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01 November 2012

1st November, Thursday




More local firms aiming for Grade A offices in Central Business District

Source: Channelnewsasia

Grade A offices in areas like Shenton Way and Raffles Place are now looking more attractive to Singapore firms.

Experts said companies are taking advantage of cheaper rentals, as well as more space made available by large multi-national firms moving into the Marina Bay Financial District.

According to a consultancy, Grade A and A-plus offices in the Central Business District are going at between S$7.40 to S$11.90 per sq ft.

Some firms, however, remain cautious from making huge commitments because of the current economic outlook.

Experts said the economic lull may continue to have a drag on office rentals for the rest of the year.

For the coming quarter, a property firm expects office rents in Raffles Place to fall between one and two per cent on-year, with rents ranging between S$7.30 to S$11.20 per sq ft.

Leasing activity is also expected to slow as the festive season approaches.


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JTC releases three industrial plots for sale

Source: Business Times

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.

An analyst said that the site could fetch between $75 and $100 per sq ft per plot ratio (psf ppr). Assuming that the person who wins the bid decides to strata-title and sell the units, industrial space in the area can probably fetch $280-$290 psf, he said.

Another analyst however expects the plot to fetch between $55 and $75 psf ppr, which translates to $15.8 million and $21.6 million. The site could attract moderate interest, in the range of three to six bidders.

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.

Analysts expect relatively keen interest for the plots. The plots should fetch $50-$78 psf ppr.


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Investment Sales


GCB market weathers latest cooling measure well

Source: Business Times

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.

An analysis shows 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 sq ft. It sold for $21.98 million or $1,423 per sq ft (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.

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.

Most of the caveats for bungalows in GCB Areas for October involved deals which originated in September or early October before the restrictions on home loan tenures took effect. "There was a slowdown in activity and transactions in October as anticipated due to the new measures introduced. Nevertheless, I foresee pent-up demand and a pick-up in transactions early next year, provided no further cooling measures are unveiled,” an analyst said.

However, another analyst has not seen any slackening in activity. "The past eight weeks have been my busiest this year in the GCB market - in terms of viewings, negotiations and deals," he said.  

Meanwhile, a 24,207-sq-ft freehold plot in the Holland Rise GCB Area has been put on the market. The sole marketing agent for the site, says 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 22 November.


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Industrial building near Sims Dr up for sale

Source: Business Times

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 sq ft 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.

The rectangular freehold plot takes up approximately 23,936 sq ft 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.

The tender closes on 28 November at 3 pm.


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