Saturday 29 December 2018

Parc Botannia Review- The Condo Next To Jalan Kayu Food Heaven

Everyone in Singapore would have heard of the food heaven at Jalan Kayu which is home to the famous Thasevi roti prata. A branch of Blanco Prawn Noodle House is also located there and full of queuing customers. Have you guys heard of the famous Beach Road Prawn Noodle? Blanco and Beach Road Prawn Noodles are actually restaurants that are set up by the same Lee family (please read the history here by Dr Leslie Tay-Ï Eat I Shoot I Post"). The prawn noodle at Jalan Kayu is really superb and is a must try for all foodie! Ok, back to Parc Botannia review. The reason why I mentioned Jalan Kayu is that Parc Botannia is a stone's throw away from Jalan Kayu and one can feast on roti prata and prawn noodles daily if one choose to live in this lovely development.

(1) Location of Parc Botannia
Parc Botannia's address at Fernvale Road makes it a 10 mins brisk walk away to the Seletar Mall. This development is also just right next to Thanggam LRT station which is 1 LRT stop away from Seletar Mall and 4 LRT stops to Sengkang MRT station. There is also a plot of land designated for Park development by Npark just next to Parc Botannia (the new park sits between High Park Residences and Parc Botannia).

In addition, the Sengkang Riverside park is also near Parc Botannia or 1 LRT station away- Perfect for nature enthusiasts or folks who enjoy jogging. 

(2) More details about Parc Botannia
Tenure of Land: 99 years leasehold commencing Dec 28, 2016
Site Area: Approximately 185,095sqft
No of Units: 735 Units (spread over 4 blocks) and a childcare centre.
No of Parking Lots: 741 for residents and another 15 for childcare centre
TOP: Dec 30, 2021 (but expected TOP earlier in 2020 if construction progress is good).
Parc Botannia is being developed by joint venture partners, Sing Development and Wee Hur Development. The developers paid the winning bid of S$517.03 psf per plot ratio in September 2016 during the Singapore Government Land Sales.

(3) Internal Layout and Premium Units with Private Lift
This is one of the most efficient unit layout that I have seen despite the smaller size of the apartments relative to those launched in the area 7-8 years ago (H20 Residences, Rivertrees and Riverbank). 3 bedders are around 969 sqft but do not feel crampy as seen in the showflat. 
The high ceiling height of 2.9m certainly adds volume and exude class to the units. The developers are generous to have built in such high ceiling which is a sharp contrast to High Park Residences next door as well as many other condo ceiling heights of only 2.7m these days. 
The best units in this development are the 4 bedder Premium units as well as the 5 bedder Premium Units which comes with its own private lift. There are only a total of 3 stacks of such premium units. In addition, the premium units come with walk-in wardrobe in the master bedroom. The Master bathroom for the premium units also has 2 basins for "his" and "her" which are definitely very luxurious and posh.
Private Lift Lobby with Built in Shoe Racks/Storage
However, due to the high psf (please see "Pricing" below), getting a premium unit will set one back by an extra few hundred thousand dollars. In my opinion, getting the 958sqft 3 bedder or the 1,130sqft 4 bedder units are already value for money due to the efficient layout, high ceiling and premium fittings committed by the renowned developers, Sing Holdings and Wee Hur Holdings. 
3 Bedder Premium

4 Bedder-Typical

4 Bedder Premium with Private Lift

5 Bedder Premium with Private Lift

(4) Pricing of Parc Botannia
The average launch psf was 1,270psf. Since then, 75% of the 735 units have sold out as per the marketing agent. The remaining units are on the higher floor and may cost up to 1,350psf for high floor units. For a premium 1,249sqft unit, the price tag is thus approximately S$1.68 Mil before stamp duties.  

The strange thing about the pricing is that the developers seem to have priced the park facing units at a higher psf than the pool facing units. 

There is a current up to S$70k "Starbuy unit discount" on offer during this festive period for a limited time period. 

(5) Parting Thoughts
This is a well-conceived development by Sing Holdings and Wee Hur Holdings. There are many facilities on offer within Parc Botannia. The layout for units are very efficient and the finishing and fittings given are branded and classy. Being so close to Jalan Kayu and minutes walk away to Seletar Mall is very convenient for the residents of the development. One will certainly be enthralled when arriving home to one's personal sanctuary at Parc Botannia.

