THE move to re-launch Kovan Lodge for a collective sale yesterday after this week's deal to sell Ultra Mansion en bloc suggests the market for such sales is reviving.
Analysts said more such sales could be on the way given that many home owners believe that surging property prices have peaked and now is the time to cash in.
The freehold Kovan Lodge, near Kovan MRT station, is the first residential site up for collective sale after the seventh round of cooling measures announced in January. The asking price is just below $30 million, down from the $32 million demanded by owners last August.
If approval is given to buy an adjoining 505 sq ft plot of state land, the selling price will be $791 per sq ft per plot ratio, said marketing agent Mount Everest Properties yesterday. No development charge is payable.
The tender closes on March 26.
Ultra Mansion, a 13-storey freehold block near Novena MRT station, was sold en bloc on Tuesday for $149.13 million. It consists of 48 apartments of around 1,600 sq ft each. The sale price translates to about $1,170 psf, with no development charge payable. Unit owners will get around $3.1 million each.
Freehold apartments in Novena mostly resold for between $1,192 and $1,788 psf last month.
The tender, which closed on Jan 18, was won by a unit of Hong Kong-listed Fantasia Holdings out of three bids.
It had been a torturous process for the owners. They tried to sell the development en bloc in 2005 and 2006 but failed both times to get the required 80 per cent backing from owners. They finally succeeded on the third attempt and put the block out for tender in February last year at an indicative price of at least $170 million but failed to find a buyer.
Analysts said more collective sales can be expected.
"Whenever we have property prices at their highest, everyone gets tempted to do collective sales," said Mr Chris Koh, director of Chris International.
Mr Koh said owners of small developments may want to sell en bloc in hopes of cashing in now, then reinvest the proceeds later if prices decline.
Property prices were on a record-breaking run before cooling measures hit on Jan 12.
They began shooting up late last year after months of subdued growth. Private home prices rose 1.8 per cent in the last quarter of 2012, three times the 0.6 per cent rise posted in the third quarter.
The cooling measures have made developers more cautious, said Mr Jeremy Lake, CBRE's executive director for investment properties. He said developers may be "selectively interested in smaller collective sale sites at the right price", noting that both Kovan Lodge and Ultra Mansion had to be put up for sale twice and their asking prices were reduced.
Four freehold strata units at Queensway Shopping Centre were also put up for sale yesterday via an expression of interest.
One is a 2,734 sq ft unit on the second level used by McDonald's. The other three are on the third floor and occupied by sporting goods retailer Sports Link.
Ms Sammi Lim, associate director of investment property at CBRE, said the owners were looking for a bulk buyer with offers over $32 million for the units.
Shops at Queensway Shopping Centre have been selling at between $3,056 and $6,341 psf in the past six months.
CBRE and Knight Frank are the joint marketing agents for the shop units. The expression of interest closes on April 2.
This story first appeared in The Straits Times on March 7, 2013
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