2 Keppel directors buy Marina Bay units
12 December 09 11:16 AM | Winston Yap | 1 Comments   

TWO directors in the Keppel group of companies are shelling out millions of dollars for units in the plush Marina Bay Suites that Keppel Land is involved in developing.

Keppel Corp director Alvin Yeo, who is also the senior partner at law firm Wong Partnership, is paying $6.54 million or $2,442 per sq ft (psf) for a 2,680 sq ft apartment on the 32nd floor of the luxury project.

The details of the transaction were disclosed in an announcement by Keppel Land to the Singapore Exchange yesterday as part of the exchange’s listing rules.

No discount was given by Keppel Land, which is one of the joint-venture partners of the project along with Hongkong Land and Cheung Kong Holdings.

Keppel Land director Niam Chiang Meng is paying $4.577 million or $2,238 psf for his unit, also on the 32nd floor but smaller at 2,045 sq ft.

Mr Niam also did not receive any discount.

The recent preview of Marina Bay Suites saw units snapped by Singaporeans and foreigners, including Indonesians, Malaysians, mainland Chinese, Australians and Americans.

Reports have put the pricing of the units sold at around $2,300 psf.

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Singapore Pioneer Road North site draws 8 bids
12 December 09 11:07 AM | Winston Yap | 1 Comments   

Highest bid of $19.4 million came from Kng Realty

A 30-year leasehold industrial site at Pioneer Road North and Soon Lee Drive has attracted strong demand, pointing to sustained confidence in the economy.

By the close of tender yesterday, the Urban Redevelopment Authority (URA) had received eight bids for the 18,958.8 square metre plot, which has a maximum gross plot ratio of two. The top bid came from Kng Realty Pte Ltd, at $19.4 million or $48 per square foot per plot ratio (psf ppr).

CB Richard Ellis Research executive director Li Hiaw Ho expects the development’s breakeven cost to range from $190-$210 psf.

Kng Realty’s bid is more than two times that of the trigger bid - an unnamed developer had committed to pay at least $8.2 million or $20 psf ppr for the land in October.

Kng Realty’s shareholders include Kim Chan Wah and Ng Hock Lye, both of whom are also shareholders of another company, Kng Development Pte Ltd.

Kng Development had won the tender for an industrial site at Kaki Bukit Road 2 in August. This firm’s other shareholders include Ng Teng Yeng, brother of property tycoon Ng Teng Fong.

The next highest bid for the Pioneer Road North site was $18 million or $44 psf ppr, which came jointly from Sia Kong Wah and Gimp Investment Pte Ltd. Kng Realty’s bid exceeded this by 7.8 per cent.

Other companies such as Soilbuild Group and EL Development also took part in the tender. The lowest bid came from Bok Seng Logistics Pte Ltd, at $9 million or $22 psf ppr.

‘The healthy response to the tender reflects the more optimistic business sentiment,’ said CBRE’s Mr Li.

According to Knight Frank head of industrial business space Lim Kien Kim, tender participants could also have been encouraged by good industrial space take-up in the Woodlands and Tuas South areas.

URA said it will evaluate the bids and announce the award of the tender later. Industrial sites it put up for sale in the last few months have seen healthy demand. For example, the one at Kaki Bukit Road 2 which eventually went to Kng Development drew as many as 18 bids.

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Suntec Reit raises $149m from placement
12 December 09 11:06 AM | Winston Yap | 1 Comments   

SUNTEC Real Estate Investment Trust (Suntec Reit) yesterday raised net proceeds of about $149 million from a private placement to reduce debt, joining a host of other Reits that have made cash calls this year.

Suntec Reit called for a trading halt in the morning to announce the launch of the private placement. The Reit manager said that book-building closed within three hours. Suntec Reit managed to place out 128.5 million new units at $1.19 apiece.

The issue price was a 6.5 per cent discount to the volume weighted average price of $1.2724 per unit, based on trades done on Thursday. The new units represent around 7.7 per cent of the number of units in issue on Thursday.

According to Suntec Reit, the private placement was more than five times oversubscribed by existing unitholders and new investors. More than 60 institutional investors bagged the new units.

Assuming that all net proceeds go towards debt repayment, its aggregate leverage is expected to fall from 36.2 per cent at Sept 30 to 33.4 per cent.

Presentation slides on the Reit’s third-quarter 2009 results show that it had total debt of $1.877 billion at Sept 30. No debt will mature in FY2010, but around $532.5 million will be due in FY2011.

‘The proceeds from the private placement will strengthen Suntec Reit’s balance sheet and put us in a stronger position to take advantage of growth opportunities,’ said Yeo See Kiat, chief executive of Reit manager ARA Trust Management (Suntec).

In a report on Wednesday, OCBC Investment Research flagged a potential dilution risk in the counter. ‘With declining office income and book value risk, Suntec could decide to go the acquisition route in 2010,’ said analyst Meenal Kumar. ‘It is likely to keep aggregate portfolio gearing unchanged or lower, necessitating a combination of both equity and debt financing on any purchase.’

DMG & Partners analyst Jonathan Ng believes that Suntec Reit is expecting potential asset write-downs at year-end, and is preparing to keep its gearing below 40 per cent.

‘We expect Suntec to register a 7 per cent devaluation on its book in Q4 2009 to $5 billion, from the current $5.4 billion,’ Mr Ng said in a note yesterday. ‘There are unlikely to be further cash calls unless further asset write-downs are expected in H2 2010.’

He estimates that there will be a ‘mild’ dilution of 1.2 per cent, or 0.11 cents per unit, to the Reit’s distribution per unit in FY 2010.

Suntec Reit units closed unchanged at $1.28 each yesterday after resuming trading in the afternoon.

Several Reits, such as Ascendas Reit and Fortune Reit, have raised funds from the stock market this year. Analysts expect more cash calls next year, as the sector continues to pare debt or build capacity for acquisitions.

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Singapore Hotel room rates start edging upward
12 December 09 10:59 AM | Winston Yap | 0 Comments   

Occupancy rates picking up as corporate travel improves; hoteliers expect leisure travel to rise with IRs’ opening

WITH hotel occupancies having clawed their way up to healthier levels this quarter and tourism starting to show signs of recovery, the hotel industry appears to be regaining lost ground.

Room rates, which also came under pressure this year thanks to a slump in travel demand, are also likely to start increasing gradually in line with the market, some hotels said.

According to Hong Leong Group subsidiary Millennium & Copthorne (M&C) Hotels, its hotels pulled off a solid showing in the third quarter, with average occupancy rate (AOR) jumping to 86.1 per cent, up from 74.8 per cent in the first quarter and 75.5 per cent in the second quarter.

‘Occupancy for 4Q09 is expected to continue in this recovery trend,’ said a spokesperson for M&C, whose portfolio includes Orchard Hotel and the Grand Copthorne Waterfront.

For the Rendezvous Hotel, occupancy is at the 80 per cent mark currently, compared to 70 per cent in the early part of the year.

‘Average room rate has gone up by more than 10 per cent compared to the low rates experienced in July-August, which is a lull period for us,’ said its general manager Kellvin Ong.

Over at the Pan Pacific, booking trends have been picking up, compared to the first half of this year where occupancy rate was softer year-on-year.

Fourth-quarter figures are expected to be bolstered by Apec week in November which brought 10,000 dignitaries and members of the international media to Singapore. Food and beverage sales for the year-end festivities are also expected to prove better than last year in light of the recovering economy.

For luxury hotel St Regis - which played host to President Hu Jintao and the delegation from China during Apec week - fourth-quarter occupancy has grown by 14 percentage points year on year.

Corporate travel - which took a nosedive in the earlier part of this year as companies slashed travel budgets to contain costs - also seems to be picking up.

‘The last quarter of 2009 has been positive with an increase in corporate room bookings, which has helped to boost our average occupancy and rates,’ said Pan Pac’s public relations manager, Cheryl Ng. She also added that room rates are likely to grow marginally in 2010, while the occupancy level should also do so by at least five percentage points.

The Rendevous Hotel, which expects to gradually start revising its rates upward in line with the recovering industry, is also banking on the corporate demand to push up room rates.

Others, such as the Marriott, are upbeat that 2009 will end on a better note than it began.

‘Room occupancy has risen and the general business sentiment has lightened up,’ said Marriott’s marketing director Julie Yeong.

Meanwhile, M&C said that it will ’scale back’ on existing discounted packages, given that occupancy is treading above 80 per cent, but plans to introduce other higher value-added packages. M&C also expects next year’s revenue per available room (RevPar) to grow year-on-year as the recovery in the tourism sector picks up steam.

And with the much- talked-about Resorts World at Sentosa (RWS) and Marina Bay Sands (MBS) slated to open their doors next year, hoteliers expect to benefit from the new kids on the block, despite the hefty injection of industry supply. RWS alone adds some 1,800 rooms.

‘We expect the increase in hotel rooms will initially displace the equilibrium in the market. However, in the long-run, demand will grow,’ reckons Ms Ng.

For starters, visitors may prefer to be away from the crowds or require more affordable accomodation. Traditionally, hotels within theme parks tend to charge a premium compared to hotels in the surrounding area.

