Property News!

[sunsetbay]

Initiated by jq75, let's consolidate all posts on property news here.

Share your views anything on property trend, rental market, en-bloc sales, property investment, new project announcement, new regulations, recent sales transactions etc that would affect the property market.

I believe this thread would be useful to investors, owners, tenants, home seekers, researchers etc, esp now with the upswing of the property market.

 

[jq75]

June 20, 2007
Earlier date set for hearing on Horizon Towers' sale

Strata Titles Board said to have set aside five days next month, before deal's deadline

By K.C. Vijayan

THE hearing on the disputed Horizon Towers en bloc sale has been brought forward to next month, thus averting fears that the $500 million deal could be derailed by a closure deadline.
Collective sale agreements have to be closed within six months of being signed or go back to the sales committee - a potentially divisive procedure that can kill a sale.

That gave Horizon Towers - its deal was agreed on Feb 12 - a cut- off date of Aug 11. But that raised a serious problem for the sellers as the dispute hearing was not scheduled to be held until September.

But The Straits Times learnt yesterday from a reliable source that the Strata Titles Board had rescheduled the hearing for five days, starting on July 26.

The two blocks at Leonie Hill have been pledged to be sold en bloc for $500 million to Hotel Properties (HPL), Morgan Stanley Real Estate and Qatar Investment Authority, the investment arm of the Emirate of Qatar.

The deal won backing from 84 per cent of the owners - exceeding the 80 per cent requirement - but it still needs approval from the Strata Titles Board.

Since that initial agreement, eight owners have objected to the sale. Efforts by the board to broker a compromise have come to nought, so a full hearing has been called.

It is understood that the dissenters object in principle to procedures leading up to the sale and not to the actual price offered.

But their sentiments are shared by several other unit owners who initially consented to the sale but are now unhappy over the price.

They point to the recent property boom that has seen the neighbouring Grangeford Apartments, which is five years older than Horizon, going for an asking price of more than $2,000 per sq ft (psf).

This dwarfs the $800 psf agreed for Horizon Towers.

The mood now is in stark contrast to the rejoicing late last year, when the owners were jubilant at the price the 23-year-old Horizon Towers had fetched.

Most owners in the 199 apartments in the 210-unit estate would walk out with about $2.3 million, while owners of the 11 penthouses would reap $4 million or more.

If the deal fails to meet the Aug 11 deadline, the initial deposit advanced to the sellers would have to be returned but it is unclear if they would face any liabilities if the sale does not go through.

Senior Counsel Jimmy Yim of Drew & Napier, who is acting for the sellers, said yesterday: 'This is not a straightforward situation.'

He declined to comment on what would happen if the sale is aborted.

On Monday, more than 100 residents attended an extraordinary general meeting that sought to replace the existing sales committee.

Senior Counsel C.R. Rajah of Tan, Rajah and Cheah, who is acting for several owners, said they had a right to convene the meeting and decide who should represent them. But he stressed that the meeting had nothing to do with calling off the contract to sell the property.

One resident suggested that the existing committee resign en masse to enable others to be appointed. Another expressed concern over legal costs if the move triggered legal action by the buyers.

'I would prefer not to be sued and I would want my money faster,' said one resident.

Another resident feared that a new sales committee could raise legal questions and add to the general uncertainty over whom residents had to deal with.

Former Nominated Member of Parliament and senior lawyer Shriniwas Rai, who is representing a client-owner, proposed that the meeting be adjourned for six weeks to allow the differing parties to resolve the matter amicably. The suggestion was taken up by residents.

Senior Counsel K.Shanmugam of Allen & Gledhill, who is acting for HPL, said when contacted yesterday: 'There is a contract and we are expecting the contract to be fulfilled.'

 

[jq75]

Horizon Towers dispute goes before strat

A mediation hearing before the Strata Titles Board opens today, with the task of trying to bring together warring neighbours who have sold their apartments at Horizon Towers on Leonie Hill en bloc for $500 million.

Far from coming together, the various sides have hired top-notch lawyers to fight for them. The mediation is set to last for two days, and if there is no agreement possible, the case will go for a full hearing before the Strata Titles Board.

The dispute goes back to January, when almost 84 per cent of owners signed the agreement to sell Horizon Towers to Hotel Properties and two foreign funds for $500 million. That meets the legal requirement of more than 80 per cent of owners assenting to a sale in the case of properties more than 10 years old.

It means each owner of the condo’s 199 units will get about $2.3 million, and the 11 penthouse owners will receive sums of at least $4 million, rising to $6.28 million for the largest unit, of 890 sq m.

A group of 42 unhappy owners who had consented to the sale has called for an extraordinary general meeting (EGM) to remove the sales committee which negotiated and finalised the collective sale. The 42 are calling for a new sales committee to be elected, and they have hired the Wong Partnership law firm to advise them.

A Wong Partnership spokesman confirmed to BT that ‘it is advising some of the subsidiary owners who would like the sales committee changed’.

The 42 say they are not satisfied with the sales committee’s performance, and complain about the committee not canvassing the views of the rest of the owners prior to the sale, despite the improved market conditions. The unhappy group members pointed out that nine months had passed from the time the sales committee had been elected to negotiate the sale and its eventual agreement.

‘Before signing the option, it would be in their (sales committee) interests as well, and since there was a window of opportunity, they could have held a meeting with the owners again and see if we could have concluded a better agreement,’ said one of the 42 owners.

But law firm Drew & Napier, which is handling the collective sale of Horizon Towers, has written a letter to advise the owners that an EGM would not have the power to remove the current sales committee.

