Issue 22

Copyright 2011 www.Propwise.sg. All Rights Reserved.

CONTENTS
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p7
Singapore Property News This Week
Overseas Property Investment Part Two: Investment Considerations

FROM THE

EDITOR

Welcome to the 22th edition of the Singapore Property Weekly. Hope you like it! Mr. Propwise

p11 Resale Property Transactions (October 1 7) p13 Singapore Property Classifieds #12

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SINGAPORE PROPERTY WEEKLY Issue 22

Singapore Property This Week

Residential
New projects by developers behind the strong sales for private homes in September The new projects by developers in Outside Central Region (where mass-market developments are located), which includes 78.4% of the total 1,919 units and 81% of the 1,631 units (excluding ECs) sold in the past month, are behind the strong sales in the private home market in September. Developers sold 1,631 private homes excluding executive condos (ECs) and 433 ECs, an increase of 20.7% and 49% from August. The increase in EC sales is likely due to the increase in income ceiling for ECs. 2,064 units were sold in September, including ECs, a month-on-month
increase of 25.8%. The launches in September also accounted for the strong sales, with 2,493 private homes including ECs being released. Government to release three land parcels for private housing and one for EC The four land parcels to be released in October includes a 99-year leasehold plot on Alexandra Road which can yield about 545 private homes, two private housing sites at Bukit Panjang and Punggol which can yield 35 landed homes and 540 apartments respectively and an executive condominium (EC) site in Sengkang which can yield 770 flats. The first (under the confirmed list of GLS) was released on Oct 17 and the latter three (the first two on the confirmed list and the last on the reserve list) will be released on Oct 27.
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SINGAPORE PROPERTY WEEKLY Issue 22 Land parcels on the confirmed list are sold according to scheduled dates whereas those in the reserve list will only be released if an application with an acceptable minimum price is submitted. Dunearn Gardens, Newton Lodge, Dragon Mansion and Faber Garden available en bloc lowered its asking price from $578.5 million to between $550 million and $561 million. Given its 95,442 sq ft land area and 2.8 maximum plot ratio, it could cost between $2,180 and $2,220 psf ppr including a $32 million development charge. 39,176 sq ft freehold Dragon Mansion at 14 Spottiswoode Park Road near CBD has an indicative price to between $132 million and $142 million. The current $1,200 - $1,290 psf ppr based on a maximum gross plot ratio of 2.8 from 2 plots of land (Dragon Mansion and a substation) is lower than its previous asking price of $1,340-1392 psf ppr. 21,409 sq ft Freehold Newton Lodge located at 41 Newton Road near Novena MRT and Novena Square is still asking for a $40 million reserve price equivalent to $1,418 psf ppr, based on a 1.4 gross plot ratio and a $2.5 million development charge.
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Faber Garden which is zoned for residential use and located near three MRT stations, St Nicholas Girls School and Raffles Institution, has a potential gross floor area of 958,748 sq ft, including 10% balcony space. It is asking for $830 million - $988 psf ppr based on maximum gross floor ratio of 1.6 and a $31.2 million a development charge.
Freehold Dunearn Gardens located near Newton MRT station and the Central Expressway (CTE) with a 33-storey potential,
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SINGAPORE PROPERTY WEEKLY Issue 22

Khaw Boon Wan: Foreign buying of private homes being monitored

Commercial Keppel Land sells 87.5% of Ocean Financial Centre to K-Reit Asia at $1.57b 87.5% of recently developed 43-storey Ocean Financial Centre (OFC) office building in Raffles Place, with about 885,000 sqf of net lettable area and a tenure of 999 years with 850 years remaining, is sold to K-Reit Asia at $1.57 billion with a 99-year lease, meaning that Keppel Land can regain OFC once the lease ends. This price is equivalent to $2,600 psf including rental support of $170 million and $2,400 psf without. OFC is 80% occupied with average passing rent of about $9 psf per month. K-Reit proposed a 17-for-20 rights issue to raise $976.3 million, with the remaining $602.6 million coming from new debt.

In a response to MP Christopher de Souzas questions on the foreign buying of private homes in Singapore, National Development Minister Khaw Boon Wan stated that while over 80% of private homes available are bought by Singaporeans and PRs, the number of foreign purchases have increased and that the government is monitoring the situation and actions will be taken if necessary. He also stated that the government has tightened rules to control foreign purchases. He also stated that the foreign demand for private properties is not the only factor for the increase in property prices; there are other factors such as the low interest rate in play.

