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14 June 2013

Sengkang condo site draws top bid of $257m

Developers 'still hungry' as bullish bids for Fernvale Close beat forecasts

Source: Straits Times | Money 
By Cheryl Ong

A PLUM residential site in Sengkang with sweeping water views has beaten market expectations by attracting a top bid of about $257 million in a nine-way fight among developers.

Analysts say the bullish bidding for the Fernvale Close site indicates that developers are still hungry for attractive sites.

The tender closed yesterday.

A bid by a joint venture comprising Frasers Centrepoint, Far East Orchard and Sekisui House came out tops with a price of $533 per sq ft per plot ratio (psf ppr). The 14,931 sq m site is estimated to yield 495 units.

This exceeded experts' expectations, when the site was released in April, of a top bid ranging from $500 to $520 psf ppr.

The top bid was 2.8 per cent higher than MCC Land's bid of $250 million - or $519 psf ppr.

Experts say the strong response to the 99-year leasehold site was because "developers remain confident of demand for homes in this part of Sengkang".

The site's location - next to the Sengkang Riverside Park, Layar LRT station and amenities such as the upcoming Seletar Mall and Sengkang Sports and Recreation Centre - was a draw, said CBRE residential executive director Joseph Tan.

Jones Lang LaSalle national director of research and consultancy Ong Teck Hui said the top bid was 9 per cent higher than that of $489 psf ppr for an adjacent site at Sengkang West Way in April, showing developers are eager to secure sites in the area.

In addition, all nine bids were above the price of $400 psf ppr, while only three of eight bids in the Sengkang West Way tender were above that level, said Mr Ong.

"Recent strong sales at Jewel@Buangkok suggest there will generally be strong buyers' interest in new projects in the north-east, and thus strengthen developers' interest to continually develop new projects in Punggol and Sengkang," noted R'ST Research director Ong Kah Seng.

H2O Residences, a 521-unit condominium project next to the site, is about 92 per cent sold, reflecting buyers' interest in the area, he added.

OrangeTee's head of research and consultancy Christine Li expects the latest development to attract HDB upgraders currently residing in Sengkang.

She noted: "Those who bought Sengkang HDB flats are already sitting on tidy profits."

In the first quarter of this year, median prices of four- and five-room flats in Sengkang were $486,000 and $535,000 respectively. As such, there will be enough upgraders' demand in the locality.

The joint venture led by Frasers Centrepoint has proposed a 490-unit residential development with seven blocks of 18 storeys each.

Experts estimate a breakeven price of $1,000 psf ppr and expect selling prices to start from $1,200 psf. Projects in the vicinity developed by Frasers Centrepoint, Far East Organization and Sekisui House are Boathouse Residences at Upper Serangoon View and Watertown in Punggol Central. They will attain their temporary occupation permits in 2015 and 2017 respectively.


Recent strong sales at Jewel@Buangkok suggest there will generally be strong buyers' interest in new projects in the north-east, and thus strengthen developers' interest to continually develop new projects in Punggol and Sengkang.

- R'ST Research director Ong Kah Seng

Parc Oasis owners upset over parking fee proposal

Condo trying to raise money in bid to cover shortfall in maintenance fund

Source: Straits Times
By Cheryl Ong

SOME owners at Parc Oasis in Jurong East are up in arms over attempts by the condominium's management council to raise funds and cut costs to cover a shortfall in the maintenance fund.

The revenue-raising plans involve imposing parking fees, but the proposals have caused friction between residents.

Two meetings have already been held with no resolution, and another is set for tomorrow, with owners expecting more rows.

The issue is money. The management council told residents last month that it expects a $118,000 deficit for the year to June 30, and $353,000 in the next fiscal year.

The council says that one reason is pricier cleaning, security and landscape contracts.

Another reason, it says, is the need for more funds to maintain the 18-year-old condo, which has leaking pipes in the carpark, for example.

But a resident in her late 50s who wanted to be known only as May said: "We don't know what is happening. Yet, you ask us for money; you are confusing us."

The latest move to raise cash at the 950-unit condo, where units sell for about $920 per sq ft, will take place tomorrow when owners will be asked to back new parking charges and raised contributions to the management fund.

