Auric Pacific CEO granted option to buy Belmont Road bungalow for S$55.5 million

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A FREEHOLD bungalow in the Belmont Park Good Class Bungalow (GCB) Area is in the early stage of being sold for S$55.5 million or about S$2,055 per square foot (psf) on its land area of 27,000 sq ft.

On the rectangular plot is a 2-storey house with a swimming pool. The property is said to have been developed in the early 2000s by David Chew, who used to control The Stratech Group. With Stratech subsequently going into liquidation, the house – owned by Chew and his wife, Leong Sook Ching – was sold via a mortgagee sale by Deutsche Bank in October 2019 for S$34.5 million or S$1,278 psf to Woo Tsung Chwen, a member of the Tay family behind the OG Department Stores group.

This week, Woo is understood to have granted an option to purchase to Andy Adhiwana, chief executive officer of Auric Pacific Group, at S$55.5 million. If the deal is completed, Woo stands to make a gain of about 60 per cent or S$21 million (selling price less his purchase price, without factoring in stamp duties, legal fees and other expenses). Woo is understood to have spruced up the property. Market watchers note that the house is in a liveable condition, but Dr Adhiwana may, nonetheless, redevelop the property in the medium term. He is son-in-law of Stephen Riady, executive chairman of mainboard-listed property, healthcare and consumer group OUE.

In 2017, Riady (Auric Pacific’s controlling shareholder) and Dr Adhiwana launched a voluntary offer for Auric Pacific, privatising and delisting it.

Some observers describe the S$2,055 psf on land area as a fair price.

Said William Wong, founder of Realstar Premier, which was not involved with the sale: “Generally in this location, GCB land cost is between S$2,000 psf and S$2,500 psf of site area. This plot has relatively narrow road frontage. The main challenge, if one were to build a new home on the site, is that the land cascades downwards. The existing house on site, however, is habitable. For a plot size of 27,000 sq ft, it is being sold at close to the lower end of the range of land cost, at S$2,055 psf.”

While most GCB buyers may not fancy a site with a narrow road frontage and sloping terrain, a buyer who values privacy may find this an ideal choice, and a good architect could come up with an appealing design, added Wong.

Bungalows in the 39 gazetted GCB Areas are the most prestigious form of landed housing in Singapore, with strict planning conditions stipulated by the Urban Redevelopment Authority (URA) to preserve their exclusivity and low-rise character.

The URA has stipulated a minimum plot size of 1,400 square metres (about 15,070 sq ft) as the planning norm for newly-created bungalows in GCB Areas. One generally has to be a Singapore citizen to be allowed to buy a landed property in a GCB Area.

Fall in GCB deals in the year to date

Transactions in the GCB market have fallen significantly amid a widening buyer-seller price gap, coupled with weak sentiment arising from global uncertainties on the geopolitical and macro-economic fronts, and the looming risk of a recession.

”The uncertain economic environment and rising interest rates may give buyers a reason to wait and observe if owners lower their price expectations,” said Steve Tay, senior associate vice-president at List Sotheby International Realty (List SIR).

List SIR’s analysis of URA Realis caveats data downloaded on Aug 18 shows that between Jan 1 and Aug 5 this year, there were 33 deals in GCB Areas, worth nearly S$833 million. This is much lower than the 65 transactions totalling close to S$2 billion over the same period last year. For the whole of last year, the tally was 90 deals, adding up to S$2.6 billion.

Source : The Business Times

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