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New development charges to affect en bloc deals

Posted by Singapore Property Launch on 17th September 2017 in Blog
Residential District in Singapore

The new DC rates are expected to lead to higher breakeven prices for developers.

DBS expects the recent hike in development charge (DC) rates for condominiums to affect developers’ profitability as breakeven prices may increase by up to four percent, reported Singapore Business Review.

It noted that while most of this year’s en bloc transactions already priced in a potential six to 18 percent hike in property prices to break even, the new DC rates could add another one to three percentage point to the assumed increase in prices to break even.

This comes as 116 of the 118 sectors have raised their rates by six to 29 percent, with Sector 100, which includes Hougang, Tampines Road, Sengkang and Punggol area, registering the biggest increase.

The new DC rates would apply to cases that have been given provisional permission (PP) from 1 September.

“We believe the higher rates would especially impact the later en bloc transactions which have not been granted PP before 1 September 2017, especially those transacted in 2017, thus raising the cost of land acquisition for developers,” said DBS analysts Rachel Tan and Derek Tan.

“We believe that developers for larger en bloc sites, especially those with more than 1,000 planned new residential units per site, such as Serangoon Ville, Eunosville and Rio Casa, might look to launch projects as early as possible, especially given the large quantum of units to be cleared.

“At this moment, there are uncertainties to take up where our estimated breakeven prices are at a c. 15 percent premium to the prevailing property prices in the respective areas.”

credits: propertyguru

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Pine Grove to go en bloc again

Posted by Singapore Property Launch on 16th September 2017 in Blog
Pine Grove condominium

View of the 660-unit Pine Grove, a former HUDC estate near Ulu Pandan. (Photo: Google Maps)

After two failed attempts in 2008 and 2011, owners at Pine Grove near Ulu Pandan are trying their luck again at a collective sale, this time at a price of $1.65 billion, reported the Straits Times.

This would be the highest collective sale price since 2007, when the 619-unit Farrer Court was sold for $1.34 billion. If successful, each owner stands to gain between $2.08 million and $2.64 million.

Appointing Huttons Asia as its marketing agent, the collective sale committee is set to determine the method of apportionment and secure the requisite 80 percent approval at an extraordinary general meeting to be held on 29 October.

“We can expect good response from developers because of our prime location,” said collective sale committee chairman Kogi Murthi.

“It is among the few plots left available for residential development in the choice Holland Road district.”

The 660-unit former Housing and Urban Development Company (HUDC) estate failed to attract any bids in 2011, after the owners raised the reserve price from $1.33 billion to $1.7 billion to secure the 80 percent consent.

With 66 years left on its 99-year lease, the project has a site area of 893,227 sq ft. Zoned residential under the 2014 Master Plan, the site has a plot ratio of 2.1. Its existing plot ratio, however, now stands at 1.56, which means that the project could yield up to 2,000 units, said analysts.

credits: propertyguru

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Kong Hee’s Sentosa home relisted for $11.5m

Posted by Singapore Property Launch on 13th September 2017 in Blog
Sentosa Cove

There has been an increased interest in Sentosa Cove homes as prices have gradually moved closer to that of mass market condos.

In a sign that the luxury condo market is picking up steam again, the Sentosa Cove penthouse unit of City Harvest Church founder Kong Hee was relisted last week for $11.5 million, up 15 percent from its 2015 asking price of $10 million, reported the Straits Times.

The 5,242 sq ft property, which was co-owned by Kong Hee and Indonesian tycoon Wahju Hanafi, was bought for $9.33 million in 2007.

Serving a three-and-a-half-year jail term for misappropriating $50 million in church funds, Kong described the property in 2015 as a “temporary home” for the family as they waited for it to be sold.

The owners’ agent Sally Soh of KF Property Network revealed that three parties have visited the property since it was relisted at a higher price.

If sold, the value of the unit would translate to $2,194 psf, which is relatively higher than the $2,022 psf price of another unit sold at The Oceanfront last month.

The latest listing follows an increased interest in Sentosa Cove homes as prices have gradually moved closer to that of mass market condos.

With several homes there sold at massive losses, Sentosa Cove has become the most visible marker of the property market slump.

Sentosa Cove homes have gone from $2,600 to $2,800 psf between 2007 and 2009 to $1,500 to $1,700 psf at present, said Alex Low, group division director at PropNex.

But while Low believes that the luxury condo market is picking up again, International Property Advisor CEO Ku Swee Yong said it remains to be seen if Sentosa Cove would gain traction.

credits: propertyguru

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Changi Garden put up for collective sale at $196 million

Posted by Singapore Property Launch on 12th September 2017 in Blog
Changi Garden

The homeowners will get between $1.69 million and $3.74 million from the sale if it goes through. (Photo: Edmund Tie)

Changi Garden, a freehold redevelopment site at Upper Changi Road North, will be launched for collective sale on Friday (8 September) with an asking price of $196 million, or $700 psf per plot ratio, said marketing agent Edmund Tie & Co.

