Singapore Property News This Week #176

Residential

400 applications made for Woodlands EC

Bellewoods, which is the first executive condominium launched this year has drew 400 applications. The condominium which is located in Woodlands comprises of 561 units and is expected to be sold for between $750 and $820 per square foot. Buyers would not need to pay HDB resale levy when they purchase a unit at Bellewoods as it is one of the last executive condominiums in the northern area of Singapore to be privatised. Since January 2013, developers are required to put their executive condominium projects up for sale after only 15 months from the date of award of the site. This has moderateddevelopers’ bids for executive condominium sites in the Government Land Sales programme.

(Source: Business Times)

Private residential market and HDB resale market softens in Q3

Market experts believe that the weak holding power of private home owners and developers has pushed prices of private homes and HDB resale flats down in Q3 2014. Flash estimates by the Urban Redevelopment Authority (URA) showed that the overall Private Residential Property Price Index (PRPPI) has fell 0.6 per cent in Q3 this year. This follows a 1 per cent fall in the PRPPI in Q2 this year. Over the last four quarters, prices of private homes have fallen by 3.8 per cent. On the other hand, resale HDB prices have also fallen due to the implementation of the mortgage servicing ratio. Not only so, the increase in supply of build-to-order flats has reduced demand for resale flats. Flash estimates from HDB showed that resale price index has slipped by 1.6 per cent in Q3, while resale prices have dropped by 6.8 per cent in Q3 2014 from Q3 2013. Ong Teck Hui from JLL does not expect the private home market to rebound soon. URA flash estimates also showed that prices of landed properties have fallen 1.7 per cent in Q3. Ong believes this is because the total debt servicing ratio has reduced the demand for landed properties. Eugene Lim from ERA Realty also added that the gradual fall in prices is an effect of the government’s cooling measures.

(Source: Business Times)

Condo prices in August remains flat

According to flash estimates by the National University of Singapore, resale prices of completed private apartments and condos have been flat in August. From July to August, prices for the overall market and the central region, including the financial district and Sentosa Cove, have remained unchanged. Yet, small apartments in the non- central regions have increased by 0.1 per cent in August. LumSau Kim said that the low turnover is likely to be due to fewer successful transactions. This is because sellers have not adjusted their asking prices to meet buyers’ expectations. Not only so, only 318 condo units were transacted in August. This is a fall from the 376 units that changed hands in July. Nicholas Mak from SLP International believes that the Hungry Ghost month has slowed sales in August. Mak added that there were no launched private residential projects in August, and as such, condo sales have been flat.

(Source: Business Times)

Sembawang EC site sold for $353 psfppr

A Sembawang executive condominium site has been sold for $353 per square feet per plot ratio, which is marginally higher than the $350 psfppr that an adjacent site had fetched in January this year. The bid was won by Qingjian Realty. Despite the high price, the tender had only attracted two bids. The low participation in the tender reflects the developers’ sentiments in the executive condominium market. Ong Kah Seng from R’ST Research believes that Qingjian Realty may have offered a high bid price as it believes that the government will soon lift cooling measures on the executive condominium market. Currently, executive condominiums can only be released 15 months from the date of award of the site. Also, there is a mortgage service ratio cap that impacted residential property demand. Nicholas Mak from SLP International predicts that Qingjian Realty’s breakeven cost is as high as $740 per square foot.

(Source: Business Times)

Marina One to be launched on Oct 11 2014

M+S Pte Ltd will only be launching 150 to 200 units at the expected launch of Marina One Residences. The released units are part of the first residential block. The second residential block, which has about 521 units, will be released after the project’s temporary occupation permit has been issued. Market experts believe this will help moderate the supply of residential units. The mixed-used project, which comprises 1,042 units in total, is expected to be released on October 11. Prices of the residential units will range from $1,960 to $3,100 per square foot. One-bedroom units start from 700 square feet and are priced at $1.4 million while a two-bedroom unit is about 1,001 square feet and is selling for about $2 million. On the other hand, a three-bedder is going for $3.46 million. Since the project does not come under the qualifying certificate rules, the developer will not be required to sell all its units within two years of its completion. Kemmy Tan from M+S expects the property to fetch a rental yield of 2 to 3 per cent due to its prime location.

