Wednesday, April 1, 2009

Update: S'pore Home Prices In Steepest Drop Since 1975

Source : The Business Times, April 1, 2009

*Private home prices fell 13.8 per cent in Q1 from Q4
*Homes in central areas show largest decline
*Analysts expect further fall, but pace of decline may ease

Singapore private home prices suffered their biggest drop in more than 30 years in the first three months of 2009 as the country's worst-ever recession hammered investor sentiment in the recently booming property market.

Home prices fell 13.8 per cent in the first quarter of this year compared with the previous quarter, the Urban Redevelopment Authority said on Wednesday, more than twice as much as the 6.1 per cent drop in October-December 2008.

The fall marked the third straight quarterly drop and was the steepest fall since the second quarter of 1975, URA said.

Shares in Singapore property firms such as CapitaLand and City Developments shrugged off the gloomy market data in spite of analysts saying the drop in the URA's private residential property price index had been steeper than expected.

'The trend is clearly downward,' said Colin Tan, head of research and consultancy at Chesterton Suntec, a real estate consultancy. He said the sharp drop in the index showed momentum was strong and that home prices will fall further before they find a bottom.

But he added that the sharp decline in the index may overstate the market's weakness because of a dearth of deals involving homes in prime areas, several of which were sold at distressed prices.

According to the data, prices of non-landed private homes in the core central region fell 15.2 per cent during the first quarter. Prices of homes in the 'rest of central region' declined 17.2 per cent, while prices outside the central region only dropped 7.5 per cent.

Resale prices for Housing Development Board (HDB) apartments fell 0.6 per cent in the first quarter from the last three months of last year, a separate index compiled by HDB showed.

Mohamed Ismail, chief executive of property agent PropNex, expects prices to decline a further 7-10 per cent this year in the core central and rest of central regions, and 3-5 per cent for homes in outlying areas. -- REUTERS

S'pore Pte Home Prices Fell 13.8% In Q1

Source : The Business Times, April 1, 2009

Singapore private home prices fell 13.8 per cent in the first three months of 2009 compared with the previous quarter, the government said on Wednesday.

The fall marked the third consecutive quarterly decline and was steeper than the 6.1 per cent drop recorded in October-December 2008, according to advance estimates from the Urban Redevelopment Authority. -- REUTERS

HDB Flat Resale Prices Down 0.6% In Q1

Source : The Business Times, April 1, 2009

Prices of HDB resale flats fell for the first time since 2006, dropping 0.6 per cent in the first quarter of this year, according to flash estimates from the Housing and Development Board on Wednesday.

The latest quarterly drop came after a 1.4 per cent increase in the fourth quarter of 2008. -- BT ONLINE

HDB Upgraders On The Move

Source : The Straits Times, April 01 2009

More are buying new private condo units as prices come down.

SEVEN in 10 buyers of new private homes in the first three months of the year had Housing Board addresses, making HDB upgraders the hottest group in the property market so far for this year.

In normal times, HDB upgraders account for between 20 and 50 per cent of new home buyers, DTZ said. -- ST PHOTO: NURIA LING.

This is the second-highest proportion of HDB upgraders since the earliest available data in 1995, according to property consultancy DTZ's preliminary analysis of caveats lodged in the first quarter. The record was 86 per cent, in the second quarter of 2002.

HDB upgraders refer to better-off residents of larger flats looking to move up the property ladder.

They typically buy into 'mass market' private developments - lower-priced condominiums in the suburbs, and preferably in the same town or region where they live.

In normal times, HDB upgraders account for between 20 and 50 per cent of new home buyers, DTZ said.

But experts reckon their numbers are now swelling during a rare 'window period' when the price gap between private homes and HDB resale flats is narrowing.

Supply has also played a key part in the surging interest, with mass market projects forming the bulk of recent launches, said DTZ's senior director for research Chua Chor Hoon.

Property consultancy CB Richard Ellis thinks many HDB upgraders held back from buying during the recent property boom, particularly as prices skyrocketed in 2006 and 2007.

There were few 'mass market' condo launches then, as developers rushed to build high-end homes and investors scooped them up.

But now, private property prices are falling sharply at a time when HDB resale flat prices are still holding steady.

Official data shows that while fourth quarter private home prices fell 6.1 per cent, HDB resale prices actually rose 1.4 per cent.

So HDB upgraders are now keen to sell their flats and upgrade to bigger units at reasonable prices.

For example, a HDB five-room flat in Queenstown can still sell for around $600,000.

At recent property launches, suburban condo units were going for around $600 psf. This means a 1,200 sq ft three-bedroom private condo apartment costs $720,000.