The presence of the integrated resorts could also boost weekend rates and occupancies.

‘Hotels currently tend to experience weaker occupancies and rates during the weekends. With the expected spike in leisure visitors to Singapore over the weekend, it may not be surprising to see hotels registering higher occupancies and possibly even higher rates,’ M&C’s spokesperson pointed out.

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17,300 Punggol units completed so far
30 November 09 10:14 AM | Winston Yap | 0 Comments   

CLOSE to two-thirds of Punggol flats launched in the last decade have been completed so far, as the Government focuses its efforts on building up Singapore's north-east neighbourhood.

There have been 27,000 Punggol flats launched since 1998, out of which 17,300 have been completed.

The updated figures were announced last night by Deputy Prime Minister Teo Chee Hean, at an exhibition showcasing the winning entries of the Punggol Waterfront Housing Design Competition.

 

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The results were released to the media earlier this month. The winning entry, by international architectural firm Group8asia and local firm Aedas, features sky terraces and a resort-style environment.

This housing project of 1,200 units fronting an upcoming waterway is due to be launched by the middle of next year. It will be part of a cluster of an additional 21,000 flats and private homes.

Punggol has become a focal point again for the Government in recent years, as it is slated to evolve into a vibrant waterfront town.

In the 1990s, efforts to develop the estate were stymied by the Asian financial crisis.

The plan was resurrected in 2007, under the Punggol 21-plus programme.

Since then, despite yet another economic downturn, there has been aggressive efforts to build up Punggol.

Almost 44 per cent of new flats launched in Singapore in the last two years have been in Punggol.

Besides new housing, a 4.2km waterway will also be developed. Its name - My Waterway@Punggol - was announced last night.

Mr Teo said that the canal is still on track for completion at the end of next year.

Next month, workers will start landscaping work at the town park and the areas along the waterway promenade.

'We all look forward to canoeing, kayaking or enjoying other water activities right at the doorsteps of our Punggol residents,' said Mr Teo, who is a Member of Parliament for the Pasir Ris-Punggol GRC.

Affordability is key in buying property
30 November 09 10:12 AM | Winston Yap | 0 Comments   

THE economic upturn and surging home prices are making communications manager Lisa Low, 34, worried.

She is aghast that she may have insufficient money for the cash-over-valuation (COV) - or the cash top-up above a flat's valuation that buyers of resale units have to pay - when she eventually locates her dream home next year.

 

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The Bedok resident, who is single, told my paper: "Is there such a thing as affordable property in Singapore today? With skyrocketing COV, I wonder if I'm able to fork out the $10,000 to $20,000 upfront."

There are several factors that prospective home owners like Ms Low have to consider in real- estate buys, said ERA Realty Network's senior group division director Mark Teo.

Affordability is key.

Since private properties can cost up to three times more than public housing, it makes "the most economic sense" for first-time buyers who satisfy Housing Board (HDB) criteria to apply for a flat directly from the HDB.

They benefit from the subsidised prices and housing-loan interest rates that stay the same for an extended period, said Mr Teo.

Currently, the rate is 2.6 per cent per year.

Those who find mature estates like Marine Parade pricey can look at newer neighbourhoods like Punggol.

Private-property fans can turn to suburban areas, where units are priced at $600 to $700 per sq ft.

Ngee Ann Polytechnic real- estate lecturer Nicholas Mak said second-hand executive condominiums or 99-year condos are attractive too.

"Executive condos that are five to 10 years old are slightly cheaper and come with all the amenities of full-fledged condos, like carparks, swimming pools and tennis courts," he noted.

"Ninety-nine-year condos are also cheaper but they may not be as conveniently located."

Ultimately, choosing the most appropriate property depends on the amount of personal savings a buyer has between the time of purchase and their future earnings.

"As a rule of thumb, it is not prudent for anyone to use more than 40 per cent of their income to service their monthly home instalment," Mr Teo said.

But primary residences usually do not make good investments, said Mr Mak, as they are chosen for their proximity to certain schools or amenities.

A good investment property has to draw tenants, who tend to be expatriates. That means choosing districts 9, 10 and 11 - which cover areas from Bukit Timah to Orchard Road and River Valley Road - or locales that appeal to many expats.

Mr Teo suggested that investors with $1 million to spare consider condominiums in the Tiong Bahru area, which typically enjoy fairly high rental returns of 3 to 4 per cent.

Both experts will offer more tips on getting the most out of the property market at a my paper seminar on Dec 13.

Last week, the Global Property Guide reported that property prices in Singapore jumped an all-time record 14.3 per cent in the third quarter.

