JLL: investment sales set for bull run in 2017

According to consultancy JLL in a new report, property investment sales are set for a bull run after a spectacular start to the year. The positive outlook is being driven by the office, and possibly the retail and residential sectors.

The overall value of real estate investment deals soared 67 % in the first quarter to $4.99 B – of which $4.47 B was from the private sector.

Private investment sales of office property accounted for $2.12 B – the sector’s strongest first-quarter showing for the past 9 years. The $2.12 B figure was a 60.6 % rise from the fourth quarter, and more than treble that of a year ago. Last year’s private-sector investment sales stood at $19.06 B.

The top two office deals in the first quarter were entity sales. One was the sale of the entire interest in the holding company of PwC Building in Cross Street to an indirect unit of Manulife Financial Corporation for $760.6 M. The other was the divestment of the entire interest in Plaza Ventures – the owner and developer of GSH Plaza in Cecil Street – to Hong Kong-listed Fullshare Holdings for $725.21 M.

JLL noted the potential for the full-year sales of private office assets to surpass the $6.49 B recorded last year, considering the recent deal for One George Street and sizeable assets available in the market, including Asia Square Tower 2 in Marina Bay.

The residential segment, registered $1.69 B in private investment sales for properties valued at $5 M and above in the first quarter.
For retail and industrial sectors, private investment sales more than doubled that from the previous year in the first quarter: $280 M for retail and $390 M for industrial.

JLL predicts a bright investment sale outlook for the year, driven by the recent sale of the $2.2 B Jurong Point mall and upbeat sentiment in the private residential market. A growing appetite for collective sale sites by developers facing depleting land banks and limited supply of sites from the Government could also lend support to investment sales.

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Asia’s ultra rich still favours Singapore real estate

The property market of Singapore remains high on the agenda of Asia’s ultra-rich. Its commercial properties are a top consideration for Asian ultra high net worth individuals (UHNWIs) keen on this asset class, moderately ahead of the UK and the US.

Singapore’s residential market is the second most likely place for Asian UHNWIs to own an overseas home, after the UK, according to the recent Attitudes Survey in Knight Frank’s wealth report.

There are some 46,080 UHNWIs, each having a net worth of over US$30 million excluding their primary residence residing in Asia-Pacific, based on data from New World Wealth. Singapore continues to appeal especially to the Asian community to live, work and set up businesses. Districts 9 and 10 are still highly favoured by the ultra wealthy given their prime location, close proximity to high quality amenities and schools.

The overall slide in property prices due to the government’s cooling measures has also enhanced the value proposition of Singapore property, with demand for property gradually returning as seen in the improved transaction volumes last year.

The property consultancy also selected 20 prime city markets and calculated, based on the typical luxury residential value for each city and the exchange rate at the end of 2016, how many square metres US$1 million can buy in each city.

As of end-2016, the most expensive prime homes – generally defined as the top 5 per cent of each market by value – turned out to be Monaco, Hong Kong, New York, London and Geneva, followed by Singapore.

Real Estate 2015 Outlook Survey

Dear friends, we are conducting a short survey on the real estate outlook in Singapore. Please participate in this survey to help us consolidate response from the public with regard to Singapore’s property outlook for the near future.

Part 1 (Overall and Residential)
https://www.surveymonkey.com/r/L2ND99S

Part 2 (Commercial Real Estate)
https://www.surveymonkey.com/r/LSH3M9J

Fire sales in high-end market warned

CITY Developments Ltd (CDL) executive chairman Kwek Leng Beng has warned that the current subdued state of the Singapore housing market particularly in the high-end segment, if it continues, could ignite fire sales.

Mr Kwek made this point in CDL’s third quarter results statement. CDL posted net earnings of S$127.21 million for the third quarter ended Sept 30, 2014, up 4.7 per cent from the same year-ago period. Revenue rose 58.3 per cent to S$1.32 billion.

“The domestic residential real estate market will need to battle headwinds as sentiments remain subdued with little signs of property curbs being tweaked or removed in the near-term. Transaction volumes and prices continue to face downward pressures as homebuyers maintain a wait-and-see approach,” he lamented.

The high end market, in particular, remains subdued with prices still below their 2008 peak. “Average residential rents across all market segments, particularly the high-end . . . are on the decline, coupled with a weak secondary market.

“From the group’s experience, having gone through many property cycles, if this trend continues, with prices dipping more, some mortgage borrowers affected by lower rentals may have difficulty servicing their loans, possibly leading to forced fire sales,” Mr Kwek said.

