TL;DR For the property buyer who is looking for a sustained upside, One-North Eden provides a first-mover advantage to the impending second wave of Buona Vista’s development as a Regional CBD.
Project Name: One-North Eden
Location: Slim Barracks Rise (District 5)
Developer: TID Investment (a Joint Venture between Mitsui Fudosan and Hong Leong Holdings)
Site Area: 5,779 square metres
Tenure: 99-year leasehold
TOP (Expected): Est. 2025
Residential Units: 165 (2 blocks of 13- and 15-storeys atop a podium with commercial space on the 1st storey)
Nearest MRT: Buona Vista (450 metres; 6-minute walk)
Primary Schools within 1km: Fairfield Methodist Primary School
Nearby International Schools: Tanglin Trust School, Dover Court International School, UWC South East Asia (Dover Campus), ACS (International)
Since 2007, there hasn’t been a new condo launched in the Buona Vista/one-North area despite its status as a Regional Business District, also known as Regional CBD. This is a seriously huge area measuring two-kilometres from one end to the other—about the distance between Tanjong Pagar and City Hall. This is also the only such hub in Singapore with several specialty tech clusters such as Biopolis, Fusionopolis and Mediapolis.
In fact, Buona Vista and its clusters now form the second-largest high-skilled employment node in Singapore after the CBD. In fact, acclaimed mega-companies such as GSK, Grab and most recently Razer have decided to set up their headquarters here, following in the footsteps of Shell and P&G. Plus, Singapore’s success in fighting Covid-19 will only continue to attract big corporate names to Buona Vista, growing this catchment of high-skilled talents comprising both locals and expats.
The area also has an upcoming large-scale, mixed-use development called Rochester Commons by Capitaland, which will add 19,000 square metres (sq m) of Grade A office space, an upscale 135-room hotel, as well as retail and dining amenities when completed this year. The development will also house Catapult, Southeast Asia’s first shared executive learning centre. But it’s the vast public spaces of this campus-style project that will increase the liveability of the area and the demand for condos.
Speaking of campuses, the area is also known for its concentration of schools, especially from secondary school onwards. The National University of Singapore (NUS) is located in the vicinity, along with many large international schools that attract a large expat population to the Dover and Buona Vista area.
In 2019, the URA finally recognised the need for more housing in the area when it put up a land parcel for a condo for tender in a prime spot in Buona Vista, situated near Rochester Commons and in the sweet spot between Buona Vista and one-North. After one-and-a-half years, this is finally on the market as One-North Eden, and ahead of its April launch, this is our preview of this 165-unit, 99-year leasehold condo.
Indicative Pricing, Unit Mix and Maintenance Fee: One-North Eden
Located in District 5 and the Rest of Central Region, One-North Eden is unique because of its proximity to the Core Central Region prime District 10, which is directly on the other side of the East-West MRT Line, and this is something that could encourage the developer to price units higher.
But a big factor determining the pricing of a new launch is timing; whether a developer bought a piece of land in the months before OR after the additional cooling measures of July 2018. In the months before that, many developers assumed that the market would continue heating up and tabled their bids at a higher price.
Once the cooling measures hit, the developer bidding frenzy died down and developers secured land plots with more modest winning bids. It meant that these developers were able to launch projects not only at cheaper prices for buyers, but at prices that are reflective, relevant and priced right to the current market right now.
So, it matters that the Government Land Sales (GLS) exercise for One-North Eden was conducted in 2019, after the additional cooling measures in 2018. TID Pte. Ltd—a joint-venture between local and Japanese developers Hong Leong Group and Mitsui Fudosan—won the bid at $155.7 million, or $1,001 per square foot per plot ratio (psf ppr).
In contrast, the developers for the nearby One Holland Village Residences, Normanton Park and Kent Ridge Hill Residences won their bids during the height of the en bloc frenzy in 2017 and 2018, with psf ppf prices of $1,888, $969 and $1,096 respectively.
We’ll compare the prices and attributes of these competing new launch condos later, but first here’s the indicative starting prices for One-North Eden:
At first glance, this is a very reasonable pricing for several reasons, the first and most obvious ones being that the majority of the units at One-North Eden will come below a $2,000 per square foot (psf) price point.
