Complete Property Market Updates of Singapore

November 30, 2007

Top-end property ’still good value’ despite higher prices

Filed under: Investment Tips,Property Investment — Propertymarketupdates @ 9:21 pm

THERE is little danger that Singapore’s high-end property prices will affect its cost competitiveness, said a panel promoting the country’s real estate prospects.

Mr Daryl Ng, the executive director of Sino Group, one of Hong Kong’s largest developers, said it was healthy that prices of top-end homes in Singapore have finally caught up with those in other global cities such as New York and London.

‘There is good value in Singapore…where prices were a laggard compared with those in other international cities,’ he said yesterday at Mipim Asia, a major property conference and exhibition being held in Hong Kong this year.

Mr Ng is the son of Sino Group chairman Robert Ng and the grandson of group founder Ng Teng Fong.

The panel was addressing a question from an audience member on whether Singapore’s costly homes would price the city out, especially as some Orchard Road flats now cost twice as much as apartments near New York’s Times Square.

The head of property firm Savills Singapore, Mr Michael Ng, noted that while Singapore homes might be getting pricey, they are still nowhere near the world’s costliest residences.

There is still some way to go before they hit prices such as $15,000 per sq ft (psf), fetched recently in London, he said.

Mr Richard Johnson, who heads the Istithmar Real Estate fund, added that high prices are simply part of a market cycle. ‘We’re at the top of the cycle in Singapore. It’s just tough luck.’

An official from Singapore’s Urban Redevelopment Authority (URA) noted that while high-end homes have exceeded $5,000 psf, there are still ‘good quality, suburban homes available for $500 to $600 psf’.

‘What we are seeing now is market segmentation,’ said Mr Marc Boey, a deputy director at the Singapore agency.

‘Compared with the 1990s, we are now seeing demand not just from Indonesians and Malaysians but also from people in Monaco, London and the Middle East.’

Mr Boey also told The Straits Times that the URA and the Singapore Tourism Board were in Hong Kong to woo hotel developers that have little or no presence in Singapore, ahead of a revised Government Land Sales programme due out in two weeks.

The programme opens sites to developers for bidding.

Many companies have expressed keen interest in building hotels, ranging from smallish ones of about 300 rooms to those with about 500 rooms, said Mr Boey.

Source : Straits Times – 30 Nov 2007

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Ho Bee, Banyan Tree win Mipim awards

Filed under: Developer News — Propertymarketupdates @ 9:20 pm

HO BEE Group and Banyan Tree Holdings have won two of the seven categories in the inaugural Mipim Asia Awards held in Hong Kong.

Mipim, the Marche international des professionnels de l’immobilier, is a real estate and city development fair that also honours innovative and outstanding buildings.

Over 100 projects from 15 different countries across the Asia-Pacific region were submitted to the Mipim Asia Awards.

‘The quality of the final projects is a testimony to the high standards in Asian real estate today,’ commented Robert Lie, president of the jury and chairman of ING Real Estate Investment Management Asia (Hong Kong).

Ho Bee on Wednesday won in the Residential Developments category with its Sentosa development, The Berth by the Cove, by architects Axis Architects Planners.

This is the first award for The Berth, and Ho Bee general manager of marketing and business development Chong Hock Chang added that it is also ‘the first true waterfront housing in Singapore’.

He said: ‘The development is designed such that you either face the vast South China Sea or the enchanting waterways within the Cove. Further, it is also the first of its kind to have its own berthing facilities.’

On the efforts of Axis Architects, Mr Chong said: ‘They may be a local architect but the team has proven themselves to be able to compete against the best in the region by helping us bag this prestigious award.’

Banyan Tree Holdings won in the Hotels and Tourism Resorts category with its Banyan Tree Lijiang in China by Architrave Design & Planning.

Banyan Tree managing director (Design Services) Ho Kwoncjan explained that each Banyan Tree Resort is designed to blend into its natural surroundings, using indigenous materials as far as possible and reflecting the landscape and architecture of the destination.

‘Whether redesigning rustic Tibetan farmhouses as lodges, or visualising a resort within an intimate village setting, we promote the uniqueness of indigenous cultures,’ he said.