And even if a new sales committee is appointed, nothing significant can be or needs to be done by the new sales committee which will have a bearing on the proceedings before the Strata Title Board, the lawyers’ letter said.

Jimmy Yim, senior counsel at Drew & Napier, told BT that in his opinion, an EGM does not have the power to remove the sales committee and since it is now at an advanced stage, there is ‘little more the sales committee can do’.

It is not these two sides alone which need mediation. There are those who have always stood out against the sale, and three of them, including one penthouse owner, have hired Tan Kok Quan Partnership to represent them at the hearing.

Another penthouse owner, Wong Siew Fang, who has been bitterly opposed to the sale from the very beginning, is doing without lawyers and will be presenting her own case at the hearing.

Ms Wong said she will argue that the apportionment of the sales proceeds was not equitable.

‘When you buy property, you pay according to area,’ said Ms Wong who bought her home in 1983. She will get $4 million for her 493 sq m penthouse while those owning 220 sq m will get $2.3 million.

Many of the penthouse owners are resigned to their plight being disregarded just because they are seen as millionaires.

But one question has been answered already. One bit of legal advice sought was whether going against an en bloc sale would somehow be construed as being ‘anti Singapore’ which could in some way see some of those involved lose their permanent residence status.

They have been instructed that in Singapore, ‘you’re entitled to exercise your commercial rights’.

 

[jq75]

A home for our heritage

Important historical value in preserving old buildings

Thursday • June 21, 2007

Letter from Ken Lee

Thank you for your report, "Butterfly House escapes wrecker's ball" (June 19). To me, this is an important issue concerning the way Singaporeans think about our material history. This issue is not something that merely concerns "architecture buffs"; it should worry all Singaporeans.

There is important historical value in this house not only because of its designer, age or even its unique architecture. For many residents of Katong like myself, it has gained a life of its own.

During my childhood, my brother and I saw it as an abandoned, haunted house. In my teenage years, I found out that a good friend of my grandparents grew up in the house during the 1930s. This gentleman, Mr Lee Kip Lee, set much of his memoirs — a published book titled Amber Sands — in the house. As I read the book, it opened my eyes to the important human value embodied by this structure.

Recently, I have begun to see the Butterfly House as a reminder of a Katong gradually lost to high-rise developments. Today, it is a grand old dame ageing with quiet dignity.

To lose the house would be akin to losing an actual human being. Looking at the artist's impression of the projected development soon to rise up around it, I cannot help but agree with the Historic Architecture Rescue Plan's (Harp) view that we need to protect distinctive buildings vital to our heritage.

When will our current craze for integrating the old and the new in such a draconian, absurd fashion end? When will we, as a country, without the help of groups such as Harp, realise the need to preserve the very tangible structures that remind us of our past?

 

[jq75]

June 22, 2007
Bt Timah property hotting up

SLEEPY Bukit Timah - one of the leading lights in the last property boom - is fast making a comeback as property developers gear up for a slew of new launches there.
At least six new residential projects will be launched in the area over the coming months, with prices reaching an $1,900 per sq ft (psf) - a level not seen for 10 years.

Duchess Residences in Duchess Road, for instance, will have apartments priced at between $1,600 and $1,900 psf when it is released for sale next month, said developer United Overseas Land.

At unit sizes of between 1,464 sq ft for the three-bedrooms and 4,101 sq ft for a penthouse, this means prices will start from about $2.4 million for an apartment.

This launch is the clearest sign that the Bukit Timah area, which has stayed under the radar for the last few years, is on track for a strong recovery, say property consultants.

The District 11 corridor, an established residential area dotted with prestigious schools, has long been a favourite with expats and families. But it has been outshone in the current boom by ultra-prime areas such as Orchard Road and Sentosa.

At the peak of the property upturn in 1996, two units at Shelford Apartments fetched an all-time Bukit Timah high of about $2,100 psf.

But prices have plummeted in recent years to below $1,000 psf. They started to pick up only in December with the launch of Sixth Avenue Residences, which was 90 per cent sold in one weekend.

 

[jq75]

June 22, 2007
Lincoln Lodge sale sets top land price for Newton area

Consortium pays record $1,449 per sq ft per plot ratio for the estate

By Fiona Chan

A GROUP of four property and construction firms has paid a benchmark price for a site in Newton, betting that home prices in the area will surge over the next two years.
The consortium of Koh Brothers Group, Heeton Holdings, KSH Holdings and Lian Beng Holdings forked out $243 million for Lincoln Lodge off Newton Road.

Owners at the 98-unit estate will each get between $1.89 million and $3.07 million.

The consortium's price works out to $1,449 per sq ft per plot ratio (psf ppr) for the 59,984 sq ft site - a record land price for the Newton area, said Newman & Goh, which marketed the estate.

The previous record was held by Gilstead View, which was sold for $1,070 psf ppr last month.

Newman & Goh's head of investment sales, Mr Jeffrey Goh, believes that a new development on the Lincoln Lodge site could fetch $2,500 psf.

This bullish projection is 'riding on the announcement of SC Global's The Marq, which is targeted to fetch $4,000 psf', he said.

SC Global said on Tuesday that its latest project at Paterson Hill in the prime Orchard Road area will be sold at average prices of $4,000 psf.

But although Newton homes are still considerably cheaper than those in Orchard, Mr Goh is confident that their prices are set to soar.

'Already, we have heard that some upcoming launches in the Newton area will be priced above $2,000 psf,' he told The Straits Times.

'Going forward, 18 months down the road, it shouldn't be a problem for a new project on the Lincoln Lodge site to fetch $2,500 psf, and maybe even up to $2,700 psf.'

