Developers play a game of one-upmanship

/ The Edge Property |

May 13, 2016 10:00 AM SGT

Much like competitors in a beauty pageant, city-fringe projects being launched around the same time are vying for attention. All eyes are now on Gem Residences as it unveils its showflats and releases its unit prices on the weekend of May 20.

The project previewed on Labour Day weekend (April 30 to May 2) with the opening of just the sales gallery. At least 1,036 people are said to have registered interest in the 578-unit development located on Toa Payoh Lorong 5 and Lorong 6. The developer is ramping up interest ahead of its VIP and public launch on May 27 and 28. “We are trying to hit the magic number of 2,000 because there’s always a certain level of attrition at the actual sales,” says Vincent Ong, managing partner of Evia Real Estate.

More than 1,000 people are said to have registered their interest in Gem Residences. Source: Gem Residences.

Gem Residences is a joint project by Malaysian developer Gamuda Land with a 50% stake and its two Singapore-based partners, Evia Real Estate (20% stake) and Maxdin (30%), a subsidiary of construction company Greatearth Holdings.

Gem Residences marks Gamuda Land’s maiden foray into the Singapore property market. The property arm of Malaysia-listed engineering construction and investment firm Gamuda Bhd, Gamuda Land developed projects in Kuala Lumpur before venturing into Iskandar Malaysia eight years ago. Gamuda and its joint venture partner UEM Sunrise developed Horizon Hills, a 1,200- acre freehold township development with an 18-hole championship golf course. The project has been very popular with Singaporeans and expatriates over the years.

Singapore is Gamuda’s latest overseas venture; it entered Vietnam a decade ago and purchased a development site in Melbourne last year, says Chow Chee Wah, Gamuda Land’s managing director. “We feel it’s a good time to enter Singapore now, and we were exploring several government land sites with Evia last year. We thought the Toa Payoh site was ideal, as there hasn’t been a new private condo launch there in a long time.”

At the close of the tender, there were 14 bids with Gamuda and its joint venture partners submitting the top bid of $345.86 million ($755 psf per plot ratio) for the 130,832 sq ft site.

Artist’s impression of the 578-unit Gem Residences with 37- and 38-storey towers

First launch of private condo since 2009 The last private condo to be launched in Toa Payoh was the 590-unit Trevista by Choice Homes in 2009. The 99- year leasehold condo project in Toa Payoh Lorong 3 was fully sold and completed in 2011.

Prior to that, there were only two other private condos launched in the area, which is predominantly an HDB estate. One was the 384-unit freehold Trellis Towers in Toa Payoh Lorong 1, which was launched in late 1996 by CDL and completed in 2000. The other was the 99-year leasehold Oleander Towers, also located on Lorong 1, which was developed by Wing Tai Holdings. Launched in late 1995, the project was completed in 1998.

Resale prices in Toa Payoh have also been resilient. Units at the 99-year leasehold Oleander Towers, which is almost 20 years old, changed hands at $988 to $1,043 psf in 1Q2016. In recent months, units at Trellis Towers have been sold at $1,266 and $1,342 psf. Meanwhile, Trevista’s resale prices of mid-floor units ranged from $1,210 to $1,315 psf from February to April, according to caveats lodged with URA Realis.

“Gem Residences will be the fourth private condo in Toa Payoh in 50 years,” says Evia’s Ong. “So, we feel there’s a certain level of pent-up demand.” Among the more than 1,000 people who have expressed interest in the project, 35% live in Toa Payoh and 30% within a 5km radius, including Ang Mo Kio, Bishan and Balestier. The most-sought-after units are the two- and three-bedroom apartments, which garnered 30% and 25% interest respectively.

Triple-key units a novelty Close to 60% of the units at Gem Residences are one- and two-bedroom units measuring 452 to 775 sq ft. Another 30% are three-bedroom units of 936 to 1,055 sq ft; and there are 37 each of four- and five-bedroom units measuring 1,249 sq ft and 1,313 sq ft respectively. There are only two penthouses: a 1,636 sq ft, four-bedroom unit; and a 2,045 sq ft, six-bedroom unit.

Of the 172 three-bedroom units, 37 have been designed as “trio” or “triple-key” units of 936 sq ft each, which is a novelty in the market. The trio unit will have a main entrance and foyer that opens up to three separate suites. Each suite will be a standalone apartment with its own living room and kitchenette, bedroom and en suite bathroom as well as a balcony. The foyer can be a common area for the occupants’ shoe racks, umbrella stand and washing machine and dryer, says Evia’s Ong.

Each suite will also have its own sub-meter to allow the landlord to monitor the tenants’ utility usage and bill accordingly. “However, it’s still one property title for one triokey unit,” explains Ong.

Interest in these 37 trio units have been so overwhelming that they will have to be sold by balloting at launch, reckons Ong. While there is strong investor interest in Gem Residences, Ong says he also detects a “nostalgia factor” among the buyers because Toa Payoh, being the first HDB town in Singapore, is the most established in terms of amenities. “Many of these young families want to move back to Toa Payoh because it’s where they grew up, and their parents are still living there,” he says.