There are a few other things that are eye-catching, other than of course the sub-$1 million prices for the one-bedroom units. We want to point out that the indicative starting price of the 689 sq ft, two-bedroom unit at One-North Eden, at about $1.275 million, is only $15k higher than the list price of a 4th floor unit—of exactly the same type and size—at Parc Clematis, which is an OCR condo that’s 3.5 kilometres further west!
At these prices, especially for the larger unit types, you’ll pay a fraction of the price of a District 10 new launch in the nearby Holland, D10 area just a stone’s throw away. Bear in mind again that One-North Eden is a condo within a short walking distance to an MRT interchange station, shopping malls and workplaces employing a pool of high-skilled professionals. And many prime district $2.5k psf condos have none of these attributes.
Given it’s locational superiority, One-North Eden reminds us a little of Park Place Residences* at Paya Lebar. That is a recently-completed, 99-year leasehold condo that’s part of an integrated development, and it sold out at a median psf price of $1,877 from 2017 to 2019.
*Developer Landlease won the bid for the Paya Lebar integrated development (now known as PLQ and Park Place Residences) in 2015 at $943 psf ppr. SPH-Kajima won the bid for the Woodleigh plot in 2018 at $1,181 psf ppr.
The difference between that and One-North Eden is that Buona Vista is well ahead of Paya Lebar in terms of the scale and development of its Regional CBD, with arguably more upside (as we’ll talk about later). We also looked at the prices for The Woodleigh Residences in 2020, it’s an RCR integrated development that’s not part of a Regional CBD, and prices for the 3-bedders here are higher than that of the estimated median for One-North Eden.
Also worth mentioning is the fact that the RCR price index increased by 14% from Q1 2018 to Q4 2020, so for units at One-North Eden to come in at well-below $2k psf is real value (and a bit like travelling back in time).
Comparative Analysis: New Launch Condos near One-North Eden
There aren’t any newly or recently launched condominiums within a 1km radius of One-North Eden, but just beyond that is One Holland Village Residences in District 10. Incidentally, One Holland Village Residences is the nearest new launch condominium to One-North Eden, and it’s also of a 99-year leasehold tenure, so we’ll be including it in our comparison.
Other than that we have Parksuites (a 110-year leasehold low-rise development in the Holland Grove landed area), there’s a lack of comparable new launch condos in District 10 because most of them are freehold, higher-end developments (such as Leedon Green) with a price point exceeding $2,300. Even the leasehold One Holland Village Residences, which is part of a mixed-use development, sits in this elevated psf range.
Looking at the rest of the RCR in District 5, which is towards the south, we identified two other comparable new launch projects: Normanton Park and Kent Ridge Hill Residences. These come under the $2k psf price range.
[*Prices of comparable new launch condos are subject to change]
Compared to One-North Eden, the pricier D10 new launches do not have the same level of transport connectivity or proximity to schools, and the same also goes for cheaper options as well. In other words, if buyers choose any of these projects other than one-North Eden, they are essentially choosing to give up on one or more amenities.
Take for example One Holland Village Residences: With a significantly higher price tag, this is part of a large mixed-use development with far more leisure and dining options at residents’ doorstep compared to One-North Eden. However, there’s no primary schools within 1km of the condo.
On to Normanton Park: One-North Eden is about 5 to 12% more expensive than prices at Normanton Park, which we’ve recently reviewed. We feel Normanton Park is a more pure quantum play, great for HDB upgraders on a budget, whereas One-North Eden is a blend of price versus location and upside, perfect for more strategic buyers looking at value in terms of price versus location, rental yield, and capital appreciation.
Another thing to note about Normanton Park is that its one-bedroom units start from a floor area of 517 and 527 sq ft that’s similar to the one-bedroom units at One-North Eden at 517 sq ft.
The difference is that One-North Eden fits an additional study within the 517 sq ft footprint, whereas a one-bedroom with study unit at Normanton Park requires buyers to fork out more than $1 million for a second floor unit because the unit itself is about 10% larger in floor area. So the One-North Eden one-bedders, which all come with a study, looks very attractive at that quantum.
