Florence Regency sold en bloc for $629 million

This article is more than 12 months old

Chinese developer agrees to match independent valuation of ex-HUDC estate

Florence Regency has finally closed a collective sale deal under private treaty after Chinese developer Logan Property (Singapore) agreed to match the independent valuation of $629 million for the property in Hougang Avenue 2.

Each owner will receive gross proceeds of between $1.84 million and $1.89 million.

Owners of the 336-unit former Housing and Urban Development Company (HUDC) estate had earlier received a bid from Chinese developer Kingsford that exceeded the reserve price of $600 million and two that did not, according to Mr Jagir Singh Touwana, chairman of the collective sale committee.

None of the offers met the $629 million valuation by independent valuer Colliers International. The tender closed on Sept 27, with the three bidders refusing to match the valuation.

The collective sale agreement required that the sale price be no lower than the valuation. This prompted sole marketing agent JLL to woo other developers in an attempt to close the deal under private treaty within 10 weeks of the close of the tender.

"We are relieved it is finally over. Given the circumstances and today's market, it is a good price and a fair amount," said Mr Touwana.

The 389,236 sq ft site is zoned residential with a gross plot ratio of 2.8 and could yield around 1,000 units. The land price works out to $842 per sq ft (psf) per plot ratio (ppr) after factoring in the estimated differential premiums of $288.6 million to top up the lease to a fresh 99 years and develop the site to the gross plot ratio of 2.8.

It is the second site that has been snapped up by Hong Kong-listed Logan Property, which made history in May when, together with Chinese developer Nanshan Group, it put in the top bid of $1.003 billion for a 21,109 sq m site in Stirling Road.

That was the first time a purely residential site in the Government Land Sales programme crossed the billion-dollar mark.

"Florence Regency is one of the last few privatised HUDC estates in the north-east region. The future development will enjoy unblocked views, located next to landed housing estates and across the Hougang Stadium and the sports and swimming complex," said JLL's regional director Tan Hong Boon.

ZACD Group executive director Nicholas Mak said the land rate is fairly reasonable, adding: "It is a bit cheaper, compared with Serangoon Ville, which was sold at the land rate of $861 psf ppr, and the Government Land Sales site in Serangoon North Avenue 1 sold at $965 psf ppr in July."

Florence Regency's sale brings the total number of former HUDC estates that have been sold en bloc since 2005 to 12, according to consultants.

Ivory Heights is on the market, while Braddell View, Pine Grove, Laguna Park and Chancery Court have started the process.