Latest Updates on Property News

Business Times: Pasir Ris leasehold condo site launched for tender October 27, 2007

October 25, 2007
Pasir Ris leasehold condo site launched for tender

A 99-YEAR leasehold site for private condo development at Elias Road
in Pasir Ris has been launched for tender by the state.

CB Richard Ellis expects the 152,054 square foot site to fetch bids
of between $260 and $300 per square foot of potential gross floor
area, translating into a breakeven cost of about $620 to $660 psf
for a new condo on the site. CBRE reckons that the future project
would be able to sell for above $700 psf, assuming it is launched in
the third quarter next year.

It noted that recent transactions for units in the freehold Ris
Grandeur have been at $650-700 psf and those at Savannah CondoPark
and Modena (both on 99-year leasehold sites) at above $650 psf.

Referring to the Elias Road site, CBRE executive director Li Hiaw Ho
reckons that there may be a pool of HDB dwellers in the
neighbourhood ready to upgrade to a new private condo. ‘Units in the
new condo project will also have rental potential given the
proximity to the beach and other recreational facilities, as well as
Changi International Airport,’ he added.

Analysts estimate that the site offered by the Housing & Development
Board can be developed into a condominium with about 380 units
averaging 1,200 sq ft. The tender closes on Dec 18.

The plot is on the confirmed list of the Government Land Sales
Programme for second-half 2007. Earlier this month, the state
offered two other condo sites, also under the confirmed list. They
are a 2.2-hectare plot next to Lakeside MRT Station in Jurong that
can be developed into about 680 units, and a site at Woodlands Ave
2/ Rosewood Drive that can yield about 200 units.

Business Times: MV Land’s $68.9m bid the highest for Sin Ming site October 27, 2007

October 25, 2007
MV Land’s $68.9m bid the highest for Sin Ming site
Unit price of industrial parcel works out to about $50 psf ppr
By ARTHUR SIM

THE public tender for an industrial site at Sin Ming Lane has closed
with the top bid of $68.9 million put in by MV Land Pte Ltd.

Based on land area of about 5.13 ha and a plot ratio of 2.5, the
unit price of the parcel works out to about $50 per square foot per
plot ratio (psf ppr).

The parcel was the first of the two industrial sites tendered under
the confirmed list for the second-half 2007 Government Industrial
Land Sales programme. The other site on the confirmed list is at
Jalan Tepong.

The tender for the Sin Ming Lane site closed yesterday with five
bids received by the Urban Redevelopment Authority.

The second highest bid of $65.4 million – about 5 per cent lower
than MV Land’s bid – came from Soon Lee Land Pte Ltd.

This should come as some relief for MV Land, which through associate
company Eastpoint Development, recently outbid EL Development for an
industrial site at Kaki Bukit Road 3 by 58 per cent to pay $72 psf
ppr – the highest-ever unit land price for a 30-year leasehold
industrial plot.

Eastpoint Development is controlled by Lim Kim Hong and Lim Huixing.

The top bid of $50 psf ppr for the Sing Ming Lane site
is ‘reasonable’, said Savills Singapore’s director of industrial
business space Dominic Peters. ‘The market for such properties has
gone up about 15 per cent in the last six months.’

The site is zoned Business 1 and can be used for clean and light
industrial use. Mr Peters expects that the developer will want to
build a ramp-up facility. A possible use could be a service centre,
he said.

The breakeven price for a project could be around $220 psf, which
would mean it could be sold for $250-$280 psf, he reckons. ‘Similar
developments are already selling for between $260-$280 psf.’

A decision on the award of the tender will be made after the bids
have been evaluated by URA.

MV Land and Eastpoint Development have been hot on the acquisition
trail this year, bidding for – though not clinching – a commercial
site next to HDB Hub in Toa Payoh, a residential site near Potong
Pasir MRT Station and the maiden transitional office site next to
Newton MRT Station.

Business Times: Wealthy S’poreans can stomach risks October 27, 2007

October 24, 2007
Wealthy S’poreans can stomach risks
Barclays Wealth ranks them top in Asia in appetite for risky assets,
GENEVIEVE CUA reports

BARCLAYS Wealth has found that wealthy Singaporeans have the highest
appetite for risk in Asia when it comes to their private investments.

What is more, they appear to take as much risk when running their
private businesses. This bucks the global trend: people tend to take
more risks in business than in their personal investments.

