Property News!

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March 20, 2008
Horizon Towers case back in High Court
THE seemingly never-ending saga of the Horizon Towers collective sale is clearly losing steam.
Two of the nine sets of minority owners fighting the sale have dropped out of the High Court appeal that started yesterday, and even the number of onlookers in the public gallery was noticeably fewer than at previous hearings.

The dropouts - a couple representing themselves and a foreign firm - were not represented in court yesterday.

Minority owners Jasmine Tan and Rudy Darmawan are representing themselves and three others while Mr Quek Keng Seng is representing himself. The other minority owners are represented by Harry Elias Partnership.

Senior Counsel Harry Elias told the court that the $500 million sale price was not obtained in good faith. He highlighted the fact that a higher offer of $510 million from Vineyard Holdings in Hong Kong was not communicated to the owners.

Mr K. Shanmugam and his team from Allen & Gledhill, who are representing the buyers, applied successfully to participate in the court session.

Minority owners are appealing a decision in December last year by the Strata Titles Board (STB) to approve the $500 million sale of the 99-year leasehold Leonie Hill estate.

The on-off again sale has reflected the roller-coaster ride Singapore's property market has been on over the past two years or so.

The Horizon Towers deal was inked in January last year, before the market shot up. Hotel Properties, Morgan Stanley Real Estate and Qatar Investment Authority agreed to pay $500 million.

But as the market boiled over last year, minority owners felt they were getting a raw deal and tried to halt the sale. They had some success when the STB rejected the sale on a technicality, but that ruling was overturned by the High Court in October. The STB approved the sale in December.

But the once-hot market has cooled considerably since then. Sale volumes have thinned out dramatically although prices have generally held up.

The minority owners are still fighting the sale as they never wanted to sell from Day One. And the sale price of less than $900 per sq ft is still below prevailing market rates, said an industry source.

The hearing before Justice Choo Han Teck continues today.

 

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March 20, 2008
West Coast condo plot draws whopping 12 bids
HK-linked firm puts in top tender of $305 psf for site in attractive location
By Joyce Teo
COMPETITION was brisk for a 99-year leasehold condominium site in West Coast Crescent, with 12 firms defying signs of a property slowdown to lodge bids.
The bidders included major and mid-sized developers and contractors, with a Hong Kong-linked firm emerging with the highest tender - but only just. Billion Rise, which is linked to the Cheung Kong group, bid $110.44 million for the site - $305 per sq ft (psf) of gross floor area - to pip its nearest rival by 1 per cent.

Tian Hock Properties, which has Far East Organization chief executive Philip Ng as a shareholder, tendered $108.9 million or $301 psf. MCL Land was next with $103.5 million or $286 psf.

The response was strong, in contrast to the weak property market sentiment. One sign of that came on Tuesday when the Government decided not to award a leasehold landed plot in Westwood Avenue in Jurong West as the bids were too low.

Consultants pointed to differences between the two sites. They said the West Coast Crescent site's prime location had sparked the keen interest.

It suits a mass market condo project, which would be able to better weather any sector weakness, said Knight Frank director Nicholas Mak.

The Jurong West landed plot was in a less favourable spot and would have accommodated 99-year leasehold landed homes, which typically do not sell as well, he added.

The West Coast Crescent site can be built up to about 36 storeys. Some high-floor units would enjoy good views of the ocean and West Coast Park as surrounding buildings are mostly low- to medium-rise, he said.

This tender also reflects the current market situation as some bids came in relatively low. Industry sources say a few developers were trying their luck with opportunistic bids.

The lowest bid of $50 million, from Teambuild Construction's Scantech Development, works out to just $138 psf.

Other bidders included Sim Lian Land ($236 psf), Hoi Hup Realty ($235 psf), Frasers Centrepoint ($210 psf) and Allgreen Properties ($186 psf). City Developments' Sunny Vista Developments and TID also put in a bid of $180 psf.

Consultants said the top bid of $305 psf will translate into an estimated break-even price of $680 psf to $720 psf for new condos. Units could be sold at between $750 and $800 psf.

Units at nearby Blue Horizon were sold at about $750 psf in the resale market in January and February, while sub-sales of units in Varsity Park and Clementi Woods were done at $680 psf to $750 psf, according to CBRE Research.

 

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March 11, 2008
Kuwait fund pulls out of bulk purchase of high-end homes
It allows options for 97 condo units at Goodwood Residence to lapse
By Joyce Teo
A KUWAIT bank fund that agreed in December to buy 97 units at posh Goodwood Residence for $818.4 million has let the purchase option lapse.
Kuwait Finance House has given no reason for the move, which could result in the firm having to pay developer GuocoLand multimillion-dollar penalties.

It could also be the first time a foreign institutional investor in Singapore has pulled out of such a deal, raising concerns that the property market, already hit by weaker sentiment, may be heading into a downturn.

'While the current market is cautiously optimistic, news of such a pullout might cause it to turn more cautious,' said Cushman and Wakefield managing director Donald Han.

GuocoLand did not provide a direct reason for the lapse but said in a statement yesterday that the private residential market in Singapore appears cautious.

The developer also said it is in talks with Kuwait Finance House, an Islamic investment bank, with 'a view to a grant of fresh options for units in the development'.

The firm declined to comment further, citing ongoing talks. Kuwait Finance House also declined comment for the same reason.

Kuwait Finance House's huge deal was for 97 four-bedders ranging from 2,500 sq ft to 3,900 sq ft at the former Casa Rosita site in Bukit Timah Road, near Newton Circus.

The condo has 210 freehold units on a large 24,845 sq m site fronting Goodwood Hill. The Kuwait fund's purchase would have been the single-largest purchase of residential units under construction in Singapore.