(Source: Business Times)

Lake Life launches before 15-month sale-launch rule is up

To moderate the market, developers can only launch their executive condominium projects 15 months after the date of award of the site, or after the completion of foundation works, whichever is earlier. The Lake Life executive condominium is likely to be the first executive condominium that will be launched before the stipulated 15 months as it is slated to be released for sale on October 4. Vincent Ong from Evia Real Estate said that developers have been able to complete foundation works within the first eight months. The Lake Life executive condominium consists of two-bedroom units of about 969 square feet, three-bedroom units from 1,033 square feet and four-bedroom units from 1,195 square feet. The units are expected to be priced between $880 and $890 per square foot.

Commercial

Havelock II well received among buyers

Since its soft launch in July, about 70 per cent of the 50 units at Havelock II have been sold by Guthrie GTS. The 50 units sold in Havelock II made up half of the 100 office and retail units released by Guthrie to revamp HR buildings acquired earlier in March 2013. Of the 245 units in that project, 151 are retail units and the remaining are office spaces. Michael Leong from Guthrie said that the total debt servicing ratio framework has slowed sales. Office units, ranging from 312 square feet to 2,357 square feet have been sold for an average price of $2,228 per square feet. On the other hand, retail units from 150 square feet to 1,335 square feet have been sold for an average of $4,657 per square feet. All retail units are provided with water points and discharge outlets. Selected units will also be provided with independent air-conditioning systems. Last year, Guthrie had paid $282.88 million to acquire the eight-storey building.

(Source: Business Times)

DTZ: 1m sqft office space to be available in 2015

According to DTZ, about one million square feet of office space will be available in 2015 when current tenants move out of existing buildings to new offices. Not only so, there will be another 133,000 square feet of shadow spaces released next year. This will add on to the current 550,000 square feet of shadow office space. These spaces are made available for subletting or reassignment by tenants. Thus, there will be a net increase of 159,000 square feet in office supply in 2015, said DTZ. While office rents have been projected to grow by 15 per cent by the end of this year, Lee Lay Keng from DTZ believes that rental growth in the CBD area will increase by a slower rate in 2015. The average gross monthly rental for offices in Raffles Place has increased 2.7 per cent to $10.55 per square foot from Q2 to Q3 this year. Not only so, DTZ said that occupancy rates were higher in Q3 across the island. This is because no new office space was released in that quarter. Occupancy rates have rose by 0.8 percent to 95.8 percent in Q3 2014.

(Source: Business Times)

Tuas and Tampines industrial site on sale

Two sites at Tuas South and one at Tampines North have been put on sale. All three sites have been zoned for Business-2 development. The site at Tampines is 2.7 ha. It is the largest site that has been launched in H2 2014, under the industrial government land sales confirmed list. It has a gross plot ratio of 2.5 and has a lease of 30 years. Nicholas Mak from SLP International predicts that there will be four to seven bids for the Tampines site. Also, he expects the top bid to be around $70 to $82 per square foot per plot ratio. On the other hand, Ong Kah Seng from R’ST Research said that the winning bid would be around $90 to $105 per square foot per plot ratio. Market experts expect the Tuas site to attract lower bid prices. The site at Tuas South Street 9, which has a 20 year 8 month lease and a gross plot ratio of 1.0, is expected to draw bids as high as $65 per square foot per plot ratio, said Mak. The other site at Tuas South Street 6 will be released under the reserved list. It also has a gross plot ratio of 1.0. However it has a 20 year and 4 month lease. Analysts believe that that site will be sold for about $60 to $75 per square foot per plot ratio.

(Source: Business Times)