MCC Land to kick off previews of One Bernam, Provence Residence

 

 

Refashioning Tanjong Pagar

With Tanjong Pagar undergoing a renewal, Tan wants One Bernam to be a showcase of what the future district could look like, he says.

A 35-storey mixed-use development, One Bernam is composed of 351 residential units, a two-storey, retail podium of 15,726 sq ft and a 13-key boutique serviced apartment. &ldquo We want to have a confluence of different segments to attract different types of visitors to the development,&rdquo says Tan.

One Bernam is MCC&rsquo s and Hao Yuan&rsquo s maiden project in the Core Central Region (CCR). Adjacent to One Bernam is Realty Centre, a 12-storey commercial building sitting on an 11,000 sq ft, freehold site with a plot ratio of 5.6. It marked one of the very few collective sales of a strata-titled commercial development when it was sold en bloc for $148 million in April 2019.

The buyer of Realty Centre is Singapore-listed The Place Holdings, a Beijing-headquartered company involved in tourism, media, property management, biotechnology and international trade. The acquisition is set to be completed by the end of this month.

Last month, MCC Land entered into a shareholders&rsquo agreement with The Place Holdings, with the former taking a 30% equity stake and the latter retaining a 51% stake in the joint-venture company. Sun Gard will hold the remaining stake of 19%.

The parties are still exploring a collaboration on the redevelopment of Realty Centre and hoping to leverage the CBD Incentive Scheme, says Tan. Taking a stake in Realty Centre is strategic, as MCC would be undertaking the project management and construction too, upon completion of its acquisition.

Sitting across the road from One Bernam is Fuji Xerox Towers. Singapore-listed property giant City Developments Ltd has said that it will be redeveloping the freehold site into a new, mixed-use integrated development with commercial, residential and serviced apartment components. Under the CBD Incentive Scheme, the new development will enjoy a 25% uplift in gross floor area.

 

 

Differentiation through unit sizes, mix

Tan wants to differentiate One Bernam from Midtown Modern and Irwell Hill Residences. Both projects are located in the CCR too and were launched recently. Midtown Modern saw 61% of its 558 units taken up, while Irwell Hill Residences saw over half of its 540 units sold, on their launch weekends in March.

Hence, the unit sizes at One Bernam are larger than the average. One-bedroom apartments are sized from 441 to 463 sq ft, and make up 87 units (about 25%). Two-bedroom and two-bedroom-plus-study units ranging from 700 to 872 sq ft form the majority of the units (66%). Together, one- and two-bedders make up 91% of the units in the development.

Three-bedroom apartments at One Bernam are sizeable at 1,421 sq ft, and account for just 29 units in the development. The most spacious are the three-bedroom penthouses of 1,744 and 1,948 sq ft, and there are only two such units. On the top floor is the largest and biggest penthouse in the development &mdash a 4,306 sq ft unit with five bedrooms.

Tan feels that the CBD area could benefit from having more generous-sized units to accommodate work-from-home lifestyle and to attract more families to live in the CBD, given its proximity to Cantonment Primary School. Within a five-minute walk are the eateries at the conservation shophouses along Tras Street, Peck Seah Street and Amoy Street. There are also parks nearby, for instance, the Tanjong Pagar Park at Guoco Tower, the Duxton Plain Park next to Pinnacle @ Duxton and the Vanda Miss Joachim Park.

The location is well-connected. Tanjong Pagar MRT Station on the East-West Line is just one MRT stop from Raffles Place Interchange Station for the North-South and East-West Lines. Telok Ayer MRT Station on the Downtown Line is also within a few minutes&rsquo walk and two stops from the Bayfront MRT Interchange Station for the Downtown and Circle Lines. The upcoming Maxwell MRT Station on the Thomson-East Coast Line is expected to be completed within the next year.

One Bernam is also close to malls such as 100AM and the six-storey retail podium at Guoco Tower. Hence, Tan feels Tanjong Pagar is &ldquo liveable&rdquo with all these amenities nearby. One Bernam is therefore designed &ldquo for people who want to live here, and not just buy for investment&rdquo , he adds.

 

 

One full circle

Tanjong Pagar holds a special place in Tan&rsquo s heart. He moved to Singapore in 1996, after graduating with a degree in civil engineering from Tsinghua University in Beijing. This was followed by a Master of Science (Geotechnical Engineering) from Central Research Institute of Building and Construction, Ministry of Metallurgical Industry, China as well as Master of Business Administration from University of South Australia. He came to the city-state to explore business opportunities for parent company Metallurgical Corporation of China (MCC Group), a Fortune Global 500 company listed on the Hong Kong and Shanghai Stock Exchanges.

In the early days of MCC Group in Singapore, Tan used to visit Bank of China&rsquo s South Sub-Branch at Maxwell House in Tanjong Pagar, whenever he needed to conduct any business on behalf of the group. The South Sub-Branch had opened at Maxwell House in 1940, and relocated only in 2014.