Source : Business Times – 30 Nov 2007

MI-Reit acquires office, warehouse building for $25m

Filed under: REIT — Propertymarketupdates @ 9:19 pm

MACARTHURCOOK Industrial Reit (MI-Reit) has signed an agreement to acquire an office and warehouse facility in the Tai Seng industrial precinct for $25 million.

Under the agreement, Powermatic Data Systems, which is listed on the Singapore Exchange, will lease back the property at 135 Joo Seng Road for five years with the option to extend for another five years. The lease will commence upon the completion of the acquisition, which is scheduled for February 2008.

The property was transacted at the initial yield of 7.3 per cent, and will be accretive to MI-Reit’s distribution per unit following completion, said MacarthurCook Investment Managers (Asia) Ltd (MCKIM), the manager of the Reit.

Chris Calvert, CEO of MCKIM, said: ‘We are pleased with the acquisition of 135 Joo Seng Road. The inclusion of SGX-listed Powermatic as one of our tenants further enhances our portfolio, of which approximately 70 per cent is comprised of SGX-ST listed companies or their subsidiaries.

‘This acquisition provides unitholders with the twin benefits of medium to long-term income stability and also the opportunity for capital and rental value growth, which will form the steadily increasing demand for quality office accommodation in the Tai Seng industrial precinct.’

The inclusion of the property in MI-Reit’s portfolio will further contribute to income stability through enhanced tenancy and property diversification, and reduced exposure to its largest tenant, UE Tech Park Pte Ltd, from 31.6 per cent to 29.4 per cent of portfolio income, MCKIM said.

With the latest acquisition, MI-Reit will have total investments of approximately $642.6 million in 22 properties.

It intends to finance the acquisition wholly with debt but may consider alternative means of funding as appropriate. Assuming 100 per cent debt financing, the acquisition will increase MI-Reit’s committed gearing level from 36.7 per cent to 39.5 per cent.

Source : Business Times – 30 Nov 2007

Lawyer jailed 11 months for forgery and lies

Filed under: Legal Ground — Propertymarketupdates @ 9:19 pm

HE WILL spend the next 11 months in jail but the immediate future of his 10-year-old daughter is less certain.

Lawyer Tan Sok Ling, 40, pleaded guilty last week to lying about his residential address in order to secure his daughter a place at a reputable school in Bukit Timah. He also admitted to altering the stamp duty payable for a property transaction from $8,100 to $13,500.

Yesterday he was sentenced to nine months’ jail for forgery and two months for giving false information. Two other forgery charges and another of giving false information were considered.

As for his daughter’s fate in the school, the Ministry of Education (MOE) said it will consider the court’s ruling in deciding the course of action for the child.

Tan, who was called to the Bar in 1993, is currently under a 12-month suspension for breaching the Solicitors Accounts Rules between 2002 and 2003.

The owner of the now-defunct firm of Tan S.L. & Partners was representing Mr Kwang Siang Jin, 46, a buyer of a Thomson Park house, when he forged the stamp duty certificate in March last year.

Mr Kwang paid $13,500 for stamp duties for the purchase of the property, not knowing that the actual figure was only $8,100.

When he found out three months later, he demanded a refund and Tan complied.

Earlier in 2003, Tan’s family was living in Bedok when he decided to rent a place within the 1km radius of the Bukit Timah school in order to enrol his daughter there.

He managed to find a unit at Maplewoods Condominium and paid a $1,600 monthly rent for 41/2 months from April 2003. He told the property agent that he was not going to live there but wanted to use the address.

After signing the licence agreement, he went to the Siglap Neighbourhood Police Post on July 6 that year to change his address to the Bukit Timah one when he knew that it was false.

His daughter, now 10, was admitted to the school. But he was found out after an MOE official lodged a police report on Dec 19 that year stating that two applicants at the 2003 Primary 1 registration exercise had used the same address.

Mr Peter Cuthbert Low of law firm Colin Ng & Partners said his client cooperated fully with the police, made restitution even before he was charged, and was genuinely remorseful.

Citing aggravating factors in the case, District Judge Liew Thiam Leng said the offence involved fraud and dishonesty as well as premeditation. Tan had abused his position of trust as a lawyer and his conduct undermined public confidence in the legal profession.

