You might have heard that Huang Youlong—the billionaire husband of actress Vicki Zhao—forked out nearly $28 million for a mega-penthouse at Ardmore Park in April 2020. Although the transaction raised eyebrows mostly for it happening in the middle of the Covid-19 pandemic, 99.co found out that, from a property standpoint, there are more dramatic details about the transaction than initially meets the eye.
First, a brief background about the couple
Aside from holding their native Chinese passports, Huang Youlong (or Huang You Long) and Vicky Zhao are both Singapore Permanent Residents (PRs) who tied the knot here in 2008.
At that time, Huang was the company director and Zhao was probably still best-known for her role in the drama “My Fair Princess” back in the late 90s. The couple made quite a bit of their fortune from a deal with another (much) richer guy, Alibaba’s Jack Ma, back in 2014.
In 2017, the 44-year-old businessman and the 43-year-old actress found themselves in the wrong kind of news; they were fined and barred from trading in China’s securities markets for five years after the country’s financial watchdog found that they “deliberately misled stock investors” by providing false information.
A year later in 2018, Chinese authorities followed up by banning the duo from serving in key positions at any listed company for five years.
One could say they’re just investors right now, one of those signature uber-rich couples with a mountain of passive income and kids in tow (a 10-year-old daughter and a newborn girl, both born in Singapore).
Huang’s new penthouse at the freehold Ardmore Park condominium sits on the 29th floor. The unit cost him $27.65 million to be exact but, strictly speaking, this isn’t their most expensive property purchase. In 2011, the couple had bought Château Monlot, a winery in France’s Bordeaux region, for 40 million Euros (about $70 million Singapore dollars at the time).
At Ardmore Park, Huang already owns at least one other unit (believed to be a four-bedder on a low-floor), and it turns out that this latest transaction isn’t without its own dose of drama.
Are you ready?
Dramatic detail #1: Huang took 3 years to ‘seal the deal’ on his Ardmore Park penthouse
According to the initial report by The Business Times, Huang was actually granted the Option to Purchase (OTP) by the seller of the penthouse way back in April 2017.
For those who don’t know, an OTP has about the same function as a packet of tissue paper at a hawker centre. An interested buyer pays a deposit to the seller (typically 1% of the purchase price) in exchange for the OTP, so no one else can make another offer during the period that the OTP is effective. This period is known as the option period.
Typically, the option period for a resale condo transaction is 14 days. Long enough for the seller to secure the financing needed, but not so long in that the seller would lose out if the buyer changes his/her mind or is unable to buy for some reason or another. Now check this out:
Standard option period: 14 days
Huang’s option period: 1,096 days
Now we’ve been in the property business for a long time and we have come across some weird stuff, but we haven’t heard of an OTP granted/extended for three whole years.
Although technically a resale condo OTP can be valid for as long as both the buyer and seller can agree upon, the property agent of the seller would actively advise against giving a longer option period than the typical 14 days, simply because 14 days would be sufficient time for a committed and financially-able buyer to finalise the purchase.
IF the buyer requests a longer option, then he/she must be prepared to pay a larger deposit, say 2% for a one-month-long option period. An extended OTP suits foreign buyers like Huang, who might require more time to secure financing as a non-local, amongst other logistical and administrative tasks that could take more time.
But this is three whole years we’re talking about. If the seller of the Ardmore Park penthouse were to scale the deposit proportionately to the option period, Huang’s three-year OTP would involve a 78% deposit. That would’ve been crazy, and probably not what happened.
It turned out that the seller, RB Capital’s CEO Kishin RK, had received Huang’s unsolicited offer to buy the unit shortly after he took ownership of it back in April 2017. Kishin, who would’ve had to bear a Seller Stamp Duty (SSD) if he were to sell the penthouse within three years of taking ownership, told the Business Times that Huang’s offer was “too good to refuse”.
And so a lengthy OTP was drawn up, and the deposit required of Huang was likely far lower than 78% of the purchase price. It is likely that Huang offered to pay a deposit equivalent to the sum total of the rental for the unit for three years (or slightly higher):
Deposit of 1% of purchase price for a standard 14-day option period: 1% x $27.65 million = $276,500
Deposit equal to 3 years worth in rental: $30,000 x 36 months = $1,080,000*
*about 3.9% of the purchase price.
Imagine Huang wanting that penthouse so much that he pays rent without getting to live there (because it’s just an OTP)—that’s desire for you.
