RESIDENTIAL MARKET
GCB market weathers latest cooling measure well
The market in Good Class Bungalow Areas appears to have fared relatively well in October, despite a possible pullback in activity predicted by some players following the introduction of measures early last month to restrict tenures for housing loans and lower loan-to-value (LTV) limits for longer tenure loans.
Five caveats were lodged last month totalling $122 million, with the possibility of more streaming in over the coming weeks for deals inked last month. The initial October tally mirrors September's performance - six deals done at $128 million - and that of August (six transactions totalling $119 million). In July, four deals were done for $84.5 million.
October's caveats include two transactions of vacant sites - at Swettenham Road and Jervois Hill.
The Swettenham Road deal involved a freehold hilltop site with land area of 15,450 square feet. It sold for $21.98 million or $1,423 per square foot (psf).
At Jervois Hill, bungalow investor George Lim picked up a 15,094-sq-ft plot for $25.8 million. This works out to $1,709 psf.
In the same month, Mr Lim sold a Leedon Park bungalow for $33 million or $2,110 psf on its 15,640-sq-ft land area. The property, which Mr Lim developed, has six bedrooms and a pool. It has obtained BCA's Greenmark Gold Plus award and was completed last year.
Another deal last month was the two-storey Olive Road bungalow sold by the estate of the late philanthropist Khoo Oon Teik for $26.1 million or $1,114 psf. The deal was brokered by Knight Frank.
A property at Kingsmead Road (near Coronation and Victoria Park roads) also changed hands for $15.1 million or $1,776 psf on land area of 8,504 sq ft in October.
Typically GCBs have a minimum land area of 1,400 square metres (15,069 sq ft). However, when GCB Areas were gazetted in 1980, they included some slightly smaller existing sites. Nonetheless, these are still considered GCBs as they would be bound by the other GCB planning rules if they were to be redeveloped. For instance, such plots cannot be further sub-divided and they cannot be built more than two storeys high (plus an attic and a basement).
In Q3, 16 deals in GCB Areas were done totalling $332 million, down from 18 transactions at $359 million in Q2 2012. Year to date, the tally is 48 transactions totalling $1.04 billion.
Meanwhile, a 24,207-sq-ft freehold plot in the Holland Rise GCB Area has been put on the market. The indicative guide price for the vacant plot is $1,300-$1,500 psf on land area.
The expression of interest exercise for the property closes on Nov 22. The property is situated on elevated ground, at one of the highest points in the exclusive Holland Rise GCB estate. The plot is about 500 metres from Holland Village MRT Station and the shopping and dining establishments in Holland V.
From Oct 6, the Monetary Authority of Singapore has capped the maximum tenure for all home loans at 35 years. In addition, for new loans with tenures exceeding 30 years or loan periods extending past the borrower's retirement age (65 years), the LTV limit has been capped at 40 per cent for borrowers with one or more outstanding housing mortgages and 60 per cent for those with no outstanding home loan.
While a lower LTV was not expected to affect the well-heeled set who make up GCB buyers, some observers had predicted a knee-jerk slowdown in activity.
Several boutique bungalow deals lately - at Berrima Road, near Raffles Town Club ($9.5 million or $1,705 psf on land) and in the University Road area ($14.4 million or $1,778 psf). In Sian Tuan Avenue near Binjai Park/ Yarwood Avenue, a Balinese resort styled bungalow fetched $10.388 million ($1,751 psf). The bungalow has four bedrooms.
Source: Business Times – 1 November 2012
Daewoo E&C wins $112.8m deal to build The Scotts Tower
Daewoo Engineering and Construction has secured a contract to build Far East Organization's The Scotts Tower for $112.8 million.
The deal with Far East, signed yesterday, was Daewoo's second since it re-entered the market here in July. It had received a contract for One Balmoral then.
"To Daewoo, the Scotts Tower project has a very important meaning not because of the contract value, but the resumption of business in the Singaporean real estate and housing market," said Kang Woo-Shin, executive vice-president of the overseas business division at Daewoo.
The company exited Singapore in 2009. Its last project was the Kallang-Paya Lebar Expressway in 2005. "We didn't have enough resources to do more projects in this region," he said.
Daewoo's previous company, Kumho Asiana, had run into cash-flow problems following a spate of acquisitions, which included Daewoo, that began around 2006, Reuters reported.
State-run Korea Development Bank (KDB) bought a controlling stake in Daewoo in late 2010, as part of its restructuring of Kumho.
Between 2005 and 2010, the company focused on the Middle East and North Africa (Mena), and on its domestic base in South Korea, Mr Kang said.
With KDB's strong backing and a mandate to search for growth opportunities, Daewoo turned its focus back to the region.
Mr Kang said Daewoo was targeting Malaysia, Singapore and Indonesia because of their sound economic fundamentals compared with other countries in the region. And with the recent unrest in the Mena region, the company wanted to seek out more stable markets.
The company is also focusing on targeting infrastructure and oil and gas projects here to leverage on its experience, he said.
Chng Kiong Huat, executive director of property services at Far East, said Daewoo's expertise across disciplines made it an ideal choice.
"Their ability to construct complex and challenging engineering forms make them a good partner for The Scotts Tower," he said. "Daewoo's experience with underground and civil engineering projects will be relevant here as well."
The Scotts Tower is near Newton and Orchard MRT stations, which are both underground. The project is expected to be completed in 2016.
The Scotts Tower is the first project to be developed under the Far East SOHO brand and is marketed as a premium residence.
The 31-storey development at 38 Scotts Road will comprise 231 apartments and penthouses of between 624 and 3,315 square feet.
Of that total, 128 units have been released for sale since the launch last December, while 85 units have been taken up, Far East said. Prices start at $3,300 per square foot.
Source: Business Times – 1 November 2012
INDUSTRIAL MARKET
JTC releases three industrial plots for sale
JTC Corporation has launched three industrial plots for sale by public tender.
The first site, located off Woodlands Ave 10 and abutting Mapletree's Woodlands Spectrum I and II, has a lease term of 30 years.
The other two sites (Plots 8 and 18) are located at Tuas South Street 8, and are about 32,674.9 sq ft and 48,727.1 sq ft respectively. They have a gross plot ratio of 1.0.
The two sites have a lease term of 22 years and seven months.
A similar plot (Plot 12) at Tuas South Street 8 had received 17 bids, when the tender for the site closed in mid-October.
Source: Business Times – 1 November 2012
Industrial building near Sims Dr up for sale
A seven-storey building, meant for light industries, near Sims Drive has been launched for sale by public tender with an indicative asking price of between $33.8 million and $36 million, or $564 to $601 per square foot per plot ratio (psf ppr).
The building is mostly occupied by Hock Tong Bee Pte Ltd-Cornerstone Wines as its corporate headquarters. The company, one of the few suppliers of wines to supermarkets here, had received an unsolicited bid of more than $30 million for the property recently, but decided to conduct a sale by tender instead.
Hock Tong Bee-Cornerstone Wines' managing director Clinton Ang said: "We're open to selling the property if - and only if - offer bids meet our price expectations."
The rectangular freehold plot takes up approximately 23,936 square feet and has a gross plot ratio of 2.5. It is zoned for Business 1 use, which means it is for light and clean industrial use which will not require a "nuisance buffer" of more than 50 metres.
An industrial building in Sims Drive was recently sold for $43.18 million or $495 psf ppr. The property was a vacant two-storey factory earmarked for demolition and redevelopment.
The tender closes on Nov 28 at 3 pm.
Source: Business Times – 1 November 2012
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