Getting to know Normanton Park

Normanton Park is one of the most anticipated mega projects by Kingsford Huray Development Pte Ltd which will be launched in January 2021. The largest city-fringe launch is a 99-year leasehold mega-development that houses 1,862 residential units ranging from 1 bedroom to 5 bedrooms, terrace houses and commercial units. It is located under District 5; next to Kent Ridge Park; 1.4km walking distance to Kent Ridge MRT; and near the One-North development area. Normanton Park is expected to be completed in January 2023. 

Project details aside, Kingsford Huray, the developers behind Normanton Park, have certain issues with their track record. Back in January 2019, they were issued a no-sale license by the Urban Redevelopment Authorities (URA) for Normanton Park due to them having “failed to meet the requirements for a sale license”. This was largely due to the Building and Construction Authority’s (BCA) findings that “some building works at Kingsford Waterbay (an earlier project by Kingsford) had deviated from requirements under the Building Control Act and Regulations”.

What is a no-sale license? 

No-sale licenses are issued by the Controller of Housing (COH) when developers fail to meet all the requirements of a sale license. This prevents developers from commencing the sale of their units during the construction of the project. However, these licenses can be converted into sale licenses before obtaining a Temporary Occupation Permit (TOP), provided the developer satisfies COH’s requirements.

How has this impacted the development of the project? 

As per IRAS regulations, for housing developers that have acquired sites before 6 July 2018, they will be subjected to 15% additional buyer’s stamp duty (ABSD) which may be remitted upfront upon the fulfillment of conditions such as building and selling a project within a period of 5 years.

The estimated timeframe for Kingsford to sell all units before getting penalised by ABSD is from 2017 to 2022. With IRAS’ imposing temporary COVID-19 relief measures for the property sector, Kingsford has been granted an additional 12 months -and a more comfortable timeframe- to sell all Normanton Park units by 2023 and allow the remittance of the imposed 15% ABSD. 

China Jingye, a subsidiary of MCC Singapore, is the main contractor of Normanton Park. They have had a good past track record and experience developing private residential projects such as The Alps Residences, Queens Peak, The Canopy, One Canberra and more. Given their track record coupled with the requirement to obtain a Quality Mark Certificate for the construction of Normanton Park, the quality of the project is likely to be decent. 

After taking into consideration the track records of the developer and construction companies, we analysed Normanton Park in more detail using our 5 criteria to determine its potential.

Criteria #1: Growth Area 

One-North Business Park is one of the few development areas located near Normanton Park. In line with the URA Master Plan, the area has been transformed into a vibrant work-live-play-learn research and business park that promotes plenty job opportunities and growth. 

Just a stone’s throw away is Dover Knowledge District, an extension of One-North Business Park, located opposite the National University of Singapore (NUS). Given its purpose to synergise the business park with academic and research institutions, this area also has the potential to create more jobs and learning opportunities.

There is a potential to attract tenants from these two development areas – those working in the business park as well as students from NUS and other tertiary education institutions in the area. URA has also marked out large residential zones (highlighted in orange) which are currently subject to detailed planning. Hence, these future residential development sites may generate potential capital appreciation for Normanton Park.

Another urban transformation to take note of is the Greater Southern Waterfront (GSW), which stretches from Gardens by The Bay East to Pasir Panjang. As Normanton Park is located less than 10km from Pasir Panjang, there is potential for the new project to benefit from GWS.

However, with its development only taking place in the next 5 to 10 years, it is unlikely there will be any impact in the short term. 

Timelines have an impact on growth potential, making it a key consideration under this first criteria. One-North’s development is already in progress and will undoubtedly bring about a better, faster spill-over effect on Normanton Park. We estimate to see an impact from the Dover Knowledge District in the next 5-10 years; while for GSW, the next 10-20 years.

Criteria #2: New Launch Vs New Launch

There are a handful of new launch projects within a 3km radius from Normanton Park; in areas such as Holland Village and Queenstown. There are 2 smaller freehold projects along the coastline as well. One key comparable project is Kent Ridge Hill Residences (KRHR), located near Kent Ridge Park. It is a 99-year leasehold project that has a total of 548 units and is expected to TOP in 2024. 

Based on the indicative prices for Normanton Park, we estimate the price for 1 bedroom units (484 sqft to 581 sqft, exclude penthouse) to range from S$0.77 mil to S$1 mil. This quantum is similar to KRHR, which has sold all their 1 bedroom units. If you are a buyer looking for a newly launched 1 bedroom unit in this area, Normanton Park might be your only option. 

