SINGAPORE (EDGEPROP) - Sitting between Haig Road and Tanjong Katong Road is a quiet street, Thiam Siew Avenue, with just 25 houses. Many of the houses are pre-war, single-storey, semi-detached houses and bungalows sitting on land area of about 9,000 to 10,000 sq ft each.

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They are the legacy of property magnate and hotelier Wee Thiam Siew, who passed away in 1972. The properties are held primarily under Thiam Siew Avenue Investments and Wee Thiam Siew & Co, whose beneficiaries are the members of his family, many of whom are from the third generation. An illustrious businessman, Wee was chairman of Ban Leong & Co, dealers in cigars, cigarette and tobacco; as well as the former owner of The New 7th Storey Hotel on Rochor Road, Lion City Hotel and Hollywood Theatre at Tanjong Katong Road.

When it was built in 1953, the New 7th Storey Hotel (which actually had nine storeys) was considered the tallest structure on Rochor Road. In 2008, the hotel was acquired by the government for the construction of the Bugis MRT Interchange Station for the Downtown Line that opened in December 2013.

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Hollywood Theatre on Tanjong Katong Road was built in 1957 and opened by cinema magnate, the late Loke Wan Tho, in 1958. In its heydays in the 1960s and 1970s, Hong Kong stars such as Fung Bo Bo and Siao Fong Fong made their appearances there. The cinema closed sometime in the 1990s, and became home to City Harvest Church at one point, followed by a food centre and then Sheng Siong supermarket.

Lion City Hotel, situated adjacent to Hollywood Theatre, opened in 1968. It had been owned and operated by members of the Wee family until December 2010, when they decided to put both Lion City Hotel and the adjacent Hollywood Theatre up for sale by tender. At the close of the tender in January 2011, Singapore- listed UOL Group announced that it had purchased Lion City Hotel and Hollywood Theatre for $311 million.

UOL redeveloped the site into a mixed-use development: the four-storey Kinex mall with a net lettable area of 202,191 sq ft; and the 244-unit Katong Regency above spanning three blocks of nine to 10 storeys. Launched in April 2012, all the units in the freehold condominium were sold out within a week at an average price of $1,608 psf. The project was completed in 2015, and units have changed hands in the resale market at $1,797 psf, according to caveats on URA Realis.

Wee’s former residence at 525 Dunman Road was located just behind the houses at Thiam Siew Avenue. It sat on a sizeable land plot too. The government had acquired from the family a corner parcel fronting Haig Road, which was in turn offered for sale under the government land sales (GLS) programme. Far East Organization purchased the site with a 99-year lease from 1997. It was subsequently developed into Dunman View, an 18-storey, 148-unit, high-rise condo completed in 2004.

One of the Wee family-owned vehicles, Wee Thiam Siew & Co, developed the remaining plot at Dunman Road into a terraced housing project named Dunman Grove. The houses were completed in 1990, and a road was created for them.

A decade ago, some of the owners of the terraced houses at Dunman Grove banded together and sold their properties collectively to developer Hoi Hup Realty. The site was redeveloped into the 122-unit, 18-storey Questa @ Dunman. The freehold high-rise condo was completed in 2013, and has a mix of suites, one- and two-bedroom apartments with sizes ranging from 431 to 1,467 sq ft. (Discover insightful data of any Singapore condominium with our condo directory)

Biggest divestment of a property

The Wee family is ready to divest the land parcels along Thiam Siew Avenue, and has ap- pointed Galven Tan, deputy managing director of investment sales and capital markets at Savills Singapore, as the exclusive marketing agent. The land that the houses at Thiam Siew Avenue were built on had originally been part of Wee’s private estate at 525 Dunman Road.

However, he decided to build the houses there for rental income during the pre-war years. He had originally named the road Thiam Siew Road in 1939, but renamed it Thiam Siew Avenue in 1940.

The houses at Thiam Siew Avenue fell under the Rent Control Act in the post-war years. When the Rent Control Act was abolished in 2001, the family continued to hold the properties for lease. “Many of the tenants are long-stand- ing ones,” says Savills’ Tan.

After close to 80 years, the Wee family is planning to sell all 22 land-plots with 25 houses along Thiam Siew Avenue.

The semi-detached houses with odd house numbers at No. 1 to 17 were built during the pre-war years sometime in the early 1940s. The two adjacent bungalows along the same row at No. 19 and 21 were also built during the pre-war years. However, the four semi-detached houses at 23 to 29 were built more recently, in 2007. Collectively, these houses make up Plot 1, and sit on a freehold land area of 135,361 sq ft.

On the opposite side of Thiam Siew Avenue are the even-numbered houses at No. 2 to 22. The houses at No. 2 to 16 are pre-war-era semi-detached houses, while the three bungalows at 18 to 22 also date back to the pre-war era. These houses sit on a combined freehold land area of 128,436 sq ft and make up Plot 2.

