Singapore Property News Upfront!

Foreign power have landed in Singapore!

An increasing number of landed homes in Singapore are going to foreign buyers, especially in the prime districts.

Foreigners (including permanent residents) picked up 105 landed homes in Districts 9, 10 and 11 last year, which was 66.7 per cent higher than 2005 and the highest figure since 1995, the earliest date included in the Urban Redevelopment Authority’s Realis caveats database, an analysis by DTZ Debenham Tie Leung shows.

UK nationals were the biggest buyers of prime district landed homes last year, with 18 purchases. Other major buyers were Australians, Americans, Malaysians and Indians.

DTZ highlighted that buyers from India have increased their share of landed home purchases in prime districts from three or fewer transactions a year in the past to 11 in 2006. Similarly, Australians increased their purchases from four transactions in 2005 to 13 last year. These various nationalities bought prime district landed homes predominantly in District 10.

Foreigners have to be PRs before they can receive permission to buy landed homes on mainland Singapore, and Sentosa Cove is the only location where foreigners who are not PRs are allowed to purchase landed property.
Even then, foreign would-be buyers must seek permission from the Land Dealings (Approval) Unit under Singapore Land Authority. Foreigners, including PRs, can at any one time own only one landed home in Singapore and must occupy it themselves rather than renting it out.

Among the criteria that the Minister for Law will consider when asked to approve foreigners/PRs buying a landed home in Singapore are the applicant’s qualifications and whether the applicant has made or will be able to make adequate economic contribution to Singapore.

Typically, it takes about four weeks for approval to be granted, but on Sentosa Cove, the time has been cut to under 48 hours under a special fast-track approval scheme.

The landed properties that foreigners and PRs may be permitted to buy must have a land area of no more than 15,000 sq ft, although exceptions have been made, with some PRs buying Good Class Bungalows, which have a plot size of at least 1,400 square metres (about 15,070 sq ft).

Foreign buyers may acquire an unlimited number of non-landed private homes - condominiums and apartments.
The only foreigners who may buy HDB flats on the resale market are PRs.

‘So there are regulations in place to guard against foreigners speculating in landed homes or buying landed homes excessively in Singapore as landed properties are a relatively scarce commodity in Singapore,’ observes DTZ executive director Ong Choon Fah. But the trend of foreign buying of landed homes is set to continue, she predicts. ‘We have to accept it, if we want to be a global city, and if we want to open our doors to attract talent to our shores,’ she said.

The 105 landed properties that foreigners bought in the prime districts last year gave them a 15.8 per cent share of total landed home purchases in these locations in 2006, up from a 12.1 per cent share in 2005.

Islandwide, foreigners bought 249 landed homes last year, up 65 per cent from 2005. The 2006 figure represented 7.2 per cent of the total landed homes that changed hands in Singapore in that year.

Foreigners’ share of landed home purchases last year, whether in the prime districts or elsewhere, is significantly lower than the 23 per cent of overall private home buying they carried out last year.

Source: The Business Times, 30 March 2007
Posted by Property Wizkid

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Buyers’ Reflections excite Kepland

Project: Reflections @Keppel BayWhere: Keppel Bay

Buildings: 6 tower blocks (24/41 storeys)
and 11 blocks of low rise villas (6/7/8 storeys)

Tenure: 99-years leasehold

Expected TOP: 2011

Unit types:

- 1 bedrm + study; 732 – 800 sqft

- 2 bedrm & 2bedroom + study; 743 – 1,001 sqft & 947 – 1,335 sqft

- 3 bedrm; 1,109 – 2,142 sqft - 4 bedrm
- 4 bedroom + study; 1,938 – 2,831 sqft & 2,530 – 2,874 sqft - Penthouses; 3,488 – 12,900 sqft

Price: Expected $1500psf onwards (expect to hit $1700psf)

Remarks: The development is designed by renowned architect Daniel Libeskind, who is designing the masterplan for New York’s Ground Zero site. The six glass towers offer panoramic views of Sentosa, the city and Mount Faber, while the 11 villa blocks are situated less than 150 metres from the Keppel Bay shoreline.Posted by Property Wizkid
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Investment Sales scale up 53% to $9.2billion!

Property investment sales in Singapore rose 53 percent on year in the first quarter to S$9.2 billion.
According to property consultant CB Richard Ellis (CBRE), this was due to the high volume of development sites acquired.

Investment sales in the private sector amounted to nearly $7.7 billion, accounting for 83 percent of total sales in the January-March period. The remaining 17 percent came from the public sector.

