The purchase of three remaining land parcels of The Arden’s has been postponed
Read more: Private non-landed housing prices increased 0.4% year on year in August
Developer Qingjian Realty had intended to begin construction of its 105-unit exclusive condo called The Arden in the 1Q2022 timeframe. The sales gallery located on the site located at Phoenix Road was completed early this year. But, as the year is drawing to an end, the events for the launch have yet be put into motion. Yen Chong the deputy general manager of Qingjian Realty confirms that the launch was delayed.
The delay is due to the approval of the purchase of three adjacent leftover State land parcels on Phoenix Road. “It is still waiting for the approval of the authorities,” says Chong. “We are hoping to be granted it shortly.”
When approached via EdgeProp Singapore, an Singapore Land Authorities (SLA) spokesperson would reply: “SLA is reviewing the request with the relevant agencies and will make the proposal in the shortest time possible.”
Amalgamating the remnants of State properties with privately owned properties is not a new idea. Actually, developers are encouraged to buy these remnant sites for the same-sized parcel.
Qingjian Realty purchased the former Phoenix Heights en block at $42.6 million following the time of the closing of tender the 25th of July 2019. The developer has also moved forward by purchasing three remaining State parcels of land that border the site.
Delay caused by the complexities of purchasing three remnant sites
Three remaining sites is a piece of land that forms the boundary the Arden’s site across Choa Chu Kang Road. It is believed to be home to the reserve for drainage. Two other sites are located at the rear and a rectangular site is believed to be home to an underground power station, while another smaller square site is where the unused gas pipes that were used to service the previous units at Phoenix Heights are located (see EdgeProp Landlens).
A prior written permission (WP) given URA URA on November 20, 2021 indicated that it was in the process of obtaining the abolition of two State land parcels located at lots MK10-01494M as well as MK10-01654C.
Based on the revised WP which was submitted on March 1st 2022. The 105 unit residence development will comprise three blocks that span five floors as well as an underground carpark, a swimming pool , and common facilities situated at Plot 1, which is the principal site.
The developer must give Public Utilities Board (PUB) access to the drainage reserve located at Plot 2, “without the State paying any money or offering any kind of consideration for it, and with vacant possession, and free of restrictions prior to the issuance certificate of statutory completion from the Building and Construction Authority”.
According to the sources, a different issue could be related to the ownership of the former site which includes that electrical substation. The site is in the possession by Singapore Power, which is now a corporatised company. The land needs to be returned to SLA.
Thus, as of today it is the only one of the three remaining sites is successfully amalgamated. It is the one with gas pipes that have been discarded and been used to supply the apartments of 24 and the 12 shops in the Phoenix Heights. Phoenix Heights.
“While it’s common to have several agencies involved in the purchase of remaining sites however it’s quite unusual for approval to take such a long time,” says a source who refuses to identify himself. “Perhaps it’s the purchase of three remaining lots, instead of just one that’s causing the complexityand slow approval process for this purchase SLA because it must collaborate with the various agencies.”
In the event that Qingjian submitted an application to purchase the three remaining sites before September 1st, 2022, the acquisition price would be determined by the prior price that was 50% of the land’s total value, which is determined using a factor that is 5/7 times the land betterment charge rate, according to SLA in the press release. Since Sept. 1, the acquisitions of remaining State property will be determined by the 100% of the value of the land site.
The Arden’s land rates is equivalent with GLS sites for ECs currently
The opening The Arden The Arden is anticipated to occur in 2023. This is one year longer than the developer was hoping for. The clock is ticking toward the deadline of 5 1/2 years for the cancellation of 35% additional stamp duty for buyers. In the case of Qingjian Realty, that date is believed to be the year’s end in January 2025. This means that the developer will have about two years in order to market the 105 units of residential homes located at The Arden.
Alongside the extension of six months to the sale period up to five and a half years project’s deadline for completion was delayed by 12 month, to November 2025 as a an element of the relief measure Covid-19 that are available to developers.
In retrospect the Qingjian Realty’s price for the site located on Phoenix Road is attractive compared to the prices for land on the government-owned land sale (GLS) sites today. The 63,000 square foot site is an agreement for 99 years that began in 1969. This implies that the developer is required to pay a premium differential for an increase in lease. The purchase price is $42.6 million, which is equivalent to approximately $630 per plot ratio (psf ppr).
It represents 38.5% below the $1,024 PSF price per square foot the Far East Organization and Sekisui House paid for the GLS site at Hillview Rise at the close of the tender on November 3. The $630 psf and ppr is also 53% lower than the $1,343 per person which Bukit Sembawang Estates paid for the GLS site at Bukit Timah Link which is adjacent to the entry point to the entrance of Beauty World MRT Station. This tender was for Bukit Timah Link was also shut on November 3rd.
The $630 psf per-psf rate is the same as the cost for GLS sites that are executive condominium (EC) construction sites in the present, says Lee Sze Teck, senior director of research at Huttons Asia. In the middle of September, City Developments Ltd (CDL) paid $626 per sq ft per ppr in exchange for an EC site located at Bukit Batok West Avenue and Qingjian Realty paid $662 psf per person in exchange for an EC site located at Bukit Batok West Avenue in March of this year.
What price will The Arden be priced at?
EC projects that were launched in this year have already had prices that have surpassed $1,300 per square foot. For example six39 units of Copen Grand project in Tengah Garden Walk, launched jointly by CDL and MCL Land in September, had four85 units (75.9%) sold to the date, at an average of $1,337 per sq ft. CDL along with MCL Land had paid $603.17 per square foot to purchase Copen Grand site at the time of its launch in April 2021.
The consortium comprised of Qingjian Realty, Santarli Realty and Heeton Holdings is launching the 618-unit Tenet EC in Tampines North on Dec 3. The estimated average price is set at $1,331 per sq ft. In Qingjian Realty’s consortium, they paid $659 per person in exchange for an EC site located in Tampines North, in the month of July.
Suburban 99-year leasehold condominiums were launched in the last year with prices that average just over $2100 per square foot, for instance Amo Residence in Ang Mo Kio Rise in July in which the 98% (372) units sold in the weekend following launch; Sky Eden@Bedok with 75% of the 158 units sold by the first week of September. Lentor Contemporary which has a market share of the 85% of units had been sold by Nov 21.
“Qingjian Realty paid $630 per per square foot for the site which is the most appealing land price in the present – they could cause an uproar within the marketplace by the launch of The Arden for sale at a cost equal to fresh launches for ECs as well as suburban condominiums. It will be arousing interest,” says Huttons Asia’s Lee.
The building that is adjacent to The Arden adjacent to The Arden is Hillsta which is an apartment block of 416 units, 99-year leasehold development that consists of Soho’s, condominiums and townhouses. The project was designed through Far East Organization, the project was completed in the year 2012. The most recent median price at Hillsta is $1,241 per square foot which is based on transactions between June through November 2022.
Further down Phoenix Road and separated from The Arden by the Phoenix Park playground is the Phoenix Residences, a 74-unit development. Phoenix Residences by OKP Holdings. It was launched in December of 2020. around 95% (70 apartments) of the development has been sold at an average cost of $1,554 per square foot. Based on caveats filed between June and November 20, 2022. The median cost is $1,626 per sq ft.