The best treat he and his colleagues had gotten then was a buffet at Amara Singapore. &ldquo At that time, I never would have dreamt that I would be developing a project in the Tanjong Pagar or CBD area,&rdquo he relates. When Tan saw the Bernam Street site on the Confirmed List of the GLS Programme in 1H2019, he felt that fate had led him to come full circle back to Tanjong Pagar.

MCC Group&rsquo s business in Singapore started with the construction of HDB estates and public transport infrastructure, and evolved into construction of other significant projects such as Universal Studios Singapore, Resorts World Sentosa, Singapore Expo and Keppel Distripark. Under Tan, MCC&rsquo s business has extended beyond Singapore to the rest of the Southeast Asian region, including Cambodia, Indonesia and Malaysia.

In 2010, the group made its foray into property development under MCC Land. Its portfolio of residential projects includes The Canopy, Canberra Residences and One Canberra in the northern region The Santorini and The Alps Residences in Tampines Avenue 10 as well as the mixed-use development The Poiz Residences and The Poiz Centre next to the Potong Pasir MRT Station and Queens Peak located directly in front of the Commonwealth MRT Station. MCC Land has developed 12 projects with over 6,000 condominium units in Singapore to date.

 

 

Northern playground

For Tan, the Canberra area in Sembawang has special significance too. When he moved to Singapore 25 years ago, he rented a place in Woodlands, near the Causeway immigration checkpoint. He then moved to Yishun. He feels that Woodlands and Yishun in the northern region of Singapore have changed tremendously over the years.

When MCC Land was looking for development sites more than a decade ago, its maiden EC project was the 406-unit The Canopy at Yishun Avenue 11. The 99-year leasehold EC was completed in 2014. At the time of the launch, Tan&rsquo s residence was just behind The Canopy site.

This was followed by a series of projects in Sembawang: a second EC project, the 665-unit, 1 Canberra at Canberra Walk the neighbouring private condo, the 99-year leasehold Canberra Residences with 320 units followed by the 435-unit The Nautical on Jalan Sedudok, off Sembawang Road. MCC has also developed two EC projects in Woodlands, namely the 653-unit Forestville and the 358-unit Northwave.

&ldquo Those were the early days,&rdquo relates Tan. &ldquo And now the Sembawang landscape has changed completely.&rdquo He wants Provence Residence to be representative of &ldquo the new Sembawang&rdquo .

With its history of developing projects in Sembawang and the northern region, MCC Land has participated in all the GLS sites launched in these areas. In 2018, MCC Land and joint-venture partner Greatview Investments emerged as the second highest bidder for Land Parcel A at Canberra Link. A joint venture between Hoi Hup Realty and Sunway Developments submitted the highest bid and won the site.

The new project by Hoi Hup and Sunway, the 496-unit Parc Canberra was launched in February 2019. On the first weekend of sales, 316 units (64%) were taken up at an average price of $1,085 psf. To date, the project is 97.4% sold, with average price of units sold at $1,099 psf.

Not be outdone, Tan wanted to make sure that MCC won the neighbouring site, when Land Parcel B was launched for sale a year later in 2019. The upcoming 413-unit Provence Residence is located within walking distance of Canberra MRT Station on the North-South Line.

 

 

 

&lsquo Great place to live&rsquo

Sembawang has become a more attractive location for developers, especially with the upcoming North-South Corridor, an expressway that will shorten the commuting time from the city area. There are more amenities in the area today, with Northpoint City shopping mall in Yishun, the &ldquo new generation&rdquo Canberra Plaza neighbourhood centre and the upcoming Bukit Canberra integrated sport and community hub that will include a new hawker centre. This is on top of existing malls such as Sembawang Shopping Centre and Sun Plaza.

&ldquo With all the amenities, Sembawang has become a great place to live in,&rdquo says MCC&rsquo s Tan. He is betting on the future growth of the northern region, with the North-South Corridor, the Northern Agri-Tech and Food Corridor and the upcoming Woodlands Health Campus, offering integrated healthcare, from acute and community hospitals, to nursing homes and specialist clinics.

Nature attractions in the area include the Mandai Mangrove and Mudflat Nature Park, Kranji Marshes and Sungei Buloh Wetland Reserve. Once Sembawang Shipyard&rsquo s operations cease, the site could be redeveloped into a mixed-use waterfront lifestyle precinct, according to the URA Master Plan.

With all these government plans in the pipeline, MCC&rsquo s Tan believes that there are many opportunities for developers like him in the northern region.

 

 

Next-gen projects

MCC wants to position Provence Residence as representing the &ldquo new generation&rdquo of ECs in the Sembawang area. The development&rsquo s Provence theme will be carried through in both the facade design as well as the condominium facilities. &ldquo We like to come up with different themes for our projects,&rdquo says Tan.

