Developer Controlled by UOL Chairman Said Buying Singapore Luxury Site for $52M

A private developer owned by the Wee family which controls Singapore’s UOL Group has reportedly added a new luxury site to its pipeline with the purchase of a pair of bungalows in the city’s upscale District 11.

A unit of Kheng Leong Co, a builder owned by UOL Group and UOB Bank chairman Wee Cho Yaw is paying around S$70 million ($52.1 million) for the 43,457 square foot (4,037 square metre) freehold site on Gilstead Road, according to an account in the Business Times.

The purchase of the luxury plot from the Teo family, which founded local food processing firm SuperGroup, is Kheng Leong’s third major residential project acquisition within the last year, and comes despite cooling measures put in place during December which have dampened enthusiasm for more mainstream housing.

“The property, which is held by a family, presents an exceptional opportunity for immediate redevelopment, without having to deal with the uncertain timeline for a collective sale,” Edmund Tie executive director of investment advisory services Swee Shou Fern had said last year when his firm began marketing the plot, while pointing to the value of the location as likely to drive demand among developers.

Luxury at a Discount

With the site at 32-34 Gilstead Road assigned a maximum plot ratio of 1.4, Kheng Leong will be eligible to build up to 60,840 square feet of new housing on the property located 15 minutes walk from Newton MRT station to the south and the same distance from Novena station to the north.

If developed into low-rise condominiums such as its four-storey neighbour The Gilstead building, or the nearby Newton Mansions building, the site would yield up to 56 new homes, according to Edmund Tie, which was sole marketing agent for the property.

At the reported price, Kheng Leong would be paying S$1,643 per square foot of floor space in the project, with the stated compensation representing a 24 percent discount to the asking price of S$91.8 million when the luxury site was put on the market last year.

Representatives of both Kheng Leong and Edmund Tie declined to comment on the reported transaction when contacted by Mingtiandi.

Stocking Up Sites

Kheng Leong, which is currently building the 56-unit Meyer House project in Singapore’s lower East Coast area with that development expected to be completed in 2024, has been actively adding new assets in the past year.

The company, which also built the 100-unit Nassim Park Residences in District 10 in 2011, paid S$213 million in September to acquire the freehold 21 Anderson apartment block in District 10 from Hong Kong’s Far East Consortium. The developer’s purchase of that 34-unit project came just four months after Kheng Leong had teamed up with Wee’s SGX-listed UOL Group to purchase the rights to a 31,699 square metre (341,205 square foot) project along Ang Mo Kio Avenue 1 near the Mayflower MRT station at a government land sale for S$381.4 million

In October, Kheng Leong stayed on the sidelines as UOL Group and its SingLand subsidiary won a 220,241 square foot residential project in Bukit Timah via an en bloc sale for S$550.8 million.

Paying for Posh Projects

While Kheng Leong was picking up its Gilstead Road site, another site on the same street was sold to an entity owned by Melvin Poh, founder of local developer Fission Group, for S$17 million, according to the same media report.

Poh is said to be planning to develop a pair of stand-alone bungalows on the 10,504 square foot plot, which is currently occupied by a single home.

The high-end sales indicate the resilience of Singapore’s top flight homes in the face of the latest government cooling measures, according to Ying Khuan Pow, head of research at property firm 99.co.

“Despite higher ABSD, we think that these price points are still attractive to buyers given that these condos are located within prestigious districts that are in close proximity to the central business district with amenities such as good schools as well as various retail and dining choices,” Pow said. “When compared to other global cities, these luxury condos in Singapore are still relatively more affordable and that could help mitigate the higher ABSD for property buyers.

Pow pointed out that sales of new and second-hand low-rise condos nearly doubled last year to 1,245 units with median prices hovering around S$2.2 million to S$2.3 million.