For 2 bedroom units, Normanton Park’s unit size ranges from 657 sqft to 775 sqft (exclude penthouse) and comes with an estimated price range from S$1.05 mil to S$1.32 mil. KRHR’s current available price is from S$1.39 mil and above, with its unit size ranging from 786sqft to 797 sqft. If the Normanton Park’s launch price falls within our estimated price range, it could be a better option based on its quantum. Buyers would also pay lesser progressive interest as it has an earlier TOP as compared to KRHR. 

For 3 bedroom units, Normanton Park’s unit size ranges from 904 sqft to 1,098 sqft (exclude penthouse) and comes with an estimated price range from S$1.44 mil to S$1.87 mil. KRHR’s prices range from S$1.68 mil and above. The unit size of KRHR is relatively similar to Normanton Park – 883 sqft to 1,076 sqft. 3 bedroom units are more suitable for home stay or mixed purpose, and since the price ranges are similar, it would depend on the buyer’s affordability and location preference. 

In a nutshell, Normanton Park would be a better option if its launch price falls between the estimated price range. On top of that, Normanton Park may attract working adults in the One-North Business Park area, given its convenient location. 

Criteria #3: New Launch Vs Resale Projects Comparison

For those who are not fans of new launch projects, there are many opportunities within the resale market as well. 

Within a 2km radius, there are plenty of private residential properties including some small freehold apartments along Pasir Panjang. We have shortlisted a few comparable projects in the One-North and Queenstown area. 

Queens Peak, a recent TOP project in 2020, is a 99-year leasehold project with 736 units and is located near Queenstown MRT is a strong competitor to Normanton Park. Although a smaller project, the condominium is equipped with full-condo facilities. 

For those taking leasing into consideration, another viable option would be Alexis – a freehold project that was completed in 2012. It is, however, a relatively small project with only 293 units. 

For 1 bedroom units, Queens Peak’s lowest available price starts from S$0.82 mil (431 sqft, S$1,902 psf); Alexis starts from S$0.71mill (409 sqft, S$1,736 psf); while our estimated price for Normanton Park is between S$0.77 mil to S$1 mil (481 sqft to 581 sqft). Comparing all 3 projects, their quantums are almost competitive and unit sizes similar. Based on price per sqf, Normanton Park and Alexis look like better options. 

For 2 bedroom units, Queens Peak starts from S$1.35 mil (775 sqft, S$1,752 psf); Alexis starts from S$1.20 mil (721sqft unit, S$1,664 psf); while our estimated price for Normanton Park is between S$1.05 mil to S$1.32mil (657 sqft to 775 sqft). Although Alexis is an older freehold project, it has a similar psf and quantum as compared to Normanton Park. 

For buyers on a tighter budget, Normanton Park’s 2 bedroom units might be a good option. On the other hand, if you can afford a more expensive unit, Queens Peak might be a better option due to its close proximity to MRT as well as potential in providing an immediate source of rental income.

The analysis above also applies to 3 bedroom units. For 3 bedroom units, Queens Peak starts from S$1.68mil (947 sqft, S$1,774 psf); while our estimated price for Normanton Park is between S$1.44mil to S$1.87mil (904 sqft to 1,098 sqft). Selecting to purchase either project would depend on the buyer’s affordability. 

It is important to note that Queens Peak and Normanton Park are located in different areas and give off different impressions, which in turn, may attract different tenant profiles. We highly recommend interested buyers and investors to arrange for viewings to fully experience the difference between both properties before making their decision. 

Criteria #4: Unique Selling Points

If you are a nature lover or looking at Normanton Park as an investment property, being located right next to Kent Ridge Park could be a bonus. The project has a side gate, providing residents a direct link to the park – a rare find in Singapore. Another highlight is being located off Ayer Rajah Expressway and a less than 10km dive to Orchard and the Central Business District. 

Although there are no primary schools within a 1km radius, there are many tertiary education institutions in the area. However, there are no supermarkets or eateries within walking distance of the project. Normanton Park is quite a distance away from Kent Hill MRT but it is near the One-North area, making it possibly a favourable choice for working adults within the business park area.

Criteria #5: Exit Strategy

When it comes to property investment, it is crucial to enter with an exit strategy in mind. There are many factors to consider when investing in property: growth area, project size, rental yield, tenant pool, distance to mrt, facilities, convenience to amenities, job opportunities in surrounding areas, overall quantum ( based on average TDSR of Singaporean to exit for next buyer), and more. 

Conclusion

Based on the overall factors and criteria, if you are interested in purchasing Normanton Park as an investment, 1 bedroom units might be the ideal fit. For home-stay or mixed purpose, do ensure the area and environment suits your lifestyle.

A short-term exit strategy is still unclear due to the area still undergoing development and would largely depend on Normanton Park’s launch price. Nonetheless, it is possible to exit with a profit within 5 years of growth.

Ultimately, always know where your priorities lie before planning to purchase a property and never let emotions dictate your investment decisions.