The record for homes in the Newton area is believed to be held by Scotts HighPark. The project, at Scotts Road next to Newton MRT Station, has fetched slightly more than $2,000 psf for a handful of units.

But closer to Lincoln Lodge, which is on Khiang Guan Avenue near Goldhill Plaza, most newer condominiums sell for only between $1,100 psf and $1,450 psf.

Units at the neighbouring Newton Suites, for instance, have changed hands for an average of $1,300 psf in the past two months. Nearby, Park Infinia at Wee Nam is selling for $1,200 psf and above.

Lincoln Lodge's break-even price is expected to be about $2,000 psf ppr, said Mr Goh.

A 36-storey project with 120 apartments of 1,600 sq ft each can be built on the site, said Koh Brothers yesterday.

The shares of all four partners, which own equal stakes in the project, rose yesterday.

Koh Brothers was up 1.5 cents at 55.5 cents; Heeton Holdings advanced 0.5 cent to 98.5 cents; KSH Holdings added four cents to 87 cents; and Lian Beng increased 2.5 cents to 44 cents

 

[jq75]

June 22, 2007
Investment property deals for first half reach $21.4b

MAJOR investment deals in Singapore's property sector since January have totalled $21.4 billion, thanks to a roaring collective sale market.
The figure is 48 per cent higher than that a year ago, and investment sales are on track to hit a record this year, according to a report by property consultancy ** Richard Ellis (CBRE).

'At this halfway point, there is every reason to expect that investment sales for the whole of 2007 will surpass the $30.5 billion set last year and may hit $35 billion,' said Mr Jeremy Lake, CBRE's executive director for investment properties.

But the value of deals done in the April to June period dipped slightly from that recorded in the preceding three months. The figure came to $9.7 billion, down from $11.7 billion in January to March.

Investment deals tracked by CBRE are sales of properties done at a value exceeding $5 million. They include land sales, collective sales and sales of strata-titled properties.

Of the sales so far this year, the private sector accounted for 86 per cent, or $18.5 billion, said CBRE. Government land deals, including the recent sale of a Dakota Crescent site for $229 million, made up the rest.

The lion's share of the deals this year remained with the residential sector, which made up 68 per cent of all investment sales. A total of 67 collective sales have been recorded since January, to the tune of $7.9 billion, said CBRE.

Office deals took second place, accounting for 23 per cent, or $4.8 billion, of the pie.

For the second half of the year, Mr Lake predicts that sales from the public sector will 'contribute significantly', given the release of sites in the government land sales programme.

FIONA CHAN

 

[jq75]

FROM MESSY TO TERRIFIC MANSION

Fights common. A man slashed wife in 1998 Paint peeling from walls, pee in lifts Record $4m en bloc hope for one-time dump Hangout for gamblers, call girls
RATS once roamed freely in this condominium.

By Joyce Lim
25 June 2007


RATS once roamed freely in this condominium.

It was also home to gamblers and prostitutes, and even construction workers who had to squeeze like sardines into each unit.

Other transient residents included budget travellers, karaoke lounge hostesses and China study mamas.

To top it all, the estate also got bad press when a gruesome suicide happened in 1998, and when its management started imposing parking fees on its visitors.

Some residents at Pacific Mansion at River Valley were even embarrassed to tell casual friends or colleagues where they lived.

Yet they stayed on, even as many other families have come and gone in the last decade.

Today these 'stayers' are having the last laugh because all of them now stand a chance to become instant millionaires as they put their homes up for collective sale.

They are now gunning for a record en bloc price for their 45-year-old freehold development.

If they get what they wish for when the tender exercise closes next month, Pacific Mansions could fetch around $1.18 billion, or $2,400 per sq ft per plot ratio (psf ppr).

That's above the record $2,338psf ppr set by The Ardmore exactly a week ago on Sunday.

At $2,400 psf ppr, Pacific Mansions' 290 owners stand to get between $3.9m and $4.2m each. With such a huge carrot, getting the majority of residents to say 'yes' was a breeze.

Before en bloc fever gripped the residents last year, each unit fetched only about $800,000 on the open market.

Retiree Cheng Geok Chor, 74, said in Mandarin: 'It's such an attractive price. It's silly not to sell. I've stayed here long enough, in good times and in bad. Finally I will be rewarded for staying so long.'

His wife Madam Goh Quee Yong, 70, piped in: 'The market is so good now and the price is attractive. It's only at collective sale that we can get such a good price. Of course we want to sell. I want to buy landed property!'

Another resident, Mr Lim Siah Khin, 62, who moved into Pacific Mansion 18 years ago, was glad that he no longer has to live in an estate with a dubious history.

He said: 'This place was so old and dirty before we upgraded it a few years ago. The location is very good. It's a stone's throw away from Orchard Road. But if we can get a good price for it, we will be more than happy to let it go.'

Mr Dick Tay, who heads the sales committee, agrees.

'Now is the right time and the price is right. With about $4m, residents here can find another property around the area and still have about $2m left in their bank.'

Mr Tay, a 35-year-old businessman, proudly said that his sales committee managed to get 80per cent consensus from the homeowners in just two months.

Mr Tay said that those who have not signed are generally those from bigger families who worry about relocation.

He explained: 'Some of these families own more than one unit here and the parents live close to their children, who have their own families.'

'These people are afraid that they may not find apartments next to each other after they move out of Pacific Mansion. The sales committee is doing whatever it can to help them.'

Mr Tay added that things have been smooth sailing for his sales committee because he did not treat the collective sale effort as a business transaction. Instead, he discussed the idea with every resident.

