Thursday, June 16, 2011

Owners cut price for Whitley estate

THE owners of Whitley Heights, just off Whitley Road, are relaunching their estate for tender at a lower price.

Credo Real Estate, which is handling the collective sale exercise, revealed yesterday that the first attempted sale in January this year was unsuccessful.

The offers received for the 130,165 sq ft freehold site in one of Singapore's prime neighbourhoods, District 11, were below the owners' initial reserve price.

'Earlier, the owners were hoping to achieve between $185 million and $210 million, which reflected a land rate of $1,421 to $1,613 per sq ft (psf),' said Credo managing director Karamjit Singh.

Now, they have lowered their price target to $165 million, or $1,268 psf, he said.

More than 80 per cent of the owners have consented in writing to the reduced reserve price.

Asked if the tender would be successful after the adjustments, Mr Singh said he remains optimistic.

'It should be all right because the owners have made a significant enough adjustment to attract developers' interest,' he said.

'At $165 million for the land, the developer may expect to break even at around $3 million per strata terraced. They should be able to sell the new strata units at an average of $3.6 million to $3.7 million per unit.'

Whitley Heights is a stone's throw from the large houses in posh Chancery Lane and a number of top schools.

Analysts reckon the unsuccessful tender earlier this year is not so much reflective of the current market, but more of the nature of the site and its development uses.

When most residential apartment sites go en bloc, they are typically redeveloped into high-rise condominium units.

But for Whitley Heights, the site - which currently houses a 45-unit condo development - is to be redeveloped into two-storey landed homes.

This means the developer of the site could choose to build a combination of conventional terraced, semi-detached and detached houses, as well as strata terraced, strata semi-detached houses and strata bungalows.

This implies potentially less 'intensive' use of the land for any developer, said SLP's head of research, Mr Nicholas Mak.

'The en bloc sale premium could be less, as a result, for the developer,' he said.

The tender for Whitley Heights closes at 2.30pm on July 8.

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