Ang Mo Kio site may fetch over $500 psf

Ang Mo Kio site may fetch over $500 psf
Bids for 99-year leasehold plot likely to be 65% higher than minimum offer
By KALPANA RASHIWALA

A PLUM 99-year leasehold condo site opposite Ang Mo Kio MRT Station could fetch bids of over $500 per square foot (psf) of potential gross floor area, say market watchers. This is at least 65 per cent higher than the minimum offer price of $302 psf of potential gross floor area received by Housing & Development Board for the reserve list site.
The plot, right next to the AMK Hub, can be developed into a new condo with 337,408 sq ft maximum gross floor area, enough for a condo with about 280 to 300 apartments averaging 1,200 sq ft, according to Knight Frank director Nicholas Mak.

He expects the site to fetch top bids of about $480 to $530 psf per plot ratio in the current bullish market, but given its prime suburban location, is not discounting bids of $550 psf ppr or even higher.

‘This is one of the best residential sites in the second half 2007 Government Land Sales Programme. On a scale of 1 to 10, I would rate it 8 or 9,’ Mr Mak says.

Assuming the site sells for $510 psf ppr, the breakeven cost for a new condo works out to around $800 to $820 psf. If the developer wants a minimum 10 per cent profit margin, he would be eyeing an average selling price of around $900 psf.

The developer can count on a huge pool of upgraders given that Ang Mo Kio is a mature HDB estate, Mr Mak reckons.
 
CB Richard Ellis executive director Li Hiaw Ho, who is predicting the winning bid to be above $400 psf ppr, and a selling price of around $800-900 psf for the new condo units that will be built on the site. ‘This should be achievable if the residential market continues its current performance, by the time the project is ready for launch in mid-2008,’ he added.

CBRE said that in the June/July period, units at Grandeur 8 condo a short distance away changed hands at $570 to $620 psf in the secondary market, while over at Bishan 8 condo, apartments have changed hands at around $800 psf.
Source : Business Times - 31 Jul 2007

Three CBD office projects given URA approval in Q2

Three CBD office projects given URA approval in Q2
Provisional permission also granted for several hotel projects
By KALPANA RASHIWALA
A SLEW of projects were granted provisional permission in Q2, according to latest Urban Redevelopment Authority statistics.
Afro-Asia Building: It will be torn down and the site redeveloped into a new project with about 121,100 sq ft GFA offices and 1,399 sq ft of shop space. 
These include a business park development of 215,000 square foot gross floor area (GFA) for Eurochem Corporation at International Business Park (IBP) in Jurong East, and several new office projects in the CBD - including redevelopment of Afro-Asia Building on Robinson Road (which was once the headquarters of Nanyang Siang Pau), Asia Chambers at McCallum Street, and Marina House at Shenton Way.

Residential projects that received provisional permission in the April to June quarter of this year include a 316-unit condo by Tripartite Developers on Flora Road, off Old Tampines Road, and a 329-unit condo by Frasers Centrepoint unit FCL Land Pte Ltd on the freehold Far East Mansion site on Kim Yam Road. Another condo, with 300 units, on River Valley Road, by EC Investment Holding Pte Ltd, was also granted provisional permission in April.

And as reported in June, Hong Fok has obtained provisional permission to develop 369 apartments on Beach Road under a redevelopment of part of The Concourse.

Eurochem’s business park project at IBP is expected to have about 180,000 sq ft net lettable area. Eurochem is expected to occupy part of the space, while the rest could be leased out. Allowed uses include data processing and backroom offices of banks.
The redevelopment of these properties into bigger new office projects will worsen the office crunch in the short term
 
 
The company will be developing this on a site that it bought from JTC Corp on an initial 30-year lease term with an option to renew for a further 22 years, BT understands.

The three CBD office projects granted provisional permission by URA in Q2 can generate about 480,000 sq ft GFA of offices. Hong Leong Group obtained provisional permission to redevelop Marina House at Shenton Way into a new office project with about 199,455 sq ft GFA of offices. Afro-Asia Shipping Co Pte Ltd received URA’s nod to tear down its Afro-Asia Building on Robinson Road (with an MPH store at street level) and redevelop the site into a new project with about 121,100 sq ft GFA offices and 1,399 sq ft of shop space.

