Competition in the Amber area heats up

By hockmeng.tay@bizedge.com

February 15, 2015 12:00 AM SGT

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Silversea, a 99-year leasehold high-end condominium development on Marine Parade Road, saw two transactions recently. Both were for mid-floor four-bedroom units that changed hands in sub-sales. One was a 2,465 sq ft unit that was sold for $4.73 million ($1,919 psf), according to a caveat lodged on Jan 23. The buyer is believed to be a mainland Chinese national. The unit was purchased for $4.53 million ($1,839 psf) in August 2010 from the developer, translating into a gain of 4.4% in 4½ years.

The other four-bedroom unit recently sold was 2,723 sq ft and fetched $4.78 million ($1,755 psf), based on a caveat lodged on Dec 30. The seller had purchased the unit in September 2009 for $4 million ($1,470 psf), which means the property had appreciated by 19.5% over the past 5½ years. Both buyers of the four-bedroom units at Silversea are believed to be buying for their own use, according to Jason Ang, head of EastLiving Group, a division of Savills Residential.

Developed by Far East Organization, Silversea comprises four 20-storey blocks with a total of 383 units. Units above the 10th storey have unobstructed views of the sea. The project was completed last year. The units in the development are mainly large ones, with the area of a two-bedroom unit starting from 969 sq ft and that of a four-bedroom unit as spacious as 2,766 sq ft. Meanwhile, penthouses range from 3,477 to 4,962 sq ft. As at end-December, there were only nine unsold units in the development.

In the vicinity of Amber Road, Far East Organization also developed the 76-unit The Cape. The majority of the units in the SOHO-style development are one- and two-bedroom apartments that range from 570 to 657 sq ft, and two-bedroom lofts of 850 sq ft each. The most recent transaction at The Cape was in October, when a 657 sq ft, two-bedroom unit on the 13th floor of the 16-storey block was sold for $1.388 million ($2,114 psf), based on a caveat lodged. As at end-December, only eight units at The Cape remained unsold. Positioned as a high-end SOHO project, quality fittings at the development include full Gaggenau kitchen appliances and top-end bathroom accessories and sanitaryware. The project was completed around end-2014.

Further along Amber Road, Far East Organization has a third project called The Shore Residences, which was also completed last year. The 406-unit, 103-year leasehold condo consists of one- to four-bedroom units and penthouses that range from 592 to 2,906 sq ft. The most recent transaction at The Shore Residences was for an 896 sq ft unit that changed hands for $1.37 million ($1,533 psf), according to a caveat lodged on Jan 28. The seller had purchased the unit four years ago for $1.23 million ($1,381 psf), which translates into an 11.4% gain in four years.

The total number of units in the three projects by Far East Organization is 865, and they account for 22% of a total of more than 3,900 condo and apartment units in the Amber Road and Amber Gardens enclave. The figure includes new launches such as Amber Skye, a 109-unit project jointly developed by China Sonangol and OKP Land that is scheduled to be completed in 2017, and old condo projects such as the 200-unit Amber Park and the 72-unit King’s Mansion, which were developed by City Developments and Hong Leong Holdings and completed in 1986 and 1982 respectively.

The recent completion of Silversea and The Capehas also led to a revival of interest in other projects in the Amber area. Next door to Silversea is the 612-unit Cote D’Azur. The 99-year leasehold project by Frasers Centrepoint was completed last year. The most recent transaction at Cote D’Azur was for a 1,367 sq ft, three-bedroom unit that changed hands for $1.75 million ($1,280 psf), according to a caveat lodged on Jan 23.

Located across the road from Silversea and Cote D’Azur is a freehold development, The Sea View. The 546-unit condo on Amber Road was developed by Wheelock Properties and completed in 2008. The project also saw a number of units changing hands in the resale market of late. The most recent was the resale of a 1,410 sq ft, three-bedroom-plus-study apartment that fetched $2.28 million ($1,617 psf), based on a Jan 21 caveat. The seller had purchased the unit in a sub-sale for $1.45 million ($1,028 psf) in 2008, which means he saw a capital gain of some 57.3% over the past 6½ years.

The increase in the supply of condo units in the Amber Gardens-Amber Road neighbourhood has led to more competitive rents as landlords try to secure tenants. According to listings in PropertyGuru, the asking rent for three-bedroom units at Silversea is $7,000 a month, while that for four-bedroom units is $10,800 a month. At The Sea View, a three-bedroom unit was listed for rent at $5,300 a month, while four-bedroom units are going for $6,300 to $6,500 a month. The premium for units at Silversea is also due to the fact that it is a new development and the mid- to high-floor units have direct views of the sea, according to property agents.

According to Savills Residential’s Ang, the average monthly rent for a two-bedroom unit in the Amber area is $3,800 to $4,200, while the asking rent for a three-bedroom unit is $4,600 to $5,500 and that for a four-bedroom unit is $6,000 to $7,000.

On the ground, however, actual leasing deals have achieved rents that are sometimes more than 20% below the posted asking rents. For example, a Singaporean who only wants to be identified as J Tan says she recently rented a 600 sq ft, two-bedroom unit at The Cape for $2,800 a month, which is $1,000 below the landlord’s original asking rent of $3,800. “The owner preferred to get the unit rented quickly rather than holding out for a higher rent and leaving the unit vacant,” she adds. Tan is relocating from another condo block in the East Coast.

The Amber area is sought after, owing to its proximity to shopping malls such as Parkway Parade and 112 Katong, East Coast Park and the new MRT stations in the upcoming Thomson-East Coast Line, according to marketing agents. The area is also readily accessible by public buses.

This article appeared in the City & Country of Issue 664 (Feb 16) of The Edge Singapore.

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