Hong Fok joint CEO puts GCB at Nassim Road up for sale

/ EdgeProp Singapore |
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SINGAPORE (EDGEPROP) - Some Good Class Bungalow (GCB) owners at Nassim Road, Singapore’s most exclusive address, are known to bide their time — until the right buyer comes along. And these tend to be owners sitting on large GCB plots that have the potential for subdivision. The owners of the GCB at 40 Nassim Road, which has a conservation bungalow sitting on an 58,784 sq ft, freehold elevated site with a grand driveway, are a prime example.
According to a property title search, the owners are Cheong Pin Chuan, joint CEO of Singapore-listed property investment and development company Hong Fok Corp, and his wife, Helen Cheong Zee Yee Ling. Hong Fok’s property investments and developments in Singapore include International Plaza at Tanjong Pagar, Yotel Singapore Orchard Road, as well as The Concourse and Concourse Skyline on Beach Road. Hong Fok Corp and Tian Teck Investment Holding are controlled by members of the sprawling Cheong family whose patriarch, the late Cheong Eak Chong, had three wives and 28 children (16 sons and 12 daughters). (Check all latest Singapore property Market Trends)
Even though Cheong and his wife have owned the GCB at 40 Nassim Road for at least 28 years, they have never lived in it. “The house has always been tenanted,” says Michael Tay, CBRE head of capital markets.
The GCB at 40 Nassim Road sits on an elevated freehold plot of 58,784 sq ft (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Past tenants include the Saudi Arabia Embassy (from 2001 to 2008) and corporate chieftains of companies such as marine services firm Glenn Defence Marine, contract logistics provider DHL Supply Chain and French banking group BNP Paribas. From 2018 to 2020, the GCB was home to Taiwanese family office, HH Investments. The latest tenant is a Hong Kong family.
The GCB at 40 Nassim Road is tenanted at $50,000 a month from April 2020, based on URA data. Given the surge in rental demand for such high-end homes, Tay reckons the GCB could command a monthly rental rate of $80,000 to $100,000 today.
After all, a 17,000 sq ft GCB at Bishopsgate was leased in November 2020 for $150,000 a month, setting a new record in terms of rental rates. Another GCB of 16,000 sq ft at Ladyhill Road was leased for $125,000 in October 2021, while a 32,000 sq ft GCB at Ewart Park fetched $100,000 a month last July. All three GCBs were said to be tenanted to Chinese nationals.
The front of the bungalow built in the early 1900s has to be conserved (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Conservation bungalow

The existing bungalow at 40 Nassim Road is single-story with a built-up area of 13,839 sq ft. The front part of colonial-style, pre-war bungalow with a built-up area of 5,500 sq ft (40% of the total built-up area) was constructed in the early 1900s, and therefore has to be conserved. It has a driveway leading to a porte-cochère, with steps heading up to a verandah and the main entrance of the house. Beyond the entrance hall is a formal living room, with the family lounge on one side and a formal dining room on the other. The formal dining room leads to a spacious enclosed kitchen.
There are five en suite bedrooms within the existing property, including a master suite and junior master suite, with attached bathroom and private sitting room. The master and junior master suites are situated at the two corners of the main house, which will be conserved.
From the formal living room, there are two corridors on either side of a central airwell leading to a rear extension built in the mid-1990s. The rear extension includes the kitchen, two additional loft bedrooms that are also en suite, and a fifth bedroom that can be used as a guest room or a study, gym, mahjong room or a spa. The helpers’ quarters and store room can be accessed from the kitchen and the yard. The rear extension, being a new addition, need not be conserved. It can therefore be redeveloped into a larger two-storey structure.
40 NASSIM ROAD edgeprop inspector - EDGEPROP SINGAPORE
Source: EdgeProp Inspector
Credit: CBRE
Source: CBRE