On a more positive note, Mr Kwek noted that savvy investors who believe in Singapore’s prospects will continue to read positively into the property market with a medium to long-term perspective. “New launches that are priced carefully will continue to sell, as buyers only need to make progressive payments based on stages of construction, and they are confident that the market will recover over time,” he added.

The group can also count on two “shining stars” – the office and hotel markets. “Office and hotel properties have become most desirable assets. Demand for Grade A office space in Singapore is improving; and capital value for hotels has increased significantly, even though earnings have not caught up yet. With over 120 hotels globally, the group is able to counterbalance by geographical spread,” Mr Kwek said.

In the first nine months of this year, CDL’s net earnings shrank 17.1 per cent to S$384.74 million despite revenue surging 20.3 per cent to S$2.92 billion.

CDL said that the earnings drop was due to absence of significant divestment gains from non-core investment properties as compared to the corresponding period, which had accounted for gains largely from the sale of 100G Pasir Panjang and strata units in Citimac Industrial Complex, Elite Industrial Building I, Elite Industrial Building II and GB Building. “Excluding such divestment gains from YTD Sept 2013, on a like-for-like comparison, the group’s core earnings would have increased by 25.5 per cent for YTD Sept 2014,” CDL said in its results statement.

Featured Property Listings

Looking to buy/rent properties in Singapore? Here are the featured listings for the week.

See http://www.sgbayhomes.com for more details.

Marina One Residences launch receives lukewarm response

Luxury project Marina One Residences opened its doors to the public on Saturday (Oct 11) but saw a lukewarm response, with only 20 units sold. Its developer had cleared 300 units in the past week during private sales.

Business owner Lim Jit Song, who was at the public launch, was looking for a unit for investment purposes. The 39-year-old eventually settled for a S$1.7 million one-bedroom unit on the 13th floor, which works out to almost S$2,300 per square foot (psf).

Mr Lim said: “First of all, the location is very good, it is in the Marina area. Price-wise, it is also very reasonable. We saw the furnishing and it is very good – we are very happy with that. There are three MRT stations around, and amenities within walking distance. The last point – the developer is very dependable. So with all these reasons … we decided to go for it.”

The project is a joint-venture between Temasek Holdings and Malaysia’s state investment arm Khazanah Nasional. It is their second residential development after DUO Residences in Bugis, which was launched in November last year. Buyers had snapped up more than 60 per cent of DUO’s 660 units in just three days. Prices had averaged S$2,000 per square foot, with over S$2,600 per square foot for a studio apartment.

Private sales for Marina One started on October 3 to those purchasing multiple units. The developer said the majority of its buyers are Singaporeans (70 per cent). Malaysians make up 20 per cent, while the remaining 10 per cent are Indonesians and Chinese.

One analyst described the sales as “commendable” for the current market, but said prices – which now range from S$1,960 to S$3,100 psf – might need to be lowered to further boost demand.

Ku Swee Yong, CEO of Century 21 Singapore, said: “The current competition of the unsold units along the Shenton Way stretch, up to Tanjong Pagar, as well as future Government Land Sales of parcels around Marina One would affect investment sentiments in the project.” Mr Ku said units from older projects nearby are going at competitive prices, averaging about S$2,000 to S$2,500 psf.

The launch of Marina One comes on the back of lacklustre sales in the city area, weighed down by property cooling measures. In the second quarter of this year, 95 high-end homes were sold, down from 121 units in the previous quarter and 365 units in the same period last year. Prices in the city area have also declined for the fifth consecutive quarter since Q1 2013.

Its developer is also taking a cautious stance. The project has two residential towers comprising about 1,000 units, but only one tower is currently open for sale.

http://www.channelnewsasia.com/news/singapore/marina-one-residences/1410012.html

In Japan Moving is More of an Art

In Japan Moving is More of an Art:

Amazing! I wonder whether Singapore have something similar to this standard.

Enjoy!!

Burlington Square

Address: 175 Bencoolen Street
Type of Development: Apartment / Commercial
Tenure: 99 years
District: 07
No. of Units: 179
Year of Completion: 1998
Developer: Wintrust Investment Pte Ltd (WingTai)
Unit sizes:
Studio: 667 sq ft
2 bedrooms: 861 – 990 sq ft
3 bedrooms: 1,119 – 1,350 sq ft
Penthouse: 3,035 sq ft

Burlington Square is primarily used for Office rental and sale. Burlington Square is close to Bugis MRT Station (EW12) and Bras Basah MRT Station (CC2). Upcoming new MRT station Rochor Station (DT13) will be less than 2 minutes walking distance from it.

It is near to several bus stops located opposite Burlington Square – 07517, after Sim Lim Square – 07531 and at Fortune Centre – 07518.