Redevelopment potential

Developers have an option to purchase either Plot 1 or Plot 2, or both plots combined, says Savills’ Tan. The developer can then purchase Thiam Siew Avenue and close off the road as it serves mainly the houses there. The two plots can then be amalgamated, and the combined site area (excluding the road) is about 263,797 sq ft, Tan estimates. If the road were included, the total plot size would be around 300,000 sq ft. However, closing the road is subject to approval from the authorities.

Based on the plot ratio of 2.8 for a residential development site under the URA Master Plan 2019, Tan estimates that the total gross floor area (GFA) of a new development at Thiam Siew Avenue could potentially be 738,632 sq ft.

Thiam Siew Avenue is considered part of the prime East Coast area and falls under District 15. As it is within the Rest of Central Region or city fringe, the average size of residential units in the new development has to be at least 85 sq m (915 sq ft) under the URA guidelines. Tan estimates that a developer could build about 414 condominium units on Plot 1 and about 393 units on Plot 2.

If the two parcels were amalgamated, and the road closed off, a developer would be able to build a new, 800-unit condominium development with a wide range of amenities, says Tan.

All the pre-war era houses except those at No. 12, 19 and 22 are owned by Thiam Siew Avenue Investments. The plot that was developed into the four semi-detached houses at No. 23 to 29 in 2007, is owned by Wee Thiam Siew & Co. Both entities, however, are controlled by the Wee family. Even the three houses at No. 12, 19 and 22 that are held in individual names belong to members of the Wee family, and will be included in the sale.

The land parcels will be launched for sale on Sept 24, with the tender closing on Nov 18. No price indication is provided for the Thiam Siew Avenue plots. However, it is likely to be pegged to freehold sites sold elsewhere in prime District 15.

For instance, City Developments Ltd (CDL) and joint-venture partner, Hong Realty, purchased Amber Park en bloc for $906.7 million ($1,515 psf per plot ratio, or psf ppr) in October 2017. Meanwhile, GuocoLand paid $319.8 million for Casa Meyfort on Meyer Road in July 2018. Including development charge estimated at $57.8 million, the price that GuocoLand paid for the site was $1,580 psf ppr. (See potential condos with en bloc calculator)

Competition from Jalan Tembusu GLS site?

On the Confirmed List of the GLS programme is a site at the junction of Jalan Tembusu and Tanjong Katong Road. It is located quite near Thiam Siew Avenue. The 99-year leasehold, 210,624 sq ft site at Jalan Tembusu has a GFA of 589,754 sq ft. Based on the average unit size of 915 sq ft, the site can be developed into a new 645-unit project. The site is located about 600m from the upcoming Tanjong Katong MRT Station on the Thomson-East Coast Line.

“While [the Jalan Tembusu GLS site] is attractively located, a bigger commitment and risk appetite would be required by the developer as there could be more than 600 units to be developed and sold within five years,” says Nicholas Mak, head of research at ERA Realty.

Alan Cheong, executive director and head of research at Savills Singapore, expects land bids of about $1,400 psf ppr for the Jalan Tembusu site. Given the absolute quantum above $820 million, he thinks there may be four to five bidders for the site.

Given that the Thiam Siew Avenue plots are freehold, market watchers expect the sellers to be pricing in a premium, and are estimating the price tag for the two sites to be in the range of $1,450 to $1,500 psf ppr. This is before factoring in the development charge which was hiked recently.

‘Single family seller’

Thiam Siew Avenue is located near Paya Lebar Central commercial hub. It is where integrated development Paya Lebar Quarter (PLQ), Paya Lebar Square and the Paya Lebar MRT Interchange Station for the Circle and East-West Lines are situated. It is also near shopping malls such as PLQ Mall and Kinex. Good schools located within 1km of Thiam Siew Avenue include Kong Hwa School and Tanjong Katong Primary School, says Savills’ Tan.

Residential sales in the East have been relatively healthy despite the number of new projects in the area. About 80% of the 582-unit Amber Park has been sold since its launch in May 2019. GuocoLand’s 200-unit Meyer Mansion is almost 40% sold since its launch in 4Q2019. Median price at Meyer Mansion may be $2,581 psf, but at least eight units saw prices cross $3,000 psf and were sold at prices ranging from $3,009 to $3,182 psf.

The 429-unit Park Place Residences at PLQ saw half its units taken up at an average of $1,800 psf in April 2017, and another 161 units taken up at an average of $2,015 psf in April 2018. The project was fully sold by 2019. The latest transaction in August was for a 17th-floor, two-bedroom unit of 667 sq ft, which changed hands for $1.495 million and scaled a new high of $2,240 psf for the project.

Such selling prices bode well for the land parcels at Thiam Siew Avenue, notes Savills’ Tan. “A developer can look at either Plot 1 or Plot 2, or the two sites combined if they want to develop a significant project with many amenities,” he adds.

The main attraction of the two plots at Thiam Siew Avenue is that they are owned by a single family, which ensures deal certainty for the developer, says Tan. “They do not have to go through the strata title board.” A freehold plot of such a size is also increasingly rare, he adds.

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