This comprised the sale of five government sites and the tender of the Sentosa Cove residential land parcels.
In terms of sectoral performance, the residential sector commanded the lion’s share, accounting for 60 percent or $5.6 billion.

The commercial sector contributed 36 per cent, or $3.2 billion, as investors displayed strong interest in office deals.
CBRE said office deals will continue to be sought after by property funds, institutional investors and REITs in anticipation of further capital value and rental appreciation.

It said it expects developers’ interest in residential development sites to remain strong. And it added that office and retail investment properties will continue to be popular with foreign funds and institutional investors.

CBRE said the investment market is also likely to see more activity in the public sector in the next quarter and the rest of 2007. This was based on its assessment on the positive response to the sites in the confirmed list under the Government Land Sales programme.

Source: Channel NewsAsia, 29 March 2007
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Prime properties price gap narrowing!

The gap between the average selling prices for private apartments and condos achieved by developers in the traditional prime districts compared with emerging central districts narrowed to just one per cent in 2005 and 2006, the latest analysis of caveats by DTZ Debenham Tie Leung shows.

The price-spread between the two areas was 7 per cent in 2004. In that year, lifestyle projects like The Sail @ Marina Bay in the Central Business District and The Berth by The Cove at Sentosa Cove were introduced, boasting waterfront housing.

Central districts cover districts 1 to 4 and include the CBD, the HarbourFront area and Sentosa Cove. The established prime districts are 9, 10 and 11.

The gap was at its widest in 2002 at 29 per cent. The price convergence between the two areas in the past couple of years reflects the steady increase in prices of lifestyle projects with waterfront housing themes in the central districts.

DTZ said: ‘With most of these new exclusive projects being 99-year leasehold, compared with still predominantly freehold homes in the traditional prime districts, the price convergence reflects the dwindling importance of tenure but a growing preference for unique lifestyle concepts.’ The property firm’s executive director, Ong Choon Fah, said that projects in the central districts could overtake 99-year projects in the prime districts on a selective basis.

‘There’s potential for this in the Marina Bay area because it offers the whole live, work, play concept in a waterfront setting that will also have gardens, a museum, and the Marina Bay Sands with one million sq ft of retail space.’

DTZ’s analysis of caveats captured by the URA Realis system also shows that while 2,063 apartments/condos sold by developers in the prime districts last year was almost unchanged from 2005’s figure of 2,061 units, the number of non-landed homes sold in the central districts rose 9 per cent last year to 884, the highest since 1996.

The increase was on the back of several lifestyle projects launched in the popular Marina Bay and Sentosa Cove waterfront locations.

The concept of inner-city living in the traditional CBD received a boost last year, with the launch of The Clift and Lumiere, which further buoyed developer sales in the central districts.

While primary market sales of non-landed homes in the prime districts were flat last year, it was a different story in the secondary market, where strong collective sales activity drove up the number of prime district non-landed homes sold by 88 per cent to 3,603.

This is an all-time high and surpassed the last peak of 1999 by 34 per cent, a result which was helped by prime-district en bloc sales. DTZ estimates that about 2,310 non-landed homes changed hands through en bloc sales in the prime districts last year.

‘However, taking into account developments which were collectively sold towards end-2006 and which will be recorded in 2007, as well as some transactions where caveats have not been lodged, less than half of the prime apartments transacted in the secondary market are estimated to have been sold individually,’ the firm said.
The secondary market in prime districts was also boosted by price gains in prestigious developments like Ardmore Park.

DTZ predicts that momentum in the prime districts will strengthen - particularly in the primary market as developers launch new projects on en bloc sites. ‘Together with strategic projects like The Orchard Residences and Scotts Square, average selling prices in prime districts will continue to rise,’ it said.

The secondary market in prime districts will also benefit from further price recovery and steady rental increases, which should fuel investor interest.

Source: The Business Times, 29 March 2007

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URA releases Fairy Point Hill for tender

The Fairy Point Hill site in Changi - launched by the Urban Redevelopment Authority for development into a recreational club, hotel or chalets - could fetch about $45 million or $250 psf of potential gross floor area based on a 30-year lease.

This estimate comes from Jones Lang LaSalle Hotels executive vice-president Chee Hok Yean, who reckons the site would be most viable as a resort hotel, given the recent development of infrastructure nearby. Also, Ms Chee notes: ‘This particular area has traditionally been laidback and has that resort feel.’

The spruced-up Changi Village Hotel has been achieving high occupancy and room rates, pointing to the viability of a resort hotel at Fairy Point Hill, she says. Using the site for a recreational club might not generate a sufficient return given the chequered financial performance of such clubs in Singapore and the short tenure of the site.

The 4.2-ha Fairy Point Hill site includes the old Commando Headquarters, which will have to be restored. The grand two-storey neo-classical building, built by the British in 1935, sits atop a hill. The maximum gross floor area (GFA) allowed for the project is 179,337 sq ft. The GFA for the old Commando HQ is about 29,063 sq ft. The site is wooded with many mature trees, some of which must be kept. URA says the release of the site will help realise its vision of Changi Point being developed as an attractive seaside resort and recreational destination while protecting rustic charm. The tender for the site closes on June 20.

Source: The Business Times, 29 March 200

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Wing Tai ready to spread her wings!

Wing Tai Asia will roll out at least three new residential launches over the next few months including two on recently acquired collective sale sites.

Helios Residences on the former Phoenix Mansion site at Cairnhill Circle will be launched in May while the yet-to-be-named development on the former Belle Vue site at Oxley Walk will be launched in July.

The third development will be The Riverine by the Park on Kallang Road, to be launched in April.

Wing Tai deputy chairman Edmund Cheng would not reveal launch prices but said that it would take its ‘cue’ from new properties in the same vicinity.

Wing Tai bought Phoenix Mansion for $57.9 million or $716 per square foot per plot ratio (psf ppr) in July 2005 and Belle Vue for $227.3 million or $665.95 psf ppr three months later.

Although it has helped to boost the collective sales market here - with the $1,369 psf ppr price it paid for Ardmore Point in October last year, and more recently paying $1,650 psf ppr for Anderson 18 (with City Developments) - Wing Tai does feel that owners’ price expectations for collective sale sites are getting quite high.

‘They are asking for prices that are higher than what developers are selling,’ said Mr Cheng. ‘I think they have to be a bit realistic also,’ he added.

Still, as Mr Cheng conceded, the sentiment in the market is, ‘good’. ‘The market is strong and economic growth is there. Singapore is transforming from a local to a global market, so of course your asset will have a global value,’ he added.

On future acquisitions, Mr Cheng said: ‘We will continue to see how the market develops. If the market continues to be strong, we will respond and consider if there is economic viability or not.’

Wing Tai does already have a sizeable stable of new products. In April 2006, it acquired a large development site with NTUC Choice Homes in Tanah Merah and Mr Cheng says that this development, which will have around 500-units, will also be launched this year.

The new development on the site of Newton Meadows, acquired in May 2006, could also be launched this year, he said.

In the ’super, super luxury’ segment, Wing Tai is expected to launch the new developments at Ardmore Point and Anderson 18 early next year. These will be two separate developments, Mr Cheng said, quelling speculation that both sites could be amalgamated.

Other high-end products that Wing Tai has on the market include The Light @ Cairnhill and VisionCrest Residences. The former is almost fully sold while the latter is more than 50 per cent sold. For its high-end developments, foreigners make up about 50 per cent of the buyers, Mr Cheng revealed.

Source: The Business Times, 29 March 2007

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Handy Road Site gets new owner - Allgreen

About time mainboard-listed Allgreen Properties make an entrance to the already hot land sales scene. Allgreen has emerged top bidder for a 99-year leasehold site in Handy Rd near The Cathay with an offer of $72.3 million or $669 per square foot per plot ratio.

The 38,600 sq ft site, near Dhoby Ghaut MRT Station, is designated for residential use or residential use with first-storey commercial space. It can be developed into a 10-storey project with maximum gross floor area of 108,080 sq ft.

The Urban Redevelopment Authority’s tender exercise had attracted four bids when it closed yesterday.

Alliance Development - controlled by Sino Holdings, not linked to property magnate Ng Teng Fong’s Far East Organization or Sino Land group - bid almost $70.4 million.

GuocoLand’s Rivaldo Investments offered $68.65 million. And Peak Venture, controlled by banker Wee Cho Yaw, tendered $50.5 million.

CB Richard Ellis executive director Li Hiaw Ho estimates Allgreen’s breakeven cost for a new project on the site could be around $1,000 psf.

‘Going by current prices of units at 8 @ Mount Sophia at above $1,000 psf in the subsale market, and those at the freehold Nomu selling at $1,100-1,300 psf, it is likely that the new project on the Handy Rd site will be able to sell at an average price of around $1,300 psf,’ he said.

Source: The Business Times, 29 March 2007

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Up, Up Rent away!

Superman will have to compete with the speed office rents are soaring! It’s incredible. The shortage of new office space is exerting increased pressure on rents, resulting in their rising by almost 30 per cent in some areas.
New benchmarks were also achieved in the Marina Centre, Orchard Road, River Valley/Singapore River, Novena and HarbourFront areas.