Kuwait Finance House had agreed to buy the units at a median price of $3,200 per sq ft (psf), which would have set price benchmarks for the area. Industry sources said the price was way too high, considering that bulk purchases typically come with a discount.

'If it were to have bought at an average of, say, $2,700 psf last December, it would still be a record for the Newton Circus area,' said an industry source who declined to be named.

'If it had held on for 15 to 20 years and leased the units for up to a 5 per cent yield, it may have been able to justify the deal. But if it had wanted to buy and sell, why didn't it bargain for a rock-bottom price as the property had not been launched?'

It is believed that Kuwait Finance House was keen on flipping the units as they were marketed in Dubai recently, but the sale campaign was unsuccessful.

Another industry source, who declined to be named, said: 'The pullout may be due to the terms of the deal. The buyer could have realised that it had bought at a higher-than-expected price, had problems flipping the units and wanted to cut its losses.

'It could also reflect the current market and the possibility that the property market may stagnate in the next two to three years.'

The stale market appeared to have led GuocoLand to put off the launch of Goodwood Residence, scheduled initially for the first quarter.

Many developers are following suit, delaying launches until keen interest returns to the sector, which is in the doldrums with buyers and sellers staying on the sidelines.

A GuocoLand spokesman said: 'We would be tapping selected overseas markets when we decide to launch Goodwood Residence at a later date.'

It added in its statement that the expiry of the options will not have any material financial effect on its net tangible assets per share or earnings per share for the financial year ending June 30.

joyceteo@sph.com.sg

March 24, 2008
Kuwaiti firm still in talks over mega deal
A MAJOR $818.4 million residential property deal that fell through recently could be revived.
The potential buyer, Kuwait Finance House (KFH), said last week it was still in talks to buy the 97 units at GuocoLand's freehold Goodwood Residence.

KFH said it had a positive view of the outlook for Singapore's property market.

A fund to be managed by the Islamic investment bank had agreed on the deal last December.

However, KFH did not exercise its purchase options, which lapsed, GuocoLand said on March 10. It also said the parties were in talks 'with a view to a grant of fresh options for units in the development'.

Last week, KFH said it was still in talks with GuocoLand with respect to the 'terms of the purchase', which are being reviewed by both parties. Industry sources had speculated that KFH wanted out as the price was too high.

KFH had done the deal at a median price of $3,200 per sq ft (psf), when nearby projects in the Bukit Timah/Newton Circus area were going for an average price of $2,500 psf or below.

KFH said it was upbeat about Singapore, given the Republic's status as a financial hub, the integrated resorts and the introduction of events such as Formula One.

'The current cautious sentiment driven by external factors will abate in due time and, as a global city, Singapore will remain an investment destination for international real estate investors,' KFH said.


JOYCE TEO

 

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HDB releases 2 land parcels under Reserve List for condominium development

Date : 25 March 2008 2130 hrs



SINGAPORE : The Housing and Development Board is releasing two parcels of land for condominium housing under the Reserve List of the Government Land Sales programme.

One of them, at Jurong West Street 42, is for executive condominium housing, while the other at Chestnut Avenue is for private apartments.

Among the two sites, the one at Chestnut Avenue is expected to get more attention from developers.

Analysts said this is because of its attractive location, compared to the site at Jurong West Street 42, which is some 1.2 kilometres away from the nearest train station.

The proposed condominium project at Chestnut Avenue could yield about 400 to 450 units, which will be sold at between S$720 and S$750 per square foot on average.

Nicholas Mak, Director, Knight Frank, said, "This particular parcel at Chestnut Avenue...I think the developers might want to make it not so much mass market, but they may make it slightly mass to mid market and they may play on the fact that it is quite near to a park, so they may try to sell on its greenery aspect."

The plot at Jurong West for executive condominium housing is projected to yield about 420 to 460 units.

Both sites, with lease terms of 99 years, are on the Reserve List. This means they will only be released for sale by tender if developers commit to a minimum bid acceptable to the HDB.

However, market watchers expect rising construction costs to put pressure on the land price.

Mr Mak said, "For the executive condominium site, we can expect bids ranging from S$120 to S$160 per square foot per plot ratio, while for the private 99-year leasehold site, we could see a range of bids of about S$220 to about S$270 per square foot per plot ratio."

The potential developments are unlikely to have any immediate impact on property prices in the surrounding areas until the units are ready to be launched.

Industry watchers said the demand from developers for the two land parcels will be soft and it will depend on whether they are able to sell their current stock of inventory.

In addition, the developers are also expected to take a wait-and-see approach when it comes to bidding for the two sites, as they are on the Reserve List.

Separately, the HDB also released the provisional tender results for a 99-year leasehold condominium site at the junction of Yishun Avenue 1 and 2.

MCL Land put in the highest of the five bids at over S$213 million, some 68 percent more than the next bid from Peak Green.

Analysts said the bid reflected the confidence of developers in the mass market in 2009.

They added that there is a potential for the building of 15- to 18-storey apartments at the site, which could be marketed at around S$800 per square foot. - CNA

 

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March 26, 2008
Yishun condo site draws record bid of $213.5m
MCL Land's offer for 99-year plot almost 70 per cent higher than the next bid
By Fiona Chan
A YISHUN condominium site drew a higher-than-expected top bid when its tender closed yesterday, belying expectations of a property market slide.
Developer MCL Land offered $213.5 million for the 99-year leasehold plot, which works out to about $350 per sq ft per plot ratio (psf ppr) - believed to be a new benchmark for Yishun.

Property consultants said this could translate into the finished project selling at record prices for the area, even as home buyers are now holding out for lower prices in a subdued market.

Mr Nicholas Mak, director of research and consultancy at Knight Frank, estimated that the end units for the Yishun project could be priced from $830 psf up to almost $900 psf.

This would be almost double what the 99-year leasehold Orchid Park Condo down the road is fetching. Four units at the 14-year-old development have been sold there this year at an average price of $460 psf.