The HDB resale-price index grew 3.6 per cent from Q2 to 145.2 points in Q3 - a record since 1990. A Business Times report last month said Queenstown had some of the most expensive units. Five-room and executive flats there netted a median $619,000 and $712,500 in resale transactions.

Two properties on tap for investment players
26 November 09 09:17 AM | Winston Yap | 0 Comments   

Big industrial plot put on reserve list; Boon Building up for grabs for $12-13m

 

By KALPANA RASHIWALA

PLAYERS in the property investment sales market have just been offered two properties - an industrial plot at Kaki Bukit Avenue 4, made available for application through the government's reserve list, and Boon Building, a six-storey commercial property at 61 South Bridge Road.

Boon Building: The 999-year leasehold property was last transacted for about $9.5 million in August 2007. It's being sold with vacant possession through a tender exercise that closes on Dec 17

The Kaki Bukit site is 323,133 sq ft and has a 2.5 plot ratio, which means the maximum gross floor area works out to a whopping 807,833 sq ft. It is zoned Business 2 - suitable for a range of uses such as clean/light industry, general industry and warehousing - and offered with a 60-year lease.

Under the reserve list system, the site will be launched for tender by the state only if a developer makes an application with a minimum bid price acceptable to the government.

Colliers International director (industrial) Tan Boon Leong reckons top bids for the plot - assuming a tender takes place now - could come in at $70-80 per sq ft per plot ratio (psf ppr). This works out to a land cost of about $56.5 million to $64.6 million.

According to Mr Tan, the plot is in a lesser location than an earlier plot in Kaki Bukit Road 2 that was sold in August this year after attracting a total 18 bids. 'The latest plot is farther away from the main mature industrial estate in the Kaki Bukit/Eunos area,' he said.

The earlier plot was awarded to KNG Development for $12.1 million or about $105 psf per plot ratio. It is about 1.07 hectares with a 1.0 plot ratio and is also zoned for Business 2 use, but came with a 30-year lease.

The latest plot, in Kaki Bukit Ave 4, is likely to appeal to developers, who may then build landed terrace factories to sell to end-user industrialists, as well as flatted factories, Mr Tan suggests.

'Perhaps some of the unsuccessful bidders at the earlier tender may bid for the latest plot,' he said. 'However, as the latest site is much larger in terms of land area as well as gross floor area, developing it will entail a bigger investment. Hence, it will likely fetch a lower psf ppr unit land price.'

In October last year, Sim Lian clinched a 1.15-ha, 60-year leasehold site in Ubi Ave 4 for Business 1 use for $26.3 million or $85.05 psf ppr. It has a 2.5 plot ratio.

Boon Building, a 999-year leasehold property, is being sold by Raffles Point Holdings, controlled by property investor Kishore Buxani and his family. The indicative guide price is $12-13 million, which works out to $1,165 to $1,262 psf based on the estimated net lettable area of 10,299 sq ft.

According to caveats records, the property was last transacted for about $9.5 million in August 2007. It will be sold with vacant possession and is being marketed by DTZ through a tender exercise that closes on Dec 17.

DTZ senior director for investment advisory services Shaun Poh said: 'The property's appeal lies in the building's excellent location and investment quantum. The availability of naming rights also offers the opportunity to carve out a flagship building with its own corporate identity.'

Mr Buxani and his partners also own 108 Robinson Road and six floors of Samsung Hub.

80 units sold at Marina Bay Suites preview
26 November 09 09:15 AM | Winston Yap | 0 Comments   

Developer not expected to release more units in the condo until 2010

 

By KALPANA RASHIWALA

ABOUT 80 of the 90 units previewed at Marina Bay Suites yesterday have been sold, at an average price understood to be slightly above $2,300 per square foot.

In the spotlight: The developer says that the 'average price range was between $2,200 psf and $2,500 psf'

However, the consortium developing the project said that the 'average price range was between $2,200 psf and $2,500 psf'. Only three and four-bedroom units on the low to mid- floors at the 66-storey development were released for yesterday's preview.

'Unit sizes range from 1,572 to 2,691 sq ft for the three to four-bedroom units,' said a spokesman for Raffles Quay Asset Management, the asset manager for Marina Bay Suites.

BT understands that the consortium developing the 221-unit, 99-year leasehold condo, does not plan to offer any more units in the development until next year. The show suite for the condo will be completed in the first half of next year and housed in an office tower in the Marina Bay Financial Centre (MBFC).

The condo, MBFC and an earlier condo project, Marina Bay Residences, are being developed on a 99-year leasehold plot sold by the Singapore government in 2005 to a consortium controlled by Keppel Land, Cheung Kong Holdings and Hongkong Land Holdings.

