Developer that acquires the leasehold plot may be able to build 52 to 65 bungalows on the 752,000 sq ft site in the GCB area
Aerial view of the site. It is believed all the other guidelines for GCB Areas will apply to the site except for the 1,400 sq m minimum plot size and where necessary, the setback rules.
MEDIACORP may finally be getting ready to put up its former campus in Caldecott Hill for sale.
According to sources, the group recently conducted a request for proposal (RFP) exercise, inviting property consultants to provide marketing services to find a buyer for the sprawling site of slightly more than 752,000 square feet (sq ft).
Property consultants are understood to have made their submissions nearly three months ago.
When contacted, Mediacorp declined to comment.
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The Business Times understands that the group has received advice from the planning authority that the property – bounded by Andrew Road, Olive Road and John Road – may be redeveloped into bungalows with plot sizes of at least 800 square metres (sq m), or 8,611 sq ft.
Market observers say the site, currently zoned for civic and community institution use under the Urban Redevelopment Authority’s (URA) Master Plan 2019, will have to be rezoned to residential use; this will entail payment of a differential premium to the state.
Moreover, a lease extension premium would have to be paid to top up the site’s lease to 99 years, from a balance period of about 73 years.
Market views vary widely as to how much the site could fetch: from about S$130 million to S$250 million; as a result, the land cost to a potential developer, inclusive of the differential premium and lease extension premium, too ranges widely, from S$400-550 million.
Back in 2015, Mediacorp had made an outline application to the URA for a five-storey condo development with 550 units on the site, but this was turned down as the proposed project was not in sync with the existing surrounding low-density residential character; Mediacorp’s property is part of the Caldecott Hill Estate Good Class Bungalow (GCB) Area.
URA instead suggested an alternative development scheme, of a two-storey GCB development.
Bungalows in GCB Areas are considered the creme de la creme of landed homes in Singapore and URA has stipulated stringent planning conditions to safeguard their exclusive, low-rise character.
Besides a minimum plot size of 1,400 sq m for any newly-created bungalows within a GCB Area, these include a two-storey height limit (although an attic and basements are allowed).
Stipulations on site coverage control (total covered area as a percentage of the net site area) and setback to the sides and rear for a bungalow in a GCB Area are stricter than those for a bungalow outside a GCB Area. There are only about 2,500 bungalows in the 39 GCB Areas.
While the minimum plot size for subdividing residential land in a GCB Area is 1,400 sq m, Mediacorp is understood to have been advised by property industry players in the past few years that it would be difficult for a developer to find buyers willing to fork out a big price quantum for a 99-year leasehold landed home.
“For a sum of, say, S$16 million, most buyers would prefer to spend, say, S$24 million for a brand new freehold bungalow in the Caldecott area,” said veteran GCB agent KH Tan, managing director of Newsman Realty. The above comparison is for bungalows with a land area of 1,400 sq m.
Hence, Medicorp’s current scheme envisages building bungalows with a smaller land size.
When contacted, a spokesperson for URA said redevelopment proposals that depart from the prevailing guidelines, in this case, those of a GCB Area, will be subject to URA’s evaluation on an individual basis.
Word on the street is that for the bungalow development scheme on Mediacorp’s site, all the other guidelines for GCB Areas will apply except for the 1,400 sq m minimum plot size and, where necessary, the setback rules.
Market observers note that the 800 sq m minimum plot size advice that URA is said to have given to Mediacorp for the Caldecott property is double the requirement for a bungalow in a non-GCB Area.
By some estimates, some 52 to 65 bungalows can be carved from Mediacorp’s site – after catering for roads, provision for green open spaces and electrical substations.
Agents say developers will need to factor into their bid price for the site that even with a smaller land size of 800 sq m – against 1,400 sq m – the end-unit pricing to a buyer could still amount to quite a substantial sum, say, S$9-10 million.
Said Mr Tan: “A buyer may find greater value in a new freehold boutique bungalow of the same size in the locale for about S$14 million.”
Moreover, the developer will have to complete building all the bungalows on the site and sell them within five years – for upfront remission of the 25 per cent additional buyer’s stamp duty on the land purchase price.
Developers will have to do their sums carefully and adjust their land price for this site accordingly to give themselves some buffer to market the bungalows at prices that are attractive to end buyers, say agents.
Realstar Premier founder William Wong said: “Those who buy landed homes in Singapore’s central area typically have an investment mindset. They may be planning to occupy the property themselves but they also are looking at how much they could sell it for in future.
“Hence, it is very difficult to sell 99-year leasehold bungalows unless the developer can offer a very attractive entry price to the buyer.”
Observers say that in any case, given the weak economic climate, it remains to be seen if Mediacorp goes ahead with appointing an agent or agents to market its Caldecott Hill asset.
In late 2016, Mediacorp had also launched an RFP exercise for property consultants to market the site but the effort was suspended after it received feedback from agents to build smaller bungalows.
The group moved out of its Caldecott Hill premises between 2015 and 2017 to its new 12-storey campus in one-north with about 800,000 sq ft gross floor area. It owns the one-north campus.