Chow: We thought the Toa Payoh site was ideal, as there hasn’t been a new private condo launch in a long time

Ong: We want to differentiate ourselves by focusing on providing services to make things more convenient for our residents

Providing communal services The project is adjacent to the Seu Teck Sean Tong Temple and within walking distance of the Braddell MRT station.

“Every project has a 50m swimming pool and tennis court,” says Ong. “So, we want to differentiate ourselves by being buyer-centric and focusing on providing services to make things more convenient for our residents.”

As part of the government’s efforts to make Singapore “car-light”, the developer of Gem Residences has also tied up with Smove to provide residents with a car-sharing system. There will also be a bicycle rack for 100 bicycles and 30 communal bicycles for residents’ use, as well as a taxi bay for cab and Uber or Grab drivers.

As more than half the units are one- and two-bedroom apartments, Ong foresees that most of the residents will be singles and young couples.

The developer will provide dedicated uniformed housekeeping staff for the convenience of residents, who can book the services and pay an hourly rate.

Showflat of a one-bedroom unit at Gem Residences. The fully fitted unit comes with Smeg appliances such as oven, refrigerator and washer-dryer.

Source: Gem Residences

Ong reckons that residents of the four- and five-bedroom units are likely to be multi-generational families, as Toa Payoh is an ageing estate with an ageing population. Units are designed to be wheelchair-friendly and, for the convenience of the elderly or disabled, the developer will provide a mobile medical clinic with a doctor and nurse on duty on weekends. Concierge staff will be on hand to help residents hail a cab and with other needs. Parcel lockers will be provided for registered mail deliveries and the convenience of those who shop online, adds Ong.

When Gem Residences is completed in 2020, the developer will present each owner with a compendium of all the available services, including food and grocery delivery, engaging a private chef for parties, and cleaning services.

The project comes with a 6,000 sq ft clubhouse with a gym, barbecue and grill areas and fully equipped function rooms for private parties. Beyond the full condominium facilities, there are also dedicated pet amenities for dogs — with a pet run, pet pool and pet shower. Ong estimates that 7% of the residents at Gem Residences are likely to have pets.

Competitive pricing Gem Residences has a guide price averaging $1,480 psf. The actual prices of units will be released on May 20, a week before sales begin. “We want to give potential buyers enough time to consider their purchase without duress,” says Ong. “They will have time to consult their bankers and discuss with their family members before committing to their purchases.”

The developer is offering an early bird discount in the form of a cheque to buyers. The discount is $7,500 for unit purchases below $800,000; and $10,000 for purchases above $800,000.

“In the current market, property agents continue to collect cheques [as an expression of interest],” says Ong. Cheque collection prior to a launch works in a market in which demand outstrips supply, he says. In the current market, where there are more units pursuing buyers, however, it may not be necessary, he adds.

The preview of Gem Residences coincided with the public launch of Sturdee Residences, a 99-year leasehold condo located off Jalan Besar. The VIP preview for Sturdee Residences was held on April 23 and 24, and 122 of a total of 305 units were sold. Another 10 units were snapped up at the launch weekend. Thus, the project is 43% sold at an average of $1,550 psf.

Boutique developer Techkon held the soft launch of Viio @ Balestier at end-April. Over the past three weeks, 40% of 56 freehold residential units sitting on top of a three-storey retail podium have been sold at an average price of $1,450 psf.

Glitterati at Stars of Kovan May 7 marked the VIP preview of Cheung Kong Property Holdings’ Stars of Kovan. The Li Ka-shing-controlled property group unveiled its $10 million sales gallery and showflats last weekend, drawing 4,000 visitors. The 99-year leasehold project is located at the junction of Tampines Road and Upper Serangoon Road and within the Kovan residential estate, which comprises mostly houses and private condos.

A mixed-use scheme, Stars of Kovan contains 390 private condo units in four 17-storey blocks sitting on top of a retail podium. Adjoining it is a row of five strata terraced houses. “One of the main attractions is that the project is mixed-use,” says Joseph Tan, executive director of residential services at CBRE. “The other attraction is its proximity to the Kovan MRT station just across the road.”

A total of 4,000 people visited the Stars of Kovan showflat at the VIP preview on May 7 and 8

The “British-style” retail podium of Stars of Kovan will have 46 commercial units with a mix of retail and F&B space. “It is set to raise the bar on quality mixed developments in Singapore,” says Tan. The closest shopping centre is the ageing 32-year-old Heartland Mall adjacent to the Kovan MRT station.

Condo units at Stars of Kovan are a mix of one- to three-bedroom apartments measuring 506 to 1,023 sq ft, with absolute prices said to range from $800,000 to $1.5 million. The two-bedroom units measuring 732 to 807 sq ft were the most popular among Singaporean investors, according to Cheung Kong Property. The indicative price range is said to be $1,550 to $1,600 psf.

The project is scheduled to be launched on May 21, with CBRE and Huttons Asia as joint marketing agents.

The race is on for the two projects — Stars of Kovan and Gem Residences — that are set to be launched over the next fortnight. “Developers will therefore have to sharpen their edge in terms of product differentiation,” says a veteran property consultant who declined to be named.

This article appeared in the City & Country, Issue 728 (May 16, 2016) of The Edge Singapore.

Tags: