SINGAPORE: En bloc fever has reached a new high with an attempt by the owners of Mandarin Gardens condominium to engineer what is set to become Singapore's largest collective sale.
According to documents seen by Channel NewsAsia, owners of the 99-year leasehold development in East Coast have set a S$2.48 billion price tag in a new attempt at a collective sale.
A marketing agent has been appointed to handle the process, and an Extraordinary General Meeting will be held within two weeks to approve the sale conditions.
Analysts Channel NewsAsia spoke to have expressed surprise over the reserve price, adding that the en bloc process will be closely watched as it could raise the ceiling for collective sales attempts in Singapore.
"This would represent probably the highest land price ever in Singapore in terms of absolute quantum,” said Mr Ku Swee Yong, chief executive of International Property Advisor.
“S$2.5 billion sounds large, but that's partly also because this piece of land is one million square feet. Multiplied by the plot ratio, you could in fact build about three million square feet of residences."
Based on the collective sale agreement seen by Channel NewsAsia, C and H Realty has been appointed as the marketing agent.
The agreement states that residential owners of the 1,006-unit condominium stand to pocket between S$1.58 million and S$5.07 million at the set reserve price.
The property is located at Siglap Road, alongside the upcoming Thomson-East Coast rail network. It is close to schools such as Victoria Junior College and Tao Nan School, and has a sea-facing view of East Coast Park.
Analysts say that Mandarin Gardens' S$2.5 billion price tag sits in uncharted territory, and could mean that the owners face an uphill task after a failed attempt 10 years ago.
With S$2.5 billion as the reserve price, analysts say developers still need to consider the upgrading premium, development charge, and Additional Buyers’ Stamp Duty as factors that pile on the costs.
This means that the total bill to acquire the lush estate in eastern Singapore, and to build a new one, they add, could eventually balloon to S$3 billion or S$4 billion.
The record for the largest en bloc sale by dollar value currently belongs to the former Farrer Court, which has since been redeveloped into D’Leedon. That 99-year leasehold property fetched about S$1.3 billion in 2007.
Last year, 37 en bloc tenders worth more than S$8.7 billion were awarded. This includes Amber Park, which holds the record for Singapore's largest freehold collective sale by dollar value at S$906.7 million.