Yesterday's preview was held on the mezzanine level of One Raffles Quay, which was also developed earlier by the three partners. The project is being marketed by CB Richard Ellis and DTZ.

'There are no immediate plans to officially launch Marina Bay Suites (MBS). This private preview was for invited clients, business associates, registered prospects, staff and directors. We will launch MBS at the appropriate time,' the spokesman said.

Initially, the consortium had planned to release only 50 units but decided to add 40 more due to keen demand from potential buyers.

BT understands that at least a third of the buyers were foreigners (including permanent residents) and companies, with Indonesians being the predominant foreign buyers. Well-heeled Singaporeans also bought units in the condo.

Prices of three-bedders start from $3 million or about $1,908 psf, BT understands.

The least expensive four-bedder (a 2,045 sq ft unit) cost $4.3 million or $2,103 psf. For the larger four-bedroom apartments of 2,680 sq ft, prices start from $6.1 million or $2,276 psf.

Median resale prices for exec condos soar 63%
24 November 09 10:09 AM | Winston Yap | 0 Comments   

(SINGAPORE) THE median resale prices of executive condominiums (ECs) have increased 63 per cent in the past two years, riding on the bull run in the private residential market, a report says.

Caveats lodged for ECs in the resale market in October 2009 showed prices at $519 per sq ft (psf), says CB Richard Ellis (CBRE). This is 63 per cent higher than at the bottom of the market in Q3 2006, when resale ECs were sold at $319 psf.

CBRE's analysis of caveats lodged between 2004 and early 2007 shows median EC prices in the resale market fluctuated within the $300-400 psf band, bottoming out at $319 psf in Q3 2006.

ECs are a hybrid of private and public housing. They are similar to private condominiums in terms of facilities and amenities, but eligibility requirements are almost similar to those for new HDB flats.

The EC was first introduced in 1996 when the property bull run caused new private condo prices to soar to above $600 psf.

The last EC launched was La Casa in May 2005. It was completed in early 2008. Since then no new EC projects have been launched. Since the second half of 2007, when the private residential market was peaking again, the government has placed up to four EC sites on the reserve list, but there have been no takers.

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But in the recently announced government land sales programme for the first half of 2010, the government placed two EC sites on the confirmed list and three others on the reserve list, which is 'a clear signal that the government wants to provide the EC as an alternative housing choice for homebuyers from next year', says CBRE.

Currently, a 14 per cent price gap exists between the median prices of ECs and mass-market non-landed projects in the resale market, CBRE says.

'Our analysis shows that buyers who bought new ECs at various periods from 1996 when EC prices hovered at around $400 psf should benefit from the price appreciation in the past two years,' said Li Hiaw Ho, executive director of CBRE Research. 'The residential market run-up of 2007 lifted new EC prices to above the $500 psf mark.'

Going forward, CBRE says that if the price gap between the next new EC project and a new private non-landed leasehold project in the same location is attractive enough, buyer demand for EC developments will surely return. The firms expects the tender bids for the two EC sites to be offered in January 2010 on the confirmed list - Buangkok Drive/ Compassvale Bow and Yishun Avenue 11 - will be a function of developers' confidence in the EC market and their pricing strategy.

HDB boosts flat supply to 13,500
24 November 09 10:06 AM | Winston Yap | 0 Comments   

THE Housing and Development Board (HDB) estimates it has to offer 10,000 to 12,000 new flats every year for the next five years to meet demand, National Development Minister Mah Bow Tan told Parliament yesterday.

Up and coming: DBS Vickers estimates that HDB may have to build an average of 14,000 flats a year over the next 20 years to meet public housing demand, in a scenario where Singapore's population hits 6.5 million by 2027

Responding to strong demand, HDB will offer 13,500 flats in 2009, he said. This is about 'half the number of flats in Bukit Panjang or Pasir Ris town'.

Public housing was a hot topic in Parliament yesterday, as applications surged for new flats and resale flat prices soared to record levels in the third quarter.

According to Mr Mah, HDB started the year with a planned flat supply of 6,000, as the economy was stuck in recession. It had to ramp up flat supply as an unexpected turnaround in the second half of the year boosted demand.

'If take-up of BTO (Build-To-Order) flats remains strong, we will continue to push out more flats under BTO next year - at least one every month if necessary,' he said.

In the next five years, HDB projects that it has to offer 10,000 to 12,000 new flats per year, he continued. The agency arrived at these figures after taking into account various factors, in particular the number of new households formed from marriages and immigration, and resale flat transactions.

This medium-term projection serves as a guide for the BTO system, Mr Mah said. But he stressed: 'What actually happens a few years down the road is not known. Demand is also not constant. It varies from year to year, depending on economic and other factors.'

Mr Mah also said HDB has a 'small buffer' of flats over and above those from the BTO scheme. HDB did not intentionally plan this buffer - it comprises surplus flats from other programmes such as the Selective En-bloc Redevelopment Scheme.

PropNex chief executive Mohamed Ismail believes that the projected 10,000 to 12,000 new flats a year is adequate. 'Over-supply would only serve to dampen the asset value of a majority of Singaporeans who live in HDB flats,' he said. 'We must also consider the continual supply of resale flats, potentially amounting to 40,000 transactions this year alone.'

Chesterton Suntec International research and consultancy director Colin Tan agrees the projected number of new HDB flats seems reasonable. But he is concerned about whether there is a mechanism to warn HDB of a potential sudden increase in demand.

Population growth and immigration will drive up demand for flats. In a report issued yesterday, DBS Vickers projected in a base case scenario that Singapore's population could reach 6.5 million in 2027. It estimates that HDB may have to build an average of 14,000 flats a year over the next 20 years to meet public housing demand.

 

 

Upgraders sidelined as home prices soar: DTZ
24 November 09 10:02 AM | Winston Yap | 0 Comments   

But private home dwellers enjoyed the party in Q3, buying more and paying more

 

By EMILYN YAP

(SINGAPORE) HDB upgraders account for a shrinking share of private home transactions as property prices rise and mass-market launches taper off.

 

In contrast, private housing dwellers are buying more property as economic sentiment improves, keeping the real estate market afloat.

According to property consultancy DTZ, buyers with HDB addresses picked up 4,065 private homes in the third quarter. This was 73 units or 1.8 per cent more than in the preceding quarter.

Though still rising in number, these deals are making up a smaller proportion of all sales. They accounted for 37 per cent of private home transactions in Q3, down from 44 per cent in Q2 and the recent peak of 56 per cent in Q1.

This reflects 'the diminishing buying power of HDB upgraders' as property prices rise, DTZ says. It notes that prices of private resale homes have climbed 9-22 per cent from their lows in Q1.

ERA Asia-Pacific associate director Eugene Lim points out that there were fewer mass-market launches in Q3. Encouraged by rising resale flat prices, HDB upgraders had gone for these more affordable projects in the early part of the year, reviving the property market.

But in October, the pricier Core Central Region (CCR) trumped other parts of the island in terms of the number of new private homes launched and sold. Developers pushed out 339 units in CCR, surpassing 40 in the Rest of Central Region (RCR) and 187 in the Outside Central Region (OCR).

Developers also sold 311 units in CCR, compared with 249 in RCR and 251 in OCR.

The buying mood may be wearing thin among HDB upgraders, but it is still strong among private housing dwellers. DTZ found that buyers with private addresses picked up 6,837 units in Q3 - 1,846 units or 37 per cent up from the previous quarter.

These deals accounted for 63 per cent of all transactions in Q3, rising from 56 per cent in Q2 and 44 per cent in Q1.

Buyers with private addresses 'are more excited now', says Jones Lang LaSalle's (JLL) head of South-east Asia research, Chua Yang Liang. This is the result of improving liquidity, buoyant stock markets and rosier economic sentiment, he says.

Not only are private housing dwellers buying more units, they are also paying more. According to DTZ, 66 per cent of them bought units that cost more than $1 million in Q3.

On the other hand, HDB upgraders had smaller budgets. The bulk of them - or 30 per cent - went for homes that cost between $600,001 and $800,000. Just 33 per cent of them paid more than $1 million.

Some 90 per cent of transactions involving buyers with HDB addresses were for homes outside Districts 9, 10 and 11. Many of them were attracted to The Gale in the Upper Changi area, Trevista in Toa Payoh, and Parc Imperial in Pasir Panjang.

Separately, analysing transactions in Q3 according to buyers' nationalities, DTZ found more foreigners were acquiring nests here.

There were 1,069 private home transactions involving foreigners, up 52 per cent from 703 in Q2 and more than six times 174 in Q1.

These deals accounted for 10 per cent of all transactions in Q3, up from 8 per cent in Q2. During the 2007 boom, this figure hit 13 per cent.

Singapore permanent residents (PRs) also became more active in the property market in Q3.

They accounted for 1,404 private home transactions, 27 per cent more than the 1,104 in Q2.

Among foreigners and PRs, Malaysians bought the most homes, accounting for 26 per cent of transactions. Indonesians took second place with a 19 per cent share, followed by mainland Chinese and Indians, with 14 and 12 per cent shares respectively.

Companies are also ramping up property purchases.

DTZ says the number of corporate transactions jumped more than four times to 225 in Q3.

