The Avenir is another centrally located new project launch. Recent new project launches have had very good locational qualities and it would be interesting to see how such launches perform as their launch prices continue to set new benchmarks. 2020 should see about 40 new project launches and it would be interesting to see if the market has the appetite and capacity to absorb all these units.
Details about the development
The Avenir is a freehold condominium developed by a consortium of Hong Leong Holdings, Guocoland and Hong Realty. In March 2018, the consortium acquired the former Pacific Mansion for SGD$980 million in the largest collective sale in more than a decade, eclipsing Tampines Court (SGD$970 million) and Amber Park (SGD$907 million). In fact, this was the second-largest collective sale ever. Only the sale of Farrer Court for SGD$1.34 billion in 2007 is larger. Pacific Mansion was a 290-unit development with 288 apartment units and 2 commercial units sitting on a 128,352 square feet plot of land at River Valley Close. It had an existing gross floor area of about 493,222 square feet. The achieved collective sale price of SGD$980 million represented a 4.5 per cent premium over the reserve price of SGD$938 million. The sale price works out to SGD$1,987 per square foot per plot ratio (psf ppr) and if you factor in the 10 per cent bonus balcony area, the max allowable gross floor area works out to be 542,544 square feet which works out to a purchase price of SGD$1,806 psf ppr. Each residential unit owner received a gross payout of between SGD$3.26 million to SGD$3.48 million. The commercial unit owners received between SGD$2.2 million and SGD4.5 million.
In place of Pacific Mansion, The Avenir will be developed to consist of 376 residential units. Here is the unit mix:
1 bedroom, 527 to 538 sq ft: 69 units
2 bedroom, 807 to 829 sq ft: 69 units
3 bedroom, 1141 sq ft: 69 units
3 bedroom (with private lift), 1528 to 1572 sq ft: 68 units
4 bedroom (with private lift), 2056 to 2067 sq ft: 67 units
4 + Family (with private lift), 2441 sq ft: 34 units
Where is the development located?
The Avenir is located along River Valley Close just after Killiney Road. It is located behind The Regalia, just off the main River Valley Road.
The closest MRT station currently is Somerset MRT Station. In future, the nearest MRT station will be Great World MRT Station which is on the upcoming Thomson-East Coast Line. There is no point of reference for Great World MRT Station currently on Google Maps. Thus I will be using The Trillium as a point of reference to estimate the walk from The Avenir. According to Google Maps, the walk to The Trillium is 850 metres and will take about 10 minutes. However, there is a more direct route to Great World MRT Station via River Valley Green and Kim Seng Park. This should get residents of The Avenir to Great World MRT quicker. Both walks, along River Valley Road and along River Valley Green are relatively unsheltered. I would believe that most would choose the River Valley Green route.
The walk to Somerset MRT Station, which is along the North-South Line, is about 10 minutes and the distance covered will be about 800 metres. Getting to Somerset MRT Station also gets you to the main Orchard Road shopping belt. In fact, Somerset MRT Station is linked to 313@Somerset and Orchard Central. This walk is also relatively unsheltered.
As the Thomson-East Coast Line station at Great World is not yet available, I will only be doing the MRT travelling timing and costs from Somerset MRT Station.
If you are travelling to Orchard MRT Station from Somerset MRT Station, it will take you 2 minutes and it is just one station away. It will cost you $0.92.
If you are travelling to Raffles Place MRT Station, it will take you about 7 minutes over 3 MRT stations. The cost of this journey is also $0.92.
The drive to Orchard Road (The area around Orchard MRT Station), is about 1.3 kilometres and it will take about 3 minutes.
The drive to Raffles Place will cover a distance of about 2.6 kilometres and will take about 5 minutes. Do note that this Google Map query was done in the wee hours of the morning at about 5:45 am when traffic conditions were optimal. Although peak hour traffic should add some driving time to both journeys, I would not expect significant differences as The Avenir is very close to both Orchard Road and Raffles Place.
The selling points of the development
The location would be the primary selling point. This is really right at the edge of Singapore’s main shopping belt and also very close to the Central Business District (CBD). Unlike the hustle and bustle of the main Orchard Road, River Valley is nestled slightly away and feels like a very unique residential enclave with amenities all around. I do encounter clients who favour River Valley over other Orchard fringe properties around Cairnhill or Sophia Road area. I may not be indicative of the general market as my small sample size does not allow me to make an accurate hypothesis of the situation but I do think that there is some truth to this. Just off where The Avenir is located, you will find a row of shophouses along Killiney Road that serves up your typical local fare, coffee shops and clinics. There is a supermarket, a primary school and a park nearby as well.
