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.

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.

(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.

<script language='JavaScript1.1' src='http://ads.asia1.com.sg/js.ng/Params.richmedia=yes&site=tbto&sec=btosuite&cat1=bus&cat2=btoexecsuiteart&size=300X250'></script><noscript><a href='http://ads.asia1.com.sg/click.ng/Params.richmedia=yes&site=tbto&sec=btosuite&cat1=bus&cat2=btoexecsuiteart&size=300X250'><img src='http://ads.asia1.com.sg/image.ng/Params.richmedia=yes&site=tbto&sec=btosuite&cat1=bus&cat2=btoexecsuiteart&size=300X250' border='0'></a></noscript>

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.

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.

(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.