Assuming redevelopment work begins early next year, the redeveloped building could be ready around early 2010. The current owner bought it in the late 1960s. The site has a land area of about 16,000 sq ft and has a remaining lease of about 45 to 46 years.

Work on redeveloping Asia Chambers at McCallum Street is expected to begin in August. Owner TM Asia Insurance Singapore Ltd - part of the Tokio Marine & Nichido Fire Insurance Co group - will build a new 19-storey office project with about 161,000 sq ft GFA offices. The net lettable office space could be about 110,000 sq ft, of which around half or so is expected to be occupied by the group, which currently operates out of leased premises at Fuji Xerox Towers on Anson Road. Tokio Marine’s project, which is slated for completion in late 2009, will see a chunk of the building’s street level space devoted to public spaces with trees, other greenery and sitting areas to serve as a meeting point in the location.

URA also granted provisional permission for several hotel projects in Q2, such as a 355-room hotel on Clemenceau Avenue/Unity Street to be developed by Hong Kong’s Park Hotel Group); and a 90-room facility at Fullerton Square granted to Sino Land subsidiary Precious Quay Pte Ltd. The latter project also includes about 26,700 sq ft GFA of retail space.

In May this year, URA temporarily banned conversion of office use in the Central Area to other uses until December 2009 to curb further depletion of the existing office stock on the island. Even prior to that announcement, though, the trend had changed, with some owners of ageing CBD office blocks considering redeveloping their premises into office blocks, instead of the earlier trend of going for apartments, on the back of rising CBD office values.

Nonetheless, the redevelopment of these properties into bigger new office projects will worsen the office crunch in the short term while they are being redeveloped, say market watchers.

Source : Business Times - 31 Jul 2007

Publishing firm buys $12.5m plot

Publishing firm buys $12.5m plot 
PUBLISHING company Eastern Holdings, which ventured into property development three years ago, has bought a 10,888 sq ft freehold plot in Grove Drive for $12.5 million.
The price for the plot - which is near Ghim Moh Road - works out to $1,148 per sq ft of potential gross floor area.

Eastern said the move into property has allowed the company to ride on Singapore’s booming property market for growth.

Its chairman and managing director, Mr Stephen Tay, said yesterday: ‘This is the beginning of a new era of growth for Eastern, brought about by the robust demand for residential and commercial spaces.’

Eastern had earlier secured an option to buy an adjacent plot for $10.3 million and now plans to amalgamate the two sites.

Together, the combined plots at 81 and 83 Grove Drive offer a total gross floor area of 42,837 sq ft.

In a statement yesterday, the group said it is still discussing specific plans for the sites but may develop cluster bungalows or cluster semi-detached houses.

Eastern entered the property business in 2004 when the property market showed the first tentative hints of recovery.

It was a way for the company to diversify and add growth to its revenue streams beyond publishing, it said.

Today, the group - which publishes magazine titles such as Motherhood, Teens and Motoring - has a property portfolio of commercial, industrial and residential properties.

Source : Straits Times - 31 Jul 2007

Two River Valley condos fail to get asking prices

Two River Valley condos fail to get asking prices 
Pacific Mansions sought $2,400 psf; Rivershire asked for $2,200 psf
By Joyce Teo, Property Correspondent 
NO TAKERS FOR NOW: Owners of Pacific mansions are seeking $1.18 billion. Marketing consultants are said to be negotiating with ‘interested parties’, as developers are finding these prices too steep. — PHOTO: SAVILLS SINGAPORE
 
  View more photos
 
RECENT high-profile collective sales of Pacific Mansions and Rivershire have both failed to attract bids from developers willing to match the prices being sought by owners at the two River Valley condominiums.
Marketing consultants of both sites, however, are understood to be negotiating with ‘interested parties’ to see if they can at least achieve the reserve price - ranging from 10 per cent to 20 per cent below the asking price.

Asking prices at the two condominiums were optimistically priced at the very top end of market levels.

The current collective sale record stands at $2,338 per sq ft (psf) of potential gross floor area at The Ardmore in the prestigious Ardmore area.

Owners at the 45-year-old Pacific Mansions in River Valley Close, however, asked for even more - about $2,400 psf of potential gross floor area. This placed its total price at $1.18 billion.

Although the property market is booming, the perception is that the asking price for Pacific Mansions is high and unachievable for now, said a source.

Rivershire in the Leonie Hill area was put up for sale in late June at $348 million, or a hefty $2,200 psf of potential gross floor area.

