When Alexis@Alexandra was launched in early 2009 by EC Prime, a joint venture between boutique developers Fission Group and Yi Kai Group, all the units were snapped up within three days. Average prices then were between $850 and $1,100 psf, which were considered high for the area. The apartments were mainly of the shoebox variety, with typical one-bedroom units measuring 388 sq ft and two-bedroom apartments starting from 527 sq ft. Such units were priced in the $420,000 to $840,000 range,which proved attractive to homebuyers because of their affordability.
Purchasers of the 293 units at Alexis, a six storey residential block sitting on a commercial podium, are expected to receive their keys soon, as the Temporary Occupation Permit (TOP) is expected to be issued this month. The condominium is considered to be a significant shoebox development, and one of the first to be completed. It will also prove the viability of shoebox apartments as an investment, according to property consultants.
Located along Alexandra Road, the freehold Alexis is within walking distance of the Queenstown MRT station. There were three sub-sales at the development between April 17 and 23, based on caveats lodged with URA Realis. Two of them were for one-bedroom units of 388 and 398 sq ft, while the third was for a 1,033 sq ft, two-bedroom duplex apartment.
The 398 sq ft, one-bedroom unit, which is on the third floor, changed hands for $700,000 ($1,758 psf). This is a 60% increase from its original transaction price of $442,000 ($1,110 psf) in March 2009. The other one-bedroom unit, at 388 sq ft, was also sold for $700,000 ($1,806 psf). The seller had paid $443,000 ($1,143 psf) for the fourth-floor unit in March 2009 and hence saw a capital appreciation of 58%. The $1,806 psf achieved for the unit is close to the all-time-high of $1,808 psf achieved in January this year, when 398 sq ft unit was sold for $720,000.
Meanwhile, the 1,033 sq ft, two-bedroom duplex apartment, which is on the sixth floor, changed hands for $1.52 million ($1,471 psf). This is the second time the unit has changed hands in a sub-sale. The previous transaction was in August 2010, when it was sold for $1.29 million ($1,248 psf). The first buyer paid $1.07 million ($1,038 psf) for the unit when it was launched.
The majority of the buyers of Alexis, even in the secondary market, continue to be those with HDB addresses. This is in line with a March report by Nomura Research that says those with HDB addresses make more than 50% of buyers of such shoebox apartments, with the majority buying for investment.
Lynda Lim, a marketing director at ERA Realty, reckons one-bedroom apartments at Alexis could fetch a monthly rental of $2,000, or $5 to $6 psf. The monthly rental for a master bedroom of an HDB flat in the Alexandra area, near the Queenstown MRT station, is already $900 to $1,500,” she says. Tenants who have expressed interest in Alexis’ shoebox units are mainly students and single expatriates from the US, Europe, China, Indonesia and India, observes Lim.
Based on the current transacted prices and rental rates, the gross rental yield for shoebox units at Alexis works out to 3.4% per annum, instead of the 5% to 6% that investors expect. The yield could come under further pressure with increased competition as new supply enters the market next year, says Lim.
In the neighbourhood of Alexis, further down Alexandra Road, is the 775-unit The Anchorage, a freehold condo developed by Frasers Centrepoint. The property is integrated with Anchorpoint, which features F&B outlets and shops, and is also directly opposite IKEA. Built 15 years ago, the units at The Anchorage are large, with studio apartments starting from 818 sq ft, two-bedroom units from 1,044 sq ft, threebedroom units from 1,378 sq ft and four-bedroom units from 2,077 sq ft. Given its large apartments, The Anchorage has traditionally been popular with expatriate families, says Lim.
Recently, a 1,765 sq ft, three-bedroom unit was sold for $2.15 million ($1,218 psf). The last time the unit changed hands was in 2003, when the economy was in the doldrums. It was sold for just $970,000 ($549 psf). According to rental listings in propertyguru.com.sg, three-bedroom units at The Anchorage have asking rentals of about $5,000, or $2.80 psf per month. “Due to the units’generous size, the monthly rentals are higher than those at Alexis but lower in terms of rental psf, as Alexis is located closer to the Queenstown MRT station,” says Lim.