Demand for condominiums in prime areas continues to rise as resale prices continue to soften. In prime District 9 alone, there were 22 transactions from June 14 to 21. Besides OUE Twin Peaks, the condo in District 9 that saw the most activity over that period, Martin Place Residences, a 302-unit freehold project developed by Frasers Centrepoint Ltd and completed in 2011, also saw heightened activity.
Martin Place Residences is located on Martin Place, just off River Valley Road. The recent spate of resales did not come as a surprise to real estate agents marketing units in the project. They attribute it to the site next door, which the URA had launched for sale in April. The site can be developed into a 445-unit private condo, according to URA. “Some owners do not relish the prospect of living next door to a construction site for the next three to five years,” comments an agent who declined to be named.
Some owners of Martin Place Residences have sold their units as they do not
relish the prospect of living next door to a construction site for the next three to five years
The tender for the 171,535 sq ft, 99-year leasehold site closed on June 28 and attracted 13 bids. The highest bid was from GuocoLand, which submitted a bid of $595.1 million ($1,239 psf per plot ratio), the highest price psf ppr for a residential development site since 2009, according to Nicholas Mak, executive director of SLP International. The tender saw keen demand from developers as the site is located in a prime district and within walking distance of the upcoming Great World MRT station, says Mak.
There are also no new launches in the vicinity, he adds. Based on the land price of $1,239 psf ppr, he estimates that the break-even price of the new project could be $1,850 to $1,910 psf, with the selling price of units at the new condo to be above $2,100 psf.
The only other condo in the immediate vicinity is the twin 33-storey Martin Place Residences, which was fully sold five years ago. Two out of the three units that changed hands recently were purchased in sub-sales. One was a 1,722 sq ft, three-bedroom-plus-study unit on the 20th floor that was sold for $3.42 million ($1,985 psf), according to a caveat lodged on June 20. The property last changed hands in a sub-sale for $3.44 million ($1,997 psf) in June 2012.
The second unit that was sold recently was a 1,421 sq ft, three-bedder on the 26th floor of the same tower. It fetched $2.92 million ($2,055 psf), according to a caveat lodged on June 17. The previous owner had purchased it in a sub-sale for $3 million ($2,111 psf) in November 2011.
Meanwhile, the third unit was a 1,421 sq ft, three-bedroom unit on the 24th floor. It went for $2.925 million ($2,059 psf), according to a caveat lodged on June 20. The seller had purchased it for $2.11 million ($1,488 psf) in June 2009 when the project was first launched for sale. This translates into a capital upside of 38.4% over the past seven years.
“The recent transactions at Martin Place Residences are close to prices in the 2010-to-2011 period,” observes Samuel Eyo, managing director of Singapore Christie’s International Real Estate. “This means prices are likely to have bottomed. And when the project next door is launched, Martin Place Residences, being freehold, could enjoy a renewal of interest from homebuyers.”
This article appeared in the The Edge Property pullout of Issue 735 (July 4, 2016) of The Edge Singapore.