Simon Cheong redefines luxury

/ EdgeProp |

September 27, 2018 5:12 PM SGT

Simon Cheong, founder of luxury property developer SC Global Developments on his latest series of condos, Petit Collectibles (Photo: SC Global Developments)

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SC Global Developments stays relevant by launching a new line of projects called ‘Petit Collectibles’, featuring predominantly one- and two-bedroom units

A battered tennis racquet enshrined in a glass case sits among prized art pieces in Simon Cheong’s tastefully furnished lounge at his head office in Newton 200. The smashed-up racquet is a token of American professional tennis player Serena Williams’ tantrum at a match in the WTA Finals in Singapore in October 2014, says Cheong, the founder and chairman of SC Global.

His firm, SC Global Developments, is the presenting sponsor for the BNP Paribas WTA Championships in Singapore from 2014 to 2018. Cheong put the racquet up for sale at a charity auction. “When prices went up, we bid for it too and took it back because we wanted it,” he says.

Few people can make a battered tennis racquet look like $1 million; Cheong is one of them. “Luxury is an art, not a science,” he says.

Cheong: We push the boundaries on quality, and the price will take care of itself (Picture: SC Global Developments)

Small is luxurious

SC Global, which has positioned itself as a luxury property developer, has two projects in the pipeline. They will be launched under SC Global’s new line of projects — Petit Collectibles — that features predominantly one- and two-bedroom units. The name was not an afterthought but had been thought-through over the past few years,” says Cheong. He has even had the name ‘Petit Collectibles’ and variations of it trademarked.

The hallmark of the Petit Collectibles series will be units that offer living spaces with “flexible functionality”. It also rides on the success of SC Global’s earlier projects that feature smaller luxury apartments, for instance, Martin No. 38, Thr3e Thre3 Robin and The Lincoln Modern. “SC Global’s apartments have often been referred to as ‘collectibles’ because they are limited in edition and refreshingly original in design,” says Cheong.

The first project in the Petit Collectibles line is a redevelopment of the former Jervois Gardens, for which SC Global paid $72 million in September last year. The price for the 34,038 sq ft, freehold site translates into $1,373 psf per plot ratio (ppr). Cheong was already familiar with the location of Jervois Gardens prior to its purchase. “I like the site for its serenity,” he says. “It’s surrounded by lovely bungalows and a lot of greenery.”

The fully sold 88-unit Martin No. 38, SC Global’s luxury warehouse-style apartments on Martin Place (Picture: SC Global Developments)

Another attraction is its proximity to the Alexandra Park Connector, which stretches from Tanglin Road to Zion Road, and is linked to the Queensway Park Connector, which leads all the way to the Singapore River. “We went there many times,” says Cheong. “My wife and I walked on the park connector, and when I had clocked the required number of steps, we went to Zion Road for char kway teow.”

To Cheong, it was important “to feel the site”. He adds, “I think this will be a lovely project for young people who want an active lifestyle. They can bring their bicycles or jogging shoes and hit the park connector trails.”

Younger buyers

Named Petit Jervois, the new 55-unit project will be the first in the Petit Collectibles line. The boutique, low-rise development is designed by niche architectural firm RT+Q, which has also designed several of Cheong’s bungalows under his SC Homes brand.

Targeted for launch at year-end, the units in Petit Jervois will be mainly in the 800-to-1,000 sq ft range. Prices are likely to start from $2,800 to $3,000 psf.

Artist’s impression of the 55-unit Petit Jervois, the first in a series of projects under SC Global’s new Petit Collectibles line (Picture: SC Global Developments)

The other site for the Petit Collectibles line is on Cuscaden Road. It was purchased in a government land tender for $410 million in April this year. SC Global acquired the site jointly with two Hong Kong groups: Far East Consortium and New World Development. The price of the 61,597 sq ft, 99-year leasehold site worked out to $2,377 psf ppr, which is a record price for a government land site. “99 years is a long time,” says Cheong. “We are running out of freehold sites, so the next best alternative is to bid for 99-year leasehold sites.”

To Cheong, the shift in demand was evident when smaller units in SC Global’s portfolio of projects were fully sold. He says it is also a trend observed in other global cities such as London and New York. “We decided that Petit Collectibles will be our answer to a market that wants SC Global products but at smaller unit sizes.”

The profile of the typical buyer of a luxury condominium has also changed over the past two decades. “When we first started, a wealthy buyer looking for a luxury apartment was typically someone in the 45-to-50 age range,” says Cheong. “The buyer today is younger, probably in the early- to mid-30s. They tend to be be successful, well-travelled and are looking for something interesting.”