Subdivision potential

The GCB at 40 Nassim Road is on the market for sale with the possibility of subdivision into three plots, each with a frontage along Nassim Road. “GCB plots of such size along Nassim are tightly held and rarely made available for sale,” says Tay. CBRE has been appointed the sole marketing agency for the property.
Under the latest sub-division, the first plot with the main conservation house will be the largest — with a site area of 25,188 sq ft and guide price of $88.158 million ($3,500 psf). Tay has even appointed an architect to show how a new double-storey extension can be built. The second of the three plots (Plot B3), which is now the front lawn, will have a site area of 15,996 sq ft, with a price tag of $63.984 million ($4,000 psf). The third plot (Plot B4) is a rectangular site (where the swimming pool and part of the front lawn is), with land area of 17,600 sq ft. At $3,900 psf, it has an absolute price tag of $68.64 million.
The last time the GCB at 40 Nassim Road was put up for tender was in the wake of the sale of another Nassim Road GCB nearby, that fetched $230 million ($2,720 psf) in May 2019. Sitting on an elevated freehold plot of 84,544 sq ft, it was owned by Wing Tai Holdings chairman and managing director, Cheng Wai Keung, and his wife Helen Chow, under a private company, Winright Investment. That GCB was first put up for tender in 2013 by JLL. The guide price then was $250 million to $300 million. Sold at $230 million, it is still the biggest GCB deal in terms of absolute price to date.
Sold at $230 million, the Good Class Bungalow sold by Wing Tai's Cheng Wai Keung is still the biggest GCB deal in terms of absolute price to date (Photo: Samuel Isaac Chua/EdgeProp Singapore)
In March last year, the GCB market saw a new record price established on a psf basis: $4,005. It was for the purchase of a 32,160 sq ft, regular freehold plot on Nassim Road by Jin Xiao Qun, wife of Nanofilm Technologies founder and executive chairman Dr Shi Xu. The absolute price for the purchase was $128.8 million.
Prior to the sale, the GCB at Nassim Road had been unofficially on the market for sale for several years. The previous owner of the GCB, Sukmawati Widjaja aka Oei Siu Hoa, executive director and controlling shareholder of privatised property group Top Global, had never lived in the property. It was mainly offered for lease.
“As transaction prices moved up, the asking price of the GCB had also been adjusted to reflect that, hence it increased from $2,500 psf to $3,000 psf and then to $4,000 psf,” recalls Samuel Eyo, managing director of Lighthouse Property Consultants, who handles marketing of high-end properties. “And it was never publicly on the market. It was just a pocket listing.”
The Good Class Bungalow at Nassim Road that was sold last year to Jin Xiao Qun, wife of Nanofilm Technologies founder and executive chairman Dr Shi Xu for $128.8 million or a record $4,005 psf (Photo: Samuel Isaac Chua/EdgeProp Singapore)
The GCB was able to command a premium of $4,005 psf as “it’s one of the nicest land-plots in the Nassim area”, comments KH Tan, founder and managing director of Newsman Realty, a specialist in the GCB segment. Since then, there hasn’t been a GCB sold on Nassim Road in the last 12 months, Tan points out.
It’s not for lack of trying. Following the deal, anecdotally, other owners of GCBs at Nassim Road recalibrated their asking prices to the $4,000 psf threshold. The more optimistic even pushed their asking prices to $6,000 psf.

Finding the right buyer

When 40 Nassim Road was placed on the market three years ago, the asking price was $175 million ($2,977 psf), in line with the pricing of GCBs at Nassim Road that had transacted at around $3,000 psf then, relates Tay. The owners had received offers at the close of the tender, but did not accept any of them. It was felt that such large GCB plots are increasingly scarce, he adds.
drone shot of the entire property - EDGEPROP SINGAPORE
A drone shot of the entire property, which can be subdivided into three plots, each with direct access from Nassim Road (Credit: CBRE)
“Time has proven them right as sites in this location have since been transacted at about $4,000 psf,” he says. “For such owners, it’s a matter of finding the right buyer.”
Tay sees the Russia-Ukraine conflict as another catalyst that reinforces Singapore’s attractiveness for its stability and status as a safe haven. “We have already seen an increase in the number of foreign enquiries following the unrest in Hong Kong, the US-China situation and of course, since Covid,” he observes. “Any macroeconomic uncertainties will fast-track the interest of these ultra-high-net-worth individuals to invest in Singapore.”
Foreigners need to convert to Singapore citizenship in order to be eligible to purchase a GCB, which is a protected asset, with just 2,800 in number across 39 gazetted areas. The Nassim and Cluny areas are the most prestigious. Last year, a GCB at Cluny Hill hit a new record of $4,291 psf when a property under construction sitting on a 14,844 sq ft, freehold site was sold for $63.7 million.
swimming pool at the side of the main house - EDGEPROP SINGAPORE
The swimming pool at the side of the main house, with the rear extension that was built in the mid-1990s (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Safe haven for the rich

“We have seen so much liquidity and wealth created in Singapore over the past two years,” says Tay. “It’s not just the tech sector, but increasingly we see wealth created in biomedical and renewable energy, with more entrepreneurs looking to set up their base in Singapore. They will in turn be keen to buy a property here.”
Some ultra-high-net-worth individuals are buying property for their children or grandchildren. “Some may not see the need to buy such a large GCB plot of over 58,000 sq ft, and that’s why we are receiving enquiries about the potential for subdivision,” he adds.
Tay is of the view that this echelon of buyers is undeterred by the latest property cooling measures of Dec 16, 2021, nor the hike in property tax for high-end residences in the Budget 2022 announced last month. (Check all latest Singapore property Market Trends)
Tay: A lot of wealth has flowed into real estate, in particular, GCBs, which have seen prices appreciate over 62% from 2010 to 2021. That translates to an annualised capital growth of 4.5% (Photo: Samuel Isaac Chua/EdgeProp Singapore)
According to Knight Frank’s Wealth Report 2022, the number of individuals in Singapore with at least US$1 million ($1.36 million) of net assets soared 126% to 526,370 between 2016 and 2021. The figure is expected to increase by another 13% by 2026, based on the Knight Frank Wealth Sizing Model. The cohort of ultra-high-net-worth individuals with at least US$30 million of net assets has swelled 158% to 4,206 over the same period, and is forecast to increase by another 43% by 2026.
“A lot of wealth has flowed into real estate, in particular, GCBs, which have seen prices appreciate over 62% from 2010 to 2021,” observes CBRE’s Tay. That translates to an annualised capital growth of 4.5%, he estimates. “It fulfils its role as a hedge against inflation,” he continues. “And when it comes to locations like Nassim and Cluny, the exclusivity and prestige of the location has outperformed the general GCB market, providing buyers with confidence of long-term capital appreciation.”
Check out the latest listings near Nassim Road, Cluny Road, Cluny Hill, Bishopsgate, Ladyhill Park, Ewart Park

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