Dairy Farm eyes collective sale at more than $1.68b

Another residential development that could smash the collective sale record currently held by Farrer Court is The Dairy Farm, if it obtains the requisite approval from owners and is successfully sold.

Owners of the freehold development comprising 477 residential units and 10 retail shops are holding an extraordinary general meeting today to approve the terms of the collective sale agreement and method of apportionment on sale proceeds.

Their asking price for the 750,019 sq ft site is said to be in excess of $1.68 billion. If successful, it will surpass the $1.34 billion record held by Farrer Court, which was acquired by a CapitaLand-led consortium in 2007 and redeveloped into the 1,715-unit D'Leedon.

Other developments hoping to pull off Singapore's largest collective sale in quantum dollar terms include Pine Grove, where owners are asking for at least $1.65 billion, Braddell View ($2.08 billion) and Mandarin Gardens($2.48 billion).

The Dairy Farm's last collective sale bid was in 2007. Its collective sale committee (CSC) hopes to hit the 80 per cent threshold approval from owners within six weeks, said CSC chairman Tay Tiong Choon.

Mr Sieow Teak Hwa, managing director of appointed marketing agent Teakhwa Real Estate, said he believes owners will be more receptive this time round.

"They will be getting at least double their current resale value if the en bloc sale is successful," he said. "Many owners also felt the property has since aged another 10 years and repair and maintenance costs... will inevitably go up."

Zoned residential with a plot ratio of 2.1, the site has a potential gross floor area of about 1.58 million sq ft. This would translate into some 1,500 apartments, based on an average size of about 1,000 sq ft per unit. The new Hillview MRT station is a three-minute walk away.

The development charge (DC) for intensification of land use is estimated to be $61 million. Inclusive of the DC, the land rate for the site is estimated to be at least $1,100 psf.

Mr Alan Cheong of Savills Singapore, who estimates a break-even price of $1,550 psf based on the estimated land rate, noted that the more prolonged process of a collective sale means that developers have to consider whether the market can digest the 1,500 units two years down the road.

Adapted from: The Straits Times, 7 Apr 2018