MCL Land's bid pipped four others and came in almost 70 per cent higher than the next bid, from Peak Green, at $127 million, or $208 psf ppr.

Frasers Centrepoint, Sim Lian and Hong Kong's Cheung Kong also tabled offers ranging from $57.7 million to $109.7 million, or $95 to $180 psf ppr - which some consultants said were 'unrealistically low' bids. They had predicted bids of between $200 and $300 psf ppr.

But Mr Li Hiaw Ho, executive director of CBRE Research, said the response was 'fairly robust' and signalled 'developers' confidence in the suburban segment despite the current lukewarm response to new projects'.

'Should the United States enter a mild recession and the sub-prime problems clear up, sentiment for suburban homes should improve after June, bringing demand and upward price momentum back to the market.'

Experts described MCL Land's offer as 'extremely bullish' and suggested that the developer may be short on land bank in the mass market segment.

MCL Land said in its latest financial results that it bought some sites last year, including Holland Hill Mansions and Dynasty Court Garden 1 in Sixth Avenue. Its land bank can now yield 780 units with a total gross floor area of 1.4 million sq ft.

The Yishun site is at the corner of Yishun Avenues 1 and 2, and is 10 minutes' walk from Khatib MRT Station. It is next to Yishun Stadium and overlooks Lower Seletar Reservoir.

'The site is good in that frontage to the reservoir is fantastic,' said Mr Ku Swee Yong, director of marketing and business development at Savills Singapore. 'I agree you should pay a premium for this site, but this seems to be a very significant premium.'

Separately, HDB yesterday put two more sites up for sale through its reserve list system.

One is a 182,986 sq ft plot at Jurong West Street 42 for executive condos, while the other is a 244,341 sq ft condo site at Chestnut Avenue in Bukit Panjang.

fiochan@sph.com.sg

 

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March 26, 2008
High Court rejects Airview Towers' collective sale
By Joyce Teo
A SINGLE home owner has managed to persuade the High Court to reject the $202 million collective sale of Airview Towers in the River Valley area.
The sole objector, Mr Ken Lee, 52, a business consultant, pulled off the victory by representing himself in court against the might of top Singapore law firm Harry Elias Partnership.

The High Court upheld a decision of the Strata Titles Board (STB) last October to throw out the sale application as the minimum 80 per cent approval had not been met in the required time.

Mr Lee said the case showed that the system is fair and considers the views of minority owners.

Bukit Sembawang Estates was the prospective buyer. Unit owners would have reaped about $2 million each.

The court case centred on just two out of the 100 units at Airview Towers, which made the crucial difference between the approval level rising above or falling below 80 per cent.

These two new owners had bought their units during the collective sale process from owners who had signed the agreement - but the new owners failed to sign the agreement in time.

Justice Lee Seiu Kin, in a judgment dated March 19, concluded that the two flats should not be counted. The owners of the two units, whose signatures were originally counted as part of the 80 per cent had, in effect, not signed in time, he said.

That meant the condo did not meet the minimum requirement for the sale to go ahead of 80 per cent of share values within 12 months of the first signature.

As a result, he threw out the appeal against STB's dismissal of the sale application.

He said the 12-month timeline for the 80 per cent minimum requirement is a 'substantive' condition put in place by the legislature to protect the legitimate rights of the minority.

The plaintiffs, three owners, argued that the owners of the pivotal two units agreed all along to the sale. Their failure to sign was due to 'mistake or inadvertence' and so was a technicality.

But the judge ruled that non-compliance with the timeline is not a mere technicality.

He said safeguards were built into the Land Titles (Strata) Act, allowing for the consideration of all objections of minority owners, and other factors. 'Timing is important because the longer the process is dragged out, the greater the likelihood that market conditions will change.'

Numerous owners agreed to the sale after the 12-month period. Mr Lee said he objected only over concerns that the sale process was not being done properly - which was some time last June after he had rushed out to buy a replacement unit.

'I had nine objections but only one was found necessary to halt the sale,' said Mr Lee.

He added: 'I respect the majority's wish to sell, but they should be mindful of the minority's rights to their homes.

'That means they have to sell it at a proper en bloc price and do it properly and legally.'

An owner who signed the agreement after the estate's sale tender was launched said he is 'very happy' it did not go through.

'I was misled into signing the (agreement). I was told they had launched the tender and 80 per cent have signed,' said Mr Foo Feng Yin, 54.

'I am very grateful to Mr Lee as I feel that the sale wasn't done in a transparent manner. The proceeds are also not enough for me to find a replacement unit in the same area.'

Listed Bukit Sembawang won the tender last April. It was planning a 36-storey condo on the site and an adjacent site, Chez Bright Apartment, that it bought in an en bloc sale in 2006. It could not be reached for comment yesterday.

Property consultants said the firm is unlikely to take the case further.

'Chez Bright can be developed into a small upmarket development,' said Savills Residential director Ku Swee Yong

'Given today's tighter credit terms and slower pace of sales, this decision is probably a positive for Bukit Sembawang.'

joyceteo@sph.com.sg

 

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March 31, 2008
Hotel site amidst garden setting in Balestier Road up for tender
THE Urban Redevelopment Authority (URA) on Monday launched a hotel site at Balestier Road for sale by public tender.
The 1.77 ha land parcel is one of two hotel sites to be launched for sale in the Government Land Sales Programme for the first half of this year.

The hotel sitie, located across from the Sun Yat Sen Nanyang Memorial Hall, a national monument and heritage centre that pays tribute to Dr Sun Yat Sen who led the Chinese Revolution in 1911, will nestled in a 0.46 ha park, named 'Zhongshan Park'.

This means the developer will be able to capitalise on the park to create a unique garden setting for the hotel and enhance the experience for hotel guests and visitors to the Memorial Hall.

