HDB receives top bid of S$38.5m for Westwood Ave residential site

HDB receives top bid of S$38.5m for Westwood Ave residential site

By Channelnewsasia.com

SINGAPORE: Chappelis Pte Ltd has submitted a top bid of S$38.5 million for a residential site at Westwood Avenue.

The Housing and Development Board (HDB) said it received a total 32 bids, with the lowest one at S$16.8 million from Boon Keng Development.

The second highest bid came from a partnership between Hoi Hup Realty and Sunway Developments, which put in a bid of some S$38 million.

Act-Nobel Homes rounded off the top three bids with its offer of S$35.1 million.

Other bidders of the site included Soilbuild Group, Sing Holdings, Frasers Centrepoint and Sim Lian Land.

The land parcel located in Jurong West has an area of 14,098.9 square metres and is proposed for landed housing development with a 99-year lease.

Based on the top bid of S$38.5 million, this works out to about S$254 per square foot.

Property consultancy CB Richard Ellis (CBRE) said it expects terrace houses that are put up for sale there to be priced around S$1.25 million to S$1.30 million each.

“The alternative is cluster housing that can appeal to home buyers who are attracted by the facilities offered,” said Li Hiaw Ho, executive director, CBRE Research.

“Currently, houses in Westville and Westwood landed estates are sold in the resale market at S$850,000 to S$1.1 million each. Potential buyers could comprise locals working in the manufacturing firms in Jurong and Tuas, as well as academics at the nearby Nanyang Technological University,” Li added.

The consultancy said the tender suggests that the property market has recovered significantly compared to a year ago.

Last year, the same site was launched for tender and received only two bids of S$10.8 and S$11.8 million, both of which were rejected by the government as they were considered too low.

HDB said it will award the tender within the next two weeks after the bids have been evaluated.

- CNA/al

Source : Channel NewsAsia - 09 December 2009

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Private residential property transactions up 20% in Q3

Private residential property transactions up 20% in Q3

By Yasmine Yahya

SINGAPORE: The third quarter saw a strong surge in Singapore’s private residential market, as transaction volumes rose 20 per cent over the previous quarter.

Property consultancy Savills said some 11,000 units were sold between July and September, mostly in the mass market and mid-tier sectors.

Projects such as The Gale at Flora Road, Hundred Trees at West Coast and Optima at Tanah Merah benefited from this buying interest.

On the other hand, the high-end sector saw volumes easing off in the third quarter, due to a limited number of launches and the implementation of cooling-off measures by the government.

On the back of buoyant sales, private property prices surged 15.8 per cent in the third quarter - the sharpest quarterly rise in 28 years.

Even in the high-end sector, prices recorded a second straight increase, despite being about 22 per cent below the previous peak in the fourth quarter of 2007.

Savills said it expects transaction volumes in the private residential sales market to slow in the next few months, as there will be fewer major launches and buying activity tends to ease during the year-end holiday season.

Nevertheless, island-wide home prices are expected to firm, with a moderate increase from the third quarter to the last.

Meanwhile, the office vacancy rate rose to 12.5 per cent in the third quarter, up 2.5 percentage points from the second quarter, as 1.25 million square feet of new office space was completed.

Savills said net supply now outstrips net demand by some 1.2 million square feet. It said companies remained cost conscious in the third quarter despite the better economic outlook.

As a result, leasing activity was largely led by relocating tenants who were seizing the opportunity to move to new office buildings that offered competitive rental packages.

The average Grade A asking rents continued to slide by 9.4 per cent on quarter, to S$9.30 per square foot per month.

Faced with intense competition from new buildings, Savills said existing office buildings in the core Central Business District area saw asking rents tumbling at double digit rates.

Looking ahead, Savills said the gradual return of business confidence will lead more companies to expand or to revisit their space planning needs, resulting in an increase in leasing demand.

It said with the completion of over one million square feet of office space in the next six months, the leasing market will be led by opportunistic expansions, renewals and flight to quality by companies taking advantage of the weak rental environment.

As a result, take-up in new buildings may be at the expense of older ones putting downward pressure on their rents.

Savills expects Grade ‘A’ rents to fall by another 10 to 15 per cent in the next six months.

- CNA/sc

Source : Channel NewsAsia - 09 December 2009

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URA releases site at Woodlands for industrial development

URA releases site at Woodlands for industrial development

By Jonathan Peeris

SINGAPORE: The Urban Redevelopment Authority (URA) has released a site at Woodlands Avenue 12 for sale from the Reserve List.

