SINGAPORE: Dave Loo of SQFT Global Properties has brought in Christie’s International Real Estate to the city-state. Will it change the way high-end property is marketed here?
On Nov 22, US$82 million ($106.7 million) worth of Japanese and Southeast Asian art was sold at Christie’s art auction in Hong Kong.
Although it amounted to less than 10% of the record-smashing US$852.9 million worth of contemporary American art sold by Christie’s at its auction in New York on Nov 12, it is still the second-highest gross sales for Christie’s in Hong Kong to date.
The most expensive painting was Potted Peonies by Chinese-French artist Sanyu, which went under the hammer for HK$49 million ($8.2 million) and is equivalent to the price of an 88ft yacht.
The buyer was said to be a Taiwanese couple.
In the world of the ultra-rich, expensive art and real estate go hand in hand.
That explains the establishment of Christie’s Great Estates in 1995, which morphed into Christie’s International Real Estate three years ago.
Christie’s is wholly owned by French billionaire François Pinault, who purchased it under his holding company, Artemis SA, for US$1.2 billion in 1998.
Pinault’s son, François-Henri Pinault, is CEO of Kering (formerly PPR), which owns high-end designer houses Gucci, Stella McCartney, Alexander McQueen and Saint Laurent.
Pinault Senior himself epitomises Christie’s clientele: He is said to have amassed a personal collection of over 2,000 works of art, from Pablo Picasso and Piet Mondrian to Jeff Koons, as well as luxury real estate around the world, including a mansion in Los Angeles, a 19th-century townhouse in Paris and palatial homes in St Tropez and London, according to Forbes.
Wishing to tap Christie’s database of billionaires and centa-millionaires with a penchant for art and real estate is Dave Loo.
The Singaporean spent more than a year trying to secure the franchise before he was appointed an affiliate of Singapore-Christie’s International Real Estate in September 2013.
The agreement is for 12 years, and Loo hopes to grow the brand in the city-state.
He has plans to expand to some of the other cities in Southeast Asia as well.
It is the first time that Christie’s International Real Estate has a presence in Singapore.
No stranger to the realty business, Loo founded SQFT Global Properties in 2010.
Prior to that, he was deputy managing director of OrangeTee.
Even though Loo now holds the Christie’s International Real Estate franchise in Singapore, he will continue to operate SQFT, which specialises in marketing overseas properties.
The offices of SQFT and Singapore-Christie’s are now located in Palais Renaissance on Orchard Road, having moved from Golden Agri Plaza on Pasir Panjang Road a month ago.
However, the positioning of Singapore- Christie’s will be vastly different from that of SQFT, emphasises Loo.
SQFT will continue to focus on marketing overseas properties, comprising residential projects from Canada, the UK, Australia, Malaysia, Thailand, the Philippines and Vietnam.
Top-end market
Singapore-Christie’s on the other hand will focus on marketing projects at the very top end of the market, which will include selected luxury developments in Singapore that will appeal to the well-heeled.
Loo also intends to bring in exclusive overseas projects that will attract the rich in Singapore.
Loo was in Hong Kong last week for Christie’s art auction.
He was also there to attend a private cocktail reception on Nov 21, on the eve of the auction.
At the cocktail reception, a historic London project by China- based Reignwood Group was unveiled.
The chairman of Reignwood Group is Chanchai Ruayrungruang, also known as Yan Bin, a billionaire investor and property developer who ranks among the richest in China.
Showcased at the reception was Reignwood Group’s Ten Trinity Square, a Grade II heritage- listed building in London that was built in 1920 and was the former Port of London Authority Building.
Reignwood Group had purchased Ten Trinity Square in 2010, and invested between £450 million and £500 million to give it a new lease of life.
In September this year, the company purchased Wentworth Golf Club for £135 million ($277 million) from UK billionaire and restaurateur Richard Caring.
Ten Trinity Square now contains a 100-room Four Seasons luxury hotel, 41 private residences (known as Ten Trinity Square, The Residences at Four Seasons) and a members-only private club.
Refurbishments have been completed, and the exclusive apartments are now available for sale at £3,500 psf onwards.
The private preview was organised to coincide with the auction, says Loo.
He had flown to Hong Kong together with three of his highnet- worth clients from Guangzhou, Macau and Malaysia for the event.
Other affiliates of Christie’s International Real Estate from the US and UK had also flown to Hong Kong with their clients for the event.
“We saw numerous interested parties at the event,” says Loo.
