Buy a luxury bungalow, drive away in a supercar
By Cecilia Chow
/ The Edge Property |
To lure buyers back to Sentosa Cove, a marketing agent is packaging a brand new Lamborghini Huracán with the sale of a bungalow priced below valuation. Will this help stir interest in Singapore’s luxury waterfront enclave?
The glamour of Singapore’s waterfront residential enclave has been somewhat tarnished by a spate of distressed sales at some of the luxury condominiums since last July, say property consultants.
Real estate agency SRI5000 is hoping to lure buyers back to Sentosa Cove by packaging a gleaming new Lamborghini Huracán worth $1.028 million with a luxury bungalow it is currently marketing at 28 Cove Way. “We just wanted to do something different,” says Bruce Lye, managing partner of SRI5000, a division of real estate consultancy SLP International. However, the car does not come with a Certificate of Entitlement, which is priced at $59,889 today.
The owner of the house at 28 Cove Way is believed to be an Indonesian tycoon, who had incorporated feng shui elements into the house. In fact, he even consulted a feng shui master before purchasing the 8,060 sq ft, 99-year leasehold site on the bend of the waterway. “According to the feng shui master, that was the best site as it resembled a grabbing hand,” says Lye. “And it also means that the homeowner will enjoy a 180-degree water view.”
After spending $4.5 million building the house, the owner never moved in. As a foreigner, he is not allowed to rent out the bungalow either. Thus, the property has remained vacant for the past five years.
The 180-degree water view from the roof terrace of the house at 28 Cove Way, located at the bend of the waterway
Bringing the shine back
It was only recently that SRI5000 was appointed the exclusive agent for the house at 28 Cove Way. The house had to be spruced up and staged for sale. SRI5000 has also engaged an architect to draw plans for a new 4,000 sq ft extension in the event some buyers want a bigger house. The existing property has a built-up area of 4,143 sq ft.
According to Lye, the house was valued at $19 million last year and currently has a fair market value of $16 million to $17 million. The price of the house is tagged at $14.8 million ($1,836 psf), which is “already a good deal as it’s priced below valuation”, says Lye. “And we’re packaging it with a brand new Lamborghini Huracán.” If a buyer prefers to have a further discount instead of a new Lamborghini, “that can be considered”, he adds.
The two-storey detached house was designed as a holiday home, with four bedrooms, a separate living and dining area, as well as a wet and dry kitchen. The house also comes with a lift, an infinity swimming pool overlooking the waterway, a koi pond with 88 fish and an ornamental tree. The master suite is on the first level, with three other en suite bedrooms on the second level. The house was designed by renowned architect MKPL Architects and completed in 2010.
The exterior of the house is of chengal wood. The feature wall at the entrance is 150mm thick and is made by pouring concrete into a rubber form mould created in Germany, and thus extremely expensive, says Lye. That wall alone cost $500,000. All the walls of the house are also protected with a layer of sealant to prevent discolouring, stains or fungus.
The flooring on the first level of the house is of Italian marble slabs measuring 1.2m by 1.2m, the kitchen countertops are of granite with Miele appliances and the bathrooms are of travertine with top-end German brand accessories.
Fizzled out
The effervescent property market in Sentosa Cove may have fizzled out much quicker than that of Good Class Bungalows in the prime districts of mainland Singapore. This was especially noticeable following the imposition of punitive property cooling measures in 2013, when foreign buyers were hit by an additional buyer’s stamp duty (ABSD) of 15%.
Bungalow transactions at Sentosa Cove have contracted significantly over the past two years. In 2013, there were 18 bungalow transactions worth $366.8 million, according to CBRE Research. For the whole of last year, the figure shrank to just three bungalows, totalling $39.5 million. The first 10 months of 2015 have seen a handful of deals amounting to $80.86 million. Although a bungalow on Pearl Island is said to have been sold, a caveat has not been lodged. Excluding that deal, there were four transactions this year with total sales of $60.68 million. This is, however, still an improvement from 2014.
Average bungalow resale prices at Sentosa Cove fell from $2,123 psf in 2013 to $1,676 psf last year. This year to date, it is about 19% higher at $1,997 psf, if the bungalow on Pearl Island were to be included. If excluded, the average price would be $2,018 psf.
However, it is difficult to make comparisons in the landed home market purely on price psf, says Desmond Sim, head of CBRE Research for Singapore and Southeast Asia. The price psf of the bungalows in Sentosa Cove tends to vary widely, because of factors such as their land size, built-up areas, design and aesthetics, quality of finishes and, more importantly, orientation. Bungalows facing the sea tend to have a premium over those that face the waterway or golf course, he adds.
A lot depends on the location of the bungalow that is sold and whether it has a sea view, says Samuel Eyo, managing director of Singapore Christie’s International Real Estate. “Bungalows fronting the sea still command prices of $2,300 to $2,400 psf, while those with non-sea-facing views tend to transact at prices of $1,700 to $1,900 psf.”
According to Lye, buyers who are house-hunting in Sentosa Cove are generally newly minted Singapore citizens or permanent residents looking to buy their first home in Singapore. “The weak global economy and financial markets have not affected their decision to purchase a home in Singapore,” he says. “Most would also prefer to get their citizenship or PR first before making a purchase to avoid being penalised by higher ABSD.”