The plot of land, which is meant for industrial development, will have a site area of about 3.2 hectares.

It can generate a maximum gross floor area of 32,279 square metres and has a 60-year-lease period.

URA said the site can be developed for a variety of uses under “Business 1″ zoning. Sites that are zoned Business 1 can be used for shops, restaurants, residences and association uses.

Under the system, a site is released for sale only if a bid with an acceptable minimum price is received.

- CNA/sc

Source : Channel NewsAsia - 09 December 2009

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S’pore drops 3 spots in survey of top real estate investment markets

S’pore drops 3 spots in survey of top real estate investment markets

By Ryan Huang/Tan Huileng

SINGAPORE: Singapore appears to be losing a bit of its shine as one of Asia Pacific’s top real estate investment markets.

It slipped three notches among Asian markets in PwC’s latest survey on where institutional investors prefer to put their money next year.

Singapore was ranked number two last year. But it was placed number five among 20 cities in the latest report by PricewaterhouseCoopers (PwC).

Shanghai was the top Asian city for real estate investment, according to the annual survey. It jumped from fifth place last year to first, ahead of Hong Kong, Beijing, Seoul and Singapore.

The survey said this is due mainly to the Chinese government’s decision to inject liquidity into its economy with its massive economic stimulus package. This helped to boost lending and led to a sharp rebound in commercial property prices.

The survey polled more than 270 industry players around the world. It found that concern about softening property values next year due to over-supply dented Singapore’s ranking among developers.

Among the real estate sectors in Singapore, residential investments came up tops in the survey. It attracted a ‘buy’ recommendation from 37% of respondents.

Another 45.1% of respondents gave a ‘hold’ recommendation on residential properties in Singapore, also the lowest recorded among all other types.

However, the survey highlighted some caution as well due to the expected volatile nature of the Singapore market. PwC told MediaCorp that respondents were uncertain about how the residential market will pan out in Singapore next year.

Going forward, the report expects real estate investments in Singapore to pick up momentum, boosted by the transparency of its market.

Despite the bullish atmosphere, market watchers believe it will largely be a slow and steady recovery for the region.

Stephen Blank, senior resident fellow at Urban Land Institute, said: “2010 is going to be a long year, we’re not going to have a sudden victory or surprises. The Asia Pacific region is expected to grow at a rate faster than the rest of the world (but) not as fast as it did in 2007…

“It will be a leading economy again. It should present excellent opportunities from a global perspective. It’s going to be a long year, we’re going to have to work hard. But I think for people who invested in the Asia-Pacific region, they are going to be rewarded.”

- CNA/ir

Source : Channel NewsAsia - 09 December 2009

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2 Keppel directors buy Marina Bay units

2 Keppel directors buy Marina Bay units

TWO directors in the Keppel group of companies are shelling out millions of dollars for units in the plush Marina Bay Suites that Keppel Land is involved in developing.

Keppel Corp director Alvin Yeo, who is also the senior partner at law firm Wong Partnership, is paying $6.54 million or $2,442 per sq ft (psf) for a 2,680 sq ft apartment on the 32nd floor of the luxury project.

The details of the transaction were disclosed in an announcement by Keppel Land to the Singapore Exchange yesterday as part of the exchange’s listing rules.

No discount was given by Keppel Land, which is one of the joint-venture partners of the project along with Hongkong Land and Cheung Kong Holdings.

Keppel Land director Niam Chiang Meng is paying $4.577 million or $2,238 psf for his unit, also on the 32nd floor but smaller at 2,045 sq ft.

Mr Niam also did not receive any discount.

The recent preview of Marina Bay Suites saw units snapped by Singaporeans and foreigners, including Indonesians, Malaysians, mainland Chinese, Australians and Americans.

Reports have put the pricing of the units sold at around $2,300 psf.

Source : Straits Times - 09 December 2009

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Real estate investors pick China over S’pore

Real estate investors pick China over S’pore

Experts cautiously optimistic about S’pore, which ranks fifth among Asia-Pacific cities

By Sylvia Paik

SINGAPORE’S popularity as one of Asia’s top real estate investment destinations has slipped, according to a new survey of institutional investors by the Urban Land Institute and PricewaterhouseCoopers (PwC).

The report put the Republic in fifth place in the latest rankings of Asia-Pacific cities with the best property investment prospects. It came in second the last time.

The top three cities, overtaking Singapore in the investment league table, are Shanghai, Hong Kong and Beijing respectively, with Seoul in fourth place.

