BT : The Estoril put up for collective sale at $208m

Business Times - 16 Oct 2007

The Estoril put up for collective sale at $208m No DC payable; price works out to about $1,536 psf per plot ratio
By ARTHUR SIM

The Estoril: CBRE estimates that a developer can build about 75 unitsassuming an average size of 1,800 sq ft each.

THE Estoril on Holland Road has been put up for collective sale, and the indicative price is $208 million.

This works out to about $1,536 per square foot per plot ratio (psf ppr) for the 84,600 square feet site.

Marketed by CB Richard Ellis (CBRE), its executive director of investment,Jeremy Lake, said that no development charge (DC) is payable due to the high development baseline.

He also said that developers would not incur DC to build the additional 10per cent gross floor area allowable for the provision of balconies.

Currently, there are 40 three-bedroom units and four penthouses on the site.

Based on the indicative price, the three-bedroom units will receive $4.32million each and the penthouses, $8.69 million or $8.78 million.CBRE estimates that the developer can build about 75 units assuming an average size of 1,800 sq ft each. The estimated breakeven is around $2,000-$2,050 psf.

In July, Tulip Garden, also in the Holland Road area, was sold for $516 million or about $1,018 psf ppr.

A recent CBRE report did note that a 'cautious mood' is being felt in theprivate land sales market due to the global credit tightening, the higherprice tags as well as the two rounds of revision to DC rates. Only 24 sitesworth a total of $1.96 billion were sold in the third quarter of 2007compared with 51 sites (worth $6.92 billion) in the previous quarter.

Separately, Colliers International noted that for the first time in at leastthe last two years, the residential sector did not take the top spot ininvestment sales in the third quarter.

In its report, Colliers noted that total sales of residential investmentproperties dived to $2.9 billion or 21.4 per cent of total sales.'This reflects a significant 68.3 per cent drop from last quarter's record$9 billion which accounted for 82.7 per cent of total investment sales in Q2'07,' it reported. 'The trend, where developers continued to land bank atrecord high prices in the previous quarters, was evidently not repeated inthis quarter.'

Attention was shifted to bulk purchases of strata residential units,including those at Costa Del Sol, Reflections at Keppel Bay and M21.

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