Lippo, CLSA sell out of Holland Collection

Published 15 March 2011
The Business Times
By Kalpana Rashiwala

A JOINT venture between Lippo Group and CLSA Capital Partners has sold the remaining 14 units in the 26-unit freehold development The Holland Collection at slightly over $50 million, BT understands.

The Holland Collection

The Holland Collection

The deal is said to price the units, which include two, three and four-bedroom apartments, at nearly $1,600 per square foot on average. Straits Trading has been tipped as the buyer. The group developed the Gallop Gables and Gallop Green condos nearby.

The five-storey Holland Collection, which is near the Singapore Botanic Gardens, is expected to be completed later this year. Analysts reckon Straits Trading is likely to hold the 14 units as a long-term investment, for rental income.

Colliers International is understood to have brokered the sale. When Lippo and CLSA first released the project at Holland Road around April last year, the average price was indicated at about $2,000 psf.

The luxury development is being built on the site of the former Aura Park, which Lippo bought in a collective sale deal in June 2007 for $1,280 psf of potential gross floor area – a high for the location. CLSA Capital Partners took a 50 per cent stake in the project a few months later.

Despite the developers selling the remaining units at much lower prices under the bulk deal than the project’s initial pricing, industry players reckon that Lippo and CLSA may break even or make a small profit. ‘The saleable area is relatively high as the development is low rise, which means there’s lot of garden areas which are included in the saleable area,’ said a market watcher.

The Holland Collection has 19 variations in layout, size and space configurations. Apartment sizes range from 1,281 sq ft to 3,606 sq ft, according to earlier media reports.

Analysts say that bulk sales of apartments in new developments have slowed because of the Jan 13 property cooling measures. The loan-to-value limit on housing loans for non-individual buyers has been slashed to 50 per cent.

In addition, punitive seller’s stamp duty rates have been put in place. Those who buy a private residential property from Jan 14 and sell it within four years have to pay a seller’s stamp duty of 16, 12, 8 and 4 per cent if they sell it in the first, second, third and fourth years respectively of purchase. As a result, the potential buying pool in this market segment has narrowed to cash-rich, long-term investors.

‘Developers wishing to sell unsold units in projects may have to give more attractive discounts to such bulk buyers, because their numbers are now more limited,’ said an industry observer.

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