Ivory Heights, a 654-unit privatised HUDC estate in Jurong East, has failed to secure the requisite 80 per cent approval rate by yesterday’s deadline, making it the first mega site to fail to get the mandate to launch a public tender, analysts say.
They pointed to factors such as the July 6 cooling measures as well as the postponement of the Kuala Lumpur-Singapore High Speed Rail (HSR) project, which had been touted as a unique selling point.
Collective sale committee chair Vincent Ng cited resistance from some residents even after the initial reserve price of $1.34 billion had been raised twice to $1.68 billion. If successful, each owner would have received $2.5 million to $2.8 million, up from $2 million to $2.3 million.
“We were at 74 per cent for the last few months. More than 480 units had signed. We just needed another 40-plus units. But the people who refused to sign kept asking for more, and market conditions have changed,” said Mr Ng, 69.
“We have to leave it to the residents whether they want to restart. Our committee has done its part, and since we were unable to achieve 80 per cent, it will be dissolved,” he said.
Built on 825,502 sq ft of land and with 68 years left on its lease, Ivory Heights offers unblocked views of Jurong Lake, the Chinese Garden and the Japanese Garden. According to the URA Master Plan 2014, the site is zoned for residential use with a gross plot ratio of 1.6.
Analysts were not surprised at Ivory Heights’ steep asking price, given its large land area and location near the Jurong East and Chinese Garden MRT stations and the proposed HSR terminus.
“But it’s a case of ‘never the twain shall meet’ for now. You can’t ask for a high price when the unique selling point – the HSR project – is absent for the moment,” said Mr Alan Cheong, senior director of research and consultancy at Savills Singapore.
Last month, Singapore and Malaysia agreed to defer the HSR project for two years.
A bigger issue is higher land acquisition costs and potential penalties for developers following the latest cooling measures, Mr Cheong said.
Effective July 6, a developer has to pay a non-remissible additional buyer’s stamp duty of 5 per cent and a remissible 25 per cent if it does not complete and sell the entire project within five years of buying the site.
Ivory Heights’ failed attempt could be a harbinger of what is to come for other mega sites undergoing the collective sale process, analysts say. Next up is the 660-unit Pine Grove, whose deadline to get the 80 per cent mandate expires on Oct 28. To date, 78 per cent of owners have consented to a reserve price of $1.72 billion.
Huttons Asia’s head of investment sales Terence Lian, who is marketing Pine Grove, said: “The 2 per cent who are holding out should come to terms with current market conditions and not harp on getting a higher reserve price, so as not to end up like Ivory Heights, which lapsed prematurely.”
“Source:[Ivory Heights fails in bid to go en bloc] © Singapore Press Holdings Limited. Permission required for reproduction”
