Emerald Garden unit hits $1,582 psf

Emerald Garden is probably one of the most overlooked residential properties in the CBD. Located amid conservation shophouses on Club Street near Chinatown, the 265-unit residential project completed in 1998 was probably the first downtown private apartment development. It is within walking distance of both Raffles Place and Tanjong Pagar, and also the Tanjong Pagar, Chinatown and Raffles Place MRT stations. The development could increasingly be on the radar screens of potential investors, with the upcoming Telok Ayer MRT station, also within walking distance, expected to be ready next year, says Darren Teo, a senior team director with ERA.

Teo reckons Emerald Garden has been eclipsed by the newer 99-year leasehold high-rise condominiums in Tanjong Pagar, for instance Icon on Gopeng Street, Lumiere at Mistri Road and 76 Shenton Way, and the shiny new towers at Marina Bay, also of the 99-year leasehold variety, such as One Shenton, The Sail @ Marina Bay and Marina Bay Residences. As such, apartments at Emerald Garden have not been as actively traded as those in Tanjong Pagar and Marina Bay.

What’s more, Emerald Garden, located in a conservation shophouse neighbourhood, has a 999-year leasehold status and is made up of six low-rise blocks, unlike the high rises found in Tanjong Pagar and Marina Bay. “Many of the owners are perhaps aware that it’s the only property with a 999-year leasehold status, which is equivalent to a freehold status, and are therefore holding on to their units,” adds Teo.

Based on caveats lodged with URA, from March 8 to 15, two units at Emerald Garden changed hands at prices of $1,582 and $1,568 psf. A 980 sq ft, two-bedroom unit on the 11th floor went for $1.55 million ($1,582 psf), giving the seller a hefty 50.2% gain, as he had purchased the unit for $1.03 million ($1,053 psf) from the developer a month after the project was launched, in April 1996.

The other transaction involved an 829 sq ft studio apartment on the second floor that went for $1.3 million ($1,568 psf). This represents a 57.6% gain for the owner, who had also purchased the unit in 1996 for a mere $825,000 ($995 psf).

In addition to their 999-year leasehold status, units at Emerald Garden are also larger than those in newer developments, with studio apartments sized at 721 to 829 sq ft; two-bedroom apartments, 926 to 1,119 sq ft; three-bedroom apartments, 1,227 to 1,346 sq ft; and four-bedroom units, 1,507 to 1,991 sq ft.

Emerald Garden’s monthly rental rate is around $4 psf, while the latest asking prices are in the $1,600 to 1,700 psf range. This compares with asking prices of above $1,800 psf at the 646-unit Icon.

Even at the peak of the market, the highest price achieved at Emerald Garden was $1,731 psf, when a 1,259 sq ft apartment changed hands for $2.18 million.

Meanwhile, the highest average price achieved at Icon was for a 1,119 sq ft, two-bedroom plus- study loft on the 46th and topmost floor, at $2.8 million ($2,515 psf). The unit was sold by the developer in October.

In the week of March 8 to 15, five units at Far East Organization’s Icon (located just in front of SkySuites@Anson) changed hands in resales at prices of $1,824 to $1,890 psf, according to caveats lodged with URA.

When Icon was launched in May 2003, it was right after the SARS outbreak, and the first phase of 161 units was released at an average price of $650 psf. Today, sellers are asking for prices above $1,800 psf in the resale market.

The most popular units among investors are the studio and one- and two-bedroom apartments sized at 561 to 869 sq ft; and one- and two-bedroom lofts sized at 913 to 1,119 sq ft. Most of the buyers there are young Singaporean investors purchasing for rental income, as the units are favoured by expatriate professionals working in the CBD, says Kevin Lau, associate marketing director at Propnex Realty.

The main attraction of Icon among investors is the potential for higher rental yields, given that the units fetch almost the same rates as newer residential developments in the Marina Bay area, such as The Sail @ Marina Bay and Marina Bay Residences, adds Lau. As such, Icon is one of the most actively traded residential developments in the CBD, with many units having changed owners several times.

Based on current transaction prices, rental yield works out to 4% a year, says Lau. Owners could rent out the studio lofts of 599 to 608 sq ft for at least $3,600 a month, while one-bedroom units could fetch $4,500. The latest asking rents for two-bedroom apartments are $4,800 to $5,000, while two-bedroom lofts are going for above $6,000.

One of the most recent transactions was of a 560 sq ft studio apartment on the 24th floor that was sold for $1.03 million ($1,840 psf) on March 14. It represented a marginal 8.4% gain for the seller, who bought it in a sub-sale for $950,000 ($1,697 psf) in September 2007. This is the second time the unit has changed hands in the secondary market. The previous owner had purchased the apartment from the developer four months earlier and paid 642,000 ($1,147 psf), hence enjoying a 48% price gain from his sale.

Two other units that changed hands were on the 34th floor. One was a 581 sq ft unit that fetched $1.06 million ($1,824 psf) — a 35% capital gain for the seller, who purchased it for $785,000 ($1,351 psf) in May 2007. Prior to that, the first owner bought the unit for $448,431 ($771 psf) when it was launched in 2003. As such, that owner saw a 75% capital appreciation in the four years that he held the property.

The other unit sold in a resale was a smaller, 570 sq ft apartment that commanded $1.05 million ($1,832 psf). The seller bought it in the resale market for $940,500 ($1,649 psf) in February 2010, hence seeing an 11% gain in about a year. Prior to that, the previous owner bought the unit in the sub-sale market for $870,000 (1,525 psf) in November 2007.

On the 35th floor of the same block, a 904 sq ft unit went for $1.79 million ($1,980 psf). The seller made a gain of 25.2%, as he had purchased the unit in the sub-sale market for $1.43 million ($1,582 psf) in November 2007. The previous owner had purchased the unit from the developer three years earlier for $690,000 ($763 psf), hence enjoying a whopping 107% capital gain.

The Tanjong Pagar neighbourhood, which has been declared the next waterfront district that will rival Marina Bay, has also been receiving a lot of investor attention, especially with GuocoLand’s announcement of its upcoming $3.2 billion mixed-use development, which includes both Grade-A offices and residences sitting atop the Tanjong Pagar MRT station.

Meanwhile, on March 18 to 20, Allgreen Properties held a VIP preview of the 360-unit SkySuites@Anson. During the preview, 54 of the 100 units released were taken up at an average price of $2,200 psf. The launch of the new 72-storey residential tower has sparked renewed interest in other residential developments within the CBD, particularly in Tanjong Pagar.

Also nearby, located just off Shenton Way at Mistri Road, is BS Capital’s 168-unit Lumiere, a 45-storey condo that was completed just last year. Most recently, a 635 sq ft unit there went for $1.33 million ($2,094 psf). This represents a 24% gain for the owner, who bought the unit from the developer for $1.07 million ($1,688 psf) in January 2007.

Units at Lumiere were priced at $1,500 to $1,600 psf at launch in December 2006. Asking prices are above $2,000 psf today, with the highest, $1.1 million ($2,174 psf), recorded for a 506 sq ft unit on the 29th floor that was sold in September.

Source : The Edge – 4 Apr 2011

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