'When some of the residents said 'no' to us, we left them alone. We didn't pester them. That's why we don't have problems which sales committees in other developments faced, like residents hurling abuse at each other,' Mr Tay said.

'Over at Pacific Mansion, anyone can be part of the sales committee. We don't have closed-door meetings.'

Asked if he is giving residents false hope that they can each pocket about $4m for the sale, his reply was 'no'.

He said: 'It is not out of greed that we have asked for $4m per household. We came up with the figure based on the current market trends.'

'We have to safeguard the interests of our residents. I want to avoid the same situation as at Horizon Towers. I don't want residents to blame me later for asking for too little. I believe we have priced ourselves reasonably.'

Pacific Mansion is one of the oldest developments in the area.

Formerly occupied by British families, vacant units were sold to Singaporeans after independence and the British moved out.

Madam Lucy Lim, 74, who moved into Pacific Mansion in 1969, recalled: 'In the begining I rented a three-bedroom apartment at Block 16, subletting the other two bedrooms and providing meals to the tenants to earn my living.

'Later when my landlord wanted to sell her apartment, I rented units in other blocks and ended up at Block 16 when I finally saved enough to buy my own unit.'

It cost her about $100,000 in total, including $30,000 on renovations and $35,000 on upgrading fees.

She said: 'In the past it was easy to rent out our apartments here. But after we got our sleazy image and bad reputation, the price of our property dropped. It only shot up again in recent years.'

Mr Cheng added: 'We had tenants with unsophisticated backgrounds living here. They peed in the lifts and the nightclub women created a lot of noise when they returned home after their work in the wee hours of the morning.'

'My wife and I regretted moving in here back then. When friends asked me where do I live, I would tell them 'somewhere in River Valley'. I was embarassed to tell them that I live in Pacific Mansion.'

Mr Tay said that the management had put in a lot of effort to try to change the reputation of the place.

Over the years, the residents' profile has changed, with families moving in.

'Today, young professionals, foreign students, Japanese and Indonesian expats make up about 40 per cent of the tenants at Pacific Mansion,' MrTay said.

When the spanking new condominium comes up, it will probably dominate the River Valley skyline once more, sans the estate's colourful past, he said.

 

[jq75]

'THIS WAS A DIRTY ESTATE'
MOVING to Pacific Mansion used to be his biggest regret because he lost over $800,000 by doing so.
By Joyce Lim
25 June 2007

MOVING to Pacific Mansion used to be his biggest regret because he lost over $800,000 by doing so.

Mr Cheng Geok Chor used to live in a two-storey shophouse on Campbell Lane but he sold it for $160,000 to move into a three-bedroom unit in Pacific Mansion in 1987.

Not long after Mr Cheng sold his shophouse near Tekka Market, the area was given conservation status by the Urban Redevelopment Authority.

The 74-year-old retiree recalled: 'My ex-shophouse's value rose to more than $1 million. At that time, I felt that moving into Pacific Mansion was my greatest regret.'

Other than its easy accessibility to Orchard Road and Chinatown, there was nothing else that Mr Cheng liked about his home, especially before it was upgraded.

'It was an old and dirty estate, flooded with undesirable characters,' he told The New Paper on Sunday in Mandarin.

His wife Madam Goh Quee Yong, 70, recalled: 'We couldn't sleep well at night because the apartment above ours was rented to women who worked in the nightclubs.'

'When they came home late at night, their high-heeled shoes made a lot of noise and often woke us up.

'There were also many gamblers coming in and out of the estate. Some of them would get drunk and pee in the lifts. I usually avoided getting into the lifts with them.'

The couple has four children aged between 36 and 46. Three are married and have their own homes. Only their eldest daughter is staying with them.

Mr Cheng said that he only started to appreciate living at Pacific Mansion after the upgrading works were completed in the mid 1990s.

'We have a new management council who ensured tighter security in the estate,' Mr Cheng said. 'Things have improved since then.

'And with the security cameras installed inside the lifts, people stop peeing inside and dirtying them.

'Also, after the upgrading, every two units on each floor had their own private lift. For the first time I felt that I had privacy living in a condominium.'

Mr Cheng and his wife decided to stay on in Pacific Mansion. After all, he had used his retirement funds to pay for it.

'If we had wanted to sell it, we wouldn't have been able to get a good price for it,' Mr Cheng said.

'Not many people want to live here after all the bad publicity on its sleaze.'

'Also the old estate still looks drab amongst the newer, classier-looking condominiums in the area.'

Today, with a potential collective sale bonanza, the ex-bank clerk is hopeful that his patience will pay off and that he, too, will soon be an overnight millionaire.

Pacific Mansion's sordid past

Early 1990s

Some apartments are used as workers' quarters and illegal accommodation for budget travellers.

Outsiders also make use of the free parking facilities in the estate.

17 Apr 1991

Anti-vice officers and policemen uncover a brothel with 11 prostitutes operating in one unit.

Operator Chua Huat Thong, then 45, is jailed for 18months.

5 Jan 1993

Two men are sentenced to death for drug trafficking. He left heroin in a a friend's apartment in 1988.

1996

Estate's management council proposes $28m upgrading project which is rejected.

Five months later, estate accepts new $10m upgrading plan.

New lifts and lift lobbies are installed.

Water-piping, electrical systems and rubbish chutes are changed.

Closed-circuit monitors and card-only access to blocks are installed. All blocks are repainted.

30 Aug 1996

Police officers raid one unit and seize 26 Myanmar passports with expired immigration entry stamps.

Twenty three illegal Myanmar nationals are arrested.

6 Jun 1998

Businessman Albert Lee Kim Kang slashes his wife on the neck and jumps out of his bedroom window on the sixth storey.