An analysis of market data in DTZ Debenham Tie Leung’s quarterly property market report for Q1 2007 revealed that office space slated to be demolished for redevelopment will exceed the supply scheduled for completion in 2007.
In addition, average annual new supply in the next four years - 928,700 square feet - will fall short of the 1.7 million sq ft average annual take-up seen in the last 10 years.

DTZ noted that financial and business services sectors have continued to expand here.

DTZ executive director and regional head of consulting and research Ong Choon Fah added: ‘The clustering of global businesses has resulted in across-the-board multiplier effects, for example, increased demand for supporting businesses.’

This has led to an increase in rents.

In Raffles Place, prime rents escalated by 28 per cent in Q1 2007 to average $10.90 per square foot (psf), higher than the previous peak of $10.50 psf in 1996.

The highest quarter-on-quarter increase of 29 per cent was achieved in the Marina Centre area, which has reached a historic high of $10.30 psf.

DTZ’s report revealed that in microzones like Orchard Road and HarbourFront, rents similarly registered highs of $8 and $6.30 psf respectively.

DTZ also noted that higher rents caused some occupiers to relocate from the CBD to most cost-effective premises.
It also believes that more tenants will review workplace strategies or pre-commit earlier in future developments where possible, as rents are expected to top the highest peak in 1990 with prime rents in Raffles Place only 3 per cent shy of the $11.25 psf achieved 17 years ago.

Occupancies have also risen. DTZ highlighted increased occupancies at Samsung Hub in Raffles Place and at PSA Building in the Alexandra microzone in particular, where occupancies rose by 18 percentage points each to 98 per cent and 85 per cent.

Source: The Business Times, 29 March 2007

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Vanity sells! Designer Condo is here to stay.

A Top European architecture firm has unveiled an eye-catching blueprint for a Cairnhill project that dramatically underlines the growing trend here for ‘designer condos’.

The daredevil design by the Office for Metropolitan Architecture (OMA), a company founded by celebrated Dutch architect Rem Koolhaas, is a gravity-defying creation featuring four suspended towers.

The release of the plans for the Far East Organization development was followed by news that Keppel Group is working with American architect Daniel Libeskind on two more residential projects.

Mr Libeskind’s creative juices have been unleashed on Keppel’s new condo, Reflections at Keppel Bay, due for launch early next month. Keppel had indicated the project could be priced from $1,600 per sq ft (psf) to over $2,000 psf - which is higher than nearby homes.

The premium prices such projects can command illustrate the clout a famous architect can have, a trend more evident as Singapore becomes a global city and increasingly discerning buyers look for something with star power.
Ms Rita Soh, immediate past president of the Singapore Institute of Architects, said: ‘People are beginning to recognise there is a higher value attached to designer condos.’

DTZ Debenham Tie Leung executive director Ong Choon Fah agreed, adding that a big-name architect can entice a larger pool of global buyers. ‘These are global brand names; they give the perception that they can deliver a better product.’

The Cairnhill project is designed by OMA partner Ole Scheeren, who is working with Mr Koolhaas on the five billion yuan (S$981 million) China Central Television Headquarters project.

OMA is famed for projects such as the Seattle Public Library and Prada stores in the US.

Mr Scheeren told The Straits Times: ‘Singapore has a very exciting late modernist architectural history. Our project emerges from a certain resonance with that while exploring a contemporary approach to building in this tropical city.’
The 68-unit Cairnhill development will be at the junction of Scotts and Cairnhill roads.Called Scotts Tower, it will feature four towers suspended from a central core. These lifted towers reduce the building’s footprint while providing for communal leisure activities at ground level.

‘It is an interesting design with some very bold concepts,’ said Mr Tai Lee Siang, new president of the Singapore Institute of Architects. ‘It deals very well with the challenge of designing a high-end condo on a tight site - elevating all the units to a level with good views.’

Far East expects to launch Scotts Tower later this year. Existing projects in the Cairnhill area now fetch $1,800 to $2,000 psf, market sources said.

Completed designer condos include The Colonnade in Grange Road by American Paul Rudolph. But for all the prestige a big-name architect might bring, experts said location trumps design any time.

While they are usually easier to market, such projects also depend on the design, said an expert, pointing out that designer condos do not always command a premium. The Linear by Mr Paul Tange of Japan’s Kenzo Tange Associates did not command high prices as its Bukit Panjang location was not attractive, he said.

‘Look at Orchard Scotts. It’s designed by the famous Bernardo Fort-Brescia but is not selling very well,’ he added.

Source: The Straits Times, 28 March 2007

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