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Pine Grove relaunched for collective sale at $1.95b, but efforts still on to get mandate for $1.78b

Pine Grove condominium is set to be relaunched for collective sale at $1.95 billion on March 6, as the collective sale committee (CSC) was unable to secure the 80% mandate required to reduce the reserve price to $1.78 billion.

The tender deadline is May 6, 2024, at 3 pm, with ongoing efforts to attain the mandate for the lower reserve price by the closing date, as disclosed by ERA Realty Network’s managing director of investment sales, Mr. Tay Liam Hiap, to The Straits Times.

As of March 3, more than 62% of Pine Grove homeowners, who hold a remaining lease term of 59 years, have agreed to the lower reserve price. Notably, inquiries from several developers were received in February after over 60% of the 660-unit condominium’s owners endorsed a supplemental agreement to decrease the reserve price to $1.78 billion.

At the revised $1.78 billion price, the land rate calculates to $1,341 per sq ft per plot ratio (psf ppr), factoring in a 10% bonus gross floor area, an estimated land betterment charge (LBC) of $987 million for intensification, and a lease upgrade to a fresh 99-year term.

Pine Grove homeowners initiated the supplemental agreement process during an extraordinary general meeting on Jan 21. ERA Realty’s Jan 18 letter to owners justified the $1.78 billion valuation as “fair” based on Premas, a unit of Cushman & Wakefield, assessing the full potential of redeveloping the 893,218 sq ft site into a 2,050-unit development.

At the higher $1.95 billion price, the land rate is $1,440 psf ppr, considering an additional 10% bonus gross floor area under various incentive schemes, and an estimated LBC of $1.02 billion for intensification along with a lease upgrade to a new 99-year term.

ERA CEO Marcus Chu highlighted the strong willingness of owners to sell through this collective sale attempt, as indicated by their support for the supplemental agreement. Additionally, he mentioned the positive impact of the recently revised additional buyer’s stamp duty (ABSD) remission clawback for large collective sale sites like Pine Grove.

In light of policy adjustments, more residential projects are attempting collective sale at reduced prices. Thomson View condominium, for instance, was listed for collective sale at a lower reserve price of $918 million in late February. Similarly, Island View in Pasir Panjang was relaunched for sale on March 5 at $575 million, with a potential reduction to $532 million based on the consent of 60% of owners and ongoing efforts to secure the 80% mandate for the lower price by the condo’s CSC.

The Straits Times

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