 

Fast upturn in property market surprises agents
23 November 09 10:17 AM | Winston Yap | 0 Comments   

THE recession seems like no more than a distant memory, and 2009 is turning out to be a great year for property agents.

The commissions they earned were nothing short of spectacular in the third quarter, some real estate companies told The New Paper.

Related story:
» She earned twice as much in a month as she did in a year

PropNex chief executive Mohamed Ismail said his agents brought in some $54 million worth of commissions - the company's best quarterly performance since it started 10 years ago.

 

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This translates to about $1.8 billion worth of properties sold in three months.

He said: 'The property market did very well and there was a pent-up demand for homes. A lot of consumers who were sitting on the fence came into the market. And interest rates, which were low, also spurred demand. 'People felt the economy was recovering, and bricks-and-mortar was seen as a safe bet.'

The last high was during the third quarter of 2007, when his agents brought in $45 million in commissions. He said almost every active agent in his company earned more this year than last year, and some even doubled their commissions.

During a slow year, he estimated, an agent could make about $7,000 per month, and this could go up to $20,000 a month in a good year.

HSR Property Group CEO Patrick Liew said the company saw a 25 per cent increase in commissions from the previous quarter.

Pent-up demand He said: 'The last quarter was good for the industry. What caught most of us by surprise was how fast the upturn was. There was a lot of pent-up demand and the sentiment was very positive.

'There was an increase in transactions across the board, from primary to secondary sales.'

He also noticed more people joining the industry to be agents. He said an average of 250 people joined his firm every month in the past three months, compared with 100 to 150 earlier.

These new entrants include those who used to be lawyers, accountants and financial controllers. There was even a managing director of an electronics company.

Some of them had been retrenched from their previous jobs, said Mr Liew.

He added: 'The property market was at a downturn but now people are bracing for an upturn.

'Some of these professionals may have been retrenched or they don't feel that their current job has any security. Others want something with an unlimited upside.'

ECG's Mr Eric Cheng said that on average, the company's agents earned about 15 per cent more than in the previous quarter.

He said: 'The transaction volume was higher and logically, the agents' commissions also increased. It was better than the previous high in 2007.'

Mr Paul Heng, founder of NeXT Career Consulting Group, said it's not surprising that job-seekers will take advantage of the real estate boom to join the industry.

He said: 'The property market has indeed improved and for those who are jobless or looking to switch jobs, it's only natural that they'll join this industry. The barriers to entry are quite low and it's easy for them to join a big company and get trained there.

'Similarly, if the insurance or financial services industries picks up, more people will switch careers too.'

She earned twice as much in a month as she did in a year
23 November 09 10:12 AM | Winston Yap | 0 Comments   

A RECORD 5,719 private homes were sold from July to September - surpassing the previous record of 5,129 units in the second quarter of 2007.

Because of this boom, real estate agencies have reported stellar performances, with more people signing up to become agents.

Related story:
» Fast upturn in property market surprises agents

 

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In one month, this property agent earned $90,000 in commission nearly twice the amount she did for the whole of last year. And it's thanks to an unexpected mini property bull run in the third quarter of this year. The returns can be attractive - just ask property agent Wee Ai Na.

This 34-year-old earned about $90,000 worth of commissions in October, far exceeding the $48,000 that she earned in the whole of last year.

Miss Wee, an agent with ECG Property, said her recent deals were all sales of private condo units averaging some $1.5 million each. She sold six condo units last month, with a total value of about $10 million, in the prime 9, 10 and 11 districts.

Most of her transactions are new units from developers, where the commission is less than 1 per cent.

Said Miss Wee: 'I never expected to do so well. But the market did really well and I guess I was lucky. It was a lot of hard work and I guess I got my lucky break.'

Miss Wee, a Singapore permanent resident, has been in this business for only two years.

She moved here from Malaysia when she was 3 and studied here before getting her business degree in accounting and finance at the University of Exeter in the UK.

She admits that hers is no rags-to-riches story. Her father,who died 11 years ago, was a timber tycoon in Kuching, Sarawak, and they had a huge house on a one-hectare site.

Miss Wee, who is single, lives with her retiree mother in a 3,200 sq ft condo in Katong.

She does not own any property.

Her three brothers and six sisters are all in the family business.

'I am very blessed and well-provided for. I had no issues with money and I never had to go hungry. But I don't ask my family for money,' she said.

She worked as an auditor with KPMG for two years before joining Hewlett-Packard as a business process analyst. She worked there for about three years. Her last drawn salary was about $5,000 a month.

She then joined a trading business as a business partner selling misting fans here and in Kuching.