(P.S: Check out the official video here of Parc Botannia and the waterfall feature wall at the grand entrance).

Saturday 22 December 2018

SPH REIT Still No Fate To Be Together With The Seletar Mall- But Suprised All With Australian Shopping Mall Acquisition

Many shareholders of SPH REIT have lamented over the lack of M&A for expansion. Ever since its maiden IPO, SPH REIT only had Paragon and The Clementi Mall in its portfolio. During the last AGM held on November 30, 2018, the question of why only a tiny strip of Mall, namely, The Rail Mall was acquired during the current financial year was raised. The answers given as per below screenshot on the usual rhetoric response that the asset acquired must be good quality, well located with a minimum 6% yield similar to the existing 2 malls. You can imagine the disappointment of all shareholders (including myself) that SPH REIT still has no fate to be together with The Seletar Mall that SPH is still keeping in its stable ever since its official opening in November 28, 2014. 

Why is everyone so looking forward to The Seletar Mall joining SPH REIT?
As a suburban mall located in the heart of Sengkang West, it is expected to enhance the REIT's resiliency in earnings even during an economic downturn. Currently, Paragon forms the main bulk of the earnings contribution. The Seletar Mall is expected to cost S$500Mil and will boost the earnings significantly from suburban shopping. NTUC Finest and Shaw Theatres are the current major anchor tenants. The hotpot chain Hai Di Lao also has a new branch opened in 2018 there that sees super long queues during lunch and dinner time during the weekend. 

Other retail chains such as Uniqlo and BHG are also tenants that have been there for many years since its official opening in November 2014. Other F&B tenants include Mc Donald, Starbucks, Burger King, Song Fa Ba Kut Teh. There are also many education centres such as the Learning Lab located at The Seletar Mall. 
Picture of The Seletar Mall at Sengkang West

The interior layout which is unique and have natural lightings from the roof pouring into the Mall.
Many analysts have been saying that The Seletar Mall will be up for sales to SPH REIT since 2016 but it has not materialized.

A surprised announcement of another acquisition- purchase of freehold Australian Mall
The big surprise came on Dec 18, 2018, just 2 weeks after SPH REIT mentioned that they are mulling over acquisitions which have been tough to fulfill based on their stringent checklist. SPH REIT announced that they have signed an agreement to acquire Figtree Grove Shopping Centre from Swordfish Australian Mid TC Pty Ltd for approximately A$210 Mil. 

Figtree Grove Shopping Centre is located about 3.7 km southwest of the Wollongong and 71 km southwest of Sydney. It occupies a total gross lettable area of 21,984 sqm, including facilities like a 24-hour Kmart, supermarkets, retailers and dining options. It sits on a freehold land area of 50,900 sqm. 

The proposed acquisition will be made through Figtree Holding Trust, a wholly owned sub-trust of a joint venture between SPH Reit and entities managed by Moelis Australia, an ASX-listed financial services group. SPH REIT and Moelis Australia Asset Management will pay A$175.1Mil and A$30.9 Mil for a stake of 85% and 15% respectively.

This bodes well for SPH REIT through working on a partnership with Moelis which is brokering the deal with the giant private equity fund Blackstone and providing local networking support. It also allows SPH REIT management team to get invaluable management exposure of shopping mall in Australia and pave the way for more Australian acquisitions in future pipelines. It also diversifies the geographical risk of portfolios based only in Singapore. 

Current SPH REIT valuation using Dividend Discounted Model
The Dividend Discount Model ("DDM" is a method of valuing a company's stock price based on the theory that its stock is worth the sum of all of its future dividend payments, discounted back to their present value. Since REITS payout more than 90% of its earnings as dividends, DDM will be a useful tool for us to do some mathematical valuation to see the fair value per unit expected.
P = D1 / (r -g)
P= Current Price based on summation of the infinite series;
D1= Dividend Payment per unit (S$0.055) for 1 year;
r= Cost of Equity (assume 5.5% based on 21st Dec 2018 closing price);
g= Dividend Growth Rate-Assume zero to be conservative.