He dies 13hours later in hospital.

2002

Visitors have to pay to park their cars in the estate.

 

[jq75]

June 25, 2007
En bloc blues: A child depressed because of constant moving

I AM touched by the article on the en bloc phenomenon, 'Can money ease loss of memories?' by Ms Linda Lim (ST, June 21).

I want to share my personal experience on property transactions here though I did not benefit from any en bloc sales in any property transactions.

So far, I have sold three properties and stayed in six places in my short married life of 15 years.

The other three properties were all rental units with one in Tasmania, Australia, which we stayed in for about a year.

I have heard of friends moving house every other year just to enjoy some profits from the property transaction. I fear that they do not consider how their children feel when they move houses.

We were very lucky in our first two transactions, making a total of close to half a million dollars - one transaction from a HDB executive unit netted us about $400,000 and the other from a private unit about $150,000.

We, nevertheless, lost more than $100,000 in our third private property transaction as we felt that the interest rate was too high for us to bear over a prolonged period of repayment but still could have enough to pay off a HDB maisonette that we bought recently.

Sad to say we were very poor stewards of the property profits and squandered them all away on overseas trips and extravagant purchases. We also made some wrong investment choices. As the saying goes, 'Easy come easy go'. For en bloc benefactors, let this be a gentle reminder to all to use your money wisely.

We lived in the third property for well over five years and had pleasant memories there. Our daughter also grew up there during her primary-school years.

We even built up a good rapport with our neighbours and enjoyed the ample space of the property. We were familiar with the area and I would say that a home is built over many pleasant memories of laughter and conversation in the house.

We missed our home and our friends immensely when we moved out last year. I was sleepless for a period before the move. I was also unprepared at how the move impacted my daughter.

During the last week of our stay in the house, our daughter could not pack her room and was depressed for a period.

She needed us to help her pack her stuff.

On the day that the movers came, she locked herself in the room and did not want to see the movers move our boxes to the new place. She came out only when the house had been emptied.

As parents, it was difficult for us to watch such an emotional spectacle. She felt that the security of the home had been destroyed and removed from her. To her, it was not just a house but a place where she could feel secure and anchored.

Until now, it pains us to pass by the property, recalling pleasant memories which are no longer ours to treasure and enjoy. It was an experience that I did not anticipate when we sold the property. Maybe there were too many pleasant memories that we had brought into the house over the years which we were reluctant to disengage from.

My advice to the en bloc benefactors is to ask yourself whether money can buy memories? Those memories are built over the years through efforts made to grow your house into a home which no collective sales money can buy.

Our children will dearly miss them as they treasure those memories that were stored in a place called home.

If you move too much, your children's anchor will be shaken. Their heart will also turn cold as they could not understand why money is more important than how they feel about the security and familiarity of a home.

Gilbert Goh Keow Wah

 

[jq75]

June 26, 2007
Banks' growing exposure to property sector raises concerns

Govt may need to step in to curb surge in such loans: Citigroup report
By Alvin Foo
THE financial industry is becoming so exposed to the property sector, via loans to developers and other market players, that the Government may have to impose cooling measures.
The warning came yesterday in a Citigroup report highlighting the surge in lending to firms making the running in Singapore's real estate boom.

It said the lending pattern is unusual in that there has not been an expected increase in home loans along with the boom. 'Instead, property developers, construction companies and financial holding firms have been driving the lending boom.

'In the next phase, mortgages will likely climb and accelerate over the next few years as the rate of completion surges, development of collective sale properties gets under way and investment companies unload their properties to end-buyers.'

In the report by Citigroup economist Chua Hak Bin, the bank identified three causes for the debt dynamics.

Firstly, the deferred payment scheme has moved the financing burden to developers. Debt-equity ratios of listed developers rose to 61 per cent in the first quarter from 50 per cent a year ago.

Secondly, there has been a surge in collective sales, which explains lagging mortgage growth. A recent Jones Lang LaSalle report noted that $16.2 billion of collective sales were done between the beginning of 2005 and May 15 this year.

Thirdly, there has been a sharp rise in property purchases by investment firms or funds - a tenfold jump over the last nine months, according to the Urban Redevelopment Authority.

Citigroup said recent moves to apply a touch of the brakes to the market - such as bringing forward stamp duty and releasing more land - have had limited impact.

'However, any new measures will likely be calibrated and will not be as draconian as those in 1996, which included capital gains tax, Central Provident Fund restrictions for down payment and restrictions on foreign borrowing and purchases.

'Some tightening of the deferred payment schemes may be a possibility,' it said.

But the Monetary Authority of Singapore said existing measures were adequate. It said yesterday: 'We are monitoring developments and expect banks to maintain prudent credit standards in their property-related loans.'

Most market players feel intervention is premature and unnecessary.

Daiwa Institute of Research analyst David Lum said: 'There's a boom but it is happening only after eight or nine lean years. It's part of the cycle. I don't think the authorities will clamp down so soon.

'Besides, the overlending is largely confined to the luxury sector, so I don't think the Government will touch that as it is more concerned with the mass market.'

One bank economist said: 'The boom is not yet huge. It'll be alarming only when we see people no longer being able to afford HDB flats, and that hasn't happened.'

Minister for National Development Mah Bow Tan said last week there was no danger that the heat from the private property market would filter down to the HDB segment.

Industry experts say the market is a long way from the property hysteria of the mid-1990s. Knight Frank's head of consultancy and research Nicholas Mak said: 'The Government should let the market correct itself.'

He said speculation purchases accounted for close to 30 per cent of total transactions in 1995. The figure now is about 7 per cent.