It didn't take off as well as she expected, and she turned to real estate.

'I have always had a keen interest in property because it's a tangible asset. I also like to meet people. So, I thought that it was a good industry to be in,' she said.

Her start was far from rosy.

For the first six months, she didn't draw a salary and had to live off her savings.

'The volume of work was very low, I was still learning and observing the market. My family asked if I wanted to join the family business but I refused to do so.

'I knew I was in a bad shape but I wanted to strike out on my own. I learnt how to live lean then,' she said.

That means no new clothes, jewellery or lavish meals at restaurants.

As she lives with her mum, her biggest expense is her car, a humble Chevrolet Aveo for which she paid $67,000 in 2003. The $650 monthly instalments came from her savings.

'I can't do without the car because I need to travel around to meet clients,' she said.

As a rookie, Miss Wee has been learning a lot about her job. For example, about how it helps to go the extra mile for her clients.

She recalled how a client remarked that he missed the famous braised duck rice from Pasir Panjang Road about two years ago.

Miss Wee immediately drove from East Coast to Pasir Panjang to buy the duck rice, and delivered it to her client who lives in Sembawang.

The reward' A $10,000 commission for closing a $1.5 million Reflections at Keppel Baycondo deal for this client a week ago.

She said: 'You cannot take these things as hardship. It's part of the job. I am serving my client and I have to do my best.'

PropNex agent Andy Goh, 29, raked in about $600,000 in commission this year alone - a huge increase from his takings of about $400,000 last year.

This former air force regular has been an agent for about 2 1/2 years.

He said: 'I've always had a passion for property and the returns can be good. I am focused on my high net-worth clients and it paid off.

'This is my best year. The property market did well, and it helped my business too.
A good place to shoot the breeze
21 November 09 09:11 AM | Winston Yap | 0 Comments   
>> ASIAONE / BUSINESS / MY MONEY / PROPERTY / STORY
 
Sat, Nov 21, 2009
The Straits Times
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A good place to shoot the breeze

SHE cuts a strange figure, sitting quietly on the void deck bench with a thick cane in her hands.

She says in Hokkien: 'There is a mentally unstable young man who comes around and scolds me loudly sometimes. I wave this cane to keep him away.'

Related link:
» The void that is alive

'But really,' she adds, 'there is nothing to be afraid of around here.'

 

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Ms Leow Tham, 55, is one of the hundreds, if not thousands, of older public housing residents around Singapore who find the void deck a good place to shoot the breeze without venturing too far from their homes. Many of them live on little or no income, so air-conditioning is out of the question.

It explains why senior citizens' corners - complete with chairs, tables and sometimes TV sets and pantries - are popular during estate upgrading exercises.

Ms Leow, who is single, shares a three-room flat in West Coast Drive with her younger brother and his wife.

'It is hot in the flat, so I sit downstairs every day,' she says.

The former school cleaner has been jobless for seven years because her weak knees and heart condition prevent her from getting paid work.

'My brother gives me about $10 now and then. But I live off him, so I don't dare to ask for more.'

The easy-going woman makes it clear during the interview that she does not want charity. 'I don't want to ask people for money,' she says.

This independent streak can be found among other void deck regulars, like Mr Chui Euan Guan, 83, who spends his mornings catching up with neighbours at the foot of his apartment block at Ang Mo Kio Avenue 10.

The retired plant operator, who has six grown-up children and now lives with his wife in a four-room flat, is concerned about falling ill and becoming dependent on his children.

He says: 'My children sometimes give me $50 to $100 each month. But they have to take care of their family expenses too.

'I don't dare to ask them for money, because if they don't have it, my request will make them feel sad.'

This article was first published in The Straits Times.

Middle-income earners put off by high property prices
20 November 09 09:36 AM | Winston Yap | 0 Comments   

I REFER to reports that the prices of private homes are getting out of most buyers' reach.

Prices of private homes are persistently high because of the following reasons:

  • Singapore is land-scarce. The price of land slated for private development is usually pushed up by developers' bids.
  • Singapore's rapid economic development has led to a rise in the demand for land. Recent factors include the two integrated resorts and the influx of immigrants.
  • Efforts to make Singapore a global hub for business and tourism also contribute to the inflow of people.
  • The buoyant property market in recent years has also accelerated the demand for private and public housing.

The statistics speak for themselves: In 1998, the average price of a home in the prime districts of 9 to 11 was $847,744.

 

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In 2007, it had more than tripled to $2.9 million.

This year, although prices have declined slightly, the average price stands at about $2.2 million.

While property experts may have theories on why prices are so high, these mean nothing to middle-income earners, who feel that their salaries are not growing in tandem with the rise in property prices.

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