Braddell View will be launched for collective sale by public tender on March 27 at a reserve price of S$2.08 billion, after 80 per cent of its owners voted to put the property on the market.
The development on Braddell Hill is the largest private residential site here, and was the largest of the 18 former Housing and Urban Development Company (HUDC) estates in Singapore, comprising 918 units of apartments, maisonettes and penthouses, as well as two shops.
If the sale goes through, each residential owner will stand to receive between S$2.04 million and S$4.03 million, marketing agent Colliers International said in a media release on Tuesday (March 19).
The reserve price translates to a land rate of S$1,199 per square foot per plot ratio (psf ppr) and includes the premium to intensify land use and to top up the lease to a fresh 99 years, which is estimated at S$795.1 million.
The land area at Braddell View is 1.14 million sqf and the site has about 61 years remaining on its 102-year lease tenure, which started on Feb 1, 1978.
Braddell View’s asking price of S$2.08 billion is the highest for a former HUDC project, with Pine Grove holding the previous record with its reserve price of S$1.86 billion. Mandarin Gardens has the record for all private developments after raising its asking price to S$2.927 billion last week.
Some of the residents at Braddell View had previously voiced unhappiness over the details of the deal, such as the method that would be used to divide the earnings if the collective sale went through. However, the notice put up by lawyers overseeing the sale said that the owners of 741 units had agreed to it, and this figure was more than the 80 per cent required to trigger the en-bloc sale.
Up to 2,620 new residential units with an average size of about 915 sqf could be built on the site, Colliers said.
Under its Master Plan 2014, the Urban Redevelopment Authority (URA) has earmarked the site as residential with a gross plot ratio of 2.1, which translates to a proposed total gross floor area of about 2.4 million sqf.
Colliers will be working with the authorities to explore the possibility of marketing the site separately as two plots and look into the feasibility of a phased redevelopment of the site, its managing director Tang Wei Leng said.
The redevelopment site comprises two separate land lots, which are about 618,221 sqf and 524,055 sqf. The tender closes on May 28.
“Given that this is a sizable development, it is likely to see interest coming from a consortium of developers,” Ms Tang said.
Property experts contacted by TODAY said that the development’s size could pose a challenge and questioned if it would be able to sell out within the five-year mark. Developers have to meet the five-year deadline in order to apply for the remission of the 25 per cent Additional Buyer’s Stamp Duty (ABSD).
Mr Ku Swee Yong, chief executive officer of International Property Advisor, said: “I will be surprised if developers bid. Anything over a billion dollars is a huge financial consideration for developers these days.”
He cited the example of several recent developments, such as JadeScape along ShunFu Road, which have had problems selling out after six months on the market.
Located 1.5km from Braddell View, the 1,206-unit JadeScape development has sold just 374 units to date. Nine units were sold at a median S$1,697 psf last month, which Mr Ku estimates to be the minimum price that the Braddell View project should be marketed in order to earn a profit.
Mr Nicholas Mak, executive director of SLP International Property Consultants, said that the Government’s property cooling measures were “not helpful” to developers. He suggested that the Government could extend the ABSD deadline to eight to 10 years for larger sites.
“That is only fair. If the land is double or triple (the area) of other sites, they should have more time as well,” Mr Mak said.
Mr Colin Tan, director of research and consultancy at Suntec Real Estate Consultants, also said that the chances of a successful en-bloc sale for Braddell View were not high.
“There is a lot of competition, but this does not mean it may not get sold. If they (developers) find the location and other attributes to be good, they will put their bids,” Mr Tan said.
The Braddell View site is located near the upcoming North-South Corridor which will be completed around 2026. The integrated transport corridor will feature vehicular expressways, continuous bus lanes and cycling trunk routes.
Caldecott MRT Station, which is a 10-minute walk from the site, will be connected to the new Thomson-East Coast MRT line in 2020. The other MRT stations in the vicinity are Braddell and Marymount stations.
Mr Tan said that the high reserve price of S$2.08 billion might have been needed so that owners would come onboard to reach an 80 per cent agreement for a collective sale.
“There may still be room for negotiation, but there is very little chance for the bids to come in at that high price,” he added.
He said that the majority of the homeowners would probably be satisfied with a “much lower and realistic price” as they want to sell their ageing property. The unhappy minority could be persuaded to agree to a lower price if their sales proceeds were topped up by homeowners who were more willing to part with their properties.
“If the negotiation is successful, everyone gets what they want,” Mr Tan said.
Source: Today – 19 Mar 2019