While there are detractors who think now is not the time to bring the Christie’s brand to Singapore, given the slump in the luxury property market, Loo begs to differ.
“I see it as something positive,” he says.
“There’s an even greater need now to expand one’s network when it comes to selling luxury property.” According to Loo, the luxury real-estate clientele is an international one, and Christie’s has a good referral structure, which allows him to tap its database.
For him, “that was a key consideration”.
Christie’s arch rival, Sotheby’s, also has a Sotheby’s International Realty franchise network under Realogy, a New York Stock Exchange- listed real-estate franchiser and provider of real-estate brokerage.
A group of high-net-worth investors had purchased the master franchise for Singapore Sotheby’s International Realty and opened an office in Palais Renaissance in 2007.
However, it never quite took off, and the office has since been closed.
Loo sees opportunities in marketing the citystate’s luxury projects to overseas buyers.
For such buyers, it won’t be a weekend launch, he says, but a “one-on-one approach”.
In recent months, he has brought overseas buyers from Hong Kong and Macau to Singapore.
“They want to divest out of their domestic market,” he explains.
“The reason is partly due to the political situation in Hong Kong, and they feel that Singapore is politically more stable.” The buyers were said to have purchased condominium units at the 381-unit freehold Leedon Residence by GuocoLand, which is scheduled to be completed next year.
The deals involved units in the $5 million-to-$7 million price range.
There were also expressions of interest in units at GuocoLand’s other luxury condo development, the 73-unit Goodwood Residence, which was completed just last year.
“These people are buying with the possibility of moving to Singapore, and therefore buying for their own use,” Loo says.
Sentosa Cove ‘a buying opportunity’
Loo also has a client from the UK who is interested in purchasing a bungalow in Sentosa Cove, as he is considering moving with his family to Singapore.
So far this year, there have been only three bungalow deals at Sentosa Cove, and they were transacted at progressively lower psf prices, based on caveats lodged with URA Realis.
A bungalow sitting on a 99-year leasehold plot of 7,341 sq ft on Paradise Island was sold for $14.5 million ($1,976 psf) in September.
This was followed by the sale of a bungalow on Ocean Drive for $13 million ($1,716 psf) on Oct 1.
The most recent transaction was for a bungalow sitting on a 99-year leasehold, 8,654 sq ft plot that fetched $12 million ($1,386 psf) on Oct 31.
The previous caveat lodged for the property on Coral Island was $15.8 million ($1,825 psf) in August 2010, which means the owner sold at 24% below his purchase price.
The Coral Island deal at $1,386 psf is the lowest psf price achieved since July 2009, and has caused dismay among bungalow owners in Sentosa Cove with their own property on the market for sale.
“It looks like some owners have lost patience and no longer want to hold on to their properties,” says Steve Tay, associate director of Newsman Realty, who has focused on marketing bungalows in Sentosa Cove for the last three years.
However, Loo remains optimistic.
“Sentosa Cove presents a good buying opportunity now,” he says.
Ultra-high-net-worth buyers are not too sensitive to restrictions such as the TDSR, or total debt servicing ratio, although they may not be willing to pay the additional buyer’s stamp duty (ABSD).
“But of course, they want a good-value opportunity,” he concedes.
‘Proactive’
With demand at the top end of the residential market in the doldrums, Loo believes this is the time to be proactive.
He intends to organise property showcases to coincide with Christie’s auctions in London, New York and Hong Kong.
Besides art, Christie’s also holds auctions of fine and rare wines as well as vineyards.
Loo believes he can provide “value-add opportunities” in terms of luxury real estate that will appeal to Christie’s buyer profile.
“We have done private events with Christie’s auction house overseas, but not in Singapore as yet,” he says.
“We are hoping to tap Christie’s auction database and organise an event in Singa pore similar to the one held in Hong Kong.” For sure, there is no shortage of supply of luxury property in Singapore.
It’s a matter of finding the right buyer.
According to Loo, he has identified “a few” upscale developments in Singapore that he reckons would attract buyers with deep pockets.
“During good times, developers can launch a new project and wait for people to come,” he says.
“Not anymore.” When it comes to marketing overseas, the typical weekend road show at hotels does not work for high-net-worth individuals.
“You have to arrange a very exclusive event for them,” says Loo.
“I think developers will be interested in tapping our database of clientele.”
This article appeared in the City & Country of Issue 654 (Dec 1) of The Edge Singapore.