In October 2020, a government land sales (GLS) exercise for a new condo at Tanah Merah Kechil Link drew 15 bids from developers.
It was ultimately won by MCC Land, whose bid of $930 per square foot per plot ratio was significantly above media analysts’ expectations of $850. The plot of land has a size of 8,880 square metres (sq m) and MCC Land is likely to build 265 condo units and 2,000 sq m of commercial space.
The last time a GLS exercise attracted such a strong level of interest was back in 2018.
So why did this land parcel at Tanah Merah Kechil Link spark such an intense bidding frenzy?
There are a few reasons, which this article will examine in detail.
First off, the location is highly strategic.
This new project is a mixed development with 2000sqm of retail space. The Tanah Merah MRT does not have a mall at the moment, and the nearest mall would be Bedok (where Bedok Mall and Bedok Point is located) or Simei (which has Eastpoint Mall). It is also located right next to the Tanah Merah MRT station, which gives residents and tenants unparalleled connectivity and convenience. Residents in the area will also benefit from this mixed development as they can now do grocery shopping nearby.
PIE, ECP and TPE are the expressways that link future residents to other parts of the island.
In other words, the new mixed development condo at Tanah Merah Kechil will benefit from the area’s accessibility and convenience.
A good selection of nearby schools across all levels will also be a huge drawing point for families.
They include Temasek Primary School, St Anthony’s Canossian Primary School, Red Swastika Primary School, Yu Neng Primary School, Victoria Secondary School, Anglican High School, Temasek Junior College, Temasek Polytechnic, ITE College East and Singapore University Of Technology And Design.
Besides location, the Tanah Merah Kechil area has plenty of development potential.
There are some 30,000 residents in District 16 (where Tanah Merah Kechil is located). However, the neighborhood has been crying out for more retail, dining and commercial amenities.
Since the new mixed development condo at Tanah Merah Kechil will be a mixed use development comprising of residential and commercial units, it fulfils the need for more value-added amenities in the area.
That being said, there are several entertainment, shopping and food landmarks already close by.
They include Eastpoint Mall, Tampines Mall, Bedok Mall, Singapore Expo, Changi City Point and Simpang Bedok.
Tanah Merah Kechil New Mixed Development Condo Summary
Having a commercial landmark right in the heart of Tanah Merah Kechil however, would elevate the area to even greater heights.
Which is why the new condo at Taneh Merah Kechil is projected to be a sound investment with top notch living conditions.
Other than the facilities and amenities on-site, the growth of District 16 is likely to result in a steady appreciation in value for condos in the area.
Further analysis of similar developments will be done further down in the article, so as to give you a better idea of the investment potential of the new condo at Tanah Merah Kechil.
Second Quarter of 2021
Total Number Of Units
265 units of 1-4 bedrooms
2000sqm of retail space (managed by the developer)
99 year leasehold
A mix of 265 residential and commercial units
Full fledged condo facilities with swimming pool, BBQ pits and function room
It will sit atop a mall and will have direct linkage to mall below
Tanah Merah Kechil New Mixed Development Condo Pricing And Floorplans
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Tanah Merah Kechil New Mixed Development Condo Comparative Market Analysis
The nearby comparables to the new mixed development condo at Tanah Merah Kechil include [email protected] Merah and Grandeur Park Residences.
[email protected] Merah was launched in Jan 2010 at a PSF of 7xx to 11xx. More than 10 years since launch, it is now transacting at 13xx to 14xx in the resale market.
This is mainly due to the growth of District 16, and recognition from the market of its status as an established residential hub.
Over the years, eastern Singapore has also gradually increased the number of business/industrial estates in the area; the most prominent being Changi Business Park.
The result is more rental demand from tenants who work nearby. This is a key reason why District 16 property prices have appreciated steadily.
Profitable transactions are mostly from owners who bought first hand from the developer back in 2009.
They managed to cash in on the District 16 growth, and sold their units at handsome profits ranging from $5xxk to $7xxk.
On the flip side, there have been a few owners who have so far, made unprofitable transactions from [email protected] Merah.
They are typically those who bought second-hand units. Meaning resale units from other owners.
Conclusion: Buying directly from the developer during the launch period will greatly enhance your chances of making a profit.
Since [email protected] Merah is a comparable for the new condo at Tanah Merah Kechil, the same principle applies as well.
Now, let’s take a quick look at Grandeur Park Residences – another development at District 16 which just gained TOP status.
Since the launch in 2017, its price has appreciated strongly from 13xx-14xx PSF to 16xx-17xx PSF.
This reinforces the conclusion derived earlier. Buying at the launch stage directly from the developer is key to making a sound property investment.
Government Masterplan And Growth Nodes Leading To Capital Appreciation
District 16 in the east is one of the most coveted residential hotspots in Singapore, among both local and foreign home owners.
For locals, the area has served as a comforting home to multiple generations of Singaporeans. As the younger generation grows in status and income to the point where they need a home for themselves, many choose to stay in familiar surroundings.
For foreigners, an exemplary transportation network, diverse dining options and easy access to water sports are the main drawing factors. As the number of foreign home owners take up residence in District 16, this paves the way for more to follow in future.
Besides being a residential haven, District 16 is becoming one of Singapore’s major commercial and business hubs.
Industrial estates Changi Business Park and Bedok Industrial Estate are already well-established. With plans to increase industrial activities already underway, properties in the area (including the new condo at Tanah Merah Kechil) will benefit from this positive transformation.
As indicated above, District 16 is a popular home choice for foreigners in Singapore. While some prefer to buy and own a home, many choose to rent as well. The rental yield in District 16 is well above 3%, and even hitting 3.7% simply because of its proximity to business nodes like Changi Business Park and the airport.
Which is why rental yield numbers for District 16 properties are healthy and set to grow in future.
When the area becomes even more established as a commercial and business hub, it is likely that more jobs will be created.
As we all know, more jobs means more rental demand from professionals working in the area.
The new condo at Tanah Merah Kechil, with its convenient mix of residential and commercial units, is primed to be one of the most highly sought-after rental choices in District 16 due to this industrial shift.
High demand leads to high prices.
The popularity of District 16 properties has led to a gradual increase in prices.
While this may not seem like positive news for potential buyers, let’s look at the situation in another light.
The developments in the area are the driving forces behind the demand and price increase.
These developments are nowhere near complete. Which means that prices are likely to rise even further in the years to come.
Should you invest in a unit at the new condo at Tanah Merah Kechil, the price you pay will probably be a lot lower than the value you receive, once the condo reaches TOP status.