Optima @ Tanah Merah hits $1,373 psf

On the eve of the public preview of the 297-unit Optima @ Tanah Merah two years ago, a queue had already formed outside the showflat. All the units were snapped up within three days at an average price of $810 psf, according to a press release by TID, a joint venture between Mitsui Fudosan and Hong Leong Group. The attraction was its location right next to the Tanah Merah MRT station.

At that time, the 556-unit Casa Merah, located directly behind Optima, had just been completed, and transactions in the secondary market were hovering at $750 to $800 psf.

Since the start of last year, units at Optima had already started to change hands in the sub-sale market. Prices of the 484 sq ft one-bedroom apartments in the condo were changing hands from $1,028 psf to a high of $1,280 psf last year. Meanwhile, the larger units, such as the 3+1-bedroom and four-bedroom units measuring 1,367 to 1,528 sq ft, were trading at prices of $876 psf and $878 psf. By April this year, such large units were being sold at $947 psf and $951 psf.

The 484 sq ft one-bedroom units have also seen prices escalating in the secondary market and crossing $1,300 psf by the middle of this year. The most recent transaction was of one located on the fourth level of one of the five 14-storey blocks. It changed hands at $665,000, or an all-time high of $1,373 psf, according to caveats lodged with URA Realis.

That was the third time the unit has changed hands so far. The first buyer had purchased it at launch in August 2009 for $496,600 ($1,025 psf). He sold it last November for $545,000 ($1,125 psf), at a 10% gain. The buyer enjoyed a 22% price appreciation in less than a year, however, when he sold it recently for $1,373 psf.

Construction is well underway, with the project scheduled for completion by 2014. As the latest condo to be launched there, Optima had set new price benchmarks for that part of Tanah Merah. Since its launch, prices of the neighbouring condos have also soared, most notably the neighbouring Casa Merah. Since end-2010, units at Casa Merah have been changing hands at more than $1,000 psf. A high of $1,127 psf was achieved for a two-bedroom 947 sq ft unit in June this year and a 958 sq ft two-bedroom unit in April, which are also the highest average price psf achieved for Casa Merah. The project was jointly developed by NTUC Choice Homes and Wing Tai Holdings.

The neighbourhood in which Optima, Casa Merah and older condos such as The Tanamera and East Meadows are located is also near famous dining enclaves such as Simpang Bedok and Siglap. Shopping malls such as Tampines Mall, Tampines Point, East Point and Bedok Point are also just a few MRT stops away. Investors who had bought into Optima were also looking at its proximity to Changi Business Park and the upcoming fourth university, the Singapore University of Technology and Design (SUTD), scheduled to open by next April.

Jason Hew, associate marketing director of PropNex, says Optima is the first development in the Tanah Merah neighbourhood to offer one bedroom apartments. The smallest units at Casa Merah, for instance, are the 947 sq ft two-bedroom apartments. Property agents marketing units at Optima have slapped a premium on prices, given the condo’s convenient location right next to the Tanah Merah MRT station. “Most of the nearby properties like Casa Merah and older condos like East Meadows offer more family-sized three- and four-bedroom apartments,” adds Hew.

He sees prices at Optima continuing to trend upwards. As the area develops, he foresees the neighbourhood attracting more single expatriates and young couples who may be working at Changi Business Park, or even in the CBD, given the proximity to the MRT station.

Not surprisingly, asking prices of one-bedroom units at Optima range from $650,000 to $700,000, or $1,350 to $1,400 psf. “Some sellers are intending to hold on to the units because it will [obtain its temporary occupancy permit] next year,” adds Hew. A property that is newly completed tends to see a spike in the numbed of transactions because there will be interest from buyers who want to move in or rent out immediately, he says.

The government has put on the reserve list another residential plot at the Tanah Merah area, in the vicinity of Optima. The site can yield another 390-unit, 99-year leasehold condo.

Meanwhile, also in the east, along Upper East Coast Road, UOL Group recently completed its freehold 88- unit Breeze by the East condo. The development is made up exclusively of two- to four-bedroom apartments. In August and September, units have been changing hands in the secondary market at $1,083 to $1,233 psf. Just a few doors away, MCL Land launched the 95-unit Uber 388 on the site of the former Casa Nassau. As at end-August, 41 units of 54 launched were sold, with the most recent units achieving a median price of $1,372 psf. These prices are likely to attract interest in the Upper East Coast neighbourhood.

Source : The Edge – 3 Oct 2011

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