Tan could have been jailed for up to seven years for forgery. For giving false information to a public servant, the maximum penalty is six months’ jail or $1,000 fine or both.

Source : Straits Times – 30 Nov 2007

JTC awards two industrial sites by tender

Filed under: Commercial,Regulators — Propertymarketupdates @ 9:19 pm

JTC Corporation said yesterday it has awarded two industrial sites – one at Commonwealth and the other in Jalan Tepong.

The 120,300 sq ft site at L1 Commonwealth Drive/Lane went to WHB Pte Ltd, which submitted the highest of 14 bids received. WHB paid $51.2 million, or $170 per square foot per plot ratio (psf ppr). The 30-year leasehold site has a 2.5 plot ratio, giving it a maximum floor area of 300,700 sq ft.

The Jalan Tepong site was awarded to EL Development, which is fully owned by Evan Lim & Co Pte Ltd. The company submitted the highest of six bids received. It paid $9.5 million, or $30 psf ppr, for the site. The 23-year leasehold site has a land area of 224,600 sq ft and 1.4 plot ratio, giving it a maximum floor area of 314,500 sq ft.

The tender for the L1 Commonwealth Drive/Lane parcel was launched on Sept 21 and closed on Nov 2. The tender for the Jalan Tepong parcel was launched on Sept 28 and closed on Nov 9.

JTC is Singapore’s biggest industrial landlord.

Source : Business Times – 30 Nov 2007

SLA auctions off 6 infill sites for $30.6m

Filed under: Auction,Regulators — Propertymarketupdates @ 9:18 pm

THE Singapore Land Authority (SLA) yesterday auctioned off six 99-year leasehold residential land parcels for some $30.6 million in all – but some of the sites went for bargain prices.

A 16,690 sq ft good class bungalow (GCB) site at Eng Neo Avenue was picked up by a buyer for at the starting auction price of $6 million – which works out to $360 per square foot (psf). The buyer, Foo Chee King John, said that he was lucky to have won the site at such a good price.

‘Leasehold land on Sentosa can go for over $1,000 psf,’ he pointed out. The land, he said, is for his own private use.

And another GCB plot, also on Eng Neo Avenue, was sold to individual buyer Hu Nan Lee for $12.1 million – significantly above the starting price of $9.5 million. But the 29,200 sq ft site was still considered a good buy as it went for $414 psf.

The auction was SLA’s first for infill sites, the government agency said. Over 120 individuals and companies turned up for the auction, including professionals, businessmen, construction companies and niche developers.

Other than the GCB sites, SLA also auctioned off one other site in one of Singapore’s prime districts – a 6,290 sq ft semi-detached housing plot Moonbeam Walk, which is in District 10. The site fetched $3.9 million (as compared to the starting bid of $3.3 million), which works out at $626 psf.

The three other sites, at Somme Road, Jalan Insaf and Bedok Close went for $3.8 million, $3.5 million and $1.3 million respectively. The price works out to $353 psf for the Somme Road site, $508 psf for the Jalan Insaf site and $307 psf for the land parcel on Bedok Close.

The Somme Road plot proved to be the most popular of the six land parcels on offer and there were altogether 64 bids before it was awarded to Sarda Pte Ltd.

‘We are very encouraged by the strong bids shown at this auction,’ said SLA chief executive Lam Joon Khoi. ‘We will consider releasing more infill sites to help meet the current market demand for high quality residential properties.’

Source : Business Times – 30 Nov 2007

Keen interest at first SLA auction for small plots

Filed under: Auction,Regulators — Propertymarketupdates @ 9:18 pm

MORE than 120 eager buyers yesterday crowded into a room at M Hotel hoping for a bargain deal at a first-of-its kind auction of six small plots of land.

The buyers were mostly hoping to buy a plot on which to build their own dream home.

And after some brisk bidding, six of them each left with a 99-year leasehold plot – some with what they saw as bargains.

The plots sold at prices from $1.3 million to $12.1 million, for a total of $30.64 million.

It was the Singapore Land Authority’s (SLA) first auction of residential ‘infill’ sites.