Looking at Kent Ridge Hill Residences, which is now 80% sold, the base list prices for its remaining units are mostly higher than the corresponding indicative starting prices at One-North Eden, which means that One-North Eden has a highly competitive quantum. There is a big overlap in the psf price range of these two projects, and if Kent Ridge Hill Residences can get to 80% sold at this point in time, we feel One-North Eden can very well match this figure.
If you want a new launch that is any cheaper in the West in terms of psf, you’ll have to look as far as Clementi’s Clavon and Parc Clematis, which are still within District 5 properties but lie in the Outside Central Region. These 99-year leasehold projects have transacted with median psf prices of $1,634 and $1,643 respectively in the past year (about 15% lower than One-North Eden’s expected median psf price).
Then you have District 21, which is still considered RCR but further away from the city or any employment nodes compared to One-North Eden. Comparably sized, 99-year leasehold new launch projects in D21 right now are Mayfair Modern, with a median psf price of $1,932 in the past year, and View at Kismis, with a median psf price of $1,706. (No surprise that View at Kismis is now more than 90% sold, compared to the 70% of units sold for Mayfair Modern.)
What’s also important to note is that there will be two more condos with similar plot sizes coming up along the same street as One-North Eden. The two land parcels have been put on the Confirmed List by URA for tender this year and will yield about 265 and 140 units each. After the tender, the projects are estimated to launch sometime in late-2022 or even 2023, so that will be quite a long wait.
Because the RCR price index now is at a higher level than in 2019, It’s likely that the winning bids for these two condos sites will come in at a higher psf ppr price than what TID paid for the One-North Eden site, which means the resulting launch price could also be higher. In a sense, buyers who snag a unit at One-North Eden have a relative ‘first-mover advantage’.
Comparative Analysis: Resale Condos near One-North Eden
Similar to new launch condos, there’s also a lack of competition for One-North Eden in terms of resale condos. In fact, there are only four comparable condos that have a similar proximity to Buona Vista and one-North:
The Rochester Residences (TOP: 2011)
One-North Residences (TOP: 2010)
Heritage View (TOP: 2000)
Dover Parkview (TOP: 1997)
Here’s the in-depth comparison between these four developments, which shows that prices are quite different and has much to do with the age of these properties:
In both psf price and quantum, One-North Eden is simply no match against the two older leasehold condos in the Buona Vista area, namely Dover Parkview and Heritage view. These are condos that are about a quarter-way into their 99-year leasehold lifespan so although that there will be some upside in the coming years due to Buona Vista’s continuing development, prospects of long-term capital appreciation may not be that great.
Still, Dover Parkview and Heritage View may be worth considering as we believe both have en-bloc potential 15 to 20 years down the road. This is because both projects are surrounded by higher density housing developments according to the URA Master Plan. The units here are also significantly larger, as is typical of older resale condos.
Although The Rochester Residences is technically the newest condo in the Buona Vista area and very close to One-North Eden, it’s positioned quite differently to both One-North Eden and One-North Residences because it’s meant to be a higher-tier, more luxurious flagship condo in the area. In fact, if you’re looking for one-bedroom loft units with double height windows and dramatic, ultra-high-floor panoramic views, The Rochester Residences is the only condo with such units in the Buona Vista area.
So the closest resale competition for One-North Eden is One-North Residences right next door. This is a 15-storey condo with one-bedroom units at exactly the same 517 sq ft floor area, and prices that are about 15 to 20% cheaper. This presents a tough challenge to the 24 one-bedroom units at One-North Eden, especially since the one-bedders at One-North Residences have one of the best open layout configurations we’ve seen.
With that being said, the developers of One-North Eden are smart and know what they are up against, and responded by substantially differentiating the one-bedroom units at One-North Eden with a regular closed layout and an additional study that can double up as a storage space.
With the same square footage that incorporates an additional study, we feel the one-bedroom units at One-North Eden will appeal to single buyers and also justify a higher rent for tenants than the $2.8k that One-North Residences one-bedders are currently fetching on average.
