RESIDENTIAL MARKET
URA to review guidelines on private enclosed space
THE Urban Redevelopment Authority (URA) has been directed to review and fix guidelines on private roof terraces and private enclosed space on ground floors that allow developers to profit off bonus floor area that is given to them for free.
National Development Minister Khaw Boon Wan said in a blog post yesterday that super-sized executive condominiums (ECs) units were offered and snapped up by buyers at some recent launches who did not appear to be from the sandwiched class.
"Understandably, there was public indignation at such deviations (both by some developers and some buyers) from what we had intended ECs to serve," he wrote.
Developers explained that such units were priced lower and were in the minority, Mr Khaw added.
For example, recent reports put the largest penthouse at the Citylife@Tampines EC project at about $470 per square foot (psf), while its other smaller and more typical units transacted for upwards of $700 psf.
"I was initially baffled by this. Why would the developer short-change itself? Why not sell more normal-sized EC units at a higher dollar psf, and make more profit?" Mr Khaw wrote.
He eventually found out this was not the case.
Currently, developers do not have to pay development charges for outdoor spaces that are open to the sky, as they are not considered part of gross floor area (GFA). This exemption applies to all developments, including ECs.
Developers can build either private or communal open spaces. This is aimed at encouraging more outdoor space for residents to enjoy, Mr Khaw noted.
However, when developers price a unit, they offer the entire space (including the outdoor space) for sale and make additional profits.
Mr Khaw said that the creation and sale of super-sized private roof terraces has become more prevalent, and has extended to the ground floor where "private enclosed space" (PES) is sold.
"Developers selling off free space to make additional profit for themselves is not improper under current URA rules," the minister pointed out.
"But as more developers do so, with larger private roof terraces and PES, communal space in the development that benefits all residents will correspondingly shrink."
These open spaces also cannot be covered up or enclosed, he added, which could disappoint buyers down the road.
A URA spokesman said that it is currently reviewing the guidelines on PES and private roof terraces, and will announce the details once the review is completed.
The strong demand for ECs means that a ban on big units ensures "EC housing subsidies go to the appropriate sandwich class".
For developers, the same demand will sustain sales, and the review will free up space to provide more smaller units which fetch higher psf prices.
But some analysts expressed doubts over the review.
Source: Business Times –8 January 2013
CDL's Echelon more than three-quarters sold
More than three-quarters of City Developments Limited's Echelon private condominium project next to Redhill MRT have been sold since its launch over the weekend.
This translates to 390 units out of the 508-unit development at Alexandra View being sold as at Sunday, CDL said yesterday.
Chia Ngiang Hong, CDL's group general manager, said the strong sales reinforces Echelon's attractiveness in terms of its location, value, architectural excellence, quality and potential appreciation.
"The overwhelming response is an endorsement by buyers that Echelon is a distinctive project with all the right ingredients that commands its demand and premium," he said.
Over 200 units were snapped up in the 99-year condo's preview on Dec 28 last year.
The average selling price for the development was $1,700 per square foot. This was the "early bird selling price", CDL said, and subsequent releases of units will be sold for 2 per cent and 4 per cent more.
City Developments is developing Echelon, which is expected to be completed in 2016, with its joint-venture partners, Hong Leong Holdings and Hong Realty.
The parties clinched the site at the end of 2011, just before the introduction of an additional buyer's stamp duty, which was aimed at curbing the wave of foreign buying at the time and excessive private residential property investment by Singaporeans and permanent residents.
As at yesterday, CDL said that 80 per cent of buyers were Singaporeans, with the remaining 20 per cent of units sold taken up by permanent residents and foreigners.
Echelon will be a 43-storey, twin-tower development. Units will range from one to four-bedroom apartments, and there will also be four penthouses.
Source: Business Times –8 January 2013
Brisk start to property market for 2013
Sales were brisk at showflats for both private projects and executive condominiums (ECs) over the first weekend of the year.
Analysts said this reflected pent-up demand from buyers after a lull in launches late last year, as well as expectations that prices will keep going up.
At Echelon, a 508-unit condo in Alexandra View which was officially launched at the weekend, 390 units had been sold as of Sunday, developer City Developments (CDL) said yesterday.
This means that nearly 200 more units at the 99-year leasehold project were sold after the Dec 28 preview when more than 200 units were snapped up in a single day.
CDL said the units were launched at an early-bird price of $1,700 per sq ft (psf) on average, with increases of 2 per cent to 4 per cent for subsequent releases.
Singaporeans made up 80 per cent of the buyers, with the rest being permanent residents or foreigners from countries including Malaysia, Indonesia and China.
The buyers are likely to be mainly investors aiming to rent out units and those attracted by the project's proximity to Redhill MRT station, said SLP International research head Nicholas Mak.
He said these investors would be prepared to hold their units for three to four years.
Weekend sales were also strong at another condo, Sea- Suites, which is being built in Pasir Panjang by boutique developer Link (THM) Group.
The Straits Times understands that almost all the units have been sold, though the freehold project is fairly small with only 52 apartments.
Not to be outdone, ECs such as CityLife @ Tampines also reported healthy sales figures over the same period.
More than 90 per cent of the 514 units at CityLife had been sold as of yesterday, since its launch on Dec 29.
A few more launches are expected soon, such as the 810-unit La Fiesta condo next to Sengkang MRT station which opened for viewing last Saturday. Average prices at La Fiesta are expected to be more than $1,100 psf.
Source: The Straits Times –8 January 2013
COMMERCIAL MARKET
Mohd Sultan shophouse up for sale
A 999-YEAR leasehold conservation shophouse at 15 Mohamed Sultan Road has been put up for sale by its owner with an asking price of $15.5 million.
This works out to about $2,259 per square foot based on the property's existing's gross floor area (GFA) of 6,862 sq ft spread across three storeys and an attic.
Under Master Plan 2008, the property, which has land area of 2,606 sq ft, is zoned for residential use with commercial on the first storey and has a 3.8 plot ratio.
Based on this, there is potential to build a further GFA of about 3,000 sq ft at the rear, which would take the property up to five storeys. Based on the maximum 9,903 sq ft GFA and assuming it costs about $2 million to build this (development charge is not payable), the $15.5 million asking price translates to $1,767 psf on GFA.
Located about 300 metres from the upcoming Fort Canning MRT Station on the Downtown Line, 15 Mohamed Sultan is just off River Valley Road and close to the Singapore River.
The tender closes on Feb 20.
Source: Business Times –8 January 2013
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