‘Infill’ sites are pockets of state land, located in the midst of an established housing estate, that have been left untouched by nearby developments or were once used for public purposes.

The six sites were mostly hotly contested, reflecting strong interest in the attractively-priced sites.

The bidders included professionals, businessmen, construction firms and niche developers, said SLA in a statement.

Included in an SLA sale for the first time were two good- class bungalow (GCB) parcels, which were sold to individual buyers for up to $12.1 million.

Still, one of the two top-end plots – a 16,689 sq ft site – attracted just one bidder. Fund manager John Foo met with zero competition when he bought the smaller of the two plots at Eng Neo Avenue for $6 million or $359.50 per sq ft (psf).

He reckoned he got a good deal for the site, which is for his own use. ‘Sentosa leasehold plots can be over $1,000 psf while District 10 GCB plots are going for $800 to $1,000 psf.’

The other GCB plot, at 29,201 sq ft in size, attracted more bidders. Bids came in hefty $50,000 increments but bidders did not hesitate long as they fired in a total of 52 bids, driving the price up from $9.5 million to $12.1 million.

The interest is not surprising, given that GCB sites, particularly one as big as 29,201 sq ft, are quite rare, said Ms Mok Sze Sze, Jones Lang LaSalle’s director and head of auction and sales.

The successful buyer, Ms Hu Nan Lee, is a Singaporean who is overseas. Her representative said it is meant for her own use.

Of the six plots, the most popular was one at Somme Road. It attracted a whopping 64 bids before local firm Sarda clinched it at $3.76 million.

Sarda’s price was 52 per cent above the $2.48 million opening bid for the 3,547 sq ft residential site, which comes with commercial use on the first floor.

A 6,971 sq ft site in Jalan Insaf, suitable for a pair of two-storey semi-detached houses or a bungalow, was sold to Lye Holdings for $3.54 million, up from the starting bid of $2.9 million.

Avadh, another firm, paid $1.3 million for a 4,228 sq ft site in Bedok Close, suitable for a two-storey bungalow. The opening bid was $880,000.

Both Sarda and Avadh have a shareholder in common: Mr Shriniwas Rai, the veteran lawyer and former Nominated Member of Parliament.

Another firm, Liverland Investments, bought a 6,293 sq ft Moonbeam Walk site for $3.94 million. Bids for the site, which can be used to build a pair of two-storey semi-detached houses, opened at $3.32 million.

Ms Mok said the strong response shows people are open to buying leasehold plots to build their dream homes.

SLA’s chief executive, Mr Lam Joon Khoi, said: ‘We will consider releasing more infill sites to help meet the current market demand for high quality residential properties.’

Source : Straits Times – 30 Nov 2007

Pacific Star sets up Asian property fund

Filed under: REIT — Propertymarketupdates @ 9:17 pm

SINGAPORE-BASED investment firm Pacific Star has shrugged off concerns about global share markets to launch a fund that banks on Asia’s property prospects.

The company has set up the Asia Real Estate Prime Development Fund and aims to make $400US million ($578S.2 million) worth of real estate investments.

The fund will invest in prime residential apartments, serviced residences and mixed development projects in Singapore, China, Hong Kong, Malaysia, Thailand, South Korea and Japan.

Its first deal is under way – the purchase of a 49 per cent stake in two Bangkok freehold residential projects. The developer is Asian Property Development, one of Thailand’s largest listed residential property developers.

Both projects will target local buyers in the upper-middle-income group.

Pacific Star, although one of the newer property fund houses in Asia, is growing fast. It has launched three other funds, including the $580US million Eureka Office Fund, which owns commercial properties such as Temasek Tower, One George Street and The Adelphi.

It was also behind the Macquarie Meag Prime Real Estate Investment Trust, which is listed in Singapore and owns stakes in shopping malls Wisma Atria and Ngee Ann City.

Source : Straits Times – 30 Nov 2007

Where high finance meets high living

Filed under: Expat Community,Genius Thoughts,Market Watch,Property Trends,Singapore Economy — Propertymarketupdates @ 9:17 pm

TIRED of Orchard Road? Jaded by Clarke Quay? Finding Robertson Walk just a trifle same-old, same-old? For the Singapore consumer – probably among the most avid in the world – Marina Bay may be the next big thing.

