”

But analysts said DC rates have increased significantly in the last four years, which have thinned profit margins for some enbloc property residents.

Ms Sim said: “We were looking at as high of a profit margin of 50 to 100 per cent, but now if you get a margin of 15 to 30 per cent, I think you are considered quite lucky.”

Analysts said the DC rate increase is the government’s way of keeping the enbloc property market in check.

Source : Channel NewsAsia – 10 Mar 2011

Jones Lang LaSalle has put up what it calls “the largest en bloc site” for sale by tender.

Pine Grove has a site area of around 893,000 square feet and is zoned for “residential” use.

Jones Lang did not provide an indicative price for the site but Channel NewsAsia reported in November last year that the site has an estimated reserve price of S$1.7 billion.

The property consultancy firm said the site has a gross plot ratio of up to 2.1 and can be redeveloped into a residential development of up to 24-storeys with a gross floor area of near 1.88 million square feet.

That translate to some 1,500 apartment units with sizes of about 1,200 square feet.

Jones Lang said the surrounding area comprises of prime residential developments and renowned educational institutions.

It added that the land would appeal to consortiums as it could be redeveloped into a landmark development or be divided into several smaller parcels for different or phase development.

Looking ahead, the marketing agent also said that despite the recent cooling measure, it is confident that the demand for en bloc sites would remain strong as the surge in foreign home buyers due to key recovering economies, could fuel the take up rates.

The tender will close at 3pm on April 19.

Source : Channel NewsAsia – 7 Mar 2011

Pine Grove residents may be sitting on an enbloc gold mine, but analysts have said realising the dream of a collective sale may be fraught with hurdles.

With a hefty asking price of S$1.7 billion and with more land sites launching soon, developers may pass on the 660-unit property.

Situated along Ulu Pandan Road, Pine Grove has an 80 per cent approval for its third enbloc tender.

And with its location in the prestigious district 21, analysts said an iconic mid-tier to luxury residence complex is an obvious choice.

But creating opulent luxury in a sprawling 890,000-square foot property may be too costly for investors.

Colin Tan, Head of Research and Consultancy at Chesterton Suntec International, said: “If I am the developer, I would be going for big units. The problem is not the dollar per square foot, it is the quantum. The absolute amount may go into millions, so how many individuals can really afford that amount or are willing to risk it just on one project?”

Analysts said Pine Grove’s gross plot ratio of 2.1 will yield too few units for developers to maximise their returns.

By comparison, Laguna Park, with an enbloc reserve price of S$1.14 billion, offers a plot ratio of 2.8.

But despite the red flags, analysts said developers with a longer-term view could look favourably at Pine Grove.

Christina Sim, Director of Investment Capital Markets at Cushman & Wakefield, said: “Our Singapore market is so small and so responsive to external stimulus. And there is also a huge foreign demand out there. It is ideal if a developer buys this maybe for land banking, because the truth is if you take a mid- to long-term view of the real estate market in Singapore, nothing is really very expensive now.”

However, with more land being released under the Government Land Sales (GLS) programme, developers are currently spoilt for choice.

The tendering for such land sites is also more straightforward, compared with enbloc tenders.

Ms Sim said: “Certainly for collective sales, the gestation period and the time to have 100 per cent ownership is certainly very long, unlike those developers going for GLS sites; they bid for the site, prepare for it and sell.”

However, analysts said Government land sites no longer offer the prime location and massive size that Pine Grove has.

Source : Channel NewsAsia – 19 Nov 2010

It could be third time lucky for Pine Grove estate along Ulu Pandan Road.

MediaCorp understands that the condominium’s third attempt at an en bloc sale received the necessary 80 per cent majority approval last Saturday.

According to residents, the reserve price is set at S$1.7 billion, setting the stage for Pine Grove to become Singapore’s largest residential collective sale, beating the 2007 record for Farrer Court.

“It’s a good time to sell because the estate is getting old, and it will be expensive to upgrade the old lifts, sewerage pipes and wiring in future,” said a resident, who declined to be named.

The next stage of the en bloc attempt is the preparation of tender documents, but the votes have to be first audited by the appointed law firm Lee & Lee.

There is also a “cooling off” period where residents who had signed can withdraw their consent to sell within a week.

MediaCorp understands that Jones Lang LaSalle, which is the marketing agent, is unlikely to launch a sale this year, and will likely wait for more favourable market conditions.

“Since 2008, most en bloc sales have been less than S$100 million,” said Nicholas Mak, Executive Director of Research and Consultancy, SLP International. “This shows that developers are now more cautious and the risk appetite is not so high.”

Analysts believe that potential buyers are likely to take a consortium or joint-venture route so as to spread the risk.

A collective sale also faces challenges from a successful Government Land Sales programme.

“Developers sometimes prefer the straight forward government sale of sites,” said Donald Han, vice chairman, Cushman & Wakefield, Singapore. “The collective sale process on the other hand can become protracted.”

Signatures for the sale have been collected from Pine Grove owners over various sessions since 15 November 2009.

The reserve price of S$1.7 billion could work out to between S$2.1 million and S$2.75 million per unit, depending on the size of the apartment and the development charge.

There are 660 units at the former HUDC estate, which covers over 893,000 square feet of land area.

The current record for an en bloc sale is held by Farrer Court, located along Farrer Road, also a former HUDC estate. It was sold in 2007 for S$1.34 billion, and had a development charge of about S$500 million.

Observers said Pine Grove could attract a similar development charge.

Source : Channel NewsAsia – 16 Nov 2010

Some homeowners at the Pine Grove estate along Ulu Pandan Road are making another attempt to sell their properties in a collective sale.

This will be their third bid since 2005.

MediaCorp understands that the minimum reserve price for the 660-unit unit estate is S$1.33 billion.

Depending on the size of the unit and the development charge that is payable, owners stand to pocket an average of S$2 million per unit.

The former HUDC estate has a land area of more than 893,000 square feet.

Farrer Court, another former HUDC estate along Farrer Road, was sold for a record S$1.34 billion in 2007.

Pine Grove’s reserve price is higher than the S$1.2 billion price tag that the Laguna Park estate in Marine Parade had expected in its first tender in September.

Even after the price was reduced later to S$967 million, the Laguna Park collective sale was called off last week.

At Pine Grove, there have already been three sessions to collect signatures for the possible enbloc sale since 15 November.

A fourth session is coming up next Thursday.

At the upcoming session, representatives from property consultancy Jones Lang Lasalle and law firm Lee & Lee will be present to answer homeowners’ questions.

Source : Channel NewsAsia – 23 Nov 2009