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SINGAPORE PROPERTY WEEKLY Issue 22 One miserly bid for Paya Lebars second 99-year leasehold commercial site The only bid for the site (from a UOL GroupSingapore Land equal joint venture) was $529.3 million or $565.74 psf ppr, 35% lower than what the first site, which drew 10 bids, sold for earlier this year. This is due to the technical difficulties of developing the site and restrictions on strata units and lots which affects returns from leasing and rentals. The project plan includes a retail podium and two towers - one for a hotel, another for offices (with a 20,000 sq ft floor plate) with a 40:15:45 ratio for office, hotel and retail purposes. The site will likely be awarded since the offer is fair, despite being low. 60-year-leasehold industrial site up for sale The 230,636 sqft 60-year-leasehold industrial site near Gambas Avenue and Woodlands Ave with a 2.5 plot ratio and a maximum gross floor area of 576,590 sq ft is zoned for Business 1 use. On the reserve list earlier, a developer has committed at least $57 million, amounting to $98.86 psf ppr. The tender will close at noon on Nov 17. Discussions held over KeyPoints sale Talks are being held over the sale of KeyPoint at Beach road after the expression of interest exercise closed. The $283 million 5.0 maximum plot ratio asset can be redeveloped to a commercial and residential project with a maximum gross floor area (GFA) of about 391,209 sq ft, where at least 60% of the GFA must be reserved for residential use and 2040% is allowed for commercial use. The site which has a remaining lease term of 63 years had been granted an in-principle approval to top-up the current lease with another 99-year term.
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SINGAPORE PROPERTY WEEKLY Issue 22 The developer of the site will have to pay premiums to upgrade the lease and enhance the sites use to include residential use.

Tanjong Pagars Orchid Hotel asks for $250m or above

272-room Orchid Hotel Singapore built on a site with a remaining lease of 95 years is asking for $250m or above, about $920,000 per room with vacant possession. This means that hotel owner-operators or investors can acquire and rebrand it. The sale price excludes the nine strata office units on the second floor, which includes three larger units which could be converted into function rooms depending on approval from the authorities. The total area of these units is about 10,600 sq ft. The site also includes 19 strata retail units were sold earlier and are therefore not included in the sale, and carpark lots in two basement levels.
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SINGAPORE PROPERTY WEEKLY Issue 22

Overseas Property Investment Part Two: Investment Considerations

In Part One, Overseas Property Investment: What You Should Know Before You Buy, I discussed a number of steps a new investor can take to ensure they know what they are getting into before committing to an overseas property purchase. In Part Two, I will cover additional factors a buyer should think of when deciding what kind of property would be most suitable for their own individual circumstances. 1) Should You Go For Rental Yield or Capital Gains? One of the first questions that agents will ask investors is whether they are looking for rental yield or capital gains. Ideally, the perfect property investment would perform well on both fronts, yielding both high rents as well as strong year-on-year capital appreciation.
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SINGAPORE PROPERTY WEEKLY Issue 22 However, the more common case is where a property performs stronger in one area compared to the other. For example, Australian properties benefit from a strong rental demand, as a result of the gradual increase in the number of immigrants into the country. Australian properties also appeal to the more risk-adverse investor, as property prices down under have been stable over the last several years. On the other hand, distressed properties in the USA, currently on the market at prices more than 30% lower compared to their values in 2007, are likely to enjoy strong capital gains in the next 4 to 5 years. An investor with a long-term investment horizon, and who is able to hold on to their investment for more than 1 or 2 years, should do well with picking up bargain-priced property for a song during an economic slump. 2) The Risks Leveraging & Benefits of Over-

While famous investment gurus may encourage investors to maximize their leveraging capacity in order to quickly turn a massive profit, a cautious investor would bear in mind the possibility of prices falling even further from the levels at which they bought their properties, should a prolonged economic downturn occur. Given the uncertainty of economic markets, investors must be prepared to hold on to their properties longer than what they previously expected, and be able to wait out the market

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SINGAPORE PROPERTY WEEKLY Issue 22 until prices to rebound. Should the investor not be able to make the mortgage payments in the meantime, he would be forced to sell his properties at a loss. Hence, cautious investors with limited experience would be well advised to adhere to the general guideline of making sure their monthly mortgage payments do not exceed 28% of their gross income. 3) Off-Plan or Existing Property As the majority of properties launched during exhibitions in Singapore is off-plan, meaning they will not be ready for move-in until 2 to 3 years down the road, investors have to look at past trends, anticipate future demand, and decide if government policy changes in the pipeline will positively impact the value of the property upon completion. While off-plan has the obvious advantage of being brand new, and may be sold at a lower price during the launch to compensate for a waiting period, investors should bear in mind that the key drawback of off-plan investments is that compared to completed properties, there is zero rental income to be had during the construction period. Investor funds also become tied up for a number of years; and in certain jurisdictions, off-plan property may not be resold while construction is still uncompleted. 4) Letting & Management Services

As an overseas investor would find it difficult or impossible to make regular on-site visits and manage their properties on their own, they often hire a management company to assist with drawing up rental contracts, rent collection, responding to tenant calls, as well
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SINGAPORE PROPERTY WEEKLY Issue 22

as the day-to-day business of maintaining a property.