 

Condo Facilities at Burlington Square

Facilities are full and include covered car park, 24 hours security, swimming pools, BBQ pits, gym, tennis courts, steam bath, and a multi-purpose hall. Some units have roof gardens and there is also a communal viewing terrace that offers residents an outstanding view of the city skyline.

 

Amenities Burlington Square

Reputable schools such as Laselle College of the Arts and Singapore Management University are both within walking distances.

Cinema, restaurants and eating establishments, supermarkets, and shops are located at the nearby Bugis Junction Shopping Centre. Residents can go to the neighboring Sim Lim Square for a range of computer and electronic products at competitive prices.

Numerous other restaurants and eating establishments are scattered around the development. In addition, there are numerous pubs and bars located at Selegie Road, which is a stone’s throw away. Burlington Square has several eateries located within its buildings such as Café Lyubi Menya and Burger King Fast Food Restaurant.

Attractions like Fort Canning Park and Little India are just around the corner and interested residents can scour through the huge collection of books and electronic media available at the nearby 7-storey Singapore National Library.

For vehicle owners, travelling to the business hub and the buzzing Orchard Road shopping belt takes about 5 minutes, via Victoria Street and Bukit Timah Road respectively.

Burlington Square is within reasonable distance to NTUC Fairprice Supermarket. It is also an array of amenities such as grocery, retail shopping, banks and more.

Burlington Square is accessible via Bencoolen Street, Rochor Road and Jalan Besar.

 

Developers negotiate price cuts in Singapore and China

http://www.property-report.com/developers-negotiate-price-cuts-in-singapore-and-china-35219

Chinese and Singaporean developers are contemplating bigger price cuts in an effort to attract more homebuyers as domestic residential markets start to cool down.

In China, where home sales reached a recording-setting USD1.31 trillion last year, there is an increasing concern from developers to meet sales targets as many companies only achieved less than 30 percent of their sales projections to date, according to Reuters.

“The market is very weak now, price cuts and promotions are very normal,” Simon Fung, chief financial officer of Greentown China, told Reuters. Fung’s company last week distributed cash coupons to existing clients who are looking to buy a new home.

A number of China-based developers have also started offering free renovation or free parking space packages to lure new investors in a move that is expected to continue throughout the third quarter.

The secondary home market in Hong Kong, which reported a sluggish first quarter in the luxury residential segment, was also slow-moving last week, The Hong Kong Standard reported. Several developers slashed prices over the weekend to attract more buyers, including Sino Land, which drew some 15,000 enquiring buyers in its Mayfair by the Sea I development, where units are being sold at about 20 percent lower than market rates.

In Singapore, where sales of luxury condominiums dropped by more than 60 percent in Q1 2014, year-on-year, based on data provided by property consultancy DTZ, some developers are still undecided if they would be willing to offer discounts or special promotions.

“Buyers are becoming more discerning with their purchases and are quite price-sensitive,” Chua Yang Liang, head of research at JLL Singapore, told The Wall Street Journal. A spokesperson at CapitaLand declined to comment on specific price changes in its Zaha Hadid Architects-designed d’Leedon development, whilst GuocoLand announced that there had been no price cuts in its Soo K. Chan-designed Leedon Residence property at this time.

Meanwhile, one high-end developer, Ho Bee Land, reportedly decided to rent out some units in its Sentosa development rather than pursue selling them in order to maximise profit in this investment climate, CIMB Bank analyst Tan Xuan was quoted in Singapore Business Review last April.

– See more at: http://www.property-report.com/developers-negotiate-price-cuts-in-singapore-and-china-35219#sthash.r3qmzHJO.dpuf

Chinese and Singaporean developers are contemplating bigger price cuts in an effort to attract more homebuyers as domestic residential markets start to cool down.

In China, where home sales reached a recording-setting USD1.31 trillion last year, there is an increasing concern from developers to meet sales targets as many companies only achieved less than 30 percent of their sales projections to date, according to Reuters.

“The market is very weak now, price cuts and promotions are very normal,” Simon Fung, chief financial officer of Greentown China, told Reuters. Fung’s company last week distributed cash coupons to existing clients who are looking to buy a new home.

A number of China-based developers have also started offering free renovation or free parking space packages to lure new investors in a move that is expected to continue throughout the third quarter.

The secondary home market in Hong Kong, which reported a sluggish first quarter in the luxury residential segment, was also slow-moving last week, The Hong Kong Standard reported. Several developers slashed prices over the weekend to attract more buyers, including Sino Land, which drew some 15,000 enquiring buyers in its Mayfair by the Sea I development, where units are being sold at about 20 percent lower than market rates.

