ANALYSIS: Properties that have the most to gain after partial opening of TEL

By Elizabeth Choong

/ EdgeProp Singapore |

May 17, 2022 3:47 PM SGT

The Panorama

What is the Thomson-East Coast Line?

The Thomson-East Coast Line (TEL) will bring easier access to the MRT network for residents living in the east region and along the north-south corridor of Singapore.

Stage 1 stretching from Woodlands North to Woodlands South opened in 2020 and Stage 2 comprising of six stations from Springleaf to Caldecott opened last August.

Stage 3 (with the exception of Mount Pleasant and Marina South) will open later this year. Stage 4 (with the exception of Founders’ Memorial) is expected to open in 2024, and the remaining two stations in Stage 5 are expected to open in 2025. Mount Pleasant, Marina South and Founders’ Memorial MRT stations are expected to open in tandem with developments in that area.

Map 1: Thomson-East Coast Line (TEL)

Source: LTA

On the top of many home buyers’ wish list is a MRT station within walking distance, thus giving a boost to prices of nearby properties. Savvy investors should scour listings for opportunistic purchases near MRT stations on the TEL.

In this article, we will examine the properties near Stages 1 and 2 of TEL. Stay tuned for our analysis of Stages 3 to 5 next week.

Stage 1: Improving connectivity to Woodlands

Stage 1 of TEL opened on Jan 31, 2020. According to the Land Transport Authority (LTA), commuters will be able to travel from Woodlands South to Orchard in 35 minutes when TEL is fully operational, instead of the current 50 minutes by MRT and bus.

Banking on Woodlands regional hub

Woods Square is an office and retail development that is connected to the Woodlands MRT Station. The development will benefit from the opening of TEL as well as the government’s plans to transform Woodlands into a regional hub. Offices in Tower 1 of Woods Square are for sale, while Far East Organization retained the units in Tower 2 for lease.

Office units in Woods Square are fetching an average price of $1,883 psf and average monthly rent of $3.40 psf; giving an implied rental yield of 2.1%. There is no requirement to pay additional buyer’s stamp duty (ABSD) and seller’s stamp duty (SSD) when buying commercial properties – an incentive for investors to consider adding commercial properties to their portfolio.

Affordable resale HDB flats in Woodlands

Resale HDB flats in Woodlands may be the answer to the housing woes of buyers with a tight budget because prices of resale HDB flats in Woodlands are consistently among the lowest. Additionally, living in Woodlands allows residents to benefit from the improved and affordable connectivity via TEL. (Find HDB flats for rent or sale with our Singapore HDB directory)

According to the latest data from HDB, median price in Woodlands was $450,000 (up 4.7% q-o-q) for four-room flats and $530,000 (up 5.0% q-o-q) for five-room flats in 1Q2022. The price growth for flats in Woodlands is higher than the 2.4% q-o-q overall increase, reflecting price appreciation from the opening of the TEL stations. As prices are expected to grow further when the TEL opens fully in 2025, potential buyers may want to act quickly.

There are 888 HDB flats in Woodlands Glen that obtained MOP in January. In Admiralty Flora and Marsiling Greenview, 1,706 flats will achieve MOP later in May, while 78 flats in Kampung Admiralty will obtain MOP in July. Readers can use EdgeProp HDB MOP to find out more.

Stage 2: Interesting upcoming residential launches

Stage 2 of TEL connects the Thomson area to the MRT network when it opened on Aug 28, 2021 Interestingly, there are a number of recently awarded government land sale (GLS) sites near two TEL stations.

Exciting developments in Lentor

The Lentor Hills Road (Parcel A) GLS site near Lentor MRT Station was awarded in January to a joint venture between Hong Leong Holdings, GuccoLand and TID for $586.6 million ($1,060 psf ppr).The upcoming 600-unit condominium development has an estimated selling price of $2,098 psf.

GuccoLand won the tender for the nearby Lentor Central GLS site last July for $784.1 million ($1,204 psf ppr). Lentor Modern, comprising 600 residential units and a 96,000 sq ft commercial podium with F&B outlets, childcare facilities and a supermarket, is expected to be built on the site.

The residential units in the upcoming Lentor Modern are expected to be launched at higher prices than those on Lentor Hills Road (Parcel A), because of its higher land cost and direct link to Lentor MRT Station. Additionally, mixed developments are generally priced higher than pure residential projects.

Buyers who are unwilling to fork out more can consider the upcoming project at Lentor Hills Road (Parcel A) instead. As Lentor Modern is a short walk away, they will still be able to enjoy the amenities at the retail podium.

A second alternative will be the upcoming development on Lentor Hills Road (Parcel B) GLS site. The plot, which is located across the road from Parcel A, will be launched for tender later in May. The 116,251 sq ft site with a gross floor area of 244,128 sq ft can yield 265 residential units.

Parcel B is further from Lentor MRT Station. The less ideal location and intense competition from the two nearby sites may dampen interest from developers, resulting in a lower bid price. This could be good news for potential buyers, because the lower land cost could result in lower launch prices for the residential project.

Given their proximity to Lentor MRT Station and the lack of new launches in the immediate neighbourhood for the past three years, the upcoming developments are expected to see much interest from buyers.

Family-friendly Mayflower

A GLS site along Ang Mo Kio Avenue 1 was awarded last June for $381.1 million ($1,118 psf ppr). A joint venture between UOL Group, Singapore Land Group and Kheng Leong submitted the winning bid.

The site is walking distance of Mayflower MRT Station and is expected to have 372 residential units. Assuming a profit margin of 20%, the upcoming development has an estimated selling price of $2,187 psf.

The upcoming development is ideal for nature lovers because it is sandwiched between Bishan-Ang Mo Kio Park and Lower Peirce Reservoir. Kallang River is also nearby. Families with school-going children will also appreciate the six schools that are within a one-km radius.

Limited significant launches

The area does not have any launches of large-scale condominium projects since The Panorama along Ang Mo Kio Avenue 2. The 698-unit leasehold development received temporary occupation permit (TOP) in 2017 and has an average price of $1,611 psf.

The 339-unit leasehold Thomson Grand along Sin Ming Walk received TOP two years earlier and has an average price of $1,494 psf. Thomson Grand also has 22 landed units.

The only recent launch is a freehold boutique development that is still under construction; it has only 48 units that are all sold. Average price for Lattice One along Seraya Crescent is $1,853 psf.

Key takeaways

Stages 1 and 2 of TEL are up and running, thus allowing nearby residents to enjoy improved connectivity and some capital appreciation. However, the full impact of living near a TEL station is unlikely to be felt until the whole line is open in 2025, indicating potential for further price growth for nearby properties.

The area around Lentor MRT Station will be transformed with upcoming launches of two residential developments and a mixed development.

The Ang Mo Kio Avenue 1 GLS site, near Mayflower MRT Station, is expected to see much interest after years of limited new supply in that area.

Check out the latest listings near Thomson Grand, Woods Square, Lattice One, Lentor Modern, Lentor Central, Mayflower MRT Station, Woodlands MRT Station, Lentor MRT Station

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