Developed in the late 1970s and early 1980s, the project sits on a 200,093 sq ft site and comprises 60 apartments, 12 penthouses and 12 shops.

The homeowners will get between $1.69 million and $3.74 million from the sale if it goes through, while the shops range from $3.7 million to $5.5 million.

According to the Master Plan 2014, the site is zoned for residential use with a plot ratio of 1.4. No development charge is payable.

“Since 2013, there has not been any residential land sold within a 2.8km radius of Changi Garden,” said Tan Chung Ming, director of investment advisory at Edmund Tie. “We believe a developer can take advantage of this huge freehold site to create a residential development with full communal and lifestyle facilities to tap on the potential pent up demand.”

The upcoming Jewel Changi Airport and Terminal 4 will further enhance the location’s attractiveness, noted Edmund Tie. 

The tender for Changi Garden will close on 16 October. 

credits: propertyguru

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All BTO flats to come with prefabricated bathrooms by 2019

Posted by Singapore Property Launch on 10th September 2017 in Blog
Singapore property

All newly launched HDB flats will be installed with prefabricated bathroom units (PBU) by 2019, the Housing and Development Board (HDB) announced on Wednesday (6 September).

These PBUs that have been pre-assembled off-site will come with finishes like partial tiling, copper piping, window frames and a waterproofing system.

The Housing Board first piloted the concrete PBUs in Fernvale Lea, a Build-To-Order (BTO) project in Sengkang completed in January last year. So far, this has been utilized in 15 such developments comprising about 14,000 units.

“Moving ahead, HDB will implement PBUs in 60 percent of the flats launched in 2017, and extend PBUs to all projects launched by 2019, where feasible.”

In the next two years, the Housing Board will also start using in 35 percent of its projects the concrete Prefabricated Prefinished Volumetric Construction (PPVC) method, which involves building and assembling three-dimensional (3D) prefabricated modular units in a factory.

These components like kitchen, bedrooms and living room are combined in different configurations in the factory to create various flat layouts. Besides an initial coat of paint, these are also pre-fitted with window frames as well as floor and wall finishes, before being transported to the construction site for installation.

HDB first tested the PPVC method in Valley Spring @ Yishun, an 824-unit BTO project whose construction started in March 2017.

Before this, the agency did a trial run for the Prefabricated Volumetric Construction (PVC) approach, which is similar to PPVC but without pre-finishes like paint and flooring. This was piloted in West Terra @ Bukit Batok, a 1,793-unit BTO project quipped with PBUs and targeted for completion next year.

The use of these new construction methods is not only a departure from the conventional approach where finishes are built on-site, but is also expected to help HDB meet the government’s target of boosting construction productivity by 25 percent in 2020 compared to that in 2010.

credits: propertyguru

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Singapore developers ramp up landbanking activity

Posted by Singapore Property Launch on 7th September 2017 in Blog
GLS site-crop

View of a Government Land Sales site in Singapore. (Photo: Nikki De Guzman)

Seven of the top 10 developers with the biggest residential landbank and unsold units in launched projects are local developers, according to the Business Times’ compilation of developers.

This comes as Singapore developers came out strong in the collective sales market and private land deals, even as foreign developers crowded them out in government sales of residential sites, the report said.

Based on JLL’s analysis, half of the eight private residential sites, excluding the mixed-use site in Bidadari, sold in Government Land Sales (GLS) so far this year went to Singapore developers.

Over in the collective sales market, Singapore developers snagged six of the seven deals with a residential component. They also secured most other land deals this year.

“It was a matter of time before the local developers upped their game plan,” said Ong Teck Hui, national director of research and consultancy at JLL.

Sim Lian Group, for instance, topped the list in terms of residential landbank in one swoop when it acquired Tampines Court, a former Housing and Urban Development Company (HUDC) estate that could yield over 2,000 homes.

Oxley Holdings made a swift comeback this year to its home market, with the purchase of six residential sites comprising three sites via en bloc deals and three under private treaties. Two of the en bloc deals were for large sites acquired with consortium partners.

With this, Savills Singapore research head Alan Cheong expects Singapore developers to continue to be aggressive in their land bidding.

“When land prices are rising, they may sacrifice margins if they are motivated to get the site but when the project is ultimately launched a year down the road, selling prices are likely to have increased, thereby pumping their margins up again.”

credits: propertyguru

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