Most of the buyers today are hunting for a good bargain, concedes Lye. “They are entering the market now as prices are perceived to be at an attractive level. Reality has set in, and they realise that the measures are unlikely to be removed anytime soon. Now is as good a time as any to buy a home at Sentosa Cove.”
However, there are some buyers who are still sitting on the sidelines, waiting for the property cooling measures, particularly ABSD, to be rolled back, says Steve Tay, vice-president of resale at CBRE Realty, who has been marketing bunga lows in Sentosa Cove for the past four years. “Following the property cooling measures in 2013, a lot of the investment demand has gone and will only return when investors believe there’s a bargain,” he adds. “Those in the market right now are buying for their own use with the intention of making Singapore their home. And they are unwilling to pay top dollar for a property unless they find something they really love.”
Multi-million-dollar bathrooms, flooring
CBRE’s Tay is marketing a bungalow at Lakeshore View, where there are only 19 such bungalows on an elevated site, with greenery at the back and views of the seawater lake, Serapong Golf Course and the sea looking towards Singapore. “The feng shui here is very good,” he says.
The house sits on a land area of 8,576 sq ft and has a built-up area of 12,600 sq ft. The owner, believed to be a Hong Kong businessman, purchased the site in 2007 when it was put up for sale by Sentosa Cove via an auction jointly conducted by Colliers International and Ken Jacobs, an affiliate of Christie’s Great Estates.
The owner spent $7 million building the house. It was designed by MAPS Architects & Designers and built by Sysma Holdings, which specialises in the construction of bungalows for close to two decades. The house was completed five years ago, and the owner spent another $2 million designing the interiors.
The most expensive component of the house is the natural marble and other stones imported from Italy, which is used throughout the house — from the flooring on the first level, extending to the walls and floors of all the bathrooms, as well as the wash basins and bathtubs, each one carved out from a single slab of stone or marble. Those materials alone cost $1.5 million.
Fitting out the gourmet kitchen cost $500,000, as the wife loves to cook and entertain.
The living room has a 15m triple- volume ceiling with a customised display wall of niches for the display of curios, collectibles and books. There is also space to display the stone sculptures by famous Taiwanese sculptor Ju Ming, carved Chinese antique cabinets, an antique piano as well as numerous other artworks, sculptures and antiques.
The highlight of the basement is the plush home cinema and guest suite with its en suite palatial bathroom, walk-in wardrobe and tatami sitting room, as well as an en suite balcony overlooking the Sentosa Cove golf course.
The master suite and junior master suite are located on the second level. The third level contains “the attic suite”, which also opens out to a roof terrace with an outdoor jacuzzi and pool.
The house at Lakeshore View with a 15m-high ceiling and display wall in the living room
Record price in the making?
As the owner’s two children have grown up and are now studying in the US, the owner is spending less time in Singapore. He has therefore decided to put the home up for sale with a price tag of $26.8 million ($3,125 psf). “If a deal goes through at this price, it will set another record in Sentosa Cove,” says Tay.
The last time a bungalow in Sentosa Cove crossed the $3,000 psf mark was in October 2012, when a seafront property along Ocean Drive was sold for $32.5 million ($3,214 psf).
There have been several offers for the house at Lakeshore View. However, they have fallen short of the owner’s expectation and were turned down, concedes Tay.
However, Tay is confident that there could be one or two other bungalow deals before the end of this year. He has been marketing 15 houses at Sentosa Cove worth a total of $300 million, of which two were sold this year. “There’s no lack of demand,” he says. “It’s just a matter of sellers and buyers agreeing on the price.”
While sales of Sentosa Cove bungalows may be lacklustre, the rental market has been relatively “healthy”, notes Tay. Four months ago, Tay rented out a house at Cove Drive, which sits on a land area of 7,800 sq ft, for $29,000 a month. He also rented out a bungalow on Sandy Island, which sits on a land area of 7,500 sq ft, for $26,000 a month. He is now looking to find a tenant for a house at Ocean Drive with an asking rent of $26,000 a month.
SRI5000 has a listing of 22 bungalows worth a total of $400 million at Sentosa Cove. Thus, SRI5000 realtor Henry Kang is at Sentosa Cove fulltime to cater to last-minute requests from private bankers or other realtors who have high-net-worth individuals in town for business or meetings and want to view some bungalows in the area.
No distressed sales of bungalows as yet
According to Grace Ng, deputy managing director of Colliers International and a veteran auctioneer who handled several mortgagee sales at Sentosa Cove last year, word is that the banks are repossessing more properties, especially luxury condos. “During the last property boom in 2007, buyers didn’t just buy one unit, but several units and sometimes, an entire floor of units,” she says. “And some of these are being repossessed by the banks.”
So far, no mortgagee sales of bungalows at Sentosa Cove have emerged yet. And even during the global financial crisis of 2008/2009, there was only one bungalow at Sentosa Cove that was repossessed by a bank and put up for auction. “At this moment, there’s none,” says Ng.
Perhaps what is needed to dispel the gloom and rev up interest in the Sentosa Cove bungalow landscape is a roaring new supercar — a Lamborghini no less.
This article appeared in the City & Country of Issue 700 (Oct 26, 2015) of The Edge Singapore.
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