SINGAPORE: As the collective sales market picks up, more former Housing and Urban Development Company (HUDC) estates are jumping on the bandwagon to go en bloc.
A check conducted on Monday (Oct 3) showed that all remaining ex-HUDC flats are already at some point of the process.
Out of the 18 former HUDCs, 11 have been sold, with four of these deals – Rio Casa, Serangoon Ville, Eunosville, and Tampines Court – done this year alone, the most in any year.
Among the other seven, Florence Regency is re-looking its bids, while Ivory Heights, Pine Grove and Laguna Park have appointed marketing agents.
Chancery Court is looking for a marketing agent while Braddell View and Lakeview are looking to form a collective sales committee this month.
These developments were built in the 1970s and 80s to offer middle-income families public housing with condominium-like spaces. In 1995, the government began to privatise these estates.
Lakeview, a former HUDC estate that was privatised in 2003, is looking to form a collective sales committee soon. The 240-unit development is located along Upper Thomson Road. (Photo: Rachel Phua)
Some residents Channel NewsAsia spoke to had mixed feelings about their prospects.
Retiree Tay Yak Soon, who has lived in Braddell View since it was first built in 1981, said that although he likes living there because of the spacious layout and location, he believes it is time for Braddell View to go en bloc.
“Our estate is getting so old already … so a lot things got to be done … lift repairs and all that will cost us a bomb,” Mr Tay said.
However homemaker Want Sheng Nan, said in Mandarin that she is “on the fence” about moving out of Ivory Heights.
An original owner of the ex-HUDC at Jurong, she said: “The house is pretty old … but the location is very convenient – there are many shopping malls, stores. I’m very used to living here. And there’s a lot of interaction among neighbours here.”
BRADDELL VIEW’S PLOT RATIO
It could, however, take some time before one of these ex-HUDCs goes on the market.
Currently, Braddell View’s plot ratio is 2.1, but its management committee chairman Alex Teo said that the estate is hoping to have it increased to either 2.8, or 3.2 before it goes en bloc.
Mr Teo said he reached out to the estate’s MP, Senior Minister of State for Health Chee Hong Tat, over this matter in August. Mr Chee then linked him up with the Urban Redevelopment Authority (URA), he said.
Mr Teo added that the URA told him that for the matter to be considered, Braddell View will have to build an extra exit road for vehicles first. The 918-unit condominium currently only has one exit leading to Braddell Road.
Discussions with the authorities are still ongoing, Mr Teo said, but he is “positive” the authorities will build another exit route for the development.
“We understand that the Raffles Girls’ School (located next to the estate) will be completed in 2019, (so) most likely we will have the extra connection leading us from our estate to Toa Payoh Rise.”
When contacted, Mr Chee said that Braddell View is “discussing the matter with the authorities”.
Mr Teo thinks that with the current plot ratio, Braddell View can be sold for more than S$2 billion en bloc, but if the plot ratio was raised to at least 2.8, the estate could pocket nearly S$3 billion.
He added that based on the feedback from residents, they are in “no hurry” to cash out, although they are still planning to form the collective sales committee first.
LOCATION MATTERS
One developer that snapped up two of the former HUDC developments sold this year is Oxley Holdings.
Mr Ching Chiat Kwong, the CEO of Oxley Holdings, said that the reason they bought Rio Casa and Serangoon Ville is due to location.
“We believe Rio Casa and Serangoon Vile will be good for us to develop because they are in a mature estate, with all the amenities,” Mr Ching said.
He added that they are planning to launch new developments at both sites in the second half of 2018 and each site will house “more than 1,000 units”.
OLDER ESTATES, LARGE FLOOR AREAS
Besides their location in mature estates, another reason former HUDCs may make for more attractive buys could be their age, analysts said.
Mr Wong Xian Yang, OrangeTee’s head of research and consultancy, said that ex-HUDCs tend to be older than most private homes, so owners may be more willing to sell at a lower price.
Despite the large floor areas these estates have, Mr Wong said some developers are still willing to take the risk.
“The hype started after the successful sale of Shunfu Ville in 2016. (Then) we saw Tampines Court, which can potentially yield over 2,000 units. This suggests developers … are willing to take the risks to acquire large pieces of land.”
Mr Lee Nai Jia, senior director of research at Edmund Tie & Company, added that these estates were designed with a lot of open spaces and large unit sizes, so developers will have more room to maximise the land and build many more units than what the original development had.
And even though 11 residential sites – with a total sales value of more than S$3.6 billion – have already been sold en bloc this year, Mr Lee foresees that the collective sales market will remain hot for at least another nine months, given the uptick in the primary sales market.
However, both analysts reckon that with many more projects currently in various stages of the en bloc process, developers may become more selective of the sites they bid for.
