Newbuilds: The trend is for upmarket living
Newbuilds and newly renovated units are the most popular with overseas investors because they are lower maintenance and can offer better yields.
London generally is the first port of call for overseas buyers and several properties are about to come on to the market. Sitting on the doorstep of the capital's most famous park, One Hyde Park is being touted as one of the world's most iconic developments in the super-prime market. Half of the 80 units have already been sold, achieving an average of GBP20 million (HK$310.65 million) per unit, or an estimated GBP4,600 per sqft up to almost GBP6,000 per sqft for units with a park view.
According to agency Knight Frank, the market slowdown seen in the prime and mainstream market has not happened at the top end of the market, as demonstrated by the high prices paid for One Hyde Park units.
Knight Frank said that despite the credit crunch, extraordinary wealth creation had continued across the global oil and commodity sectors and the financial market was still providing huge rewards for those in the right position. It said, 'With the British market generally in a more sombre mood, the strong performance of the super-prime market and One Hyde Park in particular, is thrown into even sharper relief.'
Knight Frank said the continued wealth generation and demand from the super-rich rising strongly over time meant that the level of available stock in the most sought-after locations was still low, and the amount of new stock coming in to the market from developments in Central London was 'incredibly constrained'.
In the prime market, areas once considered down-at-heel in the capital are offering investors a chance to own a slice of the up-and-coming. London's East End district has always been the poor cousin to other more affluent suburbs, but numerous regeneration projects, and the site of the 2012 Olympics that side of the city, is changing the area. City Quarter in Whitechapel, which is a short walk from the financial district, is an area encompassing newbuilds and old buildings which are being converted into apartments. The regeneration project sits on the site of a former sugar warehouse and goods depot, and a Grade II-listed Victorian warehouse is an eye-catching building being converted into apartments. Named Sugar House, the seven-storey building, due for completion in April next year, will retain its characteristic Victorian features - the facade, large, arched feature windows, and in the lobby a sweeping staircase with its original wooden handrail and iron balustrades.
Apartment interiors, which include duplexes and penthouse suites, will be decidedly 21st century. Italian designer kitchens, double-end baths, walk-in showers and underfloor heating are the considered modern-day essentials and wiring for hi-tech multimedia systems will also be installed.
Property agent King Sturge said the location and price provided a rare opportunity for buyers to purchase before the London launch. The converted warehouse will house 42 apartments. One-bedroom units range between 414 sqft and 680sqft, while two-bedroom units will be between 714 sqft and 1,251 sqft. Duplex and triplex units will start from 1,300 sqft. Prices for a one-bedroom apartment start from GBP425,000, and GBP675,000 for a two-bedroom apartment. The potential rental income on a one- or two-bedroom unit is about 5 per cent, according to King Sturge.
In Southeast London, 15 minutes from The City and Canary Wharf is Greenwich View, a newbuild which sits on a world heritage site in Greenwich. Agency Colliers said its location made this appealing for overseas investors because of the potential of an increasing number of city workers looking to rent accommodation. 'The current tenant demand for properties in this price bracket far outstrips supply, and provides room for growth as regeneration brings additional shopping and restaurant facilities to the area', it said.
The 13-storey building houses 84 units of between one and three bedrooms. Prices for a one-bedroom unit are expected to be between GBP285,000 and GBP310,000; while two-bedroom units are priced between GBP335,000 and GBP850,000. Colliers said investment yield was estimated to be 5 per cent.
'The scheme's investment potential is huge as it has the benefit of being in an already established and sought-after area,' Colliers said. 'Values in excess of GBP800 per sqft have already been achieved in newbuild schemes close by for completions in 2010.' The average price per sqft for Greenwich units is GBP560 per sqft.
South of the River Thames is Kennington Park Square, which is just 1.6km from the South Bank, or London's playground of theatres, art galleries, shops and restaurants. The development consists of five apartment buildings each being five stories. Exteriors feature traditional stock brickwork to complement nearby older buildings while the interiors are entirely contemporary.