Working with the Economist Intelligence Unit, Barclays Wealth has
published a wealth insights report on risk, return and reward. The
report surveyed 790 individuals, 40 per cent of whom had investible
assets of less than US$1 million. The rest had over US$1 million.

Barclays Wealth chief executive Didier von Daeniken said that the
study should be viewed as a snapshot of risk attitudes at a certain
point in time. The study was completed just before headlines broke
on the sub-prime crisis. ‘If you had asked people (earlier this
year) when business was doing well, property is well and so is
equity, that would impact the way they answer questions.

‘We keep that in mind – in which environment did we ask the
questions … It’s a strong reminder that we have to understand our
clients, what they concentrate on, their businesses, families and
where they are in the life cycle.’

Nearly half of the wealthy Singaporeans (42 per cent) surveyed said
that they were willing to put their money into high risk investments
to achieve a high return. This ranked them second in the global risk-
taking table, ahead of investors in the US, Hong Kong and
Switzerland.

Some 63 per cent of Singaporeans also reported that a high appetite
for risk has been an influential factor in achieving the wealth they
now hold.

Mr von Daeniken said: ‘Globally, the report reinforces the
importance of the link between risk and wealth generation.’ On a
global basis, 60 per cent of those with assets of more than US$1
million said that a high risk appetite was a big influence in wealth
generation compared with 36 per cent of those with less than US$1
million of assets.

Wealthy Singaporeans are also among the most confident and
knowledgeable investors. When asked about their knowledge of funds
and other collective investments, 53 per cent said they were
confident, compared with 37 per cent in the US and 31 per cent in
Spain.

But Singaporeans were less confident on hedge funds (only 2 per
cent) and the debt market. They were also among the least confident
in estate planning, tax and inheritance.

Mr von Daeniken said: ‘Our responsibility is to continuously remind
clients that there is a risk return equation and they should
diversify. No market goes up forever … Whether the investor
listens or not, we say it again and again – be diversified and don’t
take undue risks. The moment there is a serious correction, they
will remember.’

Globally, three-fifths of respondents agree that having enough money
to leave to the next generation is a key motivation to securing
their wealth.

Business Times: Reserve site up for sale, sparked by $7.8m bid October 27, 2007

October 24, 2007
Reserve site up for sale, sparked by $7.8m bid
Committed sum for 17conservation shophouses comes to just $460K each
By ARTHUR SIM

With property prices hitting new peaks in recent times, it is rare
to see a committed bid of just $7.8 million for a 15,200 sq ft site
near the city centre.

Based on the committed bid received by the Urban Redevelopment
Authority (URA), each of the 17 two-storey shophouses on this Jalan
Sultan site could, theoretically, go for as little as $460,000 a
unit.

The committed bid is not the transacted price for the reserve list
site as it will now be put up for public tender. Still, it gives an
indication of the range of bids that could eventually come in.

The 17 shophouses have been gazetted for conservation and the
successful tenderer is required to restore and reconstruct these
conservation shophouses in accordance with the tender conditions and
the Urban Redevelopment Authority’s Conservation Guidelines for
Historic District.

Zoned for commercial use, the shophouses could be used for office or
even as hotels.

Colliers International executive director (investment sales) Ho Eng
Joo believes the winning bid could be around $14 million or roughly
$800,000 a unit. Add to this renovation and restoration costs of
about $300,000 per unit and the potential winning bidder could be
looking at spending about $1.1 million per unit.

But as Mr Ho notes: ‘The area is changing.’ Highlighting that
KeyPoint, formerly known as Jalan Sultan Centre, was sold recently
for $1,186 psf of net lettable area, Mr Ho believes the 17
shophouses could give an investor a yield of over 5 per cent if each
unit is rented out for at least $5,000 a month.

‘Only the lack of carparking could be an issue,’ he added.

Over in Woodlands, the Singapore Land Authority has released a
172,223 sq ft residential development site at Woodlands Avenue
2/Rosewood Drive and developers could also be looking at a bargain.

Mr Ho reckons the site, which is on the confirmed list of the
Government Land Sales programme, could go for between $250 – $280
psf ppr. With a plot ratio of 1.4, the gross floor area could be up
to 241,112 sq ft, giving the site a price tag of between $60.2
million and $67.5 million.

The site may not be directly next to an MRT station but Mr Ho
believes a future development would have good rental potential as it
is close to the Singapore American School.