&ldquo Having done The Alps Residences, inspired by the Swiss Alps, and The Santorini, inspired by the Greek island, why not Provence in France?&rdquo Tan quips. &ldquo What&rsquo s more, people can&rsquo t travel these days. They might as well have a foreign-themed home.&rdquo

At Provence Residence, the predominant apartments (389 units) are three-bedroom, with sizes ranging from 883 to 1,249 sq ft. Four-bedroom units of 1,399 sq ft make up the remaining 24 units. Based on market indicative figures, prices start from $890,000 ($1,008 psf) for an 883 sq ft three-bedder and upward of $1.5 million ($1,072 psf) for a 1,399 sq ft four-bedder.

Given the strong sales at Parc Canberra last year and with the project already more than 97% sold, Ismail Gafoor, CEO of PropNex, reckons that Provence Residence will do well. &ldquo Today, all ECs are expected to be priced in the range of about $1,100 psf, and I expect Provence Residence will be priced in line with the market accepted price range,&rdquo he says.

According to Lee Sze Teck, Huttons Asia&rsquo s director of research, Provence Residence is the only EC among this year&rsquo s slate of new project launches that is located within walking distance of an MRT station. To qualify for an EC, the gross monthly household income ceiling is $16,000, and HDB upgraders do not need to pay additional buyer&rsquo s stamp duty (ABSD) upfront, he adds. &ldquo These are strong reasons why buyers should consider buying an EC if they qualify.&rdquo

In the past year, demand for ECs has been strong, notes Nicholas Mak, head of research at ERA Realty. This was evidenced by the 59% take-up rate at the 700-unit Parc Central Residences in Tampines in January at an average selling price of $1,177 psf.

 

According to Mak, demand for ECs has remained quite stable in the last few months, (see table titled &ldquo Median unit price of four executive condominiums launched in past two years&rdquo ).

The market for ECs and at Provence Residence is mainly young families and HDB upgraders. This is a different clientele from One Bernam, notes PropNex&rsquo s Gafoor. &ldquo These two projects are unlikely to compete with or cannibalise each other hence, doing simultaneous previews is not an issue,&rdquo he adds.

 

 

Singapore Downtown and beyond

One Bernam&rsquo s unit sizes are bigger than some of those in the CCR that were launched recently, observes Gafoor. Initial indicative prices show one-bedroom units of 441 sq ft starting from $1 million ($2,268 psf), two-bedroom units priced upwards of $1.6 million ($2,286 psf), with two-bedroom premium units from $1.8 million ($2,230 psf). Meanwhile, three-bedroom units with private lift start from $3.3 million ($2,322 psf).

&ldquo With prices starting from just below $1.1 million for a one-bedroom unit, or from $2,200 to $2,300 psf for a CCR location within a five-minute walk from Tanjong Pagar MRT Station, it&rsquo s a price range that investors and home buyers are prepared to enter the market at,&rdquo adds Gafoor.

What&rsquo s more, there has not been a new project launched in the Tanjong Pagar area in eight years, not since the 181-unit Wallich Residence at Guoco Tower in 2013. &ldquo Given that it has been eight years since the last launch in District 2 in the Downtown Core, interest in One Bernam is expected to be strong,&rdquo says Mark Yip, CEO of Huttons Asia. &ldquo With the government encouraging more mixed-use developments there, the whole area is going to see more transformation in the next few years.&rdquo

MCC&rsquo s Tan believes that to succeed as a property developer and construction company in Singapore, one has to achieve not just scale, but specialisation. &ldquo It&rsquo s not just about moving up the value chain, but deepening our expertise,&rdquo he adds.

For instance, for the upcoming mixed-use development on the Tanah Merah Link GLS site which MCC Land won last November, Tan wants to come up with &ldquo a new retail concept&rdquo . The new project will have 21,528 sq ft of retail space and 265 residential units, and is located opposite Tanah Merah MRT Station. It is expected to be launched sometime in 1H2022.

Competition has intensified in the Singapore property market, with more new players entering the scene. When Tan first ventured into property development in Singapore 11 years ago, it was mainly MCC Land and Qingjian Realty, he relates. &ldquo Today, there are so many more foreign players in the Singapore property market,&rdquo he adds.

Although developers&rsquo margins may have been compressed in recent years, there is still an opportunity for a property player to establish itself in the city-state, notes Tan. &ldquo Once you&rsquo ve built a brand for yourself in Singapore, it will help you elsewhere in the region,&rdquo he says. &ldquo That&rsquo s why a lot of overseas developers still want to come to Singapore first to establish themselves.&rdquo

After all, that is what MCC did 25 years ago. Beyond Singapore, MCC has been involved in large-scale developments in Malaysia and Indonesia, as well as a luxury development in Cambodia. Tan intends to make further inroads elsewhere in the region. As such, like other major developers &mdash both local and abroad &mdash Tan has set his sights on the 1.2ha master developer site at Kampong Bugis.