ValueMax CEO buys Katong freehold bungalow for $30 million

Singapore - The chief executive of listed pawnshop ValueMax Group, Yeah Hiang Nam, has lodged a caveat to buy a freehold bungalow along Wilkinson Road in Katong for S$30 million.

It sits on a land area of 2,453 square metres. The transaction price translates to about S$1,136 per square foot (psf) of land. The sellers were Ong Tiong Seng and Ong Teck Beng, according to caveat documents obtained by The Business Times.

When contacted, Mr Yeah's daughter, Yeah Lee Ching, also an executive director on ValueMax's board, said that the house was offered for sale by an agent. "My father went to see it. My parents liked the house very much, so they offered. It took some time for the seller to consider, then the seller decided to sell to my dad," she said.

She added that Mr Yeah bought the property for own occupation, not for renting, and that he has no plans to redevelop the property because he likes the interior design. He was also drawn to the location and plot size - which is much larger than the usual size below 2,000 sq m.

According to the company website, Mr Yeah has been in the gold and jewellery business for more than 45 years, and in the pawnbroking industry for more than 25 years. He started his career as a jewellery salesman before setting up Golden Goldsmith Jewellers in 1979 to trade gold jewellery locally and overseas. In 1988, he forayed into pawnbroking by starting Ban Soon Pawnshop with business partners. Bloomberg data shows that Mr Yeah has a 15.46 per cent stake in ValueMax.

Good Class Bungalow deals in 2016

  • A charming single-storey bungalow on a sprawling site in Queen Astrid Park has changed hands for S$44.5 million. The buyer is understood to be a family member of Goh Hup Jin, son of billionaire paint tycoon Goh Cheng Liang.
  • A house along Kingsmead Road where the late Raffles Institution principal Philip Liau used to reside is being sold for S$29 million.
  • The price works out to S$1,065 per square foot based on the freehold land area of 27,228 sq ft.
  • The buyer is understood to be Darwin Indigo, a nephew of Wilmar executive deputy chairman Martua Sitorus. Mr Indigo, who is in his mid-30s, is deputy country head (Indonesia) at Wilmar International.
  • The S$29 million transaction is the biggest deal in a GCB Area since a S$32 million sale along Queen Astrid Park in July last year.
  • Ezra Holdings' Lee family has put their waterway-fronting Sentosa Cove bungalow on the block. The exclusive 2-storey 5-bedroom property comes with a price tag of S$26 million, or S$2,258 per square foot on land area.
  • The property is held by Lee Kian Soo, Ezra's founder and chairman and father of Lionel Lee, the offshore marine firm's chief executive and managing director.
  • In October last year, Mr Lionel Lee and his mother sold their GCB along Windsor Park Road for $21.8 million.
  • The freehold property at 122 Windsor Park Road, off Upper Thomson Road, has a land size of 20,383 sq ft, which works out to a price of about $1,070 per sq ft (psf).
  • In Jan 2016, a GCB along King Albert Park, which comes with a swimming pool, was sold by upmarket developer Simon Cheong.
  • The property fetched S$25 million, which translates to S$1,493 per square foot (psf) based on the land area of 16,750 square feet. The bungalow's built-up area is said to be around 10,000 sq ft.
  • The buyer, who is expected to occupy the bungalow once the existing lease ends, is Fang Koh Look, founder of Absolute Kinetics Consultancy, an SME that provides workplace safety training and medical services in addition to distributing mobile pre-paid cards.
  • Over at Wilkinson Road, off Tanjong Katong Road, a fully owned unit of Soilbuild recently paid S$19.28 million for an old, two-storey bungalow. The price works out to S$1,203 psf based on the freehold land area of 16,031 sq ft.
  • The bungalow could be easily 40-50 years old, said Lim Chap Huat, executive chairman of Soilbuild, when contacted by The Business Times. "We are buying it from a family."
  • The site is zoned for two-storey bungalow use. Mr Lim said the group plans to redevelop the site into two brand-new bungalows. Work should start around the middle of this year and the new bungalows should be completed in about two years.

Property consultants said that the transaction price was in line with recent deals closed in the vicinity, but the land size caused the total quantum to balloon to a hefty figure.

SLP International executive director Nicholas Mak said there were four transactions along Wilkinson Road since the start of 2015, averaging about S$1,168 psf on land.

"I would say in the surrounding area, this is one of the biggest deals. Because the plot size is large, it is normal to expect a slightly lower psf price."

Bungalows in the area (not just Wilkinson Road but including other nearby streets) hover around S$1,100 to S$1,400 psf, the upper range especially for smaller plots, he said.

But demand for bungalows of late has been thin and there is still price weakness because being big ticket items, bungalows are inevitably hard-hit by loan curbs and property cooling measures.

"But I think there will always be a spot in some Singaporeans' hearts to own a landed house, although bungalows are out of reach for many people. I believe when the market reaches the bottom of the price cycle, one of the first sub-sectors to recover would be the landed property market due to its very limited supply."

Knight Frank Singapore research head Alice Tan concurred on the general price trend of landed homes, although she noted some higher-priced recent transactions in locations such as Bukit Timah and near Orchard Road and Nassim Road.

Prices of landed properties have weakened for the past 11 quarters. From its peak in Q3 2013, the Urban Redevelopment Authority price index for landed homes has fallen 12.5 per cent as at Q2 2016, much more than for condominiums.

While there is continued demand for landed homes from a latent and growing pool of high net worth individuals who have greater investment capacity and are on the constant lookout for their desired home, there are also some landed property owners with businesses tied to the oil and gas sector who have recently offloaded their properties to finance their business needs amid gloomy business conditions, Ms Tan said.

This article was first published on August 25, 2016.
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