Owner gets nod to split penthouse

Owner gets nod to split penthouse
ST 14Mar2011:
Rarely granted approval means he may reap extra $300,000 from sale of 2 units.
THE owner of a penthouse duplex has won rarely granted approval to subdivide his unit into two separate apartments.
The penthouse at Horizon Towers can now be sold as two individual units, potentially reaping the owner about $300,000 more than if it was sold as a single home.

Such subdivisons have been approved before by the Urban Redevelopment Authority (URA) but they are few and far between, given the complex issues – from parking to dwelling space – involved.
In this case, the duplex at the Leonie Hill condominium had a total area of 5,167 sq ft, consisting of two equal-sized units on the 17th and 18th floors linked by stairs.
Its owner, who wanted to be known only as Mr Ng, bought the property as an investment and decided to rent it out as separate flats.
This meant blocking off the stairs, but there were already separate entrances on each floor and both spaces were self-contained, with their own kitchens and maid's rooms.
Renting out the two apartments gave him the idea of going one step further, to subdivide the strata lots – a process that required approval from the URA, the Land Transport Authority (LTA) with regard to parking provision, and the Building and Construction Authority (BCA), which agreed to the redistribution of the strata lot last October.
The duplex unit had a share value of seven, but the BCA approval has allowed for each separate unit to have a share value of 3.5.
'The main reason for the approval request was so that it would be easier to sell with a bigger pool of (potential) buyers. In terms of pricing, I think we can get about 5per cent more,' said Mr Ng.
Savills property agent Ryan Heng, who markets units in Horizon Towers, estimated that the duplex could fetch $1,200 per sq ft (psf) but the two units individually might net $1,250 psf.
That works out to about $6.2million for the duplex alone, but $6.5million in total for the two units.
There are at least eight such units at Horizon Towers and others at similar properties that might benefit from such a move, said Mr Shriniwas Rai, a partner at law firm Hin Rai & Tan, which represents Nr Ng.
Mr Colin Tan, research and consultancy director at Chesterton Suntec International, reckoned owners would be keen to split up one large unit into smaller ones that would be more affordable to buyers.
He also noted that large-sized duplex units like the one Mr Ng subdivided are usually found in older properties.
Experts said Mr Ng's success might encourage other owners to try their luck, but getting the green light is rare, as many conditions need to be fulfilled. The layout of certain apartments may also not allow for easy subdivision, they added.
OrangeTee's executive director of residential, Mr Steven Tan, said it makes sense for older and bigger apartments to be subdivided as smaller units are more popular now.
'This might appeal to owners who want to continue living at the same location even after their children move out. Getting a different strata title would allow them to lease or sell part of the unit to someone else,' he added.
However, subdivision may not always bring about better capital gains, Mr Tan noted. Penthouses have a prestige factor and good views, so they sometimes fetch higher psf prices than smaller-sized units a floor below.
A URA spokesman said its planning approval as well as endorsement from the building's Management Corporation Strata Title are required to convert a single residential unit into two or more flats. Such subdivisions can be considered if certain conditions are met.
These include ensuring that each subdivided unit is big enough for dwelling, and that it is self-contained with basic amenities like living rooms, dining rooms, toilets and kitchens. Each unit must also have direct access to common areas.
Proposed subdivisions must also meet LTA standards for adequate parking, and the BCA must approve the redistributed share values.
Source: Straits Times News by Ester Teo
http://propertylaunch.sg/propertynews/owner-gets-nod-to-split-penthouse/

===============
At/ related: