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09 January 2013

9th January, Wednesday




Wheelock unit puts in highest bid for Ang Mo Kio site

Source: Business Times

A Wheelock Properties (Singapore) unit, Pinehill Investments, has put in the highest bid of $790 per sq ft per plot ratio (psf ppr) for a private residential site at Ang Mo Kio Avenue 2.

Demand was strong for the 99-year leasehold site with 12 bids put in, which included some big name developers.

"We see great potential in this choice site being next to St Nicholas Girls' School and the future Mayflower MRT station," said Tan Bee Kim, senior executive director at Wheelock Properties (Singapore).

Lee Sze Teck, senior manager for training, research and consultancy at DWG, noted that Wheelock has "rarely ventured into the suburban areas" and are usually known for their upmarket freehold condominiums in prime areas.

Should Wheelock be awarded the Ang Mo Kio site, it will be just the developer's third development in the suburbs, after Parc Oasis and the Sea View. It will also just be Wheelock's second non-freehold property after Parc Oasis.

The number of bidders was within the range of seven to 15 bids predicted by analysts earlier.

However, the price was notably higher than the range of $560 to $650 psf ppr they put forth then.

An analyst said the elevated bidding for residential sites that became more apparent in the last quarter of 2012 is continuing into 2013. "Looks like the new pricing norm for attractive suburban sites is now around $800 psf ppr," he said, noting the top bid for the Ang Mo Kio site at $790 psf ppr and that for a land parcel in New Upper Changi Road in October last year at about $791 psf ppr.

Analysts expect breakeven prices of between $1,180 and $1,300 per sq ft (psf), and selling prices of between $1,350 and $1,600 psf.


Links to the story:$550m-top-bid-for-AMK-site



Private spaces may incur development charges

Source: Business Times

Developers may be saddled with additional development charges if private roof terraces and enclosed spaces are included under the gross floor area (GFA), said an analyst.

Additional measures targeting the resale flat market may also be in the works, she said.

To tackle this, the government can consider making it a requirement for upgraders to sell their flats before purchasing a private home, she said. This will be similar to current practices in which private property owners who want to buy a HDB flat have to dispose of their private homes within six months.

Alternatively, more restrictions can be placed on owners who want to retain their HDB flats in pursuit of rental yield after upgrading to a private property.

A host of measures targeting the non-residential sector, too, could be introduced. One possible measure is to have similar seller stamp duties.

Specific to the industrial sector, the government will likely step up enforcement against non-qualifying users of industrial spaces. The restrictions including minimum unit size, and certain sites cannot be strata-titled within 10 years on Government sites could be applied to private sites as well, she said.


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Developers fear URA will charge for outdoor space

Source: The Straits Times

The Government's intention to fix a loophole that allows property developers to sell off free outdoor open spaces for profit has got them worried.

They fear the Urban Redevelopment Authority (URA) will now slap a charge on such spaces if they are sold as private roof terraces or ground-level private enclosed spaces.

Instead, they hope the URA review will - at most - restrict the size of such areas.

After all, they argue, it was overly big roof terraces in subsidised executive condominiums (ECs) that aroused public indignation, and not roof terraces per se, which are popular with buyers and a fixture of penthouse units.

Developers said a levy for outdoor space would mean a hefty increase in costs for developers. This could cause them to exclude roof terraces in their penthouse units altogether.

The URA declined to say when the results of its policy review would be ready, nor whether the change would involve restricting the size of roof terraces, or charging developers for outdoor space.

While analysts said that new restrictions in whatever form might mean that a 1,600 sq ft roof terrace becomes a thing of the past, they do not see private roof terraces going the way of planter boxes or bay windows.

Roof terraces, meanwhile, remain popular with buyers like engineer Ram Ramesh, 45. He recently bought a private penthouse in Pasir Ris that comes with a 500 sq ft roof terrace. "It gives me extra space that opens up to the sky and provides fresh air," he said.


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SC Global to pay $5.5m for sales extension

Source: The Straits Times

Luxury developer SC Global Developments has to pay $5.5 million for a six-month extension on the stipulated period for selling The Marq on Paterson Hill.

The company, which is in the midst of a privatisation bid, disclosed the impost on Monday in a statement on the status of the bid.

SC Global is the first developer to announce that it has to pay such a charge to obtain an extension on the usual seven years for selling all units at a new property.

Under the Residential Property Act, developers whose shareholders and directors are not all Singaporeans have to get a qualifying certificate to buy residential property for development.

With the certificate, developers have up to five years to build the project and sell all the units within two years of obtaining the temporary occupation permit. If developers cannot meet the deadline to sell all units, they may face a pro-rated extension charge, based on the proportion of unsold units.


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Prices of resale flats to remain high this year: analysts

Source: Channelnewsasia

Property analysts expect resale prices of public housing flats to remain high this year, after trending up by 2.5 per cent in the fourth quarter of 2012.

But they said prices could start to weaken in 2014 to 2016 as over 8,000 units of resale flats could be available in the market.

Dennis Wee Group estimates that up to a total of 2,600 resale units could become available from 2014 to 2016 as HDB upgraders move into the new executive condominiums, while second-time buyers moving to new Built-to-Order and Sale of Balance Flats could inject another 5,900 resale flats into the market by 2016.

An analyst said: "We are going to have a slew of record supply completing from 2014 onward which will have an impact in terms of "rentability" because we are entering into a market of tightening labour and immigration conditions. With more completion of BTOs, private condo as well as ECs that will be completing from 2014 onward, that might have a downward pressure on rentals which have an impact in capital value, especially affecting your HDB prices.

Some analysts said HDB resale prices could climb by 5 per cent this year as the supply of units remains tight. They added that the median cash-over-valuation (COV) could to breach the record high of S$36,000 set in the third quarter of 2011.

According to the Singapore Real Estate Exchange (SRX), the median COV rose by over 13 per cent to S$34,000 in October and November last year.

Some analysts have suggested ways to keep COV in check.

Senior manager for research and consultancy at Dennis Wee Group, Lee Sze Teck, said: "If you want a drastic measure, they could stop the whole COV issue which means HDB flats have to be sold at valuation price. More moderate measures could include taxation on the COV they collected from the sale of flat. Another way is to relook at how HDB flats are being valued, we could follow the private market where the selling price is being agreed upon and then the buyer will go to the banks and ask if the banks can match the price. If they can, then that would be the price being sold."

Analysts said they've already noticed some resistance in paying high COV in 2012. And they expect resale activity to slow if COV continues to rise.


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Investment Sales


Draycott site sets new unit land price

Source: Business Times

A new benchmark unit land price - higher by a whisker - is believed to have been set for residential land here.

Based on caveats evidence, Hong Kong's Swire Properties is thought to have bought all 12 units in the four-storey Hampton Court for $155 million. This is understood to work out to $2,526 per sq ft per plot ratio (psf ppr), which is inclusive of an estimated development charge of $22.3 million.

This unit land price would pip the standing record by just $1 psf ppr set in November 2007, when Westwood Apartments in Orchard Boulevard was bought by YTL for $2,525 psf ppr.

Swire Properties Pte Ltd is a recently formed, wholly owned subsidiary of Swire Properties Ltd in Hong Kong. This is its first property acquisition.

Although immediate redevelopment of the Hampton Court site may not be on the cards, industry observers are still paying close attention to the transaction's unit land price - at least that based on caveats evidence - which indicates a new high in the Singapore market.

Under the current Master Plan 2008, the 33,425 sq ft site has a plot ratio of 2.1 and can be built up to 24 storeys. Going by some estimates, the site can accommodate a new development comprising 33 apartments with an average size of 2,000 sq ft.


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