From the above assumption, the valuation of SPH REIT is at S$1.00 per unit. The current price as at December 21, 2018 thus does not seem to have fully priced in the upcoming Australian acquisition and also the potential future acquisition of Seletar Mall. Further long term price catalyst includes the new Woodleigh shopping mall that SPH is developing with Kajima at Bidadari. 

Sunday 9 December 2018

Jui Residences Review- Inspired by Heritage, Designed for Quality Living

Jui Residences is a freehold development that sits on the former National Aerated Water Company site. I used to study in a school at Geylang Bahru and as I walked to the bus stop home along Serangoon Road, it became a daily ritual to always do a stopover at National Aerated Plant and buy Kickapoo from a vending machine near its main gate. It dispensed Kickapoo cheaply at a mere 10 cents per cup and was very popular with a lot of school kids then. As a result, this development held very fond memories for me.  

Strangely, the show flat of Jui Residences is right next to Woodleigh Residences. I had applied for annual leave to visit Woodleigh Residences as I was rather fascinated by staying in an apartment that is right above a shopping mall just like Punggol Watertown Residences and Sengkang Compass Heights. I harbored hope that maybe there will be special star buys around in Woodleigh Residences given the current feeble state of our global economy. When my property agent who was showing me around told me that prices are around S$2,000++ psf,  I nearly fainted as I gasp for breath. Then the agent whispered into my ear: "Yes, I also think the prices here are crazy.....why don't I recommend you a freehold development near the area that is way cheaper than this?" So, my agent then brought me next door to the Jui Residences show flat.   

In December 2016, National Aerated Water Company sold the freehold industrial site for S$47Mil to Selangor Dredging Berhad ("SDB"). SDB paid an additional S$22.66Mil to the local authorities for intensification of usage to a residential site. The total land cost thus translates to an acquisition cost of S$785psf per plot ratio for the land area of 31,705sqft with permissible built up of 88,775sqft of gross floor area based on plot ratio of 2.8. Also, the National Aerated Water building will be partially conserved as stipulated by Urban Redevelopment Authority and integrated into the new development and kept fenceless along Serangoon Road and the river.

This is a city fringe located freehold property. Coupled with it being just next to Kallang River, residents gets to enjoy river view. Not many properties can boast being near to reservoir or waterbody and I considered it an unique gem that is away from the hustle and bustle of City life. Coming back home to this development thus allows one to enter into a mini resort ambience and at the same time enjoy the convenient location.  
Good size Infinity Lap Pool albeit small landsize.

Amenities and Facilities
There will be 117 units for one tower in this development. Carpark lot is 1 for 1 as well as an additional 5 parking lots for visitors. There will be adequate parking space from B1 to level 4 multistorey carpark. There will not be big fights over parking relative to other developments which has cut down to less than 1 for 1 ratio.

The infinity pool is the main highlight for this development. It looks very impressive and is decent sized considering the small landsize.

However, I was quite disappointed that there was no gymnasium at all. This is good in the sense that this will reduce the yearly maintenance cost. In addition, the developer will link up Jui Residences to the Kallang Park Connector hence probably they make do away with the need for treadmills since residents can just go jogging along the track. 

Units and Finishing
Overall, the layout of the apartments here is quite small. The master bedroom based on my standard are tiny. This seems to be the trending these days. If one wants to buy a 3 bedder unit, please avoid type C1, C2 and C3 which have long entrances that wasted the use of space efficiently. The best will be type C4 as illustrated in the picture above which represented the best 3 bedder layout. Type C4 is also the biggest unit in the entire development.

I do have a serious problem with the finishing given, that is, the tiles for the kitchen wall and bathrooms which I find too "Retro" and does not exude a modern contemporary feel. This maybe due to the integration with the conservation of the older industrial facade for National Aerated Water Company. But one can always choose to change the finishing during the renovation to fit one's desired theme. Rather, it is the location that cannot be altered at will.

Pricing is around S$1,700psf and there is still some discount available from the developer. This is a freehold status development. For home buyers who wanted more value for money and do not mind buying 2nd handed projects, one can look for other older developments located closer to Boon Keng MRT direction and also Potong Pasir direction. 

Parting Thoughts
The "Jui" in the name of this project actually means "Water". This is a good city fringe located property that is beside the beautiful Kallang River. The integration with a part of Singapore history that is being earmarked for conservation further enhances the uniqueness of this freehold development.