<Alert!> Euro Asia Apartments enbloc to drive record prices in District 12
- Euro Asia Apartments located close to Boon Keng MRT in District 12, sold for S$222.18m, above reserve price
- Winning bid translates to a land rate of S$1,313 psf (after 7% balcony); new launch estimated to range between S$2,300 psf – S$2,400 psf
- Land prices remain firm; property prices likely to remain sticky given recent strong responses at new launches
What has happened.
Euro Asia Apartments, located at 1037 Serangoon Road has been sold for c.S$222.18m, 1.9% above the reserve price. The freehold project is located within District 12 and is along the main arterial road, Serangoon Road. The site is also within 400 metres to Boon Keng MRT and in the vicinity of 3 primary schools (Hong Wen School, St Andrew’s Junior School and Bendemeer Primary School) – all located within 1 km of the project.
The winning bid was placed by a joint venture KSH Ultra Unity Pte. Ltd (“KSHUU”) involving KSH Holdings, H10 Holdings Pte Ltd and SLB Development Ltd. The site of 56,476 sqft of land area can be built to a maximum GFA of c.158,132 sqft. The developer intends to redevelop the site into a new residential development with c.172 residential units.
Land prices remain firmly on an uptrend, will new launch at Boon Keng hit S$2,400 psf? The winning bid translates to a land rate of c.S$1,405 psf (or S$1,313 psf after 7% balcony bonus), which are at transaction levels for resale condominium in the vicinity. Given the lack of major new condominium launches within the vicinity, this proposed new development could potentially serve demand from upgraders and investors looking for a home that is closer to the Central Business District (“CBD”). Based on estimates, we estimate that the breakeven for the project to range between S$2,050 psf to S$2,100 psf. This imply that the developer will likely target at least S$2,300 psf – S$2,400 psf launch price in the future.
En-bloc sites to complement GLS for “land-banking” opportunities. Given substantially sold inventories and an overall unsold units of c.17,500 (2Q22), the residential market remains in a “tight situation” given absorption rate of <2.0 years. As such, despite macro uncertainties and the hike in mortgage rates, we have seen developers continue to be actively land-banking with the en-bloc space an avenue to add selectively given the limited available sites in the government land sales (“GLS”).
Location of Euro Asia Apartments