The recent hike in development charge has no impact on the sites, as no such charge is payable for both sites.

There is talk that the Pacific Mansions’ tender had attracted a few expressions of interest but no firm bids.

Mr Steven Ming, director of investment sales at Savills Singapore, which is marketing Pacific Mansions, only said: ‘We have received interest, and we are in discussions with the interested parties.’

Knight Frank, which is marketing Rivershire, is also believed to be in talks with keen parties.

Nearby, owners of the 99-year leasehold Grangeford Apartments, who had asked for $2,016 psf of potential gross floor area, also failed to get what they had asked for.

The best they got was an offer from Overseas Union Enterprise - believed to be around $1,820 psf - subject to approval by owners controlling 80 per cent of the property’s share values.

The deal is likely to be sealed soon. CB Richard Ellis, which is marketing the site, said it is waiting for lawyers to confirm the approval level.

The absence of finalised deals for these condos has not stopped others from hitting the market at relatively high prices.

These include Trendale Tower in the Cairnhill Road area, which was relaunched for sale in late July at $2,477 psf of potential gross area. Its earlier asking price in May, when it was put up for sale via an expression of interest exercise, was at $2,200 psf of gross floor area.

Recently, City Towers in Bukit Timah Road was also relaunched for sale at a revised asking price of $2,100 psf of potential gross floor area.

Property consultants say the residential market is still rosy, though some collective sales may stall as the owners’ asking prices are far beyond what the market is currently willing to pay.

‘It really depends on the site’s potential,’ said one.
Source : Straits Times - 31 Jul 2007

Govt to take ‘light touch’ approach to property

Govt to take ‘light touch’ approach to property 
It will give out more data on prices and ramp up supply of homes and offices
By Jessica Cheam 
THE Government is not hitting the brakes on the roaring property market, but it is keeping a sharp eye on soaring prices and the office squeeze.
This assurance came yesterday from National Deve- lopment Minister Mah Bow Tan, who said the Government was more inclined towards applying a light touch.

It will depend on ‘non-interventionist’ measures like providing more information to the public on prices and rents while ramping up the supply of homes and offices.

The Government sees this shortage of space - which has resulted in rising home and office rents - as a short-term problem that is best tackled with like-minded measures.

‘We don’t want to use long-term solutions to try to solve short-term problems. If you do that, you might create problems in the long run,’ said Mr Mah.

He added that the Government will look into releasing temporary premises as a way of helping the supply side of the equation.
The HDB is also rolling out a pilot project to lease 120 vacated flats under the Selective En-bloc Redeve- lopment Scheme for terms of one or two years, depending on public response.

A ‘few thousand units’ would be available to help tide the market over the interim period before long- term supply kicks in with the completion of new residential projects, said Mr Mah.

Another initiative announced recently involved the launch of ‘transitional’ office sites by the Urban Redevelopment Authority (URA), which can be built on quickly.

The other weapon in the Government’s approach is to provide buyers and sellers with information - a lot more of it, and data that is more up to date.

Such data is seen as particularly important, given the headlines that rising prices have commanded of late.

Figures by the URA last week showed private home prices climbed 8.3 per cent in the April to June quarter, while the Housing Board revealed that resale prices for flats jumped 3 per cent in the same period.

Both increases are the highest in almost a decade.

Mr Mah maintains that in such an environment, providing useful data can clear the air for buyers and sellers.

He said he preferred to ‘let the market forces work’, but for them to work effectively, ‘there must be sufficient information’.

A wealth of information on sale prices and rent levels for both residential and HDB homes, HDB resale prices and offices has already been released and made available online.

It allows buyers and sellers to get a better handle on how the market is moving in particular areas.

Mr Mah cautioned the public to ‘make a distinction’ between data analysis reports or projections by property analysts and the hard facts provided by the authorities.

‘You can have many different reports, but you should take URA and HDB reports as a snapshot of what is really happening on the ground,’ he said.

Mr Mah added that he was confident that with these measures - comprehensive data and temporary supply - ‘we will be able to moderate the prices’.

Mr Mah was speaking on the sidelines of a Ministry of National Development joint scholarship presentation ceremony, where 36 awards were given out.

This is the first time the ministry’s agencies - such as the National Parks Board, HDB and URA - have award their scholarships in a single ceremony.
Source : Straits Times - 31 Jul 2007