Kensington Park condo up for collective sale with $1.28 billion guide price
Kensington Park condo up for collective sale with $1.28 billion guide price. Four years after previous efforts, Kensington Park condominium in Serangoon Garden has been launched for collective sale by public tender with a guide price of $1.28 billion.
The guide price for the 999-year leasehold residential site with 316 units is $1,371 per sq ft per plot ratio (psf ppr), according to its exclusive marketing agency CBRE on Wednesday (May 18).
The price includes a development charge of approximately $232.1 million and an additional 7% of bonus gross floor area for balconies.
This is more than the $1.05 billion that owners hoped for in 2018, before property cooling measures were implemented in July, slowing the collective sale momentum.
According to The Business Times, at least 80% of owners signed the collective sale agreement last month.
Kensington Park has a plot ratio of 2.1 and sits on a land plot spanning 491,000 sq ft zoned for residential use under the Urban Redevelopment Authority’s Master Plan 2019.
The property was built in 1990 on Kensington Park Drive and has unobstructed views of the Serangoon Garden landed estate.
The site, according to Mr Michael Tay, CBRE’s Singapore capital markets head, could be redeveloped into more than 1,000 residential units.
“Given the site’s location, demand for strata-landed houses will be high among home buyers,” he adds.
The tender for Kensington Park will close on July 7 at 3 p.m.
The opening of Kensington Park follows a string of recent collective sale attempts. It comes despite property cooling measures implemented in December that increased the additional buyer’s stamp duty (ABSD) for developers to 40% of the land price paid upfront, with 35% remittable if projects are completed on time.
Previously, the ABSD was paid in full up front, with the remaining 25% remittable if they completed and sold everything within five years.
Property analysts predict that developers will continue to prefer collective sales, depending on the location and yield of the site.
“The successful sale of Golden Mile Complex at $700 million gives the market confidence that developers continue to be interested in acquiring attractive sites despite the high price tag,” said Lee Sze Teck, senior director of research at Huttons Asia.
He noted that because Government Land Sales sites are overly concentrated in some areas, developers are turning to the collective sale market to acquire sites in areas with little to no new supply in order to capitalize on potential pent-up demand.
“Having said that, developers are picky. The successful collective sale sites in 2022, with the exception of Golden Mile Complex, are small and yield less than 100 units. “Consortium bids are likely for larger sites,” he added.
According to Nicholas Mak, ERA Singapore’s head of research and consultancy, developers will be wary of acquiring large sites like Kensington Park.
“The sweet spot is when the land parcel yields between 200 and 500 units,” he says, “because developers will be more confident in selling all units within five years to be eligible for ABSD remission.”
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