The developer is also required to provide a public event space within the park to serve as a venue for the staging of events and activities.

This public event space, together with outdoor refreshment areas and tea pavilions which are allowed in the park, will help to activate and inject greater vibrancy into the park and the surrounding area.

With excellent frontage along Balestier Road, the plot has a maximum permissible gross floor area (GFA) of about 40,000 sqm, 60 per cent of which can be used for hotel and hotel-related uses. The remaining GFA can be for complementary commercial and residential uses.

'The land parcel's proximity to the Memorial Hall provides a great opportunity to develop a unique hotel development,' said the URA on Monday.

'This hotel development is envisaged to be a distinctive contemporary hotel that draws inspiration from the Chinese culture and architecture of symmetry and geometric forms interspersed with attractive landscaped garden and courtyards.'

Balestier Road has an interesting mix of conserved shophouses that were built in the 1840s and modern commercial and residential buildings.

The juxtaposition of these heritage shophouses and new buildings creates an interesting streetscape along Balestier Road, displaying its significant past and vibrant present.

In recognition of its strong heritage value and distinctive old world charm, Balestier was designated as one of Singapore's Identity Nodes in URA's Identity Plan in 2002.

Balestier Road is also known for its delicious local fares, such as Tau Sar Pia and Bak Kut Teh, that are tucked away in shophouses that line the road. Today, many locals and tourists explore Balestier Road to immerse in its historical charms and dine at many of the interesting eating outlets.

To enable visitors to enjoy the area better and enhance their walking experience, there are plans by URA to improve the walkways and landscaping along Balestier Road, said the URA.

Given that the site will be a key development along Balestier Road, the development proposal for the site will be subject to review by a Design Advisory Panel to ensure a well designed development of appropriate quality and standard.

 

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Pinetree Condominium site re-launched for sale by tender
31 March 2008 2225 hrs


SINGAPORE: The freehold Pinetree Condominium site in prime district 10 has been re-launched for sale by tender.

The property in the Balmoral area currently comprises a five-storey block with 50 apartment units.

Consultants Jones Lang LaSalle, which is marketing the site, said it has an indicative asking price of S$128 million.

But if a neighbouring plot, which is presently housing some landed homes, is included, the total price increases to S$190 million.

Overall, the successful developer may be paying S$1,700 per sq ft per plot ratio.

Under the masterplan, the 41,361 sq ft property is zoned for residential use and has a gross plot ratio of up to 1.6. This means the new development can be up to 12 storeys high.

The site could be redeveloped into an exclusive residential development with a gross floor area of 66,178 sq ft, subject to approval.

No development charge is payable.

Jones Lang LaSalle also said the land could be combined with an adjoining plot of landed properties to form a total potential land area of 81,303 sq ft. This will yield a combined gross floor area of 130,084 sq ft.

With this combined area, a developer could build 60 to 80 high-end apartment units of between 1,500 and 2,000 sq ft each.

The tender will close on 23 April.

 

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April 1, 2008
S'pore home prices slow after record year
By Joyce Teo
SINGAPORE private home prices rose at the slowest in more than a year in the first quarter of this year, reflecting a general slow down in the property market.
Prices of private homes gained 4.2 per cent in the first three months, after rising 6.8 per cent in the previous quarter, according to early quarterly estimates released by the Urban Redevelopment Authority (URA) on Tuesday.

Prices of non-landed private homes in the core central region of Singapore such as Orchard Road and Sentosa Cove rose by 4.4 per cent, compared with a 7.5 per cent rise in the previous quarter.

Non-landed private home prices rose 3.9 per cent in the rest of central region and 4.8 per cent in areas outside the central region or suburban areas. In the previous quarter, these prices went up by 7.7 per cent and 7 per cent respectively.

Private home prices jumped 31 per cent last year on the back of a booming economy - to an 11-year high. The market has since slowed considerably in the wake of the global credit crunch and the jittery stock market.

The URA on Tuesday advised prospective home-buyers that there is ample supply of private housing in the pipeline.

'As at the fourth quarter of 2007, there are about 64,900 private residential units in the pipeline, of which about 56,100 new private housing units are expected to be completed between 2008 and 2011,' said the URA.

About 38,300 units, or 59 per cent of the total, haven't been sold, the authority said.

Singapore's residential property market outpaced increases in China and Bulgaria, researcher Global Property Guide said in a Dec 19 report. Prices excluding inflation climbed 24 per cent, the researcher said.

The figures released by the authority are preliminary and based on transaction prices lodged during the first 10 weeks of the quarter. The statistics will be updated four weeks later, the authority said in today's statement.

The URA will release the full first quarter real estate statistics in four weeks' time.

 

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April 2, 2008
Home prices growing, but less sharply
By Fiona Chan
HOME seekers waiting for property prices to fall in a sluggish market were disappointed by numbers released yesterday.
Government estimates showed that the prices of private and Housing Board homes continued to rise in the first three months of the year to near their 1996 peaks.

But growth was markedly lower than before and is likely to slow further in coming months, experts said.

Some even suggested that home prices may start to ease later this year - for the first time in four years - if the Singapore economy brakes more sharply than expected.

Mr Nicholas Mak, director of research and consultancy at Knight Frank, was among industry watchers who had expected prices to plateau or even dip in the first quarter, after developers reported dismal sales of new homes in January and February.

But prices held stubbornly, backed by a still healthy economy, some new launches at benchmark prices and the reluctance of sellers to lower asking prices.

However, the number of home sales plunged from last year, leading consultants to warn that yesterday's price figures are based on fewer deals and may not be representative of the whole market.

They added that buyers willing to take the plunge now are mostly genuine occupiers, with speculators having almost completely exited.