Owners pay a maintenance fee of $834.60 per quarter with no parking fee. There are 950 carpark spaces, but it is estimated that fewer than 800 parking labels have been issued.

One option on the table tomorrow involves a monthly parking fee of $100 for a second car and $150 for subsequent vehicles. This proposal includes increasing monthly management fees from $56 to $59 per share value.

Owners can reject parking fees, but the increase will be higher - at $64 per share value.

If both options are rejected, the management has proposed cost- cutting measures, including reducing landscaping and pest control expenses, and carrying out only repairs that concern safety.

This will be the third meeting called by the Management Corporation Strata Title (MCST) since last October.

The annual general meeting on Oct 27 last year proposed levying a $350 parking fee on an owner's third car, but this was withdrawn after residents asked the Strata Titles Board to review it.

A proposal at an extraordinary general meeting on Jan 12 to levy parking fees was also defeated.

May, who has one car, claimed the parking fees issue creates disharmony: "I have a neighbour who doesn't have cars and will vote for the resolution. Other neighbours who have more than one car are not talking to her."

A resident said: "Why don't they just charge a standard fee for every car to raise funds, instead of targeting those with more than one car, which is the minority."

Residents said they have also been irked by cost-cutting steps already imposed, including reducing the number of cleaners and security guards, and switching off lights in common areas in the day.

The MCST told The Straits Times: "A number of condominiums are charging for second and subsequent cars. Therefore, what Parc Oasis is proposing to implement is not an exception."

Experts say there are issues with managing a large development. Associate Professor Sing Tien Foo of the department of real estate at the National University of Singapore said: "This is a collective action problem, where you organise a group of people to work together. When the group is bigger, it is more difficult to arrive at a consensus."

Ideas to help seniors unlock flats' value

But some suggestions may mean heavier tax burden on younger Singaporeans

Source: Straits Times
By Charissa Yong And Daryl Chin

RADICAL ideas to help the elderly unlock the value of their homes were floated at an Our Singapore Conversation (OSC) dialogue on Wednesday night.

A dedicated government unit to address the housing concerns of the elderly, a state handout to match the capital gains from downsizing and even tourist homestays in senior citizens' flats were among the suggestions.

But some of these, said Senior Minister of State for National Development Tan Chuan-Jin, would mean a heavier burden on younger taxpayers.

Take, for instance, the idea that the Government should match the returns for senior citizens who downgrade to a smaller flat.

If the Government does this, dollar for dollar up to a maximum of $100,000, it could encourage more seniors to monetise their existing flats, said those who suggested it.

Unfortunately, the cost of such a scheme would be borne by the one-third of the Singaporeans here who pay taxes, said Mr Tan. And with Singapore's ageing population and falling birth rate, the weight on taxpayers would get even heavier.

"Once you give (such incentives) out, you

can't take it back. The people who will pay for these things when they kick in, in 10, 15 to 20 years later, will be your children and grandchildren's generation," he said.

At the dialogue, some participants also wanted the HDB to bring back dual-key units, which were piloted in the 1980s. This would allow elderly heartlanders to rent out one portion of their flat without having to worry about sharing space with a potentially unsavoury tenant.

Others asked for the Government to provide a service which matched various tenants among the seniors using a shared database. They also suggested that the Government step in to mediate when tensions between the elderly and their tenants run high.

In general, seniors can monetise their flats in four ways:

Downsize and receive a $20,000 cash bonus if their retirement account is topped up with part of the proceeds.
Sell part of the lease back to the Housing Board if they own a three-room flat or smaller.
Sublet their flat.
Sell it on the resale market.
Participants at the session also argued that some HDB policies can be tweaked to help the elderly.

Retired counsellor Chan Lip Hian, 62, wants to sell part of the lease of his executive apartment in Bukit Batok, although his property does not currently qualify for the scheme. "I can always sell it on the open market, but I would rather stay in the same surroundings, which I have grown to love in the past 30 years," he said.

Praising the breadth of discussions in his closing remarks, Mr Tan noted: "We can ask for many things. But at the end of the day, how do we make it sustainable? I think the Government has a responsibility to help, but individuals also have a responsibility."

