Gcb Market Rebounds End Year 132 Bil Sales Value
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In the world of the ultra-rich, the Good Class Bungalows (GCBs) market has had a remarkable performance in 2024 compared to 2023, with 22 GCB transactions worth $612.05 million recorded as of Dec 20. Another 13 GCB deals, estimated to be valued at over $700 million, were completed without caveats lodged this year, as buyers sought anonymity. This brings the total estimated for 2024 to 35 GCB transactions with a value of around $1.32 billion, surpassing the previous high of $1.186 billion achieved in 2022. In contrast, only 18 GCB transactions were recorded in 2023, amounting to $432.5 million – the lowest number of deals since URA Realis started tracking such data in January 1995.
Han Huan Mei, director of research at List Sotheby’s International Realty, says, “The additional deals in 2024 show that the GCB market has been more active compared to what official transaction data reveals. It also reinforces the status of GCBs as a highly coveted asset that is constantly sought after by ultra-high-net-worth buyers.”
The highest-priced GCB transaction was the sale of a property on Tanglin Hill for $93.888 million. The freehold site measures 15,150 sq ft and has a built-up area of 29,660 sq ft. This deal set a new record with a land rate of $6,197 psf. Another notable transaction was the purchase of a GCB at Bin Tong Park for $84 million by Xiang Yangyang, daughter of Chinese billionaire Xiang Guangda, though no caveat was lodged for the property. Based on the land area of 28,111 sq ft, this translates to a land rate of $2,988 psf.
The highest-priced deal based on caveats lodged was for a GCB on Cluny Hill that was sold for $52 million. The property sits on a freehold plot of 15,141 sq ft and is relatively new, resulting in a land rate of $3,434 psf. Another significant transaction was the sale of a 21,116 sq ft GCB plot at Astrid Hill for $49 million ($2,321 psf) in July. This was reportedly purchased by Glenn Kuok, nephew of Kuok Khoon Hong, chairman and CEO of Wilmar International.
Mohan Sandrasegeran, head of research and data analytics at Singapore Realtors Inc (SRI), notes that at least 14 transactions this year were valued at $20 million or more, indicating strong demand for ultra-luxury properties in Singapore.
“District 10 remains the cornerstone of the GCB market, with multiple high-value deals reaffirming its status as the most sought-after district for these prestigious properties,” he says. Sixteen of the recorded GCB transactions this year took place in prime District 10, including the coveted Tanglin, Bukit Timah and Holland Road areas.
Sandrasegeran notes that GCB transactions were evenly spread throughout the year, with buying activity picking up in July. “This suggests sustained buying interest for these trophy properties despite external economic factors such as inflationary pressures and high interest rates in the first eight months of the year,” he says.
Steve Tay, co-founder and executive director of his eponymous boutique luxury agency in Singapore, says the trajectory of interest rates signaled by the US Federal Reserve (Fed) was the primary driver of stronger buying sentiment in the GCB market in the second half of the year, rather than the rate cuts themselves.
“Anecdotally, most GCB buyers who had been holding back on their purchases began more serious discussions from July onwards, with most deals closing in the last quarter of this year,” says Tay.
The GCB market slowed last year as buyers retreated following the island-wide arrests of suspects in Singapore’s biggest money laundering case, says Han of List Sotheby’s.
“The money laundering crackdown had a dampening effect on the market, causing some genuine buyers to pull back to avoid media attention,” she says. “Transactions also took longer to close due to heightened scrutiny and stricter checks on buyers’ identities and sources of funds.”
A new generation of ultra-wealthy Singaporeans has emerged in the GCB market in recent years, with many young and successful entrepreneurs who have made their fortunes in technology, finance, commodities, and F&B businesses, says Tay.
He adds that ultra-wealthy and newly naturalized Singaporeans also contribute to the exclusive pool of GCB buyers who prefer sizable plots in prime districts. “However, the number of naturalized citizens buying GCBs still remains low compared to local wealthy individuals,” says Tay.
According to research from List Sotheby’s, the cost of developing a new GCB from ground up is estimated to be around $1,000 psf and takes several years to complete. Hence, most buyers are looking for relatively new bungalows in move-in condition to minimize renovation works, observes Han.
“The GCB market will likely maintain its positive momentum, with demand from ultra-high-net-worth individuals driving its high-value transactions,” says Sandrasegeran. “The preference for privacy among GCB buyers and sellers could mean continued off-market transactions, adding to the complexity of tracking market activity.”