The new downtown will be home to a casino, a financial centre and several sparkling condominiums, so not surprisingly, shops and restaurants are eager for a presence there.

‘The Marina Bay area presents many exciting opportunities for both the business and leisure market,’ said Sulian Tan-Wijaya, general manager of The Fullerton Heritage, which is developing a string of commercial properties along the waterfront.

‘Our development is at the heart of the Central Business District, the Marina Bay Sands casino, the Esplanade theatres, new high-end residences like The Sail and The Clift, and the nearby Civic District,’ she said.

Edgar Huang, manager of marketing services for Esplanade – Theatres on the Bay, said the arts-performance centre expects to see ‘even more buzz in the area, with more people coming to work and live and play here’. The theatres, open since 2002 and famous for their domes that have been likened to durians, are also adjacent to a shopping mall.

David Martin, general manager of Marina Bay Financial Centre (MBFC), which will consist of high-rise office towers as well as retail space, estimates there will be 50,000 people living and working in the ‘immediate vicinity’ of the financial hub from 2011.

Along with the visitors who are sure to flock to the adjacent Sands, ‘we believe this creates a compelling offer to potential retail tenants, and this is also the feedback we are getting from the market’, he said.

Events being held in and around the public areas of Marina Bay will also help draw in the crowds, said the Esplanade’s MrHuang.

‘Marina Bay is also currently host to many celebrations like National Day, the Fireworks Festival and the New Year’s Day celebrations,’ he said.

Upcoming events like the Chingay street parade and the Grand Prix Formula One race, which Singapore will host in September next year, will also attract visitors, he added.

To entice what promises to be a diverse range of consumers, each developer is adopting a slightly different marketing tack.

The Fullerton development, for example, is aiming to be high-end and historical.

‘In addition to the Fullerton Hotel and a new waterfront 100-room luxury hotel, the Fullerton Heritage Precinct will offer a range of chic, trendy and elegant retail and dining experiences,’ said Ms Tan-Wijaya.

‘These include conservation buildings such as The Fullerton Waterboat House, Clifford Pier and Customs House, as well as One Fullerton,’ she said.

One Fullerton will revamp its second floor and offer even more food and beverage outlets, which should attract tourists who visit the nearby Merlion Park, she said.

The Esplanade is pitching itself as a kind of natural retail extension for the arts lover. ‘It’s a lifestyle experience pegged to the arts,’ said Mr Huang.

‘Besides coming here for a show, you can start or end your evening with drinks and food,’ he added. ‘There are many shops closely related to the arts for art lovers, and those unfamiliar with the arts won’t feel out of place either.’

Mr Huang said that business at the Esplanade has been bustling since its inception.

‘It’s been positive here at Esplanade Mall,’ he said. ‘The Esplanade also presents over 70 per cent of our artistic programmes free, which means visitors will always have something to look forward to after a meal or a visit to the shops.’

He said that some of the main attractions of the mall are the food centre Makansutra Gluttons Bay, award-winning restaurant My Humble House and library@esplanade, Singapore’s first performing-arts library.

Not forgetting the small but unusual Tatami Shop – ‘the world’s first tatami furnishings retailer outside Japan’, said Mr Huang.

Suntec City Mall, which welcomed its first customers in 1997, says its retail concept is ‘a little something for everyone’. The shopping centre’s larger tenants include hypermarket Carrefour and fashion retailers Mango, La Senza and Lacoste. It also boasts the gigantic Fountain of Wealth, which attracts visitors from all over the world.

‘Also, Suntec City Mall houses the embarkation point for the many tourists going for the Duck Tours and Hippo tours,’ said Marilyn Tan, investor relations manager at ARA Trust Management (Suntec).

As for the MBFC, Mr Martin said the financial hub aims to be ‘a vibrant and prestigious, yet convenient, shopping and dining precinct for the internationally-minded’.

Retail in the MBFC would address a ‘market gap’ in the central business district for serving the needs of higher-income earners and residents, he said. ‘This group of customers wants much more than what a conventional mixed-use centre offers. MBFC is designed as a place where residents, the office population and visitors can satisfy their everyday needs without leaving the business and financial district.’

