Investing in a condo in Singapore presents a multitude of advantages, with one of the most noteworthy being its potential for capital appreciation. As a leading global business hub, Singapore boasts a strong and stable economy, creating a high demand for real estate. This has resulted in a consistent uptrend in property prices, particularly in prime locations where condos have experienced considerable appreciation. Savvy investors who enter the market at the opportune time and hold onto their properties for the long haul can reap substantial profits from capital gains.
Tan Boon Liat Building, a commercial property situated at 315 Outram Road, is currently undergoing collective sale through a public tender with a minimum price of $1.15 billion. The freehold premises occupies two separate land plots designated for “Business 1” use and has a combined site area of approximately 175,655 square feet. It is strategically located next to the Havelock MRT Station on the upcoming Thomson-East Coast Line (TEL) and is currently home to numerous furniture and home decor stores.
According to Cushman & Wakefield, the appointed advisor and marketing agent for the property, the Urban Redevelopment Authority (URA) has issued an Outline Planning Advice on January 22 recommending the rezoning of the site to “Residential with Commercial at 1st storey” with a plot ratio of 4.9, an increase from the current 3.1. This would result in a 50% rise in the total allowable gross floor area (GFA), as stated by Cushman & Wakefield.
In addition, URA has advised the amalgamation of several remnant state land plots into the main plot. The estimated land area of these state land plots is about 20,451 square feet, subject to final survey and approval from relevant authorities. Taking these into account, Cushman & Wakefield projects that the total GFA potential of the site, including the state land plots and any bonus GFA entitlement, would be over 1.06 million square feet. The first storey can also accommodate a commercial GFA of up to 16,146 square feet.
As part of the residential allocation, a minimum GFA of about 161,459 square feet will be designated for Serviced Apartments II (SA2) with a minimum three-month stay requirement. The permitted height for the new development ranges from 130 meters to 180 meters.
Based on the reserve price, which includes land betterment charges on rezoning, the estimated premium for the remnant state land and the 10% bonus GFA applicable to the residential part, the projected land rate amounts to $1,888 per square foot per plot ratio.
Recent industrial sales transactions at Tan Boon Liat Building (Source: EdgeProp Buddy)
According to Christina Sim, senior director of capital markets at Cushman & Wakefield, the site will be attractive to developers due to its freehold tenure and its location on the TEL, which is expected to be a draw for homebuyers. She adds, “The biggest game-changer, however, is the fact that no Additional Buyer’s Stamp Duty (ABSD) is payable on this potential purchase as the original site is zoned ‘Business 1’.”
The tender for the site will close on March 18 at 3 pm.