Kensington Park condo up for collective sale with $1.28 billion guide price

Kensington Park sits on a land plot spanning 491,000 sq ft zoned for residential use. PHOTO: CBRE

SINGAPORE - Kensington Park condominium in Serangoon Garden has been launched for collective sale by public tender with a guide price of $1.28 billion, four years after previous efforts.

The guide price for the 999-year leasehold residential site, comprising 316 units, translates to a land rate of $1,371 per sq ft per plot ratio (psf ppr), said its exclusive marketing agency CBRE on Wednesday (May 18).

The price factors in an additional 7 per cent of bonus gross floor area for balconies and a development charge of about $232.1 million.

This is higher than the $1.05 billion owners were aiming for in 2018, before property cooling measures kicked in that July, slowing the collective sale momentum.

Last month, at least 80 per cent of owners signed the collective sale agreement, The Business Times reported.

Kensington Park sits on a land plot spanning 491,000 sq ft zoned for residential use under the Urban Redevelopment Authority's Master Plan 2019, and has a plot ratio of 2.1.

Built in 1990, the property is located in Kensington Park Drive and has unobstructed views over the landed estate of Serangoon Garden.

Mr Michael Tay, head of Singapore capital markets at CBRE, said the site could potentially be redeveloped into more than 1,000 residential units.

"Considering the site's location, demand for strata-landed houses will also be popular among home buyers, which provides developers the option to include these into the unit mix of the new development," he added.

The tender for Kensington Park will close at 3pm on July 7.

Kensington Park's launch follows a string of recent collective sale attempts. It comes despite property cooling measures - introduced last December - that raised the additional buyer's stamp duty (ABSD) for developers to 40 per cent of the land price paid upfront, with 35 per cent remittable if they complete their projects in time.

Previously, the ABSD was 30 per cent paid upfront, with 25 per cent remittable if they complete and sell everything within five years.

Property analysts said developers would still go for collective sales depending on the site’s location and yield.

Huttons Asia's senior director of research Lee Sze Teck said: “The successful sale of Golden Mile Complex at $700 million gives the market confidence that developers remain keen to acquire attractive sites despite the large price tag.”

He noted that Government Land Sales sites are overly concentrated in some areas, so developers turn to the collective sale market to acquire sites in areas with little to no new supply to capture potential pent-up demand.

“That being said, developers are selective. With the exception of Golden Mile Complex, the successful collective sale sites in 2022 are small and yield less than 100 units. For larger sites, bids by consortiums are likely,” he added.

ERA Singapore head of research and consultancy Nicholas Mak said developers would be apprehensive about acquiring large sites like Kensington Park.

“The sweet spot is when the land parcel yields between 200 and 500 units, as developers would be more confident to sell all units within five years to be eligible for ABSD remission,” he said.

On May 11, Thomson View Condominium relaunched for collective sale with a guide price of $950 million. The land rate for the 540,314 sq ft site translates to $1,294 psf ppr.

Lakepoint Condominium in Boon Lay relaunched its collective sale tender on April 19 at $640 million, translating to a land rate of $959 to $982 psf ppr for the 562,286 sq ft site.

On April 4, International Plaza in Tanjong Pagar relaunched for collective sale at $2.7 billion, translating to a land rate of $2,448 psf ppr for the 50-storey commercial and residential block.

On March 14, Chuan Park condominium in Lorong Chuan relaunched its collective sale tender at $938 million, working out to $1,256 psf ppr for the 400,589 sq ft site.

All four 99-year leasehold properties were put up for sale at the same price as previous collective sale attempts.

The latest collective sale was Golden Mile Complex, which sold for $700 million to a consortium comprising Perennial Holdings, Sino Land and Far East Organization, the buyers announced on May 6.

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