He added that the such discussions were useful in shaping policies and that "changes are already happening".

Wednesday night was the last of the six public OSC sessions on housing organised by the Ministry of National Development.

Ageing mall's fix gives it the right mix

Refurbished Bukit Timah Plaza wins fans with new family-friendly tenants

Source: Straits Times
By Melody Zaccheus

A DECADE ago, Bukit Timah Plaza was the dilapidated home to sleazy massage parlours, car dealers and more than 20 hair salons.

But a drive by its management to revitalise the 35-year-old mall has got it booming again.

Thanks to refurbishments and the introduction of a mix of tenants, it has become a favourite destination for families.

Parents can drop off their children at any of the 16 new tuition and enrichment centres to take part in extra-curricular learning or activities such as sport, performing arts or music.

Meanwhile, they can shop, enjoy a coffee or eat at a range of food and beverage outlets such as Blue Magnolia cafe, ice-cream store Vanilla Rush and Japanese chain Saizeriya.

Unlike its run-down neighbours Bukit Timah Shopping Centre and Beauty World, the strata title plaza has come a long way in recent years.

Mr David Chong, 57, the secretary and ex-chairman of the Management Corporation Strata Title, recalled its former appearance as "unsightly" and "in danger of becoming a relic of the past".

A by-law was passed during an annual general meeting three years ago to manage the plaza's tenancy mix.

Mr Chong said: "We started to restrict the type of tenants who were leasing stores from owners here. When the contracts of tenants were over, the by-law applied and they had to find alternative arrangements. This allowed us to better manage the range of trades in the mall.

"Our intention was to survive and focus on long-term gains. The prevalence of just one or two types of trades in a mall will depress rental prices and drive the crowds away."

Property prices at the plaza have soared from $1,000 per sq ft to $4,000 psf over the past two years, said Mr Chong, while visitor numbers have jumped by as much as 50 per cent in five years.

A crucial turning point was the introduction of FairPrice Finest in 2007, which brought in the crowds. A FairPrice spokesman said the supermarket is one of its "busier stores and is very popular with the residents in the vicinity".

The education hub on the second floor replaced various stores including employment agencies, car dealers and a tile retailer.

Ms Jenny Wong, 48, an administrator at a Chinese tuition centre on the second storey, said the mall is experiencing a boom. "It's very crowded on weekends now and traffic has almost doubled. It also has managed to maintain its family-oriented vibe and parents feel safe sending their children here for classes."

Madam Doreen Chua, 58, the co-owner of an art centre which opened in December 2011, added that competition is friendly as the enrichment and tuition centres run complementary services.

Siblings with different interests are able to attend different classes at the same time and place. "Enrolment has increased at our centre by about 10 per cent since we moved in," added Madam Chua.

Others such as Madam Eileen Ang, 45, the co-owner of XueLin Learning Hub, said its location means it can cater to students from nearby schools such as Bukit Timah Primary School and Methodist Girls' School.

As a result of the growing crowd, new eateries have also sprung up. Mr Vince Kor, 50, a shop assistant at seven-month old iCook Cafe, said parents tend to linger and dine in after sending their children to classes.

Diners can also look forward to an upcoming alfresco area with about three new food and beverage options set to open by the end of the year, according to Knight Frank Estate Management, the plaza's managing agent.

Shopper Kara Quek, 17, a student at National Junior College, said she frequents the plaza with her friends and classmates for its cheap offerings and close proximity to her school.

Housewife Christina Robles, 40, said she does her shopping while her children have their taekwondo lessons. "This place isn't too crowded and I get my necessities and basics settled here."

Ms Zarina Abu Bakar, 33, an assistant manager at a real estate company, has been travelling there from her Woodlands home since 2007.

She said: "I like it because the mix of shops is just right. The environment is also very conducive for me to do my shopping in peace."

But for some, such as retiree S.K. Yeo, 69, there is still room for improvement.

"The management should focus on introducing something iconic and unique with entertainment value that will take the plaza to a new level," he said.

Additional reporting Natalie Kuan