While letting and management fees in Singapore generally fall within the 5% to 8% range, investors should be aware that these fees can be much higher in overseas countries. For example, it is not uncommon for a property management company in the USA or UK to charge 7% for letting fees and an additional 8% for management fees, making up a total of 15% of the rental a landlord would expect to collect.
Hence, when calculating net income, it is important to keep in mind that letting and management fees, as well as unexpected expenses such as repair costs due to vandalism, can take up a substantial portion of the final net rental income receivable.

Given the sheer variety of overseas property on offer, every investor should look at the individual features of a property which they are seriously considering, as well as their appetite for risk, to determine if now would be the right time for them to enter the overseas property market. Singaporeans and PRs in particular should also keep a close watch on changes in government legislation which currently prohibit HDB owners from acquiring overseas property.

Harn Ho is a freelance journalist providing professional services in Data Trend Analysis and Economist Real Estate Insights.

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SINGAPORE PROPERTY WEEKLY Issue 22

Non-Landed Residential Resale Property Transactions for the Week of Oct 1 - 7

Postal District 1 1 2 3 3 3 4 4 5 5 5 5 5 5 5 7 7 8 8 9 9 9 9 9 9 Project Name THE SAIL @ MARINA BAY THE SAIL @ MARINA BAY INTERNATIONAL PLAZA THE METROPOLITAN CONDOMINIUM THE METROPOLITAN CONDOMINIUM EMERALD PARK THE BERTH BY THE COVE CARIBBEAN AT KEPPEL BAY ONE-NORTH RESIDENCES BOTANNIA THE PARC CONDOMINIUM THE STELLAR WESTCOVE CONDOMINIUM WEST BAY CONDOMINIUM WESTCOVE CONDOMINIUM SOUTHBANK SUNSHINE PLAZA CITYLIGHTS PRISTINE HEIGHTS PATERSON SUITES RIVERGATE RIVERGATE URBANA PARC EMILY THE BAYRON Area (sqft) 1,033 990 1,604 1,076 1,356 947 2,939 1,668 980 915 1,216 1,851 1,518 1,292 1,098 969 1,109 560 732 1,765 1,841 1,539 1,012 549 872 Transacted Price ($) 3,202,300 2,029,500 1,550,000 1,550,000 1,762,800 1,040,000 5,638,824 2,600,000 1,400,000 1,120,000 1,380,000 1,580,000 1,200,000 1,020,000 830,000 1,480,000 1,405,000 1,020,000 970,000 5,378,000 3,956,000 3,231,900 1,800,000 970,000 1,480,000 Price Tenure ($ psf) 3,099 99 2,049 99 966 99 1,440 99 1,300 99 1,098 99 1,919 99 1,558 99 1,429 99 1,224 956 1,135 FH 853 FH 791 99 790 99 756 99 1,528 99 1,267 99 1,822 99 1,325 FH 3,047 FH 2,149 FH 2,100 FH 1,779 FH 1,767 FH 1,697 FH Postal District 9 9 9 9 10 10 10 10 10 10 10 11 11 11 11 12 12 12 12 14 14 14 14 15 15 Project Name PARC MACKENZIE VILLE ROYALE EURO-ASIA COURT UE SQUARE PARKVIEW ECLAT NASSIM MANSION ARDMORE II THE LADYHILL ST MARTIN'S APARTMENT THE TESSARINA TANGLIN REGENCY SHELFORD SUITES NEWTON ONE NEWTON ONE THOMSON 800 THE BELLEFORTE DE PARADISO MOONSTONE RESIDENCES AVA TOWERS SIMSVILLE ATRIUM RESIDENCES CASA EMERALD BOUGAINVILLA APARTMENTS THE SEA VIEW THE SEA VIEW Area (sqft) 850 1,044 1,658 840 2,895 3,412 2,024 3,520 926 980 1,421 1,442 1,916 1,916 1,399 1,432 1,238 1,238 1,281 969 1,044 1,044 1,152 1,410 1,647 Transacted Price ($) 1,243,800 1,450,000 2,300,000 1,120,000 9,300,000 10,000,000 5,360,950 7,600,000 1,600,000 1,372,000 1,810,000 2,595,600 3,280,000 3,200,000 1,800,000 1,568,000 1,280,000 1,178,800 1,180,000 898,000 888,000 828,000 810,000 2,300,000 2,680,088 Price Tenure ($ psf) 1,463 FH 1,389 FH 1,388 FH 1,334 929 3,212 FH 2,931 FH 2,649 FH 2,159 FH 1,728 FH 1,401 FH 1,274 99 1,800 FH 1,712 FH 1,670 FH 1,286 FH 1,095 FH 1,034 FH 952 FH 921 FH 927 99 850 FH 793 FH 703 FH 1,631 FH 1,627 FH