Moving beyond the one-bedders to the two- and three-bedroom units, and you’ll see that the One-North Eden developers have judiciously reduced the floor area to attain a quantum that is $150k to $250k lower than One-North Residences, which is a huge difference.
For two-bedders, the cheaper One-North Eden unit is about 70% the size of the smallest two-bedder at One-North Residences. The living, dining and master bedroom spaces are slightly smaller, but not to the extent that would impact liveability. Although the kitchen space is much smaller, this is also a space that many buyers today, especially those who don’t do much cooking, are okay with cutting back on. The thing to note is that the size of the common bedroom is essentially the same.
Moving on to the the 947 sq ft 3-bedroom compact unit at One-North Eden, although this is a whole 344 sq ft smaller than the smallest 1,313 sq ft three-bedder configuration at One-North Residences, again the kitchen is made super-compact, and there’s no household bomb shelter within the unit.
The adjustments for the One-North Eden 2- and 3-bedders, and the decision to keep the size of the common bedrooms decently-sized, has the effect of optimising these units for individual room tenants, and this is an especially savvy move because these tenants happen to form a very high percentage of renters in the one-North area.
That being said, we still see flexibility for families to be comfortable in these downsized units. The three-bedroom unit, for instance, allows the glass partition on one side of the kitchen to be removed and the counter space to be expanded into the dining area while still leaving sufficient space for a dining table.
So, compared to the resale condo next door, the layouts for One-North Eden makes the massively lower quantum even more attractive and landlords here might even end up stealing tenants from One-North Residences while getting a higher rental yield if they rent out rooms individually.
Here’s a more detailed comparison between One-North Eden indicative prices and recent transactions at One-North Residences for each unit type:
In our full review, we’ll be further analysing the floor plans and layouts of One-North Eden and pick out the best stacks.
Assessing Potential Growth and Future Upside: One-North Eden
A lot has happened to the Buona Vista and one-North region, but actually this area is just getting started. Aside from the Rochester Commons, a look at the URA Master Plan shows that a number of undeveloped land parcels in the area, including a plot right next to One-North Eden, has been zoned as ‘white sites’.
A white site is a land parcel where a mix of development types is allowed, such as a shopping mall with Grade A office space. As the government typically assigns white sites to strategic locations, and also because of the unique hybrid developments that eventually come up, there is potential for greater capital appreciation for a condo located near a white site.
An example of a white site that has been developed is Westgate and JEM at Jurong East, Connexion at Farrer Park and Duo Galleria/Duo Residences at Bugis. At Buona Vista, almost the entire Rochester area is a white site, as well as several land parcels in the One-North area that have yet to be developed. A sprawling area in Dover that was once a neighbourhood of HDB flats is also zoned as a white site and could in future allow for the expansion of the one-North business hub.
Also noteworthy is that the empty field right next to Buona MRT is earmarked for a future commercial development, which will further add to shopping and lifestyle amenities within walking distance of One-North Eden. Moving further towards the Mediapolis side where Mediacorp is and the new Grab headquarters is coming up, this is a place with immense potential because there’s close to a square kilometre of business park sites here that’s waiting to be taken up by companies like Grab and Razer.
In fact, around One-North Eden, the abundance of undeveloped greenfield land and the number of white sites and business park sites is unheard of anywhere else in the Rest of Central Region. So you are in a location with already very healthy and buoyant land value, with the additional prospect of steady long-term upside from future developments in the immediate, walking distance vicinity.
Moreover, the Buona Vista, Dover and Queenstown area will also see new housing developments that will predominantly consist of HDB flats. This will bring tens of thousands of households into the area and drive the growth of commercial amenities at Buona Vista. But more importantly this represents a huge pool of future demand for condos from HDB upgraders, many of which will no doubt be eyeing resale units at One-North Eden for their own-stay or investment.
One-North Eden for investment and rental yield
As we said earlier, the low quantum, unit size and layout positions the two- and three-bedders at One-North Eden for renting out individual rooms. At today’s rent, an ensuite master bedroom for a full-facility new condo in the area is expected to rent out for anywhere between $1,900 to $2,200, and a common room without attached bathroom will likely rent out in the $1,700 to $2,000 range.
