03-12-12: Unit at newly completed Sage hits $4,289 psf

| BY JO-ANN HUANG | THEEDGE SINGAPORE | DECEMBER 3, 2012
 
Sage, a newly completed luxury boutique condominium by Hong Leong Holdings, saw a unit sold for a record $4,289 psf in October

In the prestigious Nassim Road neighbourhood, the latest record breaking transaction was seen at the newly completed 33-unit luxury condominium Sage, developed by Hong Leong Holdings. As at end-October, nine out of the 10 units released for sale have been sold. The most recent recorded transaction was for a 2,852 sq ft, four-bedroom unit on the second level of  one of the five-storey blocks that was sold for $12.24 million ($4,289 psf), according to a caveat lodged with URA Realis in mid-November.

This is the highest price achieved to date since the project was launched in mid-2010. It is also the first transaction in the development to cross the $4,000 psf threshold. For much of the last two years, units sold had ranged from $2,584 to 3,225 psf.

Some property agents attribute the $4,289 psf price achieved at Sage to a recent deal for a penthouse at Nassim Park Residences, located right next door. The 6,878 sq ft unit had changed hands in a sub-sale for a whopping $27.52 million ($4,001 psf), according to a caveat lodged with URA Realis in mid-September. Since that transaction, other penthouse owners in Nassim Park Residences and luxury condo units along Nassim Road have revised their asking price upward of $4,000 psf, according to property agents.

The 100-unit Nassim Park Residences, developed by a consortium comprising UOL Group, Kheng Leong and Orix Capital, is fully sold to date. It was completed last year.

Meanwhile, sentiment in the secondary market has been more subdued, with only the Core Central Region (CCR), comprising the traditional prime districts 9, 10 and 11, as well as the CBD, Marina Bay and Sentosa Cove, seeing a 10% q-o-q increase in resale volume in 3Q2012. The mid-tier segment, or Rest of Central Region (RCR), saw a 32% q-o- q fall in 3Q2012, while in the mass market, or Outside Central Region (OCR), transactions dropped 23%, according to DTZ in a Nov 19 residential report.

Buyers in the luxury segment still appear to be price-sensitive, with the most activity seen for condos priced around $5 million or below, says David Neubronner, director of Singapore residential project sales at Jones Lang LaSalle (JLL). “Most of the secondary transactions in prime districts 9 and 10 tend to be in the $2,200 to $2,600 psf range,” he adds. “There are comparatively fewer transactions above the $3,000 psf threshold.”
Nassim Jade
For instance, along Nassim Road is Nassim Jade, a 39-unit high-end condo developed by Hotel Properties Ltd (HPL) and completed in 1997. A 2,110 sq ft, second-floor unit at the development changed hands in a resale for $5.2 million ($2,465 psf) last month, according to a caveat lodged with URA Realis. Two months earlier, a 2,325 sq ft unit on the same floor was sold for the same price — $5.2 million, or $2,237 psf.

Paterson Edge
Recent transactions in some of the older condos in the prime Paterson Road-Grange Road neighbourhood have also been carried out at prices below $2,000 psf. At the 13- year-old freehold Paterson Edge, for example, a 1,012 sq ft, eighthfloor unit changed hands recently for $1.9 million ($1,878 psf). This same unit was last transacted in October 2008, just after the collapse of Lehman Brothers, for $2.2 million ($2,174 psf), which means the seller sold for 13.6% lower than his purchase price four years ago. “It’s very rare for freehold high-end units in this area to trade below $2,000 psf,” says Neubronner. “It could be an internal transfer or a related-party transaction.”
Spring Grove
Meanwhile, at Spring Grove on Grange Road, a 1,389 sq ft unit on the eighth floor was sold for $2.2 million ($1,600 psf), according to a caveat lodged on Nov 15. Spring Grove is a 99-year leasehold property developed by City Developments 16 years ago. There are 325 units in three 20-storey towers sitting on a 240,000 sq ft plot. According to PropNex Realty’s Pearl Wong, Spring Grove is “undervalued”, considering its price and location. “Units there are transacting at $1,600 to $1,800 psf, which is lower compared with other condos in the Orchard area, which are going for $2,200 psf or higher,” she adds.

The Spring Grove site used to be the residence of the US ambassador, according to Wong. The land, which still belongs to the US government, was sold to CDL on a 99-year lease. It is one of the few 99-year leasehold projects in the Grange Road neighbourhood. “If it were freehold, it would be a prime candidate for a collective sale,” says Wong.