[Update] House for childcare centre use in Serangoon on the market for $14.5 mil
By Timothy Tay
/ EdgeProp Singapore |
Update (March 12, 6pm): Kiddiwinkie Schoolhouse does not own the property for sale and the operator is not involved in the sales process. The operator also recently renewed its property lease and is expected to operate the centre for the foreseeable future.
SINGAPORE (EDGEPROP) - A freehold detached house that has obtained rare approval to operate as a childcare centre is on the market for $14.5 million. The two-storey house on Sommerville Walk sits on a 12,066 sq ft plot, and the guide price translates to $1,202 psf on the land area.
The property is in a quiet mixed landed housing estate in Serangoon. The two-storey house has seven rooms with five en suite bedrooms, as well as a spacious family area, a study room, a helper’s room, and a store room.
The house is close to the Nex shopping mall and Serangoon MRT Interchange Station. It has a backdoor that leads to a nearby bus stop along Upper Serangoon Road. Popular schools in the area include Maris Stella High School, St Gabriel’s Secondary School and Nanyang Junior College.
Capitalising interest
This is the second time the childcare centre-approved property is on the market; the owner offered to sell the property for about $13 million ($1,077 psf) in 2019.
Childcare-centre operator Kiddiwinkie Schoolhouse has leased the Sommerville Walk property since 2016. (Picture: Kiddiwinkie Schoolhouse)
Based on URA records, the site first received written permission for the change of use to a children’s day-care centre in 2001. The site owner has consistently renewed this land use approval for the past two decades.
According to Linda Chern, head of residential (prime sales & leasing) at Knight Frank Singapore and the marketing agent for the property, the owner used to operate a private childcare centre there until he closed the business in 2016. The owner then decided to lease the property to the current operator, Kiddiwinkie Schoolhouse, says Chern.
She adds that Kiddiwinkie Schoolhouse extended its property lease in November 2019.
Growing catchment of young families
According to Fazelah Ahmad, principal of Kiddiwinkie Schoolhouse @ Braddell, the Sommerville Walk centre caters children from 18 months to six years old. “Most young families that live within walking distance prefer to send their children to our centre, but we also get families who live in the nearby Woodleigh area who enrol their children here because it is still relatively close,” says Ahmad.
She expects the catchment of young families in the area to grow as more families settle into the newly completed flats in the neighbouring Bidadari estate.
According to HDB, more than 2,000 Build-To-Order flats in Bidadari comprising three HDB developments have been completed, and more than 70% of the households have settled in by the end of last month. Nine more HDB developments in the area will be progressively completed.
Ahmad also says that the spacious built-up area in the two-storey house enables her teachers to hold large- and small-group teaching activities.
The highlight of the Sommerville Walk childcare centre is a large outdoor space fronting the house. (Picture: Kiddiwinkie Schoolhouse)
The highlight of the Sommerville Walk centre is a large outdoor space fronting the two-storey house. “Most families prefer our centre because of this large outdoor area, and we encourage the teachers here to make use of the outdoor space for teaching activities,” she says.
Childcare centres — an alternative investment asset
According to Chern, buying interest in the property comes from its rare approval as a childcare centre, and an established centre tends to reap attractive rental returns. “The longer childcare centres stay in one location, the easier it is for the operator to scale up the business,” she says.
Based on her experience, it is not easy to find available land that is already zoned for childcare centre use. Typically, URA will regulate the number of childcare centre-approved properties within the same vicinity to ensure a more even distribution throughout residential areas.
She adds that childcare centre licensing regulations require the new owner to seek approval to retain the childcare centre licence for the property because the current licence is given only to the current owner.
Kiddiwinkie Schoolhouse’s Ahmad hopes the centre will stay and serve the neighbourhood for many more years. The principal adds that it is difficult in land-scarce Singapore to find the right site for a childcare centre. Some operators choose to move into commercial buildings, while others opt for shopping malls.
Redevelopment opportunity
Chern was the marketing agent for the Sommerville Walk property when it was first put up for sale in 2019. At that time, she received several offers from different childcare operators. “There was a buyer who approached us and was very keen to acquire the property. This buyer was already running a private childcare centre in the East Coast and was looking for a space to open a second branch in the Serangoon area,” she says.
But before the prospective buyer was ready to make an offer, the owner decided to renew the lease to Kiddiwinkie Schoolhouse, says Chern.
She says given the high level of buying interest the property attracted back in 2019, the owner has revised the guide price to $14.5 million to reflect the value of the asset.
“So far, there has been a mix of potential buyers who have expressed interest in acquiring the site. About half want to continue operating the property as a childcare centre and earn the steady rental income that comes with this type of asset. But there have been a few potential buyers who would like to redevelop the site into a new landed home for their own use,” says Chern.
Check out the latest listings near Sommerville Walk, Serangoon, Serangoon MRT Interchange Station, Maris Stella High School, St Gabriel’s Secondary School and Nanyang Junior College
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