In Singapore, where sales of luxury condominiums dropped by more than 60 percent in Q1 2014, year-on-year, based on data provided by property consultancy DTZ, some developers are still undecided if they would be willing to offer discounts or special promotions.

“Buyers are becoming more discerning with their purchases and are quite price-sensitive,” Chua Yang Liang, head of research at JLL Singapore, told The Wall Street Journal. A spokesperson at CapitaLand declined to comment on specific price changes in its Zaha Hadid Architects-designed d’Leedon development, whilst GuocoLand announced that there had been no price cuts in its Soo K. Chan-designed Leedon Residence property at this time.

Meanwhile, one high-end developer, Ho Bee Land, reportedly decided to rent out some units in its Sentosa development rather than pursue selling them in order to maximise profit in this investment climate, CIMB Bank analyst Tan Xuan was quoted in Singapore Business Review last April.

– See more at: http://www.property-report.com/developers-negotiate-price-cuts-in-singapore-and-china-35219#sthash.r3qmzHJO.dpuf

Chinese and Singaporean developers are contemplating bigger price cuts in an effort to attract more homebuyers as domestic residential markets start to cool down.

In China, where home sales reached a recording-setting USD1.31 trillion last year, there is an increasing concern from developers to meet sales targets as many companies only achieved less than 30 percent of their sales projections to date, according to Reuters.

“The market is very weak now, price cuts and promotions are very normal,” Simon Fung, chief financial officer of Greentown China, told Reuters. Fung’s company last week distributed cash coupons to existing clients who are looking to buy a new home.

A number of China-based developers have also started offering free renovation or free parking space packages to lure new investors in a move that is expected to continue throughout the third quarter.

The secondary home market in Hong Kong, which reported a sluggish first quarter in the luxury residential segment, was also slow-moving last week, The Hong Kong Standard reported. Several developers slashed prices over the weekend to attract more buyers, including Sino Land, which drew some 15,000 enquiring buyers in its Mayfair by the Sea I development, where units are being sold at about 20 percent lower than market rates.

In Singapore, where sales of luxury condominiums dropped by more than 60 percent in Q1 2014, year-on-year, based on data provided by property consultancy DTZ, some developers are still undecided if they would be willing to offer discounts or special promotions.

“Buyers are becoming more discerning with their purchases and are quite price-sensitive,” Chua Yang Liang, head of research at JLL Singapore, told The Wall Street Journal. A spokesperson at CapitaLand declined to comment on specific price changes in its Zaha Hadid Architects-designed d’Leedon development, whilst GuocoLand announced that there had been no price cuts in its Soo K. Chan-designed Leedon Residence property at this time.

Meanwhile, one high-end developer, Ho Bee Land, reportedly decided to rent out some units in its Sentosa development rather than pursue selling them in order to maximise profit in this investment climate, CIMB Bank analyst Tan Xuan was quoted in Singapore Business Review last April.

– See more at: http://www.property-report.com/developers-negotiate-price-cuts-in-singapore-and-china-35219#sthash.r3qmzHJO.dpuf

Volume increase but price decrease for private residential homes resale

The number of private home resale transactions was a 7.9 per cent increase over May, but prices fell by 1.4 per cent in June, according to the Singapore Real Estate Exchange.

Resale prices for non-landed private residential homes continued to fall in June, reaching a 1.5-year low, according to the latest report by the Singapore Real Estate Exchange (SRX) on Monday (July 14).

Overall resale prices fell 1.4 per cent month-on-month to hit an 18-month low, with prices at their lowest since December 2012, according to the SRX Flash Report. Compared to the price peak in January this year, June prices are 4.7 per cent lower.

Prices fell for all three regions – Rest of Central Region (RCR), Core Central Region (CCR) and Outside Central Region (OCR) – with the city fringe area leading the fall by 3.2 per cent. This was followed by the core central area and the suburbs, which dropped 1.7 per cent and 0.3 per cent, respectively, SRX said.

The majority of districts – or 15 of 24 districts – saw zero or negative median Transaction Over X-value (TOX) in June. For districts with more than 10 resale transactions, districts 15 (Katong, Joo Chiat and Amber Road) and 10 (Bukit Timah, Holland Road and Tanglin) had the lowest median TOX at negative S$50,000 and negative S$37,000, respectively.

The number of resale transactions went up though, registering a 7.9 per cent month-on-month growth to reach an estimated 452 deals in June. Resale volume has gone up by 53.7 per cent since the beginning of year, the report said.

In terms of rental deals, prices slipped 0.8 per cent compared to May while volume went up 2.2 per cent over the same period. An estimated 3,151 whole units were rented out last month, according to SRX.

http://www.channelnewsasia.com/news/business/singapore/more-deals-done-but/1262214.html