Saturday, March 26, 2011

Homing in on high-end property

GOOD-CLASS bungalows are rare in Singapore, but even less common is the tale of Mr George Lim, who almost by chance has become a leading niche developer of these ultra-posh homes.

Since 2006, Mr Lim, 59, has redeveloped and sold at least seven of these bungalows, worth a total of $145 million.

He made headlines recently after paying a jaw-dropping record $61.4 million for a 41,852 sq ft site in Leedon Park. In his usual style, he plans to tear down the bungalow and redevelop the site with two good-class bungalows.

The unassuming Mr Lim says his foray into property was not planned, but 'happened along the way' after he sold his engineering firm for about $12 million. This helped him buy an $18 million good-class bungalow in Belmont Road. He lived there for three years before subdividing the 48,000 sq ft plot and building three homes - which sold for $33 million in total in 2006.

In an interview with The Straits Times, Mr Lim says his confidence in the value of homes here is based on land scarcity.

'My father bought our first house in Kembangan for $12,000, improved on it, and sold it for more than $60,000 after 10 years... I look at this and see that property investment has fantastic growth. There's no way you can put money into a savings account and get those kind of returns.'

He goes with a certain gut feeling - a 'feel-good' instinct - that allows him to be comfortable with every land purchase.

He holds a site for two to three years, tears down the old house, then a new, uniquely designed bungalow is built - and sold.

'Never alter a house, because it will never be as good as a new product and it will cost you almost the same,' he says, adding he will not rent out the homes.

Mr Lim has three other good-class bungalows on hand - in Binjai Park, Leedon Park and Second Avenue. All three are set to get a green mark rating, as he looks to build homes with environmentally friendly features like solar panels - another facet in his quest to build better homes.

The two bungalows in Binjai Park and Leedon Park are set to be ready by June. He hopes to sell them for more than $40 million each - a new unit price record of about $2,500 per sq ft - if successful.

But his success also comes with risks. Mr Lim admits that he is 50 per cent leveraged based on the cost of the properties.

Recent measures such as higher sellers' stamp duties are not an issue in this market, he says. He is confident that demand will continue to grow in tandem with the growing ranks of rich folks here.

'I will put a price there, and if somebody thinks it's worth buying, then I will sell it... My intention is to hold it as an investment for the long term... But the moment I sell it, I will look for another plot to buy, so that I stay in touch with the property market,' Mr Lim adds.

Good-class bungalows are the highest-end homes here. There are only about 2,400 of such homes in 39 gazetted areas such as Nassim, Dalvey and Tanglin.

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