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SINGAPORE PROPERTY WEEKLY Issue 22

Postal District 15 15 15 15 15 15 15 15 15 15 16 16 16 16 16 16 17 17 18 18 18 18 19 19 19 19 19 19 Project Name MEYER RESIDENCE PEBBLE BAY PALMERA RESIDENCE SANCTUARY GREEN PARK EAST THE ESPIRA THE GRANDIFLORA SIGLAP LODGE LEGENDA AT JOO CHIAT CASTLE LOFT COSTA DEL SOL THE SUMMIT THE BAYCOURT BAYSHORE PARK BAYSHORE PARK BEDOK COURT FERRARIA PARK CONDOMINIUM BALLOTA PARK CONDOMINIUM EASTPOINT GREEN EASTPOINT GREEN CHANGI RISE CONDOMINIUM EASTPOINT GREEN THE CHUAN MINT RESIDENCES @ JANSEN KOVAN MELODY HOUGANG GREEN REGENTVILLE EVERGREEN PARK Area (sqft) 904 1,894 560 1,141 1,701 1,109 1,087 1,292 1,238 1,173 1,324 1,238 1,206 936 1,076 1,195 883 1,679 958 969 1,130 1,141 1,367 936 1,442 764 1,152 1,367 Transacted Price ($) 1,420,000 2,600,000 668,000 1,235,000 1,680,000 1,018,000 980,000 1,101,000 980,000 870,000 1,820,000 1,190,000 1,122,000 850,000 880,000 845,000 880,000 960,000 880,000 845,000 925,000 900,000 1,850,000 1,020,000 1,410,000 630,000 880,000 980,000 Price Tenure ($ psf) 1,570 FH 1,372 99 1,193 FH 1,082 99 988 FH 918 FH 901 FH 852 FH 792 99 742 FH 1,375 99 961 FH 931 FH 908 99 818 99 707 99 997 FH 572 FH 919 99 872 99 818 99 789 99 1,353 999 1,089 999 978 99 824 99 764 99 717 99

Postal District 20 20 20 20 21 21 21 21 23 23 23 23 23 23 23 26 26 26 26 27 28

Project Name GOLDENHILL PARK CONDOMINIUM CLOVER BY THE PARK THE GARDENS AT BISHAN BISHAN POINT SPRINGDALE CONDOMINIUM CHARISMA VIEW GOODLUCK GARDEN SHERWOOD TOWER THE JADE YEWTEE RESIDENCES HILLBROOKS HILLVIEW HEIGHTS HILLVIEW REGENCY PARKVIEW APARTMENTS PARKVIEW APARTMENTS BULLION PARK BULLION PARK BULLION PARK CASTLE GREEN YISHUN EMERALD SELETAR SPRINGS CONDOMINIUM

Area (sqft) 1,335 1,744 1,227 2,626 1,119 1,496 1,130 786 1,475 1,421 1,066 980 1,119 1,119 1,130 1,238 807 1,873 947 1,195 1,582

Transacted Price ($) 1,635,000 1,900,000 1,186,000 2,350,000 1,150,000 1,428,000 1,060,000 575,000 1,400,000 1,320,000 980,000 888,000 920,000 830,000 820,000 1,230,000 800,000 1,545,000 765,000 800,000 1,200,000

Price Tenure ($ psf) 1,225 FH 1,090 99 967 99 895 99 1,027 999 954 FH 938 FH 732 99 949 99 929 99 920 FH 907 FH 822 99 741 99 726 99 994 FH 991 FH 825 FH 808 99 670 99 758 99

NOTE: This data only covers non-landed residential resale property transactions with caveats lodged with the Singapore Land Authority. Typically, caveats are lodged at least 2-3 weeks after a purchaser signs an OTP, hence the lagged nature of the data.

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SINGAPORE PROPERTY WEEKLY Issue 22

Singapore Property Classifieds #12

For Sale

Bliss Residences @ Kembangan. FH 1500+sf 3+1BR Penthouse. Only $1000psf. 1 min to MRT, 15 min to CBD. Rooftop pool and BBQ. TK Tan 98206228.

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SINGAPORE PROPERTY WEEKLY Issue 22

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