The combined estimated total rent of $3.9k for a $1.3 million two-bedder unit, and $5.75k for a $1.8 million three-bedder unit means that landlords can conservatively expect a net rental yield of between 2.8% and 3.3% after factoring in 12% Additional Buyer’s Stamp Duty for Singaporeans.
Investors must also consider the area’s booming rental demand. Currently, there is a serious supply shortage of condo rooms for rent in the vicinity of one-North because of a confluence of factors favourable to landlords: namely a lack of room rental options in the area, the unique preference of tech industry professionals to live as near to their workplaces as possible, and the presence of the highly pricey District 10 further limiting the options of renters who are well-paid but are also budget-conscious.
Moreover, one-North is probably the best location in Singapore for property investors to leverage the global tech boom and benefit from the concentration of highly-paid software engineers and developers, whose salaries now rival professionals in the banking and finance industry.
According to Glassdoor, the typical software engineer at Grab earns about $82,000 annually, and can go up to $115k. This puts condos like One-North Eden in pole position to capture these tenants. Assuming the typical expenditure on rent, which is 30% of income, those at the high-end of the salary range can afford to rent a one-bedder, while those in the more common average salary range will gravitate towards either the common rooms or master bedrooms.
A distinct advantage to renting out rooms is that you’ll seldom ever have periods of full vacancy (i.e. zero rental income). Individual room renters often recommend their peers to rent the same unit or to take over once they leave, and this is all great news for landlords who are concerned about vacancy periods eating into rental yield.
Best of all, if the situation changes to favour renting out whole units to expat families, landlords at One-North Eden will also benefit from the high concentration of international schools in the area. Families of the nearly 3,000 children and students at the nearby Tanglin Trust School often look no further than the Buona Vista, Dover and Holland neighbourhood to rent.
More condos, more growth for Buona Vista and One-North?
Now that we’ve talked about upside factors and rental prospects, the technical observation of property prices and value of the area sums up the opportunity that One-North Eden presents for buyers.
When an area has few condo developments, a correspondingly low volume of non-landed private transactions and a lack of new launches, prices are likely to underperform the overall market until there is a critical mass of buyers and sellers.
This has been very much the case for Buona Vista/Dover/one-North neighbourhood, which has just four condos. The median per square foot (psf) resale prices for the condos have risen in the past 10-year period but trailed behind the growth of the entire District 5 as well as the Rest of Central Region.
[Source: URA Realis, PLB Insights]
In 2019, we saw that resale prices in the vicinity of One-North Eden dipped below resale prices of the rest of District 5 but that was followed by a sharp upswing in 2020. The dip starting in 2014 is primarily brought about by the fact the Buona Vista condos faced a lot of competition from projects that came onto the market in this time.
Within the RCR, the most prominent example where a spike in supply of new condos pushed up resale prices in general is the Potong Pasir area in D13. D13’s pace of development in the past 10 years, which includes the completion of 11 condos near Potong Pasir MRT, saw a steady rise in resale prices of older condos such as One Leicester (TOP: 2009) while also driving up the prices of later new launches such as The Woodleigh Residences in 2018.
At a time when hype has done a lot in driving up new launch prices in certain locations, places like Buona Vista have flown under the radar despite the fact that this Regional CBD continues to grow.
In fact, it could be because Buona Vista has taken so much of a backseat in the minds of buyers that One-North Eden is able to launch at this quantum and psf. If this area had been massively developed like Potong Pasir and Paya Lebar, or hyped up like Jurong or Greater Southern Waterfront, or if the developer had bid for this site before 2018 additional cooling measures, most of the units at One-North Eden would’ve been priced at $2k psf or above.
All said and done, there are just too many catalysts for One-North Eden’s pricing to stay the same for long. We’ll be doing an in-depth review upon the project’s launch, but with only 165 units, units could very well move quickly, and only the most opportunistic buyers may be able to score their unit of choice. Speak to our new launch consultants if you’d like to enquire about this or any other development.
[One-North Eden will open for preview on 10 April, Saturday and launch on 24 April, Saturday. Dates may change.]