Of the development’s 160,000 sq ft of underground retail space, about half will be for shops and the other half for food and beverage, he said. In addition, there will be a restaurant on the 33rd floor of the Tower One office block.

‘MBFC is in talks with a number of leading retail interests to be located within the centre,’ he said. The development will offer dining and entertainment options for ‘a spectrum of tastes’.

Then, of course, there is Marina Bay Sands, which will open in 2009. Its developers, Las Vegas Sands, declined to comment at this stage on the specifics of upcoming shops and restaurants.

Besides the casino, the entire integrated resort, as it is called, will feature three 50-storey hotel towers, linked by a two-acre Sky Garden. Not to mention an Arts and Sciences Museum shaped like a welcoming gesture, and one-million square feet of ‘integrated waterside promenade and shopping arcade’, according to its website.

Clearly, there will be loads of shopping and dining opportunities there. So hang on to your hats, Singapore consumer – if not your purses.

Source : Business Times – 29 Nov 2007

More supply but HDB prices will go up: Mah

Filed under: HBD Reviews,Regulators — Propertymarketupdates @ 9:16 pm

Board may offer another 6,000 units through build to order scheme.

The Housing and Development Board will continue to monitor demand and could offer another 6,000 units through its build-to-order (BTO) system. However, prices are also likely to go up.

Saying that he did not want to ‘fudge the issue’, National Development Minister Mah Bow Tan said: ‘Prices will go up as a result of resale prices going up.’ Mr Mah was speaking at the launch of two new housing projects under the BTO system.

The projects, Segar Meadows in Bukit Panjang town and Compassvale Beacon in Sengkang town comprise a total of 1,162 flats.

Three- and four-room flats (68 sq m-93 sq m) at Segar Meadows will cost between $116,000 and $231,000, while two- to four-room (48 sq m to 97 sq m) flats at Compassvale Beacon will cost between $69,000 and $233,000.

Although the precise formula for fixing prices was not revealed, Mr Mah explained that it would be based on average resale prices rather than the ’spectacular prices’ reported for some flats recently.

Mr Mah also let on that he had received a few letters and e-mails from constituents saying that they had not been successful in getting flats through the BTO system.

But he reiterated that the government was committed to providing a variety of affordable public housing to meet the ‘aspirations’ of first-time buyers and young couples.

To this end, he revealed that 4,800 units have been launched through BTO this year, twice the number compared to 2006.

On affordability, Mr Mah said that the majority of households spent a manageable 20-25 per cent of their monthly household income servicing loans for their flats. He also added that since the implementation of the Additional Housing Grant scheme in March 2006, 4,100 eligible households have benefited from grants amounting to about $50 million.

And demand from first time buyers has been strong. According to HDB, about 92 per cent of those who applied for the 4-room flats for the two BTO launches in August and September and were successfully short-listed within the first 100 per cent flat supply were first timers.

Mr Mah also had this advice for those looking to buy a flat now: ‘If you cannot afford a big flat, then buy a smaller flat. If you can’t get a new flat, then get a resale flat. In life, we make trade-offs all the time.’

To meet the needs of the ’sandwiched class’, Mr Mah revealed that HDB will be making more sites for executive condominiums (ECs) and the Design, Build and Sell scheme (DBSS) available in the first half of 2008.

Up to three EC sites with a total of 1,300 units, and four DBSS sites with a total of 1,900 units are set to go on the reserve list of Government Land Sales Programme for H1 2008.

Knight Frank director (research and consultancy) Nicholas Mak said that the supply of more public housing flats could cool resale flat prices but the impact will be felt next year. ‘It could be a signal that the government will release more sites to control runaway prices in the resale market,’ he added.

Managing new supply and demand will be a tricky job for HDB because it does not want to be stuck with a surplus of flats.

A tight hold on supply could, however, push up prices.

But demand seems stable. Mr Mak points out that so far, demand as measured by the number of applications received for new flats between 2000 and 2007 has ranged from 7,900 to 13,800. This pales in comparison to the 60,000 to 70,000 applications received in the mid-1990’s, he said.

Mr Mak also added that he expects the impact on the private property market to be minimal.

Source : Business Times – 29 Nov 2007

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