Singapore Project Sells for Over Asking Price as Developer Appetites Recover

A residential complex up for collective sale in Singapore’s Katong area has sold for above the vendors’ asking price, demonstrating continued developer demand for sites even after a first-quarter slowdown in home price growth.

The local arm of Chinese developer Nanshan Group entered the winning bid of S$49.3 million ($36.2 million) for the freehold building at 173-183 Haig Road, exceeding the tender’s reserve price of S$48 million, according to property consultancy Colliers, which marketed the project.

“We are pleased to have delivered an extremely positive outcome for the owners,” said John Bin, director of capital markets and investment services for Singapore at Colliers. “This site has achieved a lot of buzz as it is a unique enclave that is conveniently located. We had shown the site to numerous prospective bidders.”

The purchase of the four-storey complex in Singapore’s posh lower east coast area was announced less than one month after Vicenta Lodge — a freehold development on Lorong Marzuki in the southeastern part of the city — was sold via a private treaty, with owners of other major condo complexes, including High Point in District 9, also putting their properties back on the market in recent weeks.

Builder’s Third Project

With the 27,389 square foot (2,545 square metre) site approved for development of up 38,345 square feet, Nanshan is paying S$1,286 ($943) per square foot for the right to redevelop the current 24-unit property, subject to Strata Titles Board approval of the transaction.

The residential-zoned site occupies a corner plot with dual frontage on Haig Road and Seraya Lane close to the Katong Shopping Centre, I12 Katong mall and the Paya Lebar commercial hub.

Nanshan’s existing developments in Singapore include the Thomson Impressions apartment complex in the Bishan area and Stirling Residences, a joint venture with fellow Chinese developer Logan Group near Queenstown MRT station.

The Haig Road property is a five-minute walk from a CDL project at the intersection of Tanjong Katong Road and Jalan Tembusu in Katong where Hongkong Land revealed one month ago that it had acquired a 49 percent stake in the residential project through its Singapore unit, MCL Land.

CDL has already sold close to 90 percent of its Amber Park project in Katong, with the residential neighbourhood close to East Coast Park continuing to attract upscale buyers.

Unbowed by Slowdown

Nanshan’s show of confidence in the Katong site comes after Singapore’s home price growth slowed in the first quarter of the year following the government’s introduction of cooling measures in December.

An index of private residential property prices published by the Urban Redevelopment Authority inched up 0.4 percent to 174.3 points in the first quarter from 173.6 points in the preceding three months — slackening from the 5 percent spike seen in the fourth quarter of 2021.

URA estimates showed that prices for residential properties in prime areas, including locations in the core central region such as Raffles Place and Tanjong Pagar, fell 0.5 percent in the first quarter after having climbed by 2.7 percent during the preceding three months.

The rest of the central region fell more steeply — dropping by 3 percent during the same period — after having risen by 6.7 percent from October through December.

“The private residential market got off to a slow start in 2022 after what was an exhilarating performance last year,” said Ismail Gafoor, chief executive of PropNex Realty. “The cooling measures have certainly helped to tame price growth in Q1 2022 to a more sustainable pace.”