THE developer of 38 Jervois has launched a fire sale slashing prices by up to S$547,320 so that it will not incur the Additional Buyer’s Stamp Duty (ABSD).
The discounts range from 13 per cent to 24 per cent for the remaining 16 units in the 27-unit freehold boutique condo which received its temporary occupation permit in March 2019.
In dollar terms, the smallest discount is S$275,900 for the 818 square feet (sq ft) show flat unit which now goes for S$1.82 million, or S$2,223 per sq ft (psf). The biggest discount of S$547,320 is for a 915 sq ft unit on the fourth level, bringing the price down to S$1.92 million or S$2,102 psf.
The last transaction for a 915 sq ft unit at the five-storey District 10 condo was S$2.28 million, or S$2,492 psf in June 2019.
The pricing looks attractive as it would be the lowest transacted price for a 915 sq ft unit in the Tanglin area in the last 2 years said Christine Li, Cushman & Wakefield, head of research, Singapore & Southeast Asia. Ms Li said the median prices for new sales in the area are around $2,782 psf, based on data over the same period.
ERA Realty agents began advertising the units for sale on Monday. The promotion ends on June 14 with expressions of interest collected during the two-week period. The booking fee is 5 per cent of the purchase price.
Buyers are told that the transactions will only go through if all 16 units are taken up, hence the expressions of interest. The developer will confirm the booking within seven days from June 15.
The 15 per cent ABSD has to be paid even if only one unit is left unsold, said Joni Lim, spokeswoman of Prominent Land, the developer of 38 Jervois.
Developers have to sell all units within a five-year period after buying the land or incur ABSD.
Prominent Land, a family business has been a landed developer since 2011 when it built eight semi-detached houses in District 15, she said.
In February 2015, it bought the land which had an old bungalow in Jervois Road for S$25 million to launch its first boutique condo project, said Ms Lim.
The ABSD, which is an estimated S$4.8 million, was due in February this year and it had already been paid, she added. The ABSD was returned following the six-month extension given for ABSD deadlines due to the Covid-19 pandemic. The levy is now due in August.
Ms Lim said her team thought long and hard about the remaining units and decided “to move on from this project as we also have got new opportunities coming up”.
In order to make sure all 16 units are cleared, and given the current Covid-19 situation with the economy stalled and showflats shuttered for the time being, the developer decided to extend more discounts – totalling S$7.1 million – that will be “enough to create an impact”.
The fire sale seems to be working. The promotion has received overwhelming interest and the developer is in the midst of granting options to 12 cases, she said.
On why Prominent Land had earlier paid the ABSD, Ms Lim said initially it was intended to hold the condo for long-term rental income. The company was then looking at turning the property into a co-living business which is very popular, she said.
Some co-living operators in Singapore have said occupancy rates have remained above 90 per cent, even amid Covid-19.
“But there are these new opportunities, (so) we made this very bold plan,” Ms Lim said. She declined to reveal more about the new opportunities, other than the fact that they are related to real estate.