Private home prices climbed 4.2 per cent in the first 10 weeks of the year, down from 6.8 per cent in the previous quarter and the smallest rise since 2006. Suburban home prices gained the most, rising 4.8 per cent.

HDB resale flats also saw a smaller increase in prices: 3.4 per cent, compared with 5.7 per cent previously.

The 'weaker than expected' growth comes amid continued volatility in global stock markets and a weaker Singapore market outlook, said Mr Chua Yang Liang, Jones Lang LaSalle's head of research for South-east Asia.

But Ms Tay Huey Ying, director of research and consultancy at Colliers International, called the price growth 'very encouraging', given the few transactions.

Property consultants took the chance yesterday to cut their forecasts for price growth for the whole year.

Most now predict single-digit rises compared with their earlier estimates of growth between 10 and 20 per cent. Last year, private home prices soared 31 per cent while HDB resale prices jumped 17.5 per cent.

 

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April 2, 2008
Property market may stay quiet for up to a year
Home prices, sales could remain weak as US sub-prime concerns linger
By Fiona Chan
A MONTH ago, property consultants were predicting that the cooling market would pick up after June. That optimism has fast drained away.
Consultants now expect home prices and sales to remain weak for up to a year from now, after official estimates yesterday confirmed that price growth was tapering off.

'We can expect residential prices to continue weakening over the next 12 months', in the light of the United States sub-prime debacle and an expected US recession, said Jones Lang LaSalle (JLL).

Other consultancies, such as ** Richard Ellis Research, believe price growth will slow further in the second quarter, to '1 per cent or 2 per cent'.

Home sales are also plunging as buyers retreat - and they are expected to stay low as sellers dig in their heels to wait out the slowdown.

New home sales were likely to have dropped in the first quarter to one of the lowest levels ever, second only to those recorded during the Sars period.

In the secondary market, sales have fallen to 2005 levels, according to estimates from Savills Singapore.

Mid-tier private properties on the city fringe, such as in Novena, Toa Payoh, Marine Parade and Queenstown, are likely to be hardest hit by falling buyer demand.

These areas saw the biggest slowdown in price growth in the first 10 weeks of the year, suggesting that prices in these regions may be peaking, said JLL.

Buyers in these areas have shallower pockets and are more sensitive to market sentiment, it added.

In the HDB segment, prices have stabilised at about $50,000 cash over valuation or less, said Mr Eugene Lim, assistant vice-president at ERA Realty Network.

'Resale flats priced higher than that take much longer to sell or may not sell at all.'

Phillip Securities Research, meanwhile, aired concerns over the 'huge supply' of homes due to be completed in the next two years.

Supply is 'expected to exceed the demand from buyers and result in a slide in local property prices from 2010', it said.

HDB plans to release another 5,000 new build-to-order flats in the next six months. There are also 64,900 private homes in the pipeline, of which 90 per cent will be completed by 2011, while 60 per cent have yet to be sold.

Most experts believe, however, that confidence and demand will return by year-end - as long as the Singapore economy stays robust.

'Sellers now take a while to sell their homes, but there are still buyers,' said Mr Eric Cheng, the executive director of HSR property group.

'Last year, it took maybe a month to sell a home. Now, it takes two months. But in 2000 or 2002, it took a year,' he said.

 

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Futura minority owners withdraw appeal against en bloc sale
03 April 2008 1747 hrs



SINGAPORE: Minority owners of the Futura condominium on Leonie Hill Road have withdrawn their appeal against the en bloc sale of the property.

The reasons for the decision have not been disclosed.

Futura was sold to City Developments' subsidiary City Sunshine in October 2006 for S$287 million. This means each unit owner will get between S$3.7 million and S$9.4 million.

However, some minority owners complained that the deal was not done in good faith, with no land survey done.

They also contended that a meeting of owners was not called before the price was accepted.

Now that the appeal has been withdrawn, the sale must be completed within a month.

 

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HDB, private apartment rentals set to rise
03 April 2008 0050 hrs



SINGAPORE : Rentals for HDB and mass market private apartments are set to rise in the coming years, with more foreign workers heading for Singapore.

Property agents expect rents to climb by about 10 percent this year. They say HDB flat-owners could gain from the spike in demand.

Singapore's two integrated resorts will be ready in the next two years. Besides attracting more tourists, they are also expected to draw thousands of foreign workers to the city state.

Resorts World at Sentosa says it will be hiring 10,000 people directly. And 40 percent of these jobs will go to foreigners, in view of the manpower crunch in Singapore.

Property agents say some of the foreign workers, especially higher-ranking staff, will have the means to purchase private residential properties.

But they expect the bulk of the workers to tap into the rental market for their housing needs. And this will push prices up in the short-term as supply plays catch up.

On average, monthly rentals for private apartments range between S$2,500 and S$3,500. This may be too much for some workers.

Mohamed Ismail, CEO of PropNex, said: "The public housing becomes next best alternative where today people are still able to rent at S$1,500 to S$2,000. I expect this trend to continue, as far as estates that will have a greater demand ... such as those in Telok Blangah, Bukit Merah, Bishan, Toa Payoh - anything that is not too far away from town or to the integrated resorts - will definitely have greater take-up rates."

Industry players say private residential properties currently enjoy a rental yield of some 5 percent, while that of HDB flats is between 8 and 10 percent - among the highest ever in Singapore for public housing.

All in, agents expects rentals to climb by some 10 percent in the next two years

 

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For sale again, but cheaper

Tuesday • April 8, 2008

In what could be another sign of the cooling en bloc market, a site off Sixth Avenue has been put back on the market at a discount, after it did not attract a single bidder at first go.

The reserve price for Royalville has been cut to $305 million – down 13 per cent from the minimum $350 million asked last October.

This new price works out to $1,106 per square foot (psf) per plot ratio after development charges. Credo Real Estate, which is managing the sale, says developers should now be able to break even at $1,700 psf. Other new developments in the area, like Duchess Residences, have been selling for above $2,000 psf.