'If the Government decides to intervene, it should address problems very specifically, unlike the broad-based measures introduced in 1996. Those scared away speculators but also genuine investors and home buyers.'

alfoo@sph.com.sg

 

[jq75]

June 26, 2007
Iconic buildings among four properties headed for collective sale

By Joyce Teo

TWO iconic buildings - The Riverwalk next to Boat Quay and Pearl Bank Apartments in Outram - could be torn down soon if their collective sales go through.
Elsewhere, two other residential developments - in Leonie Hill and Upper East Coast - were also put up for sale by tender yesterday.

However, it is the pair of eye-catching landmarks that have attracted the most interest.

Jones Lang LaSalle yesterday put The Riverwalk, a mixed development in the central business district, up for sale through an expression-of-interest exercise that will close on July 26.

The property, which houses businesses such as Home Club, has 181 commercial units ranging from 54 sq ft to 20,161 sq ft, plus 118 apartments ranging from 818 sq ft to 3,821 sq ft.

Jones Lang LaSalle said it is zoned for commercial use and can be redeveloped into a building with a gross floor area of up to 403,351 sq ft.

Its regional director and head of investments, Mr Lui Seng Fatt, said developers could build shops, offices or small office, home office units. Apartments cannot be built for now, as the Government has temporarily halted the conversion of commercial space to flats in the central region until the end of 2009.

Owners of The Riverwalk want $700 million, up from the $500 million they asked for earlier. Developers will also have to pay a development charge and a premium to top up the lease, which could add up to about $70 million.

The price, including the extra charges, could work out to $1,900 to $2,000 per sq ft (psf) of potential gross floor area, said market experts.

The 280-unit Pearl Bank Apartments, completed in 1976, could be put up for sale soon for more than $500 million, said market watchers.

While some owners are keen on a sale, some architects hope the building will be preserved.

One had reportedly said that it should be kept because it represents the emergence of modern architecture in Singapore.

The value of Pearl Bank has risen greatly recently, with a 1,323 sq ft two-bedroom unit sold last month at a record $1.07 million, said an ERA agent who brokered the deal.

The property has an allowable plot ratio of 7.2 based on the 2003 masterplan, though some owners are hoping for a higher plot ratio to be approved, market sources said. Pearl Bank has two-storey maisonettes, penthouses and shops.

And the 74-unit Rivershire at Leonie Hill Road has been put up for sale by tender at a revised price of $348 million or $2,200 psf of potential gross floor area. There is no development charge payable on the freehold site.

Its previous asking price was about $237 million and the tender closes on July 24.

At Upper East Coast Road, Credo Real Estate has put the 40-unit Rich East Garden up for sale, with an indicative price of $92 million to $95 million.

This translates to $630 psf to $650 psf of potential gross floor area, including development charges. The tender closes on July 31.

 

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URA Q2 home price index seen rising up to 6%

25 June 2007 2128 hrs

SINGAPORE: Private home prices are expected to rise by 4 to 6 per cent during the second quarter of this year.

That was the forecast from property consultant ** Richard Ellis (CBRE), ahead of data to be released by the Urban Redevelopment Authority.

In its latest report, CBRE predicted the number of new homes sold in the three months to June would exceed 4,300 units.

And it said the secondary market would likely register more than 4,000 transactions, outstripping the 3,866 sales in the previous quarter.

CBRE has attributed the increase to collective sale home owners who were looking for replacement properties.

It also noted the filtering down of activity from the top-end to the suburbs.

According to CBRE, this was in part due to the limited supply of new homes within the price range of S$600-S$800 per square foot.

For the third quarter, it expects prices to continue to head up by another 3 to 5 per cent, with the takeup of new homes seen shrinking to around 3,000 units.

Private home prices in Singapore rose by 4.8 per cent in the first quarter, compared to the previous three months

 

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Lift curbs on sale of landed properties to foreigners, says Goldman Sachs

26 June 2007 1013 hrs

SINGAPORE: In the eyes of some, at least, there may never be a better time to slaughter one of the sacred cows of the landed home market.

The idea of owning a nest in Singapore is becoming increasingly attractive to foreigners. The Government, too, has been effusive in its efforts to draw foreign talent here to build the economy. So why not relax restrictions on the sale of landed property to foreigners — and satisfy both needs at one go?

Making this controversial proposal in a report released on Sunday, Goldman Sachs — one of the world’s largest investment banks — cited suggestive figures.

The proportion of foreigners buying private homes here climbed to 26 per cent in the first quarter of the year, up from 21 per cent in 2005. But as of May, foreigners were involved in only 8 per cent of landed property transactions this year — compared with 29 per cent of apartment transactions.

The average price of a top-end bungalow falls short of that of a luxury condominium unit by about 35 per cent.

“We think this price gap could arrow to parity, or very close to it, should restrictions on foreign ownership be relaxed,” said the report, adding that “foreigners would like the flexibility of greater housing choice and the positive signal of Singapore’s open door policy emanating from such a move”.

But the argument will be a thorny one for the Republic to swallow, given the socio-political barbs of such a move. And going by industry players’ reactions, the debate is likely to remain an academic one.

Since 1973, the Residential Property Act has restricted foreigners and permanent residents from owning private residential property without prior official approval — and for good reason.

“The restrictions on foreign ownership of landed property is unlikely to be eased because it is an emotional issue. It involves (putting) a tangible, physical part of Singapore in foreign hands,” said Mr Colin Tan, director for research and development at Chesterton International.

“Landed properties should not be priced out of Singaporean’s reach (or) it could lead to disgruntled Singaporeans, which would be a cause of concern for the Government,” said Mr Charles Chong, chairman of the Government Parliamentary Committee for National Development and Environment.

