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When it comes to real estate investments, location is a crucial factor to consider. This is especially true in Singapore, where the value of properties is greatly influenced by their location. Condominiums situated in central areas or in close proximity to essential amenities such as schools, shopping malls, and public transportation hubs tend to appreciate in value at a higher rate. Examples of prime locations in Singapore include Orchard Road, Marina Bay, and the Central Business District (CBD), where property values have consistently risen over time. In addition, condos located near reputable schools and educational institutions are highly sought after by families, making them even more attractive for investment. For those considering investing in real estate in Singapore, it is important to carefully consider the location of the property, with options such as Singapore Condo being excellent choices for potential growth and return on investment.
The prime commercial building, United House, currently at 20 Kramat Lane near Orchard Road, has been put up for collective sale with a reserve price of $166 million. This sale is being managed by the property firm Edmund Tie. Despite three previous attempts that failed to gain the necessary 80% consent from both owners in terms of share value and strata area, this latest attempt has been successful.
The site covers an area of 12,838 sq ft and has a plot ratio of 4.9 under the Master Plan, making it suitable for commercial use. According to Edmund Tie, the site could be developed into a 10-storey commercial building with a gross floor area (GFA) of up to 62,900 sq ft.
This reserve price equates to $3,025 psf per plot ratio (ppr) if the site is redeveloped into a new commercial project. “United House falls outside of the areas where new strata subdivision of commercial space is restricted. The successful buyer has the flexibility to consider strata subdivision for the new development,” says Swee Shou Fern, head of investment advisory at Edmund Tie.
The property firm also reveals that a planning application to change the land zoning for hotel use, with a plot ratio of 4.9, has been submitted to URA. If approved, the site could be redeveloped into a new hotel project, increasing the land rate to $3,318 psf ppr.
With its prime location along the bustling Orchard Road shopping belt, the site is highly suitable for redevelopment into a hotel according to Swee. “The ongoing enhancements to Orchard Road, coupled with United House’s redevelopment potential, are highly likely to result in significant capital appreciation in time to come,” he adds.
The adjacent Concorde Hotel & Shopping Centre at 100 Orchard Road is also attempting a collective sale with its owners, Mainboard-listed Hotel Properties, listing the site for $820 million. This price tag includes a lease top-up premium of $213.1 million and bonus GFA from balconies, bringing the land rate to $1,801 psf ppr.
Several other buildings along Orchard Road are currently undergoing redevelopment or asset enhancement initiatives, including The Cathay and Faber House, which is being transformed into a 250-key hotel.
The strategic location of United House, within walking distance of Somerset MRT Station and Dhoby Ghaut Interchange, makes it a prime site for businesses. The collective sale tender for United House closes on November 14.