Singapore landmark property, People’s Park Centre, failed to attract any bid for its collective sale.
People’s Park Centre was completed in 1976 and it is located in Chinatown, a familiar place for tourists and Singaporean Chinese. There are 324 shops, 256 offices, 120 residential apartments and a carpark.
The exceptionally high S$1.8 billion reserve price was too much to ask for property developers nowadays.
The reserve price works out to a land rate of S$2,620 per square foot per plot ratio (psf ppr).
Considering that the reserve price was only S$1.35 billion in 2019. It is difficult to justify the S$450 million price appreciation after 3 years for a 99-year leasehold mixed-use commercial-and-residential development.
The risk to reward ratio simply did not appeal to savvy property developers whom are price sensitive.
Collective sale with reserve price of more than S$1 billion last took place in 2007. It is challenging given its high quantum.
ERA Realty Network is the marketing agent for People's Park Centre.
Sunny Wong, who heads the en-bloc of People's Park Centre said there's demand for mixed-use developments following the sale of Golden Mile Complex, Tanglin Shopping Centre, Peace Centre and Peace Mansion.
If the en-bloc materializes, the shop owners could receive sale proceeds of between S$213,000 and S$22.7 million, while those with strata offices could receive between S$536,000 and S$12.5 million.
Residential owners are hoping to retire with the windfall between S$2.39 million and S$3.42 million, with penthouses drawing between S$3.42 million and S$5.33 million.