SINGAPORE (Oct 5): CIMB says the new condo at the Amber Park site could add 5 cents to City Developments’ RNAV if the estimated selling price hits $2,200 psf.
CDL and Hong Realty, the private real estate arm of the Hong Leong Group, on Wednesday announced it had won the Amber Park en bloc tender which attracted eight submissions.
See: City Developments and JV partner acquire Amber Park for record-smashing $906.7 million
The acquisition price of $906.7 million works out to be $1,515 psf ppr. CDL will take 80% of the project while Hong Realty will take the remaining 20%. At this price level, this will be the largest freehold collective sale by dollar value in Singapore to date.
CDL and Hong Realty plan to redevelop the land parcel into a luxurious development comprising 800 condo units with basement carparks. Amber Park sits on a 213,675 sf land area with a potential GFA of 598,290 sf.
Based on the land price, CIMB estimates breakeven cost to be $2,000-2,100psf. This compares with transacted prices of developments within the vicinity of $1,600-2,200psf over the past few months.
Located along the Amber Rd enclave in the East Coast area, the site is close to the beach, notable schools and shopping amenities as well as being highly accessible to the upcoming Tanjong Katong MRT station and highways.
“We maintain our Add rating with a target price of $12.54, premised on a 20% discount to FY17 forecast RNAV of $15.67,” says analyst Lock Mun Yee in a Thursday report.
The latest tender also reaffirm CIMB’s optimism over the recovery of the private residential market.
“Declining completions over the next 2-3 years should be supportive of the nascent price recovery,” says Lock.
Shares in CDL are down 2 cents at $11.40.