Credo executive director Tan Hong Boon said: "With the reputable schools nearby, the new development should be popular among expatriates and families with school-going children."

Royalville currently comprises 93 residential units and 11 shops. It can be redeveloped into a five-storey complex holding 140 apartments of around 2,000 sq ft each.

A record $12.5 billion worth of collective sales were transacted last year, but the market appears to be cooling, with some failing to attract bidders.

Other unsuccessful tenders have included Dunearn Gardens, Cavenagh Gardens, The Village, Amber Glades, Grange Heights, Thomson View Condominium and, most recently, Makeway View.

 

[TA200]

April 8, 2008
Tulip Garden sale off? How the deal went
Condo owners likely to call off $516m en bloc deal after developer misses payment deadline
By Joyce Teo
THE $516 million collective sale of Tulip Garden condominium near Holland Road seems to be dead in the water after the developer missed a payment deadline yesterday.

The condo owners appear poised to formally call off the deal and pocket a cool $25.8 million - the original 5 per cent deposit paid by developer Bravo Building Construction.

Bravo would forfeit the sum if the deal is scrapped. That would mean each of the 164 unit owners could pocket more than $100,000 on average.

The cancellation of a collective sale because of a cash crunch is a rare event. Bravo and its partners say they have had trouble raising the necessary funds.

Earlier this year, the $162.8 million collective sale of Makeway View in the Newton area was ditched by an associate of Bravo. The firm said a higher-than-expected development charge was the reason for backing out. A deposit of $1.63 million was reportedly forfeited.

Last Saturday, Tulip Garden owners held a meeting and indicated in an informal show of hands that they wanted to cancel the sale if Bravo missed the latest payment, also $25.8 million. This payment had already been delayed at Bravo's request from the middle of March.

By late yesterday, no payment had been made. Bravo was putting on a brave face but it was, in effect, accepting that the deal appeared to have been lost.

The developer had asked for more payment extensions - to make the next 5 per cent payment by June 7 and then complete the deal by Aug 7.

But based on last Saturday's meeting, the owners appear unlikely to agree.

Almost all the owners at the meeting indicated that they wished to call off the sale and keep the deposit if Bravo did not pay up by yesterday, according to the people present.

A Bravo spokesman said yesterday that the firm is now seeking an 'unconditional' extension of time.

'If these extensions are not obtained, the consortium will accept this costly missed opportunity to develop a stunning 350-unit condo with unmatched features in a prominent Holland Road corner,' she said. The condo is on the corner of Holland Road and Farrer Road.

Bravo inked a deal to buy the freehold site in July last year. It was due to have been completed late next month.

The Bravo spokesman said the firm has been seeking partners since November last year.

'The current turmoil in the financial and stock markets matched with sporadic bad news have caused unforeseen delays in securing ultimate approvals to commit funds,' said Bravo. It added that the Tulip Garden owners had consented to the sale earlier than anticipated.

'Coupled with the consortium's strategic decision to significantly increase equity to balance the current cautious lending by banks, the current deadlines for next payments have become too constricted and no longer practical,' it said.

Bravo added that it has tied up with two local and two foreign parties to buy Tulip Garden. But unless an extension is given, they will not be offering more money, said the spokesman.

She said that if Tulip Garden owners still want to attempt to sell en bloc, they may face an 'unwelcome lower bid price' given weaker market conditions.

Tulip Garden sold for about $1,018 per sq ft (psf), more than its earlier guide price of $900 psf in January last year. The development has 164 units comprising 96 flats, 66 maisonettes and two shophouses.

If the sale works out, flat owners stand to reap $2.5 million to $4.2 million while maisonette owners would receive about $3.4 million each. The shop units would get about $1.1 million each.

Amid last year's booming market, Bravo also made two other fairly large collective sale deals: Pender Court, off Telok Blangah Road, at $80 million in July last year, and Makeway View.

Bravo has postponed the completion of Pender Court's sale until late this month.

Given the slower market, more sellers are now open to lower prices. Yesterday, Royalville, a freehold mixed development off Sixth Avenue, was relaunched for sale en bloc at a lower indicative price of around $305 million.

It was offered for sale in a Nov 9 tender, which failed to attract bidders at its earlier guide price of $330 million to $350 million.

 

[TA200]

April 8, 2008
Tulip Garden sale off? How the deal went
Condo owners likely to call off $516m en bloc deal after developer misses payment deadline
By Joyce Teo
THE $516 million collective sale of Tulip Garden condominium near Holland Road seems to be dead in the water after the developer missed a payment deadline yesterday.

The condo owners appear poised to formally call off the deal and pocket a cool $25.8 million - the original 5 per cent deposit paid by developer Bravo Building Construction.

Bravo would forfeit the sum if the deal is scrapped. That would mean each of the 164 unit owners could pocket more than $100,000 on average.

The cancellation of a collective sale because of a cash crunch is a rare event. Bravo and its partners say they have had trouble raising the necessary funds.

Earlier this year, the $162.8 million collective sale of Makeway View in the Newton area was ditched by an associate of Bravo. The firm said a higher-than-expected development charge was the reason for backing out. A deposit of $1.63 million was reportedly forfeited.

Last Saturday, Tulip Garden owners held a meeting and indicated in an informal show of hands that they wanted to cancel the sale if Bravo missed the latest payment, also $25.8 million. This payment had already been delayed at Bravo's request from the middle of March.

By late yesterday, no payment had been made. Bravo was putting on a brave face but it was, in effect, accepting that the deal appeared to have been lost.

The developer had asked for more payment extensions - to make the next 5 per cent payment by June 7 and then complete the deal by Aug 7.

But based on last Saturday's meeting, the owners appear unlikely to agree.

