UOL stays nimble

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/ EdgeProp Singapore
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December 27, 2017 9:00 AM SGT
A year before the collective sale fever started raging, UOL Group and United Industrial Corp (UIC) quiet- ly picked up Raintree Gardens, a privatised HUDC estate, for $334.2 million, or $797 psf per plot ratio (ppr). Then, in a private treaty in January 2017, they purchased 45 Amber Road, a 70,000 sq ft free- hold site for $156 million ($1,063 psf ppr), from developer Sin Lai Huat.
“Fortunately, we bought these two pieces of land at relatively rea- sonable prices before intense com- petition drove land prices up,” says Liam Wee Sin, deputy group CEO of UOL Group.
UOL and Kheng Leong purchased Nanak Mansions for $201.1 million ($1,429 psf ppr) in September; it will be redeveloped into a 68-unit high-end condo (Photo credit: JLL)
At end-September, UOL Group purchased Nanak Mansions en bloc for $201.1 million ($1,429 psf ppr) in a joint venture with sister company Kheng Leong Co, the privately held property vehicle of the family of Wee Cho Yaw, former UOB chairman.
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Prices of subsequent collective sale sites in the prime District 15 neighbourhoods of Amber Road and Meyer Road have since risen. In early October, Amber Park was sold for $906.7 million ($1,515 psf ppr), followed by the $146.99 million ($1,536 psf ppr) sale of Parkway Mansion in mid-December.
‘Disconnect’ between prices of land and private homes
“Each new en bloc sale or government land sale seems to have set the benchmark for the next tender, fuelling the escalating land prices,” says Liam. He sees a “disconnect” between the prices of land and the end-product — private homes.
According to URA data, private-home prices showed an uptick of 0.7% in 3Q2017 after 15 consecutive quarters of price declines. Based on transacted prices of en bloc sites sold in prime District 15 alone, free- hold land prices have soared 44.5% in terms of psf ppr over the last 12 months. Thus, Liam says, “we will be more selective in bidding for sites with good attributes and where ask- ing prices are reasonable”.
UOL has been buying en bloc sites over the past 20 years, starting with the one for Novena Suites in 1997, followed by the one for The Sunshine on Upper Serangoon Road and 1 Moulmein Rise in 1999. The latest acquisition was Nanak Mansions on Meyer Road. “En bloc sites have been a great way to replenish our landbank and a source of freehold land,” says Liam.
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Newton Suites is a redevelopment of an en bloc site, one of 21 purchased by UOL over the past 20 years (Photo credit: UOL)
Launch of Amber 45, Raintree Gardens
UOL plans to launch two projects next year: 45 Amber Road (Amber 45) in 1H2018 and the new develop- ment at Raintree Gardens in Potong Pasir in 2H2018.
According to Lim, with a plot ratio of 2.1, the site at 45 Amber Road will be developed into a 21-storey, 139- unit residential tower. The freehold project will have full-fledged condo facilities, including a 50m swimming pool and tennis court. The project is designed by ADDP Architects, which was the architect for The Clement Canopy, UOL’s condo project at Clementi Avenue 1, launched in February this year. Like The Clement Canopy, the new project at 45 Amber Road will not feature one-bedroom units; the smallest will be two-bedroom units.
At Raintree Gardens, UOL is developing a 20-storey development with a total of 728 units, given its higher plot ratio of 2.8. WOHA has been appointed the architect for the project, which will capitalise on its serene sur- roundings and the 20m riverfront. It will be a scheme “inspired by nature” featuring sky gardens and lush land- scaping, says Liam.
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UOL will develop the former Raintree Gardens into a 728-unit private condo with a 200m riverfront (Photo credit: JLL)
WOHA was the architect behind UOL’s other projects: five-star hotel Parkroyal on Pickering, Newton Suites and One Moulmein Rise, which are all award-winning projects.
UOL has also engaged WOHA to design its new development at Nanak Mansions. Sitting on a prime free- hold site of 109,631 sq ft off Meyer Road, the site will be redeveloped into a boutique 68-unit, high-end condo. Likewise, it will be a sustain- able design with a focus on green- ery, says Liam.
Existing launches substantially sold
The developer has also benefited from the pickup in both sentiment and buying activity in the residential market. Its 555-unit Riverbank at Fernvale, launched in February 2014, is fully sold and was completed in March this year.
The 797-unit Botanique at Bartley, launched in March 2015, was 70% sold as at end-September, according to UOL’s 3QFY2017 results announcement. It has since been fully sold and is scheduled for comple- tion by end-2018.
At Principal Garden on Prince Charles Crescent, only three of a total of 663 units are available for sale. The project is a joint venture between UOL and Kheng Leong, and was launched in October 2015. Meanwhile, the 505-unit The Clement Canopy, a joint venture between UOL and UIC, was launched in February this year and is already 84% sold. All these projects — such as River- bank, Botanique at Bartley, Principal Garden and The Clement Canopy — are 99-year leasehold condos devel- oped on sites purchased in govern- ment land tenders.
Liam: We will be more selective in bidding for sites with good attributes and where
Roll-out of maiden London project
Beyond Singapore, UOL is looking to launch its project in London called One Bishopsgate Plaza, a redevelopment of the former Heron Plaza, which was purchased in August 2014. The 42-storey One Bishopsgate Plaza will comprise 160 apartments and 236 hotel rooms branded Pan Pacific London. “The key advantage is its location in the City of London, right next to Liverpool Station and linked to Crossrail with direct access to Heathrow Airport and Canary Wharf,” says Liam.
He adds that UOL is “still confident” about the UK market. “In the micro-market of Bishopsgate, there’s still scarcity in terms of both hotel rooms and apartments,” he says. “We believe housing demand will still be healthy.”
In Shanghai, UOL has a mixed- use development in the Changfeng Ecological Business Park called Park Eleven. It is a joint-venture project with Kheng Leong and UIC. The first phase of 168 units was launched in October 2016 and more than 90% was sold. UOL plans to launch the second phase next year. The devel- opment has 398 residential units and 4,000 sq m of retail space.
In Singapore, Liam sees buying momentum continuing into 2018. “But if developers are buying land at higher price points, they will be testing their products at higher prices,” he says. “So, we still have to wait and see how things pan out.”
This story first appeared in EdgeProp Singapore Pullout Issue #811 (Dec 25-31, 2017)