Singapore Property News This Week #68

Residential

New measures to curb growth of shoebox units

URA has introduced new measures to control the growth of shoebox units. Large number of shoebox units is a concern as they may result in more cars in the neighbourhood than the local road infrastructure can support and there may not be sustained demand for such units. The maximum number of units in non-landed private housing projects outside the Central Area (Raffles Place, Tanjong Pagar, Singapore River, Marina Bay, Orchard Newton, Beach Road, Ophir Road, Jalan Sultan, Syed Alwi Road, Tekka Lane and Outram Road) and residential component of mixed-use developments will be capped based on an average area of 70 sq m from Nov 4. Likewise, the maximum number of homes based on an average size of 100 sq m which was introduced last year in Telok Kurau Estate, will be extended to Kovan and Joo Chiat/Jalan Eunos estates from Nov 4. However, developers can still include small units in their projects provided that there is a mixture of large and small units so that the guidelines can be met. These new guidelines are generally welcome though there are concerns that small en bloc sites will see depreciation in land values and collective sale premiums since such sites tend to attract smaller developers building a higher proportion of shoebox units in their projects.

(Source: Business Times)

Punggol EC site draws $189.87 m top bid

The 99-year leasehold EC site at Punggol Way/Punggol Walk attracted a meagre three bids, with the top bid of $189.87 million, or $313.63 psf of GFA from Qingjian Realty. The expected breakeven cost and the average selling price of the site are $580-650 psf and $700-750 psf respectively. Developments on the site are likely to attract young buyers.

(Source: Business Times)

New guidelines may not create pressure on prices

There are some who think that new guidelines on shoebox units which will come into effect on Nov 4 will result in lower prices, since shoebox units were responsible for the higher average psf price of residential projects. To meet the cap on the number of units, developers will have to build larger units with higher lump sum price which may discourage some buyers. Hence they may keep psf prices affordable in order to attract buyers. However, since most developers can maintain their current unit-size mix without violating the new guidelines, prices may not actually fall. Furthermore, developers may build more two- or three-bedroom units which could have relatively high psf prices rather than building large four-bedroom units. In fact, prices for shoebox units may even rise due to the falling supply.

(Source: Business Times)

URA launches 60-year leasehold residential site and hotel site in Jurong

The 1.02-ha residential site in Jalan Jurong Kechil offers a 30, 45 or 60-year-lease period, the first for residential sites released under the GLS. It has a 153,267.17 sq ft maximum GFA and can be developed into a condominium, flats or retirement housing with a maximum of 203 units and a part-five-storey-part-eight-storey height restriction. The site is expected to be fairly popular since there are amenities and easy access to public transportation in the area and could potentially attract five to 10 bids for the 60-year land tenure with a top bid of $200-250 psf ppr, an estimated breakeven cost of $450-500 psf, and an estimated sale price of $550-600 psf.

Also to be launched along with the residential site is a 60-year leasehold 0.9-ha hotel site located at Jurong Town Hall Road. This first hotel site in the Jurong Lake district has a 204,051.25 sq ft maximum GFA. It could potentially attract five to 10 bidders, with a top bid of $650-700 psf ppr and an estimated breakeven price of $1,050-1,100 psf assuming the successful bidder intends to build a four-star 700-room business hotel on the site.

(Source: Business Times)

Thomson View finally sold for $590m in collective sale

After two failed attempts in the en bloc market, Thomson View condominium, located along Upper Thomson Road, has finally been sold to a consortium led by Wee Hur Development Pte Ltd and Lucrum Capital Pte Ltd for $590 million. If a $107 million premium to enhance the property’s use and a $90 million premium to top up the lease from the remaining 62 years to 99 years is included, the price would be $712 psf ppr. The 540,314-sq-ft residential site with a 2.1 plot ratio and 24-storey maximum height can potentially be redeveloped into a 950-unit condominium project with each unit averaging 1,200 sq ft.

(Source: Business Times)

99-year leasehold mixed-use site near Potong Pasir MRT Station drew $245 m top bid

The top bid of $245 million or $793.02 psf ppr came from a tie-up between City Developments Ltd (CDL) and Hong Leong Holdings, beating out seven other bids. The developer plan to have 28 commercial units with an average size of 71.43 sq m (nearly 769 sq ft) based on the maximum commercial quantum of 2,000 sq m (21,528 sq ft) GFA on the ground floor of a development up to 19 storeys, and possibly release some for sale. The number of residential units is also capped at 267 units with an average unit size of 100 sq m. The expected breakeven cost and selling price of the residential units are $1,250-$1,300 psf and $1,450- $1,500 psf respectively while the retail units have an expected strata selling price of $4,000-4,500 psf. The high top bid reflects the popularity for residential sites near MRT stations, especially those with a commercial component.

(Source: Business Times)

Commercial

Freehold Geylang properties to be redeveloped by TEE, KSH, Heeton joint venture

TEE International, KSH Holdings and Heeton Holdings will jointly redevelop the 13,282 sq ft worth of land area at 48A, 50A, 52A, 54A, 56A, 58A and 60A in Lorong 32, Geylang Road. With a 2.8 plot ratio, the site can be developed up to a gross saleable area of 40,910 sq feet, including balcony. The development is located near Aljunied MRT Station, the Eunos and Ubi industrial parks and the CBD.

(Source: Business Times)

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