ST: Farrer Court sold for record $1.3b - 29 Jun 07

[Daniel Leong]

June 29, 2007
Farrer Court sold for record $1.3b
Owners of 618 units will get $2.15m each; buyer CapitaLand plans 36-
storey condo By Joyce Teo, Property Correspondent

PROPERTY giant CapitaLand is paying $1.3388 billion for the sprawling
Farrer Court estate - the biggest lump sum ever shelled out for a
residential site in Singapore.

Owners at the 618-unit estate will get about $2.15 million each,
depending on the size of their flats, which range from 1,453 sq ft to
1,615 sq ft.

The bumper price for the former HUDC estate beat the reserve price of
$1.2 billion but fell short of the owners' asking price of $1.5
billion.

It also signals how high and how fast prices have risen this year.
Farrer Court owners had revised their reserve price from $700 million
to $840 million at the start of the year, only to push it up to $1.2
billion in March.

Credo Real Estate, which brokered the deal, said the sale is also the
largest one in terms of land area, number of units and buildable
gross floor area.

Farrer Court, which is 30 years into a 99-year lease, sits on 838,488
sq ft of land near the junction of Farrer Road and Holland Road. It
is also close to the upcoming Farrer MRT Station.

It is the only site on Farrer Road with the potential to be built up
to 36 storeys.

CapitaLand said it plans to build a 'luxurious' 36-storey condominium
with about 1,500 'generously-sized' flats on the site, which will be
ready for launch in early 2009.

Existing Farrer Court owners will have the first right of refusal to
buy units at the new development, it said.

CapitaLand president and chief executive Liew Mun Leong said the deal
would further boost its residential land bank, allowing it to benefit
from Singapore's 'growth story'.

The site also gives the developer the chance to work with world-
renowned architects to create a unique landmark project, he added.

The Farrer Court tender closed on Wednesday and attracted two bids,
both above the reserve price.

Credo Real Estate declined to comment on the second bid, but sources
said it came from GuocoLand, which had paid a then-record $835
million for the freehold Leedon Heights site in Holland Road in
April.

CapitaLand's price for Farrer Court works out to about $762 to $783
per sq ft (psf) of potential gross floor area.

This psf price includes about $450 million to $500 million to
maximise the use of the land and to top up the lease to a fresh 99-
year tenure.

The deal is subject to the approval of the Strata Titles Board and
should be completed by the second quarter of next year.

CapitaLand intends to share its risks with partners but will be the
lead development manager for the project.

It said yesterday that Hotel Properties (HPL), US-based Wachovia
Development Corp and possibly a foreign fund will join it in the
venture.

CapitaLand is likely to hold 35 to 40 per cent of the joint venture
while HPL expects to take a 20 to 30 per cent interest.

HPL took a stake in an earlier CapitaLand purchase of another former
HUDC estate, Gillman Heights, in Alexandra Road, which cost $548
million, or $363 psf of potential gross floor area.

The sale of Farrer Court leaves the 290-unit Pacific Mansions in
River Valley Close as the only estate up for sale at more than $1
billion.

Owners of Pacific Mansions are asking for $1.18 billion or about
$2,400 psf of potential gross floor area.