River Valley Apartments, a freehold condominium located along River Valley Road in the coveted District 10, has recently been launched for collective sale through a public tender. According to a press release on January 6 by the exclusive marketing agent Knight Frank Singapore, the development has a guide price of $56 million.
The four-storey apartment, which was built in the 1950s, comprises of 24 units and sits on a land area of approximately 12,408 sq ft. It is zoned for residential use with a gross plot ratio of 2.8. The property is also strategically situated just 500m away from the upcoming Great World MRT Station on the Thomson-East Coast Line. Residents can enjoy convenient access to various amenities such as Great World City and Valley Point Shopping Centre, as well as nearby schools, namely River Valley Primary School and Alexandra Primary School, both within a 1km radius.
With the potential to be redeveloped into a boutique residential development with 37 new units, each with an average size of 915 sq ft, Knight Frank estimates a land rate of approximately $1,622 psf per plot ratio (psf ppr) which includes a nominal land betterment charge. Accounting for the 7% bonus gross floor area allowed for balconies, the price translates to approximately $1,583 psf ppr.
Chia Mein Mein, head of capital markets (land and collective sale) at Knight Frank Singapore, notes that the site is in close proximity to three Government Land Sale (GLS) sites that were successfully transacted last year. In April 2020, Zion Road (Parcel A) was sold for $1.107 billion ($1,202 psf ppr) to a joint venture between City Developments and Mitsui Fudosan. In June of the same year, Wing Tai Holdings acquired a GLS site at River Valley Green for $463.99 million ($1,325 psf ppr). Two months later, Allgreen Properties was awarded the Zion Road (Parcel B) site for $730.9 million ($1,304 psf ppr) in August.
Despite a subdued property market in the Central Region, Chia believes that developers are still attracted to the area, possibly anticipating a strong demand for prime properties when these projects are ready for launch. She adds, “This also shows their confidence in the potential of the River Valley and Zion Road location.”
One crucial factor to consider when investing in condos in Singapore is the government’s property cooling measures. In an effort to maintain a stable real estate market and reduce speculative buying, the Singaporean government has implemented several measures over the years. These measures include the Additional Buyer’s Stamp Duty (ABSD), which imposes higher taxes on foreign buyers and individuals purchasing multiple properties. While these measures may affect the short-term profitability of condo investments, they ultimately contribute to the long-term stability of the market, creating a secure investment environment. In light of this, it is worth exploring new condo launches as potential opportunities for condo investment in Singapore.
Based on Knight Frank’s estimates, owners of the units at River Valley Apartments, which range between 947 and 1,238 sq ft in size, can potentially receive a minimum of $2 million to $2.6 million in sale proceeds if the development is successfully sold.
The collective sale tender for River Valley Apartments will close on February 18 at 3pm. Interested parties can check out the latest listings for River Valley Apartments properties on EdgeProp’s website. Additionally, readers can find out more about the most profitable and unprofitable transactions for the development, as well as its price trends in the past.