Singapore Property News Upfront 14

Foreigners command a strong presence for 1st Quarter
Companies and foreigners upped their share of caveats lodged for private home purchases in the first quarter of this year, according to an analysis of caveats by estate agents DTZ Debenham Tie Leung. Companies accounted for 8 per cent, or 538 of the total 7,042 caveats lodged for private homes in the first quarter of the year, up from a 6 per cent share in the preceding quarter.

The 538 homes that companies bought in Q1 this year is an increase of 15.2 per cent from the preceding quarter and the highest quarterly figure ever captured by the Urban Redevelopment Authority’s Realis caveats data, which go back to Q1 1995. During the height of the last major bull run in Q2 1996, companies bought 462 private homes while the figure for Q3 1999, a year that saw a short-lived property rally, was 413.

Companies include both entities incorporated in Singapore and overseas and these buyers would include property funds as well as high-net-worth individuals who set up offshore companies to purchase properties for tax or confidentiality reasons, suggests DTZ executive director Ong Choon Fah. Some of the caveats for private homes lodged by companies are for collective sale deals. Among the caveats lodged by companies in the first quarter were 35 caveats for Amaryllis Ville, 24 for The Fernhill, 12 for Water Place and 11 for Marina Bay Residences.

Mrs Ong expects corporate buyers like funds to continue growing in importance as private residential property buyers. ‘Traditionally, overseas property funds buy offices in Singapore, but with opportunities becoming more limited, they will increasingly turn to the residential sector,’ she added. DTZ’s analysis of caveats lodged for private homes captured by the Realis system also shows that foreigners (including permanent residents) snapped up 1,938 private homes in the first three months of this year.

While this is up just marginally from the 1,934 caveats lodged by foreigners in the preceding quarter, it is nonetheless the highest level of foreign purchases in a quarter ever captured by Realis. Foreigners also upped their share of private home purchases to 27 per cent in Q1 this year, a figure that has been previously surpassed on just one other occasion. That was in Q4 1995, when foreigners accounted for 32 per cent or 1,534 of the total 4,781 caveats lodged for private homes.

DTZ also observed that while the number of private apartments and condos that foreigners bought from developers in the primary market declined 21 per cent quarter-on-quarter to 540 in Q1 2007, the number of apartments/condos foreigners picked up in the secondary or resale market rose 13 per cent to 1,315 over the same period. ‘This was the largest number of resale apartments that foreigners purchased in a quarter. Foreigners accounted for a 32 per cent share in overall resale condos/apartments transacted. This trailed only Q4 1995, when the share was 48 per cent,’ DTZ said.

‘Unlike new projects, private homes in the secondary market are usually ready for lease. This therefore attracts foreign investors who wish to have a share in the current buoyant leasing market. Similarly, resale properties are valued by foreigners who are new in Singapore and require immediate accommodation. There are also some who have received permanent residence and are keen to own residential properties, partly as rents have been rising,’ DTZ observed.

Projects that saw a high percentage of caveats lodged by foreign buyers in the secondary market in Q1 included Costa del Sol, Caribbean at Keppel Bay, The Nexus, Cuscaden Residences, Pebble Bay and Leonie Gardens. Districts 10, 9 and 15 were the three most popular locations for foreigners who bought condos and private apartments in the secondary market in Q1.

As for foreigners who purchased condos/apartments directly from developers in the primary market, the three most sought-after districts in Q1 were 9, 10 and 11, followed by 15 and 1. Tribeca, Residences @ Evelyn, RiverGate, St Regis Residences, Waterfall Gardens and Marina Bay Residences were among the projects that saw a high proportion of foreign buying in the primary market in Q1.

The 540 condos/apartments that foreign buyers purchased from developers in Q1 accounted for 28 per cent of developer sales of non-landed homes during the period. Indonesians and Malaysians continued to be the largest groups of foreign buyers of overall private homes in Q1 this year, accounting for 21 per cent and 19 per cent respectively of caveats, followed by buyers from India, with a 14 per cent share. Indian nationals picked up 275 private homes in Q1 this year, an increase of 13 per cent from Q4 last year.

Buyers from the United Kingdom were the fourth-largest home buying market in Q1 (9 per cent share) followed by mainland China (5 per cent). Australians lodged caveats for 100 private homes in Q1, up 15 per cent from the preceding quarter. Koreans also continued to increase their investments in private residential properties in Singapore, picking up 96 homes in Q1, reflecting a 30 per cent quarter-on-quarter increase and a 380 per cent year-on-year jump.

Source: The Business Times, 05 June 2007
Posted by Property Wizkid

When will the boom ends?
MR KWEK LENG BENG, executive chairman of the Hong Leong Group, when asked about how long the collective sale frenzy can be sustained, has this to say, ‘Of course, it will continue but up to a certain point. Singaporeans are reactive - ‘Oh, I better hold on, I don’t sell, I want to make more money.’ An Englishman taught me 40 years ago, when you have good profit, you shouldn’t be greedy, you should get out. Let the next person take the higher risk and make some profit. Nobody can tell when is the peak, when is the rock bottom…’

‘Office property will continue to go up because we have very limited supply. We are so successful in attracting multinationals and many companies when the economy is good… Don’t forget we’ve gone through about 10 years of difficult times, when we had retrenchments and we had to deal with so many problems one after another, including Sept 11, bird flu. Now, we have passed all these, we are on a new platform. The opportunity is there for the private sector to take advantage of. The Government has created an environment very conducive to doing business.’ Mr Kwek commented, on how long high office rental prices will continue. He confirmed that City Developments, the publicly listed property arm of Hong Leong Group, was interested in bidding for a prime 1.02ha Marina Bay site opposite One Raffles Quay.

Source: The Straits Times, 05 June 2007
Posted by Property Wizkid

Another case of "I'm not moving!" enbloc saga
He was the last one left in the 140-unit private estate, and property developer City Developments (CDL) - which bought over Lock Cho Apartments - wants to take legal action against him. Mr Chan Kin Foo busted the original mid-May deadline - and an extension to May 25 - to move out of the estate at Jalan Raja Udang in Balestier.

Mr Chan, 63, however, is uncontactable now. CDL said this is putting a strain on its redevelopment work. ‘Any further delay will result in an increase in our holding costs and an undue delay in executing redevelopment,’ said a CDL spokesman. This is the second time in three months in which a property developer decided to take ex-owners to court for refusing to move out of their home after it was sold en bloc.

The first was in April - when a family of four refused to leave their unit at Lincolnsvale estate in Surrey Road, which was bought over by Sim Lian Land. Lock Cho Apartments consists of two blocks of walk-up apartments and two blocks of high-rise units. The site was purchased in a collective sale with two other neighbouring sites - Comfort Mansion and an eight-unit apartment - on March 31 last year for $156.3 million.

Mr Chan and three other owners did not sign the collective sale agreement. This sale was subject to the approval of the Strata Titles Board (STB), which was given on Nov 14 last year. CDL has paid out the sale amount in full. Late last month, The Straits Times was able to speak to Mr Chan, who said he lived alone in his unit.

He had said he did not agree to the sale because he felt his walk-up apartment deserved more money than the apartments in the high-rise blocks. According to Credo Real Estate, which handled the sale, Mr Chan received about $900,000. Other residents received from $840,000 to $1.3 million, which is 60 to 90 per cent of their current market prices, Credo said.
Residents were also told to vacate by May 13, which they all did, except for Mr Chan.

He continued to return to his apartment - his home for the past 30 years - even though he was now trespassing. He was finally barred from entering the premises - and his apartment - at about 2am on May 24 by the estate security guard. Since then, he has not returned or contacted CDL.

The developer extended its deadline to May 25 for him to at least contact it for the handing over of his keys, which he did not do. ‘We are left with no choice but to refer this matter to our solicitors,’ said its spokesman. CDL said it had sent adequate legal notices to inform Mr Chan that he had to leave and hand over his keys. The law firm that handled the Lock Cho Apartments sale, Rodyk & Davidson, said that Mr Chan was a ‘passive objector’ to the sale: He did not sign the sale agreement or file an objection before the STB when he could do so.

The law firm said it had sent letters to persuade Mr Chan to sign title transfer documents but he failed to do so. Further notices were sent informing him that it would be seeking an STB order to appoint a representative to sign the documents on his behalf. The law firm received no word from him and it went ahead with this move.

On Oct 23 last year, the STB authorised a representative to sign the documents for Mr Chan and the $900,000 from his unit was ‘paid into the High Court’, in accordance with the Strata Titles Act. According to a property lawyer that The Straits Times spoke to, a possible legal action CDL might be taking is an eviction order to dispossess Mr Chan from the unit. Mr Chan could also be liable for damages in the form of bank interest chalked up by CDL due to the delay.

Source: The Straits Times, 04 June 2007
Posted by Property Wizkid

Sweeping away the old - Amber Road
A WAVE of collective sales is gradually sweeping old properties out of the area, to make room for high-style condos that will give the street a brand-new look. This enclave is becoming the hottest on East Coast Road as buyers snap up units at yet-to-be-completed, relatively large condos, jacking up the area’s value.

Prices averaged $850 to $1,000 per sq ft (psf) in the first quarter, up 40 to 45 per cent from $600 to $700 psf a year ago, said consultancy CB Richard Ellis (CBRE). Condos under construction include Wheelock Properties’ 546-unit The Sea View; MCL Land’s 400-unit The Esta; the 562-unit One Amber from United Industrial Corp and United Overseas Land; and Ho Bee’s 42-unit Vertis.

The three large freehold condos have seen active sub-sales, said CBRE. They are popular for the location, facilities and well-known developers, said a consultant. Recent deals for The Sea View were done near $1,000 psf on average. Buyers will soon have more choices.

A new project is earmarked for the sites now housing Amber Lodge and Jin Fu Apartments. Voda Land bought these estates en bloc in a private treaty at an undisclosed price and aims to launch Amber Residences in about three months. It will be an ‘upper mid-market’ condo with 114 units in one 21-storey block, said Savills Singapore.

More condos will come when Far East Organization redevelops Amberville and Rose Garden, which it bought in collective sales last year. For now, while construction roars ahead, the existence of older estates like Rose Garden makes for a noisy juxtaposition of past and future.

Heart of the district with sea-front housing - Marine Parade
MARINE Parade is the heart of the entire East Coast Road district and is a textbook example of how to develop reclaimed land. It brings together a popular shopping mall, schools and sea-front housing all within a linear stretch. Public housing dominates, though older, large condos such as Mandarin Gardens and Neptune Court also enjoy the sea breeze and East Coast Park is just a stroll away.

It is no wonder the HDB flats here, particularly those with sea views, have always commanded a premium. And recently, they have benefited further from the robust activity in the private residential market, said CBRE. Prices of five-room flats hit $358 per sq ft (psf) or some $467,000 on average in the first quarter, up 13.5 per cent from a year ago. This compares with a 7 to 8 per cent rise in prices of three- and four-room flats in the same period.

A four-room flat costs about $334 or some $305,000 on average, up nearly 7 per cent from a year ago. But when it comes to rental, the four-roomers seem to be the most sought after. Average monthly rents of four-roomers rose by a hefty 47 per cent to $1.47 psf in the first quarter. This compares with a 23 per cent rise to $1.62 psf for three-roomers and a 7 per cent rise to $1.19 psf for five-roomers, said CBRE.

Private home prices in the area have risen by 20 to 40 per cent to $700 to $800 psf over a 12-month period as of the first quarter, said CBRE. The area’s newest large condo is the 99-year leasehold Cote D’Azur.

Oozing old-world charm - Katong
RUSTIC shophouses, good food and a strong Peranakan heritage make Katong a real gem in the East Coast area. The housing developments are mostly low-rise, with shophouses and boutique condominiums the mainstay, although there are quaint colonial houses for lease along Kuo Chuan Avenue.

Apart from the old-world charm, there is 24/7 shopping at Cold Storage in Katong Mall.
There are few new developments, though more may come as there have been several collective sale targets. Sea Breeze Apartments was sold en bloc and should become an 88-unit project while a 229-unit condo in Jago Close is also expected, said CBRE.

Most of the properties here are small and rather old, so interest has not been very strong, with prices done in the past year or so at between $400 and $787 psf, said CBRE. Developments such as Ceylon Crest and Katong Gardens transacted recently at about $540 to $550 psf on average.
Others such as East Galleria and Bellezza @ Katong go for about $650 psf on average.

Sleepy stretch enjoys new lease of life - St Patrick’s
IF YOU are looking for some peace and quiet in the East Coast locale, then the St Patrick’s area might be just your cup of tea. The many boutique apartments, nestled alongside schools including St Patrick’s Secondary School and CHIJ Katong Primary, enjoy a special serenity that even the construction work at Grand Duchess at St Patrick’s and St Patrick’s Loft cannot disrupt.

The sleepy area has seen three launches recently. One was the 37-unit St Patrick’s Loft - marketed late last year at over $600 per sq ft (psf). Then came the fast sell-out of the 121-unit Grand Duchess, which created a stir. This project, which sold at $740 psf on average, further raised the area’s value.

Just a year ago, average levels were at just below $500 psf. Five Grand Duchess sub-sales were done at $700 psf to $900 psf, said CB Richard Ellis (CBRE). MCL Land’s recently sold-out Tierra Vue rode on the success of Grand Duchess and started sales at $800 psf. One 1,270 sq ft unit was said to have been sold at $1,051 psf, a record for the area, said CBRE. More new projects are expected for the area.

Steady stream of small projects - Joo Chiat / Telok Kurau
THE sleaze of Joo Chiat is often put in the spotlight but beyond the colourful nightspots, the area is a quiet residential zone dominated by low-rise boutique developments and terrace houses.
A sprinkling of amenities such as schools, a medical centre, a park and good food also make this a conducive residential district.

Home prices rose to $600 to $700 per sq ft (psf) on average in the first quarter of the year, up from $450 to $550 psf a year ago, said CBRE. There has been a steady stream of small apartments launched, with projects like Le Merritt selling for $650 psf this year. Last month, a 1,626 sq ft terrace house went for $1.2 million while a 2,190 sq ft semi-detached home went for $1.51 million. Sim Lian Land bought Wen Yuan Court, K Gardens and Leyuke Apartments last year, but will launch its new project for sale only next year.

Cafes give quiet area some buzz - Siglap / Frankel
THE hub of activity in the otherwise homogeneous area of bungalows and semi-detached houses is the Siglap Road and East Coast Road junction. Siglap Shopping Centre and rows of cafes and eateries give the otherwise quiet area some buzz, upping the area’s hip quotient. With few new projects, Axis @ Siglap, a 40-unit boutique condo marketed earlier this year, sold out in a matter of weeks at an average price of nearly $800 per sq ft (psf). This was above the range of $600 to $700 psf for most properties in the area, Savills had said.

The strong demand is good news to developers who have bought sites in the area. Sing Holdings and a fund will redevelop Finland Gardens while Frasers Centrepoint will redevelop Flamingo Valley. Prices for landed homes tend to vary widely, though they have moved up moderately. In May, a 4,700 sq ft bungalow on Siglap Road sold for $1.9 million while a 9,586 sq ft bungalow on the same stretch sold for $5 million.

Source: The Straits Times, 03 June 2007
Posted by Property Wizkid