Botanic Investments said to have sold 17 units at freehold 8 Napier
172,013 sq ft three-bedroom units at the freehold project 8 Napier located opposite the US Embassy and near the Singapore Botanic Gardens are said to have been sold to Alpha Investment Partners at $100 million or $2,800-3,000 psf via sale of shares in Botanic Investments. These units can found on the second to the eighth floors of the 10-storey development, which has yet to sell 15 of its units, including six penthouses.
Demand for resale HDB flats on the rise as COV falls
As the cash-over-valuation (COV) starts to stabilise after falling by over 20% in Q1, demand for resale HDB flats are increasing. According to HDB’s flash estimate of the resale price index (RPI), prices for flats increase by 1.3% in Q2, possibly due to the fall of median COVs to $25,000 in June 2012, as well as the increase in valuations. Transaction volumes also increased by 8% from 5,126 in Q1 to 5,549 in Q2, with the highest volumes coming from Woodlands, Jurong West and Yishun. Buyers may choose to purchase resale flats instead of BTO flats since COVs have fallen to a level similar to the resale levy imposed on second-timers when buying BTOs. Furthermore, those who did not qualify for BTOs or those who failed in their BTO and Sale of Balance (SBF) flats application attempts may turn to the resale market. Some, however believe that the upward trend in prices is unlikely to continue, growing by less than 2% in the next quarter and perhaps even fall since the prices are near the peak.
Recovery of property market since 2009 means more gains for private home owners
Since the recovery in late 2009, private home owners has gained at least $20.3 billion worth of gross profit and even more since profits from collective sales were not included. Overall profitability, however, has been falling from more than $4 billion in H1 2011 to $2.7 billion in H1 2012 while the percentage of unprofitable transactions has increased from 1% to 2% in H1 2012. Despite this, the average profitability per transaction in the secondary market reached a new high of $522,056 in H1 2012 almost double the $288,991 recorded in H2 2009.
99-year Landmark Tower up for sale by public tender
99-year Landmark Tower located on Chin Swee Road comes with an indicative price tag of $280-288 million or $1,315-1,355 psf ppr if another $42 million was paid to top-up the lease. If the 10% additional GFA for balcony space is included, the price would increase to $1,252-1,286 psf ppr. The 38-storey building sits on a 60,821 sq ft site zoned “residential” with a 4.014 plot ratio based on its current GFA. It also offers a 360⁰ view of Singapore’s skyline and has the added benefit of being located near the Chinatown and Outram Park MRT Stations and other amenities. The tender closes at 3pm on Aug 7.
Proportion of ABSD-exempt buying increases
In H1 2012, purchases by foreign buyers (including PRS) from ABSD-exempt countries as a result of bilateral free-trade agreements made up 3.1% of foreign purchases, up from 2% in H1 2011 and 2.6% in H1 2010. However, transaction volumes from these buyers have been falling, suggesting that the economy may be more of a factor than cooling measures in determining demand. Nevertheless, these purchases only account for a minute percentage of the market and hence could not reflect the overall market. It appeared that the ABSD has been effective in discouraging foreign purchases since the number of such purchases has fallen by 75% from 1,374 in Q4 2011 to 345 in Q1 2012 before falling by another 3% to 334 in Q2 2012.
A slew of upcoming launches to look out for
The new upcoming launches in the next couple of weeks include Haus@Serangoon Garden, Eden Residences Capitol near City Hall MRT Station, V on Shenton, Parc Olympia at Flora Drive and Parc Centros near Punggol MRT station.
First up is 99-year leasehold Haus@Serangoon Garden which consists of 97 terrace houses priced at $2.5 million-$3 million each. An intermediate terrace house will have 3,600 sq ft of built-up floor area sitting on a 1,600 sq ft land area.
Some of the 39 units at 99-year leasehold Eden Residences Capitol near City Hall MRT Station next to Capitol Theatre may be released in late July or early August. The units include three-bedroom (2,200 sq ft) and four-bedroom units (over 3,000 sq ft), penthouses and garden villas on the levels 3-11 of the mixed development with most offering views of Marina Bay. Prices have not been sets but some speculate that it could hit $3,000 psf given its location.
99-year leasehold 510-unit V on Shenton, will be launched late this month at an average price of $2,300-$2,500 psf. The units in the 54-storey tower include 440-plus sq ft studio apartments, 880 sq ft two-bedroom units, 1,000 sq ft two-bedroom-plus-study units, 1,500-1,750 sq ft three-bedroom units and six 3,300-7,000 sq ft penthouses. The project also offers a swimming pool, club lounge, an indoor gym, open-air landscaped gardens and outdoor dining areas for private parties.
Other upcoming launches include the 99-year leasehold Parc Olympia at Flora Drive with an average price tag of $880-$900 psf and 16-storey Parc Centros near Punggol MRT Station at $950 psf on average. Prices for the project with one to five-bedroom units and penthouses start from $550,000 or $1,195 psf for a 460-sq ft one-bedroom unit.
34,912.7 sq ft freehold industrial plot at Sims Drive asking for $48-50m
The site located at at 53 Lorong 17 Geylang is up for sale by public tender is asking for $48-50 million or $550-$573 psf ppr based on its 2.5 gross plot ratio. There is no development charge payable for the redevelopment of the site zoned ‘Business 1’. A new high-tech development with communal lifestyle facilities and 45 to 50 150 sq m strata-titled units could be built and sold at an estimated average price of $1,000-1,200 psf. However, many believe that the $48-50 million price tag is too high especially since a new development would have to be sold at above $1,100 psf, way above the average price of $800-900 psf in the area. The high price tag assumes that the average price will increase but this may not happen since there have been governmental measures to control price increases.
Prices of industrial space expected to rise
Even as rents for industrial space fall (greater fall expected in high-tech industrial spaces), the capital values of such property are on the rise. Average rents of business parks and high-tech industrial space fell by 0.7% to $4.35 psf per month and $2.98 psf per month in Q2 respectively while rents for conventional industrial space remained stable at $1.75 psf per month. The fall in rents for high-tech spaces is expected to be higher than that of the latter, especially since much of the upcoming supply are high-tech spaces. Capital values, however, has been on the rise, driven by investors turning to the industrial market as a result of the ABSD and higher prices in new launches in the residential market. Prices for first-storey industrial space and upper-storey spaces in the secondary market increased by 4% to $577 psf and 4.9% to $430 psf respectively in Q2. This decrease in rents coupled with increase in capital values means that yields are getting smaller but prices are expected to continue to climb as demand for new GLS and resale sites not affected by the new restrictions on industrial properties increase.