Almost all the owners at the meeting indicated that they wished to call off the sale and keep the deposit if Bravo did not pay up by yesterday, according to the people present.

A Bravo spokesman said yesterday that the firm is now seeking an 'unconditional' extension of time.

'If these extensions are not obtained, the consortium will accept this costly missed opportunity to develop a stunning 350-unit condo with unmatched features in a prominent Holland Road corner,' she said. The condo is on the corner of Holland Road and Farrer Road.

Bravo inked a deal to buy the freehold site in July last year. It was due to have been completed late next month.

The Bravo spokesman said the firm has been seeking partners since November last year.

'The current turmoil in the financial and stock markets matched with sporadic bad news have caused unforeseen delays in securing ultimate approvals to commit funds,' said Bravo. It added that the Tulip Garden owners had consented to the sale earlier than anticipated.

'Coupled with the consortium's strategic decision to significantly increase equity to balance the current cautious lending by banks, the current deadlines for next payments have become too constricted and no longer practical,' it said.

Bravo added that it has tied up with two local and two foreign parties to buy Tulip Garden. But unless an extension is given, they will not be offering more money, said the spokesman.

She said that if Tulip Garden owners still want to attempt to sell en bloc, they may face an 'unwelcome lower bid price' given weaker market conditions.

Tulip Garden sold for about $1,018 per sq ft (psf), more than its earlier guide price of $900 psf in January last year. The development has 164 units comprising 96 flats, 66 maisonettes and two shophouses.

If the sale works out, flat owners stand to reap $2.5 million to $4.2 million while maisonette owners would receive about $3.4 million each. The shop units would get about $1.1 million each.

Amid last year's booming market, Bravo also made two other fairly large collective sale deals: Pender Court, off Telok Blangah Road, at $80 million in July last year, and Makeway View.

Bravo has postponed the completion of Pender Court's sale until late this month.

Given the slower market, more sellers are now open to lower prices. Yesterday, Royalville, a freehold mixed development off Sixth Avenue, was relaunched for sale en bloc at a lower indicative price of around $305 million.

It was offered for sale in a Nov 9 tender, which failed to attract bidders at its earlier guide price of $330 million to $350 million.

How the deal went

July 2007: Bravo Building Construction decides to buy Tulip Garden en bloc for $516 million. It later pays a 5 per cent deposit of $25.8 million.

February 2008: The Strata Titles Board approves the sale. The sale completion date is set for May 28.

March 13: Bravo is due to pay another $25.8 million, but asks for - and is granted - an extension of time until yesterday.

March 18: Bravo asks to extend the payment deadline from yesterday until May 5. It also asks to set back the sale completion date from May 28 to July 23.

March 24: Before agreement for its earlier requests can be given, Bravo asks for further extensions of time to pay by June 7, instead of yesterday, and to complete the sale by Aug 7, instead of May 28.

April 5: Owners indicate in an informal show of hands to cancel the sale and take the $25.8 million deposit if Bravo misses the payment deadline yesterday.

 

[TA200]

Analysts say private home sales have peaked
07 April 2008 2347 hrs

SINGAPORE: Sales of private properties have been sliding amid a standoff between buyers and sellers, say market watchers.

In February, sales for new launches were only one tenth of the record numbers seen in August last year.

Analysts also say that residential property prices may have finally peaked, although the fundamentals still support long-term growth.

URA's latest flash estimates showed private home prices rose 4.2 percent in the first quarter this year, much slower than the 6.8 percent pace in the last quarter of 2007.

Last year, property launches drew a crowd despite the extravagant price tags. But now, the market is paying for it in more ways than one. Prices are coming off their highs, leaving some buyers with significant losses.

Chesterton's head of research & consultancy, Colin Tan, said: "What has happened over 2007 is that prices have risen quite rapidly....Part of the reason prices have gone up (is) because people are valuing properties not for the moment but maybe 2, 3 years down the road. In that sense, prices have raced ahead of fundamentals."

Seen in that light, a correction was perhaps waiting to happen. Right now, few are willing to pay a premium for homes, and fewer still are willing to sell for less.

Chesterton's Colin Tan said: "There's a standoff between buyers and sellers. The question now is, of course, (for) how long can the sellers hang on. It all depends on the economy. If things get a lot more worse, you may find that some investors may have to give up their properties and so prices will start to correct."

"For the short term, home prices in high-end (places), especially districts 9, 10, 11 will remain flat or go through turbulence because they have gone up sharply. Some homes, which have gone up to $4,000 psf, will need the rest of market to catch up before they find further support," said Knight Frank's director, Nicholas Mak.

While URA flash estimates showed private property prices increased 4.2 per cent in the first quarter, the rise was only for a handful of properties.

Chesterton's Colin Tan said: "I'd say the market is healthier if prices only rose 2 per cent and on a stronger sales volume, like 5 or 6 times the current volume."

Still, the longer-term outlook appears to be positive.

Knight Frank's Nicholas Mak said: "(Sales) volumes could remain thin for another six or nine months, but I think that after that.....market prices and rentals will start to grow at a gradual pace. The Singapore property market has all the factors necessary for it to continue to grow."

Residential property prices grew by over 30 per cent last year. Analysts said the pace is too fast to be sustainable. A more palatable rate, they said, is 10 per cent. - CNA/ir

 

[TA200]

En bloc market suffers double whammy as investors look elsewhere
08 April 2008 2210 hrs


SINGAPORE : En bloc sales have been slowing down over the past few months, but it's not just due to the recent tightening of the rules governing such transactions.

Amid the global credit crunch, property watchers said foreign investments have pulled back, and the overall downturn is pushing developers to look at other moneymaking options.

But they also noted that fundamentals remain strong in Singapore, and the current slowdown is due more to external factors.

Collective sales saw strong demand a few months ago, but developers are now changing tack in the tighter credit environment.