Even so, a concession was made in 2004 for Sentosa Cove, where potential foreign buyers were given fast-track approval. Of the 36 landed transactions at Sentosa Cove, 44 per cent involved foreigners. A seaview bungalow plot within the luxury enclave set the record at $1,308 per square foot.

 

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Dairy Farm condo resident is battling enbloc sale of 'unique' estate
'$1m profit? I still won't sell home'
SHE will make close to $1 million if she sells her condominium apartment.
By Desmond Ng

26 June 2007
SHE will make close to $1 million if she sells her condominium apartment.

But an expatriate decided to reject the collective sale offer because she likes where she is living.

She even started a 'Say No to En Bloc' petition to get residents to speak up against thesale.

Unknown to her, another group of residents has also organised a petition against the sale.

And surprisingly, they are tenants who have no investment interest in their homes.

Some of these residents at the Dairy Farm Estate do not want to leave because they are in love with its lush, tranquil setting and the peaceful neighbourhood.

The 478-unit, 24-year-old freehold condo near Upper Bukit Timah Road is close to Bukit Timah Nature Reserve.

British expatriate Andrea Woolhead couldn't believe it last month when she was offered a million more than she had paid for her flat.

The offer is about $1.8 million for her 2,200 sq ft unit if the sale goes through.

Ms Woolhead, a teacher in an international school here, paid about $840,000 for it in 2005.

It is not often that someone passes up a chance to be an instant millionaire.

The 49-year-old could have returned to the UK and retired on her million-dollar windfall.

But she turned the offerdown.

HARMONIOUS LIVING

She said: 'I know I could be an instant millionaire, but in so many countries I've been to, this estate is probably one of the most unique, with such a wide variety of nationalities living in harmony close to eachother.'

'I could have taken the money, left the country and make good with the profit. But I didn't because I like this estate.'

She may be making a wise choice.

Some homeowners who took the enbloc route are now finding it hard to get a replacement home because prices have soared beyond their reach.

Ms Woolhead's anti-en-bloc-sale petition has garnered 91 signatures and needs at least 10 more to make up more than 20 per cent of the residents, she said.

On the other side is homeowner C S Lim, who is on the sales committee tasked with convincing residents to sign for the sale.

The committee has about 10 per cent of 'yes' votes from residents.

Under the legislation, an en bloc sale can proceed only if 80 per cent of the owners approve of it.

Ms Woolhead, who lives in the condo with her three children and her husband, a junior college teacher, said: 'We started the petition because there are residents who are not doing anything even though they don't want the collective sale to happen.

'A group of us decided to start the ball rolling and it just snowballed fromthere.'

Residents can also sign the petition online.

The other petition to save the condo is being led by US expatriate Jean Rueckert, who said they have about 10 signatures so far.

The 39-year-old teacher said: 'We were not aware of the other petition.

'We just wanted residents here to share their perspective that this is a unique property that should be preserved as a heritage site because of the beautiful physical surroundings.'

Ms Rueckert, who came to Singapore eight years ago, has lived in the condo for sixyears.

Her group, like the other residents opposing the sale, wants to save the estate because of its greenery, spacious surroundings and location next to the nature reserve.

MORE VOCAL MINORITY

The anti-en-bloc-sale community has become more vocal and active of late, said Mr Nicholas Mak, Knight Frank's head of consultancy and research.

For example, in Ulu Pandan, a group that calls itself Save The Pine Grove is still trying to stop the enbloc process for that estate even though a first attempt at an enbloc sale fell through earlier this year.

Mr Mak added: 'There have been many recent reports about people who are unhappy with enbloc sales for various reasons.

'The tyranny of the majority to sell may have led more people to voice their unhappiness,' he said.

But for Dairy Farm Estate, it's still too early to rule out the possibility of a collective sale.

When there was talk about Farrer Court going en bloc in March, the dissenters there were out in fullforce.

But there's a saying that there's no property that can't be sold - it's just a matter of price.

The estate was subsequently put up for sale with a record-breaking reserve price tag of $1.5billion. More than 80 per cent of owners signed the collective sale agreement last month.

Ms Woolhead concedes that it's a long road ahead for Dairy Farm.

She said: 'It's still a big question mark if we can stop the sale. Of the 91 who signed, some will not sell at any cost, (but) there are those who are just sitting on the fence.

'I'm sure that when there's a meeting of minds between the developer and residents' asking price, more people will sign (for the sale) due to the dollar sign.'

Mr Lim, who spearheaded the sale action, said that there was no better time to sell the estate than now, when the enbloc fever ishot.

He said: 'The economics of it looks better in today's market. We could encash the property and unlock the value with the enbloc sale.

'But ultimately, it's up to the residents. If there's poor response, then so be it. It's the wish of the residents here.'

 

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June 26, 2007
$128m collective-sale windfall for Hakka clan

WHILE the recent collective property sale boom is making a million or two each for home owners, one of Singapore's major Hakka clan associations has really hit the big time.
The Char Yong (Dabu) Association will pocket a cool $128 million from the sale of the Char Yong Gardens condominium in the Cairnhill area.

The association owned 36 of the 106 units in the condominium sold to CapitaLand recently for $420 million.

It is now looking at how to best use the windfall.

Discussions have started on enriching clan activities, developing its youth wing, providing better care for older or needy members, as well as expanding its charity work.

The need for these talks almost did not arise as some clan members had opposed the sale, despite the support of the 41-strong management council, said association president Lang Chin Ngau

 

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June 28, 2007
Landed homes: Don't ease curbs on foreigners
THERE has been disturbing talk in the media recently that the restrictions on foreigners buying landed homes in Singapore could be relaxed.
I hope the authorities would quickly nip this rumour in the bud before there is too much public disquiet.