Now onto the next detail…
Dramatic detail #2: The enigmatic Kishin, the previous owner of the Ardmore Park penthouse
Kishin RK, who happens to be Singapore’s youngest billionaire, told Business Times that he had paid S$19.5 million for the unit in 2017. We’ll have to take his word for it, because no evidence of a monetary transaction for the unit was formally recorded by the Urban Redevelopment Authority (URA):
The most likely explanation is that Kishin bought the unit in a private deal and the property itself underwent a transfer in ownership, which is a practice that is more common than you think among the wealthy.
It’s rich people’s equivalent of, say, buying a friend’s or a sibling’s used iPhone 11.
On accepting Huang’s unsolicited offer, Kishin locked-in a potential profit of 42% just weeks after moving in. It turned out to be a great piece of business; in the span of three years from Q2 2017 to Q2 2020, prices of freehold condos in District 10, where Ardmore Park is located, appreciated by only 16%, according to 99.co data.
Even though Kishin is a seasoned real estate player himself, this must’ve been one of his sweetest deals so far.[Have a look inside the penthouse in this article.]
Dramatic detail #3: Huang (legally) avoided paying $4.15 million in taxes
About a year and four months into Huang’s option period, the Singapore government announced that it was putting the brakes on an overheating property market by increasing the Additional Buyer’s Stamp Duty (ABSD).
For PRs buying their second and subsequent homes, they would have to pay an additional 5% of the property’s purchase price or valuation, whichever is higher.
Because of the increased ABSD, Huang would’ve had to pay a total of 15% of the penthouse’s purchase price. The amount? $4,147,500 (about $4.15 million).
Only that he didn’t need to pay that amount. This is because Huang had bought the Ardmore Park penthouse as a trustee, with his 10-year-old daughter April the likely beneficiary (i.e. the property will be in her name when she turns 21.)
When buying property as a trustee, the buyer is not liable to pay any ABSD if the beneficiary is a Singaporean citizen and does not own any property.
Even if Huang’s daughter is a Singapore PR and not a citizen at the time of purchase, Huang would only have needed to pay 5% in ABSD, compared to 15% in a regular transaction. The 5% works out to around $1.38 million—astronomical sums for
pheasants people like us but spare change for property buyers like Huang.
ABSD or no ABSD, it’s not uncommon for the wealthy to buy properties as a trustee, with a child listed as a beneficiary. This is typically done as part of a wealth preservation strategy, a secure way to pass down wealth through generations.
Take a look INSIDE Huang’s penthouse in this article!
Which dramatic detail about Huang’s penthouse purchase stood out to you the most? Let us know in the comments section below or our Facebook post.
If you enjoyed reading this article, 99.co recommends 9 celebrity homes, including Jackie Chan’s and Jet Li’s, in Singapore: Where are they at?, REVEALED: Why Romeo Tan paid over $1.6 million for this Marina One Residences bachelor pad, James Dyson gets a new neighbour downstairs and What has Leo KoGuan, who now lives in James Dyson’s former penthouse in Guoco Tower, has to do with Tesla?
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Apartments for sale at Ardmore Park (District 10)
Who are Vicky Zhao and Huang Youlong?
Aside from holding their native Chinese passports, Huang Youlong and Vicky Zhao are both Singapore Permanent Residents (PRs) who tied the knot here in 2008. At that time, Huang was company director and Zhao was probably still best-known for her role in the drama “My Fair Princess” back in the late 90s. The couple made quite a bit of their fortune from a deal with another (much) richer guy, Alibaba’s Jack Ma, back in 2014.
What happened to the couple in 2017?
In 2017, the 44-year-old businessman and the 43-year-old actress found themselves in the wrong kind of news; they were fined and barred from trading in China’s securities markets for five years after the country’s financial watchdog found that they “deliberately misled stock investors” by providing false information. A year later in 2018, Chinese authorities followed up by banning the duo from serving in key positions at any listed company for five years.
How much did Huang You Long pay for his Ardmore Park condominium?
Huang’s new penthouse at the freehold Ardmore Park condominum sits on the 29th floor. The unit cost him $27.65 million to be exact but, strictly speaking, this isn’t their most expensive property purchase. In 2011, the couple had bought Château Monlot, a winery in France’s Bordeaux region, for 40 million Euros (about $70 million Singapore dollars at the time).
Upcoming Freehold Condo Launch: The Arcady @ Boon Keng
About Kyle Leung
Content Marketing Manager @ 99.co
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