99-year leasehold commercial devt attracts overwhelming interest
The Straits Times
January 22, 2013
ALMOST every unit of a mixed development launched in Alexandra yesterday has been snapped up - a stark sign that buyers are turning to commercial property in the wake of new cooling measures.
Only one of the 115 strata retail units released remained unsold as at 9pm yesterday after a dramatic day of sales that caught even the developer by surprise.
It was estimated that at least 20 buyers on average were competing for each unit at the 99-year leasehold Alexandra Central, while a shop space on the third storey had as many as 155 interested buyers submitting blank cheques for a ballot.
"I had strong confidence in the project but didn't expect it to do so well," said Chip Eng Seng group chief executive Raymond Chia.
The units were sold at between $4,000 and $8,000 per sq ft, said a spokesman from CEL Development, Chip Eng Seng's property arm.
Alexandra Central is next to Ikea and on the site of the former Safra building in Alexandra Road. CEL Development paid $189 million, or $789 psf per plot ratio, for the 85,517 sq ft site in 2011.
The project includes 31 food and beverage retail units and 85 shop units. The largest shop unit in the project was not launched for sale yesterday.
Mr Chia said Alexandra Central received an unexpectedly high level of interest when it was opened for preview over the weekend.
"We initially planned a soft launch on Wednesday but because the response was so overwhelming we decided to bring it forward to Monday," Mr Chia added.
When The Straits Times visited the showflat yesterday afternoon, it was packed with agents and buyers, some of whom had been there as early as 9am.
Some were genuine end-users hoping to secure shop space before prices rose further, while others said they were interested in investing in commercial property.
Mr Simon Chye, 55, who runs snack shop business Hello Food, bought a 667 sq ft F&B retail unit on the first floor for around $4,538,000.
Mr Chye, who plans to open an outlet in Alexandra Central, said in Mandarin that he wanted to buy shop space now as prices were rising, and thought the project had a good location.
Investors were drawn to the project because of the recent cooling measures imposed on the residential and industrial sectors.
Madam Zheng Fuying, 48, said in Mandarin that she was interested in investing in commercial space as it was the only segment of the market untouched by the new cooling measures.
She added that she wanted to buy shop space as a long-term investment because retail space was getting more expensive but the market was not yet overheated.
Alexandra Central will include a 450-room hotel managed by Park Hotel Group. Construction is expected to be completed by June 2016.
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