Goldman Sachs (Singapore) is lobbying for the rescindment of the Residential Property Act, which has, since 1973, restricted foreigners and permanent residents from owning landed residential property without prior official approval.

Goldman Sachs argues that this change would serve as a catalyst for further foreign buying of private homes and boost the current residential property up-cycle. To further support this argument, it implies that Singaporeans already have a stake in the country by virtue of public housing catering to 80 per cent of us.

I doubt anyone in Singapore really feels that the property market requires more encouragement. If anything, the reverse is probably true and the authorities are probably contemplating measures to cool the red-hot market to bring it to a more sustainable level.

Goldman Sach's reference to public housing also comes across as being a tad condescending to me.

Hence I agree fully with the industry's opinion leaders, who were quoted to be mostly against this proposal.

Mr Charles Chong, chairman of the Government Parliamentary Committee (National Development and Environment), was quoted as saying: 'Landed properties should not be priced out of Singaporeans' reach (or) it could lead to disgruntled Singaporeans.'

Others said that the existing Act has the positive effect of 'encouraging foreigners to commit to Singapore, to sink their roots here' and that landed-property ownership is one of the 'privileges of being Singaporean'.

In Pearl S. Buck's The Good Earth, the protagonist Wang Lung chided his sons when he overheard them talking about selling the land which he had loved so much. He said: '...if you sell the land, it is the end.'

Dr Huang Shoou Chyuan

 

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June 28, 2007
Lifting restrictions on foreigners purchasing landed properties will harm S'poreans
THE recent report and recommendation by an American bank that the restrictions on foreigners to purchase landed property be lifted is something which I feel the majority of Singaporeans would be up against.
Additionally the economic arguments are flawed. The report seems to imply that lifting the restrictions will reduce the supply crunch and help control prices.

I think lifting the restrictions will have detrimental effects - landed property prices will experience sharp jumps leading to an even greater frenzy in the property sector. Cost of living and cost of business will jump again, leading to higher inflation and further reduce our cost-competitiveness.

However, the most important factors against it are the sociopolitical effects.

Singapore is a country owned by Singaporeans. If the restrictions are lifted very soon, Singaporeans will be renting from foreigners to live in Singapore, leading to alienation and resentment among the population.

Lifting the restrictions belittles the privileges of citizenship too.

In the same way that National Service is expected only from citizens, certain rights and privileges should continue to be reserved for citizens.

David Ng Boon Kiong

 

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June 28, 2007
Outram Park MRT plot could draw bids topping $1b
By Fiona Chan
BIDS of more than $1 billion are expected for a large site on top of Outram Park MRT Station, which was released by the Government yesterday.
The 2.56ha plot, at the junction of Outram Road and Eu Tong Sen Street, is set to attract keen interest from property developers due to its good location and large size, property consultants said.

The site is also notable for being the first one to be offered for development in Pearl's Hill, thus kick-starting the area's redevelopment, the Urban Redevelopment Authority (URA) said yesterday.

The area is planned for a mix of homes and commercial buildings set within a garden. It will centre on Pearl's Hill City Park, which will be transformed into two parks.

The new site will offer direct frontage to one of these parks, the URA said.

Half of the site's total gross floor area of 1.54 million sq ft must be used for offices. Another 20 per cent of the area, or about 308,000 sq ft, must cater to hotel rooms.

But the rest of the area is 'white' - which means it can be used for homes, shops, or more hotel or office space.

It is the only 'white' site to be released on the Government's reserve list for the first half of this year.

Under the reserve list system, an interested buyer must submit a bid for the plot at an acceptable price to the Government, which will then put the site up for public tender.

Consultants such as Mr Li Hiaw Ho, executive director of ** Richard Ellis Research, said the plot is a 'prime site with lots of commercial potential'.

'We expect the site to fetch about $650 to $700 per sq ft per plot ratio,' he said. This puts the total price at between $1 billion and $1.08 billion.

'In view of the large size of the development, interested developers are likely to form a consortium to jointly bid for the site,' he said.

Mr Li added that the 'white' area of the site is likely to be turned into a retail mall to cater to the high pedestrian volume streaming out from Outram Park MRT Station as well as the 'dense residential population' in the area.

It 'offers developers an opportunity to develop a good-quality mall to rejuvenate the retail scene around Chinatown', he said.

The Pearl's Hill area - known for its old landmark buildings, myriad hotels and its proximity to Chinatown - has been in the spotlight recently.

Pearl Bank Apartments, a 30-year-old development just outside the Pearl's Hill City Park, is said to be gunning for a collective sale that could fetch more than $500 million.

 

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June 28, 2007
No change to landed home curbs

SINGAPORE has no plans to open up its landed property market to foreigners, Minister for National Development Mah Bow Tan said yesterday.
He rejected a suggestion from investment bank Goldman Sachs, which was reported in the Singapore media earlier this week, that there was a high chance the Government would soon ease curbs on foreigners buying landed homes.

Speaking to reporters during a four-day visit to the north-eastern Chinese city of Tianjin, Mr Mah said any change to the rules would deny Singaporeans a chance to own such homes, which are in short supply in the land-scarce country. 'Landed property has to be treated as a special category. It is important for us to maintain certain privileges for our citizens.'

Under the Residential Property Act, foreigners and permanent residents are barred from buying landed properties without government approval. Those who get the nod can own only one landed property at a time and they must occupy the home, not rent it out.

CLARISSA OON