Mr Choo Eng Beng, PwC’s assurance real estate leader, said the results came as no surprise in the light of the remarkable resilience of the Chinese economy.

And Mr Stephen Blank, senior research fellow of finance at the Urban Land Institute, said Singapore’s drop should be put into context, given that the difference between the third, fourth and fifth places was minor.

About 270 industry experts from across the region - including investors, developers, property companies, lenders, brokers and consultants - were questioned about their views on the outlook of the property sector for the survey.

Concern about an oversupply of property in Singapore over the next two years dented the city’s ranking among developers. Experts placed Singapore 11th, compared with seventh last year.

Respondents seemed most bullish about investment prospects for the residential property sector here, whereas other categories, such as retail and office, were placed in the ‘hold’ category.

Almost 37 per cent of those polled believed that it was time to buy residential, while 45 per cent favoured ‘hold’ positions.

This contrasts with the figures last year, when 11.6 per cent of respondents believed it was time to buy and 65.1 per cent urged investors to hold.

But the survey warned that because residential prices rose a record 15.9 per cent in the third quarter over those in the previous period, the ideal moment for buying ‘appears to have passed and most analysts are now concerned about prospects for the sector’.

Mr Choo said the overall sentiment of respondents was cautiously optimistic. ‘There continues to be confidence in terms of the strong fundamentals in Singapore,’ he added.

‘This shows that despite issues with oversupply in Singapore, we are still recognised as a property investment hub.

‘Investors, however, are watching carefully as there are concerns about the city’s development prospects across most asset classes. It would be prudent to tread cautiously going into 2010.’

Source : Straits Times - 09 December 2009

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Jurong West landed housing site draws 32 bids

Jurong West landed housing site draws 32 bids

Top bid of $38.5m for popular plot comes from Kheng Leong unit Chappelis

By UMA SHANKARI

A LANDED housing site at Jurong West put up for sale by the government drew a whopping 32 bids at the close of the tender yesterday.

Mr Li: Based on the top bid, terrace houses on the site would be priced at $1.25-1.3 million each
The top bid of $38.5 million or $254 per sq ft of land area came from Chappelis, a unit of Wee Cho Yaw’s privately held Kheng Leong.

The huge interest in the 151,759 sq ft site is a stark turnaround from last year. The 99-year leasehold parcel was put up for tender in March 2008 via the government’s confirmed list, but was not awarded because the two bids tendered - $11.8 million and $10.3 million - were considered too low. The top bid then worked out to just $78 psf of land area.

This time around, the site was placed on the reserve list and put up for tender only after an unnamed developer committed to bid at least $15 million, or $99 psf.

‘Now the residential market is performing well, the limited supply of landed sites for development has created substantial demand for this site,’ said Li Hiaw Ho, executive director at CBRE Research.

Market watchers also said the site proved popular because it is small, which means smaller players submitted bids because the amount they would have to fork out would not be too high.

However, there were far more bids than the 10 that most analysts had expected.

‘I’m astounded by the number of bids,’ said Chesterton Suntec International’s research and consultancy director Colin Tan. To meet the strong demand for landed housing plots indicated by this tender, the government might want to release more such plots next year, he added.

Kheng Leong’s bid is just one per cent higher than the next highest bid of $38 million, submitted by Hoi Hup and Malaysia’s Sunway group. But the top bid is 129 per cent higher than the lowest bid of $16.8 million by Boon Keng Development. Boon Keng put in the higher bid of $11.8 million in last year’s tender.

CBRE’s Mr Li said that based on the top bid, terrace houses on the site would be priced around $1.25-1.3 million each. Currently, houses in the nearby Westville and Westwood landed estates are sold in the resale market at $850,000 to $1.1 million each, he pointed out. Another alternative for Kheng Leong would be to build cluster housing.

‘Potential buyers could comprise locals working at manufacturing firms in Jurong and Tuas, as well as academics at nearby Nanyang Technological University,’ Mr Li noted.

The plot is surrounded by other landed estates such as Westwood Park and The Floravale condominium and is near the Pan-Island Expressway.

Source : Business Times - 09 December 2009

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Woodlands industrial site on reserve list

Woodlands industrial site on reserve list

60-year leasehold is near Admiralty MRT Station

By KALPANA RASHIWALA

THE Urban Redevelopment Authority has made a 60-year leasehold industrial site at Woodlands Avenue 12 available for application through the government’s reserve list.

It will be released for tender once a bidder undertakes to pay a minimum acceptable price.

