SINGAPORE - Orchard Bel-Air condominium in prime Orchard Boulevard has jumped on the collective sale bandwagon with a public tender at a guide price of $587.5 million.
If successful, owners of units ranging from 300 sq m to 303 sq m stand to receive about $8.1 million each, while the owner of the sole 605 sq m penthouse could pocket at least $16.3 million.
Mr Baldev Singh, chairman of the Orchard Bel-Air collective sale committee, said: "Although we have attempted to initiate the collective sale exercise in the past, this is the first time we have managed to secure the 80 per cent consensus mandate to launch the tender."
The tender for the 99-year leasehold condo, which has 57 years left on its lease, will close at 3pm on Sept 6.
Built in 1984, Orchard Bel-Air comprises 71 residential units across 25 storeys.
An estimated 128 new residential units, averaging 200 sq m each, could be developed on the site, subject to approval from the authorities.
The redevelopment would not require a pre-application feasibility study on traffic impact.
At $587.5 million, the guide price translates to a land rate of about $2,600 per sq ft per plot ratio (psf ppr) after factoring in an upgrading premium of $131 million for the lease top-up. No development charge is payable.
Taking into consideration the 7 per cent bonus gross floor area allowed for balconies, this translates to about $2,526 psf ppr.
The site has the potential to be redeveloped into a high-end luxury residential development up to its existing gross floor area of 25,668 sq m or about 276,298 sq ft, based on a gross plot ratio of 2.96.
According to marketing agent Knight Frank Singapore, Orchard Bel-Air is among several properties along Orchard Boulevard where 36-storey developments may be permitted under the Urban Redevelopment Authority's Master Plan 2019.
Most other sites located across the road from Orchard Bel-Air have a height control of up to 20 storeys.
While collective sales marketing activity has picked up, Mr Galven Tan, deputy managing director for investment sales and capital markets at Savills, believes that "suburban sites and those in the $200 million to $300 million quantum are generally more appealing to developers".
He said: "Developers today won't buy multiple sites at one go because the risks have increased significantly. Land costs, construction costs, financing costs and ABSD (additional buyer's stamp duty) have all gone up, so many would rather buy one to two sites at a time and replenish their land banks again when the projects are sold."
Ms Chia Mein Mein, head of capital markets (land and collective sale) at Knight Frank Singapore, said: "Orchard Bel-Air embodies all the qualities of a trophy asset. Redevelopment sites in the Orchard vicinity are few and hard to come by."
The last successful large-scale collective sale in the Orchard Boulevard vicinity was Park House, located across the road from Orchard Bel-Air, which was sold for $375.5 million or $2,910 psf ppr in June 2018.
Park Nova, which now sits on the former Park House site, has sold 69 per cent of its 54 units since its launch a year ago, with prices fetching $4,970 psf on average, she noted.
Since the relaxation of Covid-19 measures and the opening of Singapore's borders in April, the high-end housing market has seen more foreign interest.
A stack of 22 apartments at Draycott 8 is undergoing exclusive due diligence by an Indonesian family at a sale price of nearly $168 million, estimated at $2,570 psf on strata area. Separately, a Chinese buyer has also purchased 20 apartments at CanningHill Piers for more than $85 million.
"We anticipate a further pickup in demand in the high-end residential market, which has not experienced as much price growth in the last two years when compared with suburban homes," Ms Chia said.
She added: "Given the current tensions in other parts of the region and globally, Singapore offers private wealth a stable and secure haven."