Spring Grove along Grange Road has seen prices climbing since March last year and fast approaching the peak of $1,792 psf achieved in January 2008, when a 1,388 sq ft unit on the fourth floor was sold for $2.49 million. Last month, prices hit a high of $1,700 psf when a 2,701 sq ft unit on the 19th floor was sold for $4.6 million.
The 14-year-old, 325-unit condominium comprises three blocks of two- to four-bedroom units and penthouses measuring 1,011 to 2,701 sq ft. Credo Real Estate deputy managing director Tan Hong Boon says Spring Grove has always been popular with locals and expatriates, as well as investors and owner-occupiers, given its prime location. It is a five-minute drive from Orchard Road and close to good schools like Raffles Girls’ School and Overseas Family School. The condo also has a wide range of facilities, including a black-and-white bungalow said to be the residence of the former US ambassador, which is now a clubhouse with gym and function rooms that faces the swimming pool. The asking rent for a two-bedroom unit ranges from $4,500 to $5,700 a month, according to agents.
Apart from the general market recovery, prices at Spring Grove could be moving higher, owing to new launches nearby. Overseas Union Enterprise says it will launch Twin Peaks, a 99-year leasehold project at the former The Grangeford site, next month, and selling prices are expected at $2,700 to $3,200 psf. OUE purchased the site in 2007 but, in 2008, redevelopment of the site was deferred.
Meanwhile, Cliveden at Grange, a freehold development by City Developments Ltd (CDL), is expected to receive temporary occupation permit this year. The 110-unit, 24-storey project offers three- and four-bedroom units and penthouses. When it was launched in 2007, prices ranged from $3,265 to $4,313 psf.
For the period of April 27 to May 4, there were three transactions at Spring Grove priced at $1,419 to $1,478 psf, according to caveats lodged with URA Realis.
In one block, a 1,388 sq ft, three bedroom unit on the eighth floor was sold for $1.97 million, or $1,419 psf. It was a 25% gain for the seller, who purchased the unit for $1.57 million ($1,131 psf) in 2007. Meanwhile, the 2007 sale was an 8.3% gain for the previous owner, who had bought the unit for $1.45 million ($1,044 psf) in 1999.
In another block, a three-bedroom unit on the 13th floor was sold for $1.98 million ($1,426 psf). This represented an 11.2% loss for the seller, who purchased it for $2.23 million ($1,606 psf) in September 2007. The previous owner had made a 35% gain on a quick flip after buying the property for $1.65 million ($1,188 psf) in February 2007. In the same block, a two-bedroom unit on the 12th floor was sold for $1.495 million ($1,478 psf) on May 3.
It is evident that Spring Grove’s prime location is supporting prices above the $1,400 psf level. However, Credo’s Tan says it is unlikely that Spring Grove will be sold en bloc, as the reversionary interest or land owner is the US government, which leased the site to CDL for 99 years. This means that any developer interested in making an en-bloc purchase will have to request that the land owner increase the lease of the site to its full 99 years.
Meanwhile, CDL, which made an en-bloc purchase of Lucky Tower, a 92-unit freehold condo next to Spring Grove, in 2006, has yet to launch the new project on the site, after redevelopment was deferred because of the global financial crisis in 2008. Market expectation is that, given its prime location, prices of the new development are likely to be in the $3,000 psf range.
Source: The Edge, 25 May 2010