RESIDENTIAL MARKET
Strong interest seen in Farrer Drive site
ANYWHERE between 10 and 20 developers could make a beeline for a plum 99-year private housing site at Farrer Drive, next to Sommerville Grandeur and just a few minutes' walk from the Farrer Road MRT Station. The site has been triggered from the government's reserve list.
While the high-end residential market has been quiet, developers eyeing the prospects of building small-format apartments to keep the lump-sum apartment prices relatively affordable would find the District 10 plot attractive. Another draw is the site's manageable size with the all-in development cost estimated at about $166 million based on the top end of pricing expectations for the plot.
These estimates from property consultants came after the Urban Redevelopment Authority announced yesterday that an unnamed party has made a successfully application for the site's release with a commitment to bid at least $88.888 million ($823.33 per square foot of potential gross floor area) at tender. Analysts forecast the winning bid could fall in the $850-1,100 per square foot per plot ratio (psf ppr) range.
The 67,471 sq ft plot, with a 1.6 plot ratio (ratio of maximum gross floor area to land area), can be built up to eight storeys and some market watchers say it could potentially yield about 100-200 apartments, depending on unit size mix. The breakeven price for the unit is expected to be around $1,500 psf, giving a potential selling price of $1,700 to $1,800 psf.
Source: Business Times – 12 May 2012
Foreign developers look to Asians to drive sales
OVERSEAS property developers are increasingly setting their sights on Asia - including Singapore - to drive their sales to make up for weak demand back home.
They hope that deep-pocketed investors in the region who are frustrated with low bank interest rates will choose to invest in other corners of the globe.
While traditional areas like London, Melbourne and Kuala Lumpur have always been offered as investment alternatives, investors are also being enticed to plonk their savings into less familiar cities such as Chengdu and Houston.
Experts say that low interest rates and tighter credit conditions in the real estate sector of some Asian markets have prompted investors to look to investments further afield.
But they are also keen to partake in the growth story right in their backyard.
Residential projects in Thailand and Malaysia that have been marketed here, for example, have attracted interest from Singaporean investors.
Source: The Straits Times – 12 May 2012
Central London homes draw buyers from S'pore
SINGAPOREAN property buyers are keen on London, new figures show.
Industry players estimate that Singaporeans account for more than 3.5 per cent of recent transactions of residential property in central London.
This number is set to rise as more London projects are launched in Singapore in the coming weeks.
A Singaporean investor can purchase a property with 30 per cent cheaper values between height of peak and now due to the weakness of the pound.
Analysts say heightened interest in London property among investors here could be due to the rising rentals and capital values.
Rents for London properties have grown by 42 per cent since January 2010, and are expected to continue increasing.
A research report stated that properties in the prime districts of central London are expected to increase in value by around 6 per cent this year, and by 22 per cent by 2015.
Source: The Straits Times – 12 May 2012
COMMERCIAL MARKET
Strata-shop sales last year a record $661m
THE strata-shop segment is roaring.
Brisk sales totalled a record $661 million last year, partly driven by residential cooling measures that have diverted funds to non-residential properties.
Analysis of caveats lodged with the Urban Redevelopment Authority found a total of 615 strata-shop units transacted last year - just under the record 632 strata shops totalling $656 million sold in 2010.
Sim Lim Square topped the charts with 33 strata-shop units changing hands, followed by Icon @ Changi with 29 units and Space @ Kovan with 28 deals inked.
The robust demand also comes on the back of a dearth of new strata-shop projects in recent years, with many existing strata shops currently in older malls such as Peninsular Plaza, People's Park Centre and Lucky Plaza.
The ample supply of newer choices on the market has attracted more interest, leading to the resale market taking a hit with volumes slowing by 9 per cent last year, compared to 2010.
The popularity of strata shops is partly due to the slew of cooling measures in the housing market, which introduced tighter financing rules and additional stamp duties.
Investors were prompted to look towards alternative real estate investments to park their cash instead, in the light of rock-bottom bank interest rates.
Rising business costs have also led to some retailers buying strata shops to have more certainty in running costs.
For buyers of older strata shops, however, the main concern is for the upkeep of the ageing property.
While some of these shops may still offer niche services, strata-titled malls might have already lost their relevance with modern shopping in Singapore's fast-changing retail landscape.
Source: The Straits Times – 12 May 2012
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