Those on the buying end of en bloc sales are choosing to hang on to their properties longer, delaying new project launches. They are also getting picky about additions to their landbank.

"They've got plenty to choose from. The most straightforward possibility for developers to partake would be going to government sale of site programme. A lot are more configured toward mass market, lower mid-tier level where we're seeing some activity in the end-market purchases," said Donald Han, MD of Cushman & Wakefield (Singapore).

Many said the current slowdown is largely due to the external environment, rather than the fundamentals of Singapore.

"A lot of buying that resulted in last round of en bloc came from overseas funds... We are rather small, in terms of available of units or land, so an amount which may not make an impact in another country will have a big impact on us. (Funds) either coming in or out have got that exponential effect on the market in Singapore," said Dr SK Phang, a lawyer.

So with tightening credit conditions worldwide causing a dip in foreign inflows, Singapore's property market is taking a hit.

But analysts said many developers took home huge profits in the past two years, and will definitely be able to weather stormy skies for now.

While there is little to be done about the external environment, analysts said en bloc rules can be further tweaked to allow the process to be speeded up.

Said Dr Phang: "The long timeline has to be shortened; it's too long, the whole en bloc process. The law allows you 12 months to get 80 percent. And after that, the law allows you 12 months to file the ST (strata title). And when you do, the STB (Strata Title Board) may take short of 4 months or a long time of a year.

"Of course not every case is that long but if you look at the historical maximum permissible time, you're looking at something about 2 years plus. And that's a long time to wait for the money. Given the volatile market conditions in Singapore, if it goes up, owners get concerned with replacement. If it goes down, developers (become) concerned. So we should try to manage the timeline and shorten it."

The en bloc market saw more than a 100 deals valued at more than S$13 billion last year. - CNA

 

[TA200]

Freehold residential site Amber Glades relaunched for en bloc sale
08 April 2008 2218 hrs

SINGAPORE : Colliers International will be relaunching the collective sale of Amber Glades, a freehold residential site at Amber Road.

The site has a gross plot ratio of 2.8 and consists of two 10-storey tower blocks with 63 units in total.

About 90 percent of the owners have agreed to the sale and are asking for about S$127 million. Including the estimated development charge of S$3.5 million, the price will work out to about S$1,140 per square foot per plot ratio. This is lower than the previous asking price of S$145 million six months ago.

Based on the 2003 Master Plan, the site is zoned for residential use with a gross plot ratio of 2.8. The new development can accommodate a residential development with up to 88 units at 1,300 square feet each.

The tender sale will close on April 23 at 3pm. - CNA

 

[jq75]

April 9, 2008
Prices of high-end condos starting to fall as sales dwindle
Downward trend may continue for next few quarters, experts predict
By Fiona Chan
HOME prices are starting to fall, as several high-end properties begin to feel the squeeze of retreating buyers.

Sales of Singapore's most expensive condominiums - all the rage last year - have dwindled to just a trickle this year.

And with plunging sales, prices have also started to dip, although official figures have yet to reflect this trend.

Early signs of the slide lie in the handful of caveats filed involving many luxury projects in the first quarter. These showed prices fell from the previous quarter, in some cases by up to 20 per cent.

In Districts 9 to 11, Singapore's creme de la creme of residential locations covering Orchard, Holland and Bukit Timah, average prices have fallen by about 30 per cent since the beginning of the year, according to caveats.

They dropped to an average of $1,564 per sq ft (psf) between January and March from $2,023 psf in the preceding three months.

In luxury island enclave Sentosa Cove, almost all condos posted drops in average psf prices, ranging from 2 per cent for the Marina Collection to 23 per cent for The Azure.

Property experts say this could be because luxury home buyers are now selecting only the most competitively priced properties.

'Market activity is very slow now, so any transactions that do take place are likely to be from people who have found attractive buys,' said Mrs Ong Choon Fah, the executive director at property firm DTZ Debenham Tie Leung.

She said high-end properties in the traditional prime districts were more dependent on investor buying, so they could be more affected by the current global credit crunch and weaker sentiment.

'A lot of people who bought luxury homes are also 'specuvestors', so they may be happy making just a small profit and selling quickly,' Mrs Ong explained.

The Government estimated last week that private home prices continued to climb in the first three months of the year, albeit at a slower pace. They rose 4.2 per cent, down from 6.8 per cent in the previous three months.

In the priciest segment, the core central region, the price gain dropped to 4.4 per cent from 7.5 per cent in the previous quarter. This region covers Districts 9 to 11, the Marina Bay area and Sentosa.

Anecdotal evidence from property insiders and caveats lodged, however, showed that prices at many projects fell rather than rose this year. At Scotts Square in Scotts Road, only two units have been sold so far this year - at an average price of $3,700 psf, down from $4,000 psf for 42 units in last year's fourth quarter.

Similarly, at The Oceanfront @ Sentosa Cove, the most recent deals were in February, where three units were sold at $1,720 to $1,751 psf. Just six months before that, 15 units were sold at an average price of $2,480 psf.

Other high-profile, pricey condos, such as the Marina Bay Residences and The Marq on Paterson Hill, have yet to see a single caveat lodged this year.

But the story is not all bad. The Orchard Residences, which holds the title of Singapore's most expensive condo, has sold only one unit this year - but at $4,700 psf, higher than most of its other sales.

Other older condos in areas such as Cavenagh or Balmoral may also be trading at higher prices from their previously low base, pushing up the overall prices for the whole district, suggested Mr Ku Swee Yong, director of marketing and business development at Savills Singapore.

But he said the price index for high-end homes may be under pressure in the next two quarters, now that 'everyone wants a bargain'.

'You only need developers to start giving discounts or people starting to buy lower-

floor units instead of penthouses. That will push the index down and put pressure on prices.'