Pearl Bank Apartments redevelopment could break Wallich Residences' dominance

CapitaLand plans to build a new 800-unit residential on site.

CapitaLand makes a grand reentry into the residential game after it bought Pearl Bank Apartments via private treaty exercise for $728m.

According to DBS Equity Research, the company's plans to build a new 800-unit residential on a site on top of a hill could mean a potential luxury condominium could re-emerge to rival Wallich Residences, which is asking close to $3,000 psf.

DBS analyst Derek Tan said, "Given the significant size of the deal, timing of the launch is important and the group could look to launch the project in 2H2019 after existing en bloc projects have been launched for sale."

Moreover, a good sales momentum in the residential market could be a boon for the company.

According to RHB Research, there is also limited new supply in the Outram Park area.

Tan added that the location in Outram could potentially attract investors and homebuyers who are keen to stay close to their workplace in the city centre.

The transaction price is lower than recent sites won in the vicinity, like Jiak Kim Site at $1,733 psf, which are priced marginally lower but are located further away from the central business district (CBD).