The 347,451 sq ft site is closer to Admiralty MRT Station than two earlier industrial sites at Woodlands Industrial Park E5, sold by the state this year and last year.

As a result, Colliers International director (industrial) Tan Boon Leong reckons the latest site could fetch top bids of $50-$55 per sq ft of potential gross floor area if it was on the market today. This is significantly higher than the $34 psf per plot ratio (psf ppr) that Wee Hur Development paid for a plot on the corner of Woodlands Industrial Park E5 and Woodlands Avenue 4 in a state tender that closed in July this year. In July last year, Soilbuild Group clinched the plot next door for about $30 psf ppr.

All three plots have 60-year leasehold tenure and a 2.5 gross plot ratio - the ratio of maximum potential gross floor area to land area).

However, the latest plot at Woodlands Ave 12 is much larger than the two earlier plots, which means developers will need deeper pockets to bid for it, says Mr Tan.

With a maximum permissible gross floor area of 868,628 sq ft, the land bids of $50-$55 psf ppr predicted by Mr Tan reflect absolute bids of about $43-$48 million. ‘It could be developed into a flatted and ramp-up factory/ware-house project,’ he said.

Based on his estimated land price of $50-$55 psf ppr, the breakeven cost would work out to about $170 psf of net saleable area. Mr Tan reckons the flatted factories could sell for at least $200 psf on average, pointing out that Soilbuild sold flatted factories on its Woodlands site this year at $160 to $190 psf.

However, a seasoned industrial property developer put a much lower land price on the latest site - $30-$40 psf ppr, which is close to the earlier two sites to ensure end-selling prices are kept within reach of SMEs. ‘For flatted factories, the affordable price range for SMEs would be $150-$180 psf,’ he said.

The latest site is zoned Business 1, which means light and clean industry and warehouse are allowed. The two plots sold earlier are zoned Business 2, which also includes general industrial use.

Source : Business Times - 09 December 2009

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S’pore slips in property investment rankings

S’pore slips in property investment rankings

By EMILYN YAP

(SINGAPORE) Singapore’s property market is looking relatively less attractive to investors as they worry about oversupply and overdevelopment on the island.

According to a joint survey by PricewaterhouseCoopers (PwC) and the US-based Urban Land Institute (ULI), Singapore is fifth in a ranking of Asia-Pacific cities’ property investment prospects, falling three notches from a year ago. In another ranking of development prospects, Singapore took 11th spot, down from seventh.

For the Emerging Trends in Real Estate Asia Pacific 2010 study, PwC and ULI gathered the views of more than 270 real estate investors, developers and other players from mid-September to early November. The report notes that sentiment across the region has improved but also warns against complacency, ‘with the prospects for Western economies precarious’.

One concern participants brought up about the Singapore market is the large supply of property coming on stream. For the residential sector, Urban Redevelopment Authority (URA) data in Q3 showed 59,700 private homes were in the pipeline and that, of these, 34,120 were unsold.

On the commercial front, CB Richard Ellis estimated last month that 7.72 million square feet of office space could be completed between Q4 this year and 2014.

Still, Singapore is one of the top five markets in the region to invest in, said Choo Eng Beng, PwC assurance real estate leader for Singapore. ‘This shows that despite issues with oversupply in Singapore, we are still recognised as a property investment hub.’

And while Singapore’s ranking dropped, its absolute rating actually improved marginally from 5.4 to 5.5 on a scale of one to 9.

Respondents were most optimistic about investing in the residential sector here, with 36.6 per cent of them believing at the time of the survey that it was time to buy. The hotel sector had the fewest supporters, with 21.9 per cent of respondents making a ’sell’ call.

In the ranking of investment prospects, Shanghai jumped four notches to the top of the table, followed by Hong Kong, Beijing and Seoul.

But PwC and ULI noted that ‘the key driver for outperformance in Shanghai, and indeed in China generally, is the government’s decision to inject liquidity into the economy, leading to a surge in bank lending to the property sector and a sharp rebound in commercial property prices’.

Singapore also slipped in the table of development prospects, reflecting concerns about overdevelopment, the report said.

ULI finance senior fellow Stephen Blank suggested another reason for the drop: foreign developers may find it hard to break into the local market, which is ‘dominated by a number of large public and private owners and developers who have a long historical relationship with the city’.

Shanghai also took top spot in the development prospects ranking, with Mumbai and Ho Chi Minh City in second and third places.

Source : Business Times - 09 December 2009

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