The 241-unit Hilltops on Cairnhill Circle was completed in 2011 (Picture: Samuel Isaac Chua/The Edge Singapore)

‘Better off as a private company’

Cheong is known for commanding premium pricing for his projects. “But we are not mad,” he says. “We are not holding on to prices for the sake of holding on. Why should we sell at a price that is below replacement cost?”

The latest round of property cooling measures on July 6 has increased the cost of development. With immediate effect, developers have to pay 5% additional buyer’s stamp duty upfront when they purchase a site. If they do not develop and sell all the units within five years, they will have to pay 25% ABSD, up from 15% before. Another consequence of the latest property cooling measures is that the number of players in the luxury segment will shrink further. “Fewer people will want to enter this segment,” says Cheong. “But we are already in this market and intend to stay.”

SC Global’s 41-unit Seven Palms in Sentosa Cove (Picture: Samuel Isaac Chua/The Edge Singapore)

According to Cheong, SC Global is not only in real estate, but in the lifestyle business too. “If we had remained a public listed company, we wouldn’t have had the freedom to build the way we do: like craftsmen, taking our time to design the right project. We don’t see our projects as a commodity. That’s why we are better off as a private company.”

SC Global was privatised in January 2013 in a deal that valued the company at $745 million. The company was delisted in March 2013. The move is reported to have saved about $56 million in extension charges under the conditions of the Qualifying Certificate. The QC requires foreign companies (which include listed companies and corporate entities with at least one foreign shareholder) that hold their properties for more than two years after completion to pay extension charges pro-rated based on unsold units.

‘Fine balance’

Cheong, a former banker, founded SC Global in 1996. His maiden project was The Ladyhill, launched in 2000 and set a new benchmark for upscale apartments in Singapore. The Ladyhill, which has 55 units, was designed by Chan Soo Khian of SCDA Architects and completed in 2002. It has seven four-storey blocks, with a mix of four- and five-bedroom units of 2,325 to 4,187 sq ft.

SC Global’s maiden project was the 55-unit The Ladyhill. It was designed by Chan Soo Khian of SCDA Architects and completed in 2002. (Picture: SC Global Developments)

The launch of The Ladyhill was followed by that of the 56-unit Lincoln Modern, which was completed in 2003; the 36-unit Thr3e Thr3e Robin and 46-unit The Boulevard Residence on Cuscaden Walk, both of which were completed in 2005.

In 2007, SC Global rolled out The Marq on Paterson Hill. The 66-unit freehold development is still the epitome of luxury, and commanded a record price of $6,842 psf in November 2011. It still holds the record for the highest psf price paid.

“Even today, every time I go to The Marq — whether it’s in the day or night — I feel we got it right: achieving the feeling of luxury,” says Cheong.

The 66-unit ultra-luxury The Marq on Paterson Hill. A unit was sold for $6,842 psf in November 2011, which is still a record psf price today. (Picture: Samuel Isaac Chua/The Edge Singapore)

The Marq was launched at the peak of the last property boom, when the market favoured luxury projects with sizeable units. At the development’s Premium Tower, four-bedroom units of about 3,000 sq ft start from $10 million. Meanwhile, units at the Signature Tower are at least 6,200 sq ft and come with a 15m lap pool. Prices are upward of $21 million.

SC Global’s other recent luxury condo projects include the 241-unit Hilltops on Cairnhill Circle, which was completed in 2011; the 41-unit Seven Palms in Sentosa Cove, completed in 2013; and the 34-unit Sculptura Ardmore on Ardmore Park, completed in 2014.

The 34-unit Sculptura Ardmore. Facebook co-founder Eduardo Saverin and his wife own the super penthouse, which was purchased for $60 million. (Picture: Samuel Issac Chua/The Edge Singapore)

Pushing the boundaries

At Sculptura Ardmore, the 10,300 sq ft super penthouse was purchased in September last year by Facebook co-founder and Singapore’s second richest person, Eduardo Saverin, who paid over $60 million, or more than $6,000 psf, for it. One other unit at Sculptura Ardmore has been sold, based on caveats lodged. The 2,982 sq ft unit on the 10th floor fetched $12.44 million ($4,171 psf) last October.

So far, SC Global has developed and completed nine luxury condo projects in Singapore. Cheong said the developer was the first to offer loft-style living at Lincoln Modern. It offered an open-kitchen concept for the apartments at Thr3e Thre3 Robin long before it became fashionable in the city-state. It was the first to bring warehouse-style living to Singapore at Martin No. 38. And the Signature Tower at The Marq was the first project to feature a private swimming pool for every unit on every floor of a high-rise tower, Cheong points out.

To him, quality is still of utmost importance. “I personally go through all the details in my developments,” he says. “We manage our own projects and continue to maintain the developments even after we sell the units. There are no shortcuts. We push the boundaries on quality, and the price will take care of itself.”

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