My thoughts about the development
I really do like this location due to the fact that it feels like a serene residential enclave that is just off Orchard Road. I do think that there are tenants aplenty and if the asking rent is competitive, securing a tenant should not be too challenging.
During the launch, the developer sold 20 units and 7 of these units were 4-bedroom apartments with private lift access with an average price of SGD$3,560 psf. The remaining 13 units consisted of 1 to 4-bedroom units with an average psf of SGD$2,960. If we were to compare these prices to transacted prices in the resale market for Euro-Asia Court, Urbana, Yong An Park, The Morningside and The Regalia (no transactions for the last year), we will find that the transacted psf for these properties range from between SGD$1,448 psf to SGD$2,094 psf. SGD$2,960 does represent a 41 per cent premium over the highest psf in the resale market. We do of course have to factor in the fact that The Avenir is a brand new development versus older ones in the resale market. Pacific Mansion was acquired at the tail end of the last property cycle peak and developers will factor the land cost into the eventual selling price.
Despite what is said about freehold and leasehold properties not having too much of an impact when it comes to capital appreciation, I do that that moving forward, freehold properties will hold value and have a better chance for price appreciation. In today’s market where prices of properties are elevated, the opportunity to make a quick turnaround profit is very low. This means that buyers of new launches will have to hold on to their properties for a longer timeframe. My personal guess would be at least for a period of around a decade. This erodes into a 99-year lease and eventually when many properties face the conundrum of a decaying lease, a freehold property would but a property owner in a better position. The decaying lease was never an issue for HDB flats till recent years when the concern was brought up and I do think that the same will happen for private properties. Most things being equal, I would still personally favour getting a freehold property.
A significant premium over neighbouring developments. Buyers should take a longer-term view when it comes to capital appreciation.
I do think that this is one of the best located new project launches for 2020. Just off Orchard Road, a short drive to the CBD, amenities and coffee shops nearby, a primary school next door and close to the upcoming Great World MRT Station which will connect residents to the Thomson-East Coast Line. In fact, the station should be ready by 2021, way before the completion of The Avenir. Thus residents will have easy access to both Somerset and Great World stations when they move in.
Hong Leong is a very reputable developer and their recent projects include Midwood, The Jovell and One Balmoral. They have developed well over 50 developments in Singapore. Buyers can be assured that The Avenir should be handed to them on time and should not have to worry much about the quality of the development.
p.s. Disclaimer: I am a licensed real estate salesperson at the point of writing this review. My real estate agency is the marketing agency for The Avenir. Buyers can approach me to purchase The Avenir and I will earn a commission from the developer. My reason for writing this review is to share my personal view about the developments not as a real estate salesperson but in the neutral context of a buyer and hopefully share some insight to help buyers make a more informed buying decision.
My other Singapore Property Reviews
My review of One Holland Village Residences by Far East Organisation
My review of Neu at Novena and Fyve Derbyshire by Roxy Pacific Holdings
My review of Midwood by Hong Leong Holdings
My review of Royalgreen and Juniper Hill by Allgreen Properties
My review of Sky Everton by Sustained Land
My review of Sengkang Grand Residences by Capitaland and City Developments Limited
My review of One Pearl Bank by Capitaland
My review of The Antares by FSKH Development
My review of Parc Clematis by SingHaiyi Group
My review of Piermont Grand by City Developments Limited
My review of Parc Komo by CEL development
My review of Riviere by Frasers Property
My review of Avenue South Residence
My review of 1953 by Oxley Holdings
My review of Uptown @ Farrer
My review of The Florence Residences
My review of Treasure at Tampines
My review of Fourth Avenue Residences
My review of The Woodleigh Residences
My review of Kent Ridge Hill Residences
My review of Arena Residences
My review of Whistler Grand and Twin Vew
My review of Mayfair Gardens and Daintree Residence
My review of Parc Esta
My review of Jui Residences
My review of The Jovell
My review of JadeScape
My review of Stirling Residences and Margaret Ville
My review of The Tre Ver and Riverfront Residences
My review of Park Colonial
My review of Affinity at Serangoon and The Garden Residences