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AS PRICES of recently launched luxury condos continue to go through the roof, home buyers may well ask: Is it worth paying so much for an ‘iconic’ property?

To some extent, property consultants say, such swanky projects do make better investments.

The premium commanded by an iconic development - which experts define as a prominent, stylish building with a unique design that stands out from its landscape - tends to last through the years and often helps the project better weather market storms.

Take one of Singapore’s better-known iconic condominiums, Wheelock Properties’ luxurious Ardmore Park, as an example.

During the 2001-03 property market decline, the average unit price for Ardmore Park proved more stable than that of a typical freehold condo in District 10, falling only 8 per cent versus an average drop of 12 per cent for comparable projects, according to figures from Knight Frank.

And when prices in District 10 recovered slightly - by about 3 per cent - in 2004, Ardmore Park prices rose about 8 per cent.

At its launch in mid-1996 when the private housing market was at its peak, Ardmore Park units were sold for historically high prices of between $1,600 and $2,000 per sq ft (psf). It still costs just above $5.2 million for a 2,885 sq ft apartment or $1,808 psf.

Mr Colin Tan, head of research at Chesterton International, said:

‘Certain developments will always cost more than their neighbours as people recognise the grandeur of their architecture.’

Added Mr Vincent Chong, associate director of residential sales at Colliers International: ‘It’s easier to market a popular iconic development everyone talks about than an unknown condominium in the same area.’

The theory holds for other iconic buildings too, such as SC Global’s exclusive Boulevard Residence (BLVD) at Cuscaden Walk, which was launched in January 2003 at an average of $1,500 psf but now exceeds $2,000 psf.

The project’s price increases have also been consistently higher than those of any other freehold condo in the same district. When prices in District 10 remained flat from 2004 to last year, BLVD prices rose 11 per cent from $1,559 psf to $1,728 psf.

Another SC Global project, the architectural award-winning The Ladyhill off Orange Grove Road, has seen its annual average unit price regularly beat the market even in a downturn - sliding by a mere 2 per cent as the market fell 12 per cent from 2000 to 2001.

But looks are not the only factor determining the success of an iconic development, said property consultants, who pointed to other important aspects as location and tenure. Projects in prime areas tend to command higher prices, as do freehold properties.

Ardmore Park, BLVD and The Ladyhill are freehold. For most 99-year leasehold projects, prices tend to fall as their leases run out.

Far East Organization’s leasehold The Bayshore in the East Coast area, for instance, now goes for an average of $479 psf, a far cry from the $800 psf it commanded at its launch in 1994 - despite winning the prestigious international FIABCI Prix d’Excellence Award in 1999 for design and construction excellence.

Knight Frank’s director of research and consultancy, Mr Nicholas Mak, said: ‘Design and exclusivity are important, but taken alone, they may not be able to prevent the property’s price from going against the market.’

Source : Sunday Times - 23 Jul 2006