Windy Heights cuts reserve price in 2nd stab at collective sale

Windy Heights' $806.2 million reserve price is unchanged from the earlier collective sale attempt, but marketing agent Knight Frank Singapore said yesterday that "owners are going through a re-signing process to revise the reserve price". If enough o
Windy Heights' $806.2 million reserve price is unchanged from the earlier collective sale attempt, but marketing agent Knight Frank Singapore said yesterday that "owners are going through a re-signing process to revise the reserve price". If enough owners agree, the price tag will drop to $750 million.PHOTO: KNIGHT FRANK

The Windy Heights condominium in Kembangan is having another stab at a collective sale, with some owners ready to cut the reserve price to attract buyers in a cooling market.

The move comes hot on the heels of a failed bid for the freehold District 14 development that ended in April without a successful tender being lodged. It also comes after tough new property cooling measures kicked in on July 6.

The $806.2 million reserve price is unchanged from the earlier attempt, but marketing agent Knight Frank Singapore said yesterday that "owners are going through a re-signing process to revise the reserve price". If enough owners agree, the price tag will drop by 6.97 per cent to $750 million.

The revised price would work out to $1,089 per sq ft per plot ratio (psf ppr), including a bonus balcony gross floor area of 10 per cent, subject to approval. This is down from the original land rate of $1,171 psf ppr, or $1,288 psf ppr without the balcony area. No development charge is payable.

Windy Heights, which is at Jalan Daud, comprises 192 apartments, eight penthouses and two commercial units on a 23,291 sq m (250,702 sq ft) site.

Knight Frank said the plot could be redeveloped into as many as 581 new homes, at 100 sq m on average for each unit.

Mr Ian Loh, Knight Frank's executive director and head of investment and capital markets, said there "isn't much impending supply in the Kembangan and Bedok area... hence new launches in the area are likely to be sought after".

Windy Heights launches its new sale bid in a market that is still weighing up the new cooling measures. These included a 10 percentage point hike in the remissible Additional Buyer's Stamp Duty (ABSD) to 25 per cent for entities and a new, non-remissible 5 per cent ABSD. Some projects, such as Horizon Towers in Orchard's Leonie Hill Road, have extended their tender deadlines.

Mr Alan Cheong, senior director of research and consultancy at Savills, said the situation has changed since a collective sale drought in 2014 and 2015 when owners were reluctant to cut reserve prices despite market conditions.

"Most will refuse to budge, but some will be more flexible because they know it's different this time round," he noted.

Mr Cheong predicted that sellers gunning for up to $350 million may shave off at least 5 per cent to absorb the non-remissible ABSD for developers.

But bigger sites could need discounts of 10 per cent to 15 per cent to woo developers, he said, adding that having more owners meant higher chances of having more people who would not budge.

The new tender for Windy Heights closes at 2.30pm on Sept 7.

A version of this article appeared in the print edition of The Straits Times on August 02, 2018, with the headline 'Windy Heights has another go at collective sale'. Print Edition | Subscribe