Singapore Property News This Week #117

Residential

Property market set for 2016 incident due to abundant supply

It is reported that the sellers stamp duty (SSD) should be relooked to prevent a collision with a record number of private homes released to the market in 2016. According to Orange Tee’s data, a total of 33,555 units will make their ways into the property market in 2016, compared to 15,503 units this year. Among those, 27,181 units originate from newly launched projects, and 6,374 units are from the stash of previously locked-up units with owners choosing to hold onto their properties and not incurring any SSD. In 2011, the holding period for the SSD scheme was raised from three to four years, and rates increased steeply up to a maximum of 16 percent.

(Source: Business Times)

More than 200 units sold at Tembusu

More than 200 units have been sold at The Tembusu, Wing Tai’s condo project in the Kovan area. The average price for the 337-unit freehold condo is between $1,400 and 1,500 psf. The project is believed to be the first residential project to attract a good reception after the Total Debt Servicing Ratio (TDSR) framework took effect on June 29. The project’s showflat had already opened two weekends before the sales officially started. Entry to the showflat to VVIPs and those who had pre-registered was by balloting. Analysts estimated that developers could have sold fewer than 500 private homes last month. Len Siew Lian, general manager for property of Wing Tai said that the encouraging response can be due to the comfortable sizing of the freehold apartments in the established Kovan area, the quality design and finishes.

(Source: Business Times)

Interest in ECs increases as private home sales drop

As sales of private homes dropped last month due to limited launches and the introduction of the Total Debt Servicing Ratio (TDSR), there has been an increasing interest towards executive condominiums (ECs). Although no new EC projects were launched, 112 ECs were sold out of the 593 units moved (including ECs), which constituted 18.9 percent of July’s total sales. On the other hand, ECs only constituted 14.8 percent of June’s total sales (313 ECs were sold, out of total sales of 2,119 units) even though more than 600 ECs were released in June. SLP International executive director of research and consultancy Nicholas Mak said the phenomenon proved that TDSR framework has shifted some home-buying demand, especially among HDB upgraders, to the EC projects.

(Source: Business Times)

Commercial

Local potential investors eye offshore hospitality properties

Because the Singapore real estate investment scene is becoming more challenging, local potential investors are eyeing offshore sale-and-leaseback properties in the hospitality sector. For the past few months, many investors have been investing in such properties, which typically guarantee returns of around 6 per cent per annum for up to a decade or so. According to Isabelle de Wavrechin, chief executive of French tourism management company Pierre & Vacances, the biggest benefits of investing in offshore sale-and-leaseback hospitality properties – mainly in Europe and Asia – are the hassle-free property management, and numerous property sweeteners to entice retail investors.

(Source: Business Times)

Sentosa Resort & Spa to be sold soon

Sentosa Resort & Spa (formerly known as The Beaufort Singapore) is close to being sold at around $1 million per room, which translates to the transaction price past $200 million. The Sentosa has a gross floor area of about 312,000 sq ft with 215 rooms including the highly-acclaimed Spa Botanica , and a remaining lease of about 60 years. The site is believed to be the first resort hotel to be transacted in Singapore in recent years.

(Source: Business Times)

CBD site’s top bid at $1,112.44 psf

A 99-year leasehold commercial site at Cecil Street/Telok Ayer Street has fetched the top bid at $1,112.44 psf ppr by Frasers Centrepoint. This was 18.8 per cent higher than the next highest offer by Far East Organization. Frasers Centrepoint group chief executive Lim Ee Seng said that he was comfortable with the group’s bid price which would result in a breakeven cost of about $2,000 psf for a new development. At least 80 percent of the site’s 830,564 sq ft maximum gross floor area must be set aside for office use. Strata subdivision of the project is not allowed.

(Source: Business Times)

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