At Mi Casa in Choa Chu Kang, upgraders accounted for 80 per cent of its 97 buyers so far. They also bought many units at The Caspian, beside Lakeside MRT station, Double Bay Residences in Simei and The Quartz in Buangkok.

Corporate communications and marketing manager Adam Tan and his wife Ng Bee Kay are among the HDB upgraders.

'We looked at some properties in October but the prices were still a bit high. Then, my wife got pregnant in late November. So from January onwards, we started to search for a bigger place - with a vengeance,' said Mr Tan, 32.

The family will be moving from their four-room flat in Bedok into a $760,000, 1,195 sq ft unit at Astoria Park, next to Kembangan MRT station.

To attract buyers, developers of some ongoing launches slashed prices in the first quarter. The average price at Waterfront Waves in Bedok was reduced from $800 psf to $600 psf, while at Kovan Residences near Kovan MRT station, prices were cut from $880 psf to $750 psf.

Experts expect the gap between private homes and HDB resale flats to continue narrowing this year, which means this is likely to be a strong year for the HDB upgraders segment.

Unlike the previous downturn in 1996, HDB prices are less likely this time around to fall quickly in tandem with private property prices.

One reason is that the supply of new HDB flats is more limited now.

'Previously, HDB built public flats ahead of demand,' noted DTZ's Ms Chua. But it now builds only when there is demand via its build-to-order system.

With relaxed eligibility rules, there are also more buyers in the HDB resale market, including permanent residents and singles.

If current trends continue, the experts say, HDB resale prices should eventually fall by the end of the year in line with the bigger fall in private home prices.

组屋提升者带动 私宅首季成交量倍增

Source : 《联合早报》Apr 1, 2009

虽然经济情况进一步恶化,今年第一季的新私宅成交量却刷新过去六个季度的纪录。本地房地产顾问公司世邦魏理仕(CB Richard Ellis)估计,房地产发展商在今年第一季卖出了2000至2200个新私宅单位,这比之前一年的平均需求量暴涨了至少一倍。



每次楼市低潮 本地人提供支持力量






世邦魏理仕私宅部执行董事陈金道指出,最近卖得好的项目都有一个共同点——容易负担得起。例如水之轩(Caspian)、Double Bay Residences和The Quartz都是售价介于每平方英尺590元至750元的大众化项目。



展望下个季度,世邦魏理仕表示,即将上市的新项目还包括Ascentia Sky(348个单位)、Oasis @ Elias(367个单位)以及Illuminaire On Devonshire(72个单位)。





官方数据显示,发展商已经在今年首两个月卖出1431个新私宅单位。3月份的私宅成交量数据将在本月中公布,上个月卖得不错的新项目包括了The Mercury、Double Bay Residences、The Arte和新乐园(Mi Casa)。

另一方面,一些项目也在这段期间削价重新推出,例如Waterfront Waves的售价由每平方英尺平均800元削减至600元;Woodsville 28由每平方英尺平均900元减价至750元;Kovan Residences也由每平方英尺平均880元减价至750元。

私宅租金首季出现 金融危机以来最大跌幅

Source : 《联合早报》Apr 1, 2009




比如阿摩园(Ardmore Park)的一个单位,一年多前月租约2万元,但今非昔比,月租只有介于1万5000至1万8000元。同样的,瑞吉居(St Regis Residences)一个2100平方英尺单位,一年前的租金介于1万6000至1万7000元,但如今已下降至1万至1万2000元。




过去半年延后发展并短暂出租的项目包括幸运大厦(Lucky Tower)、景福苑(The Grangeford)、彬珠阁(Pin Tjoe Court)、祥鹤谷(Flamingo Valley)、富丽华大厦(Furama Tower),唯美园(Fairways)、淑雅阁(Sophia Court)和林肯苑(Lincoln Lodge)等。


去年共有1万零122个私宅单位完工,较过去10年的平均8671个多出17%。今年完工的项目当中,预计约30%位于黄金地段,包括545个单位的汇锦园(Rivergate)、275个单位的杰座华庭(One Jervois)、264个单位的升涛舫(Oceanfront@Sentosa Cove)和249个单位的海韵湾(The Coast)。







Top-End Hotel Opens On Sentosa

Source : The Business Times, March 31, 2009

THE ultra-luxurious Capella Singapore on Sentosa opened its doors yesterday.

With room rates starting at $750 a night, it is the only top-end hotel to open here this year.

Guests have to pay $750 for a night's stay in a standard room, which is almost twice the size on an average hotel room in Singapore. -- ST PHOTO: DESMOND LIM

Despite the poor economic conditions and global paring down of travel budgets, the hotel's general manager, Mr Michael Luible, expressed optimism that it would do well because it was a 'unique product'.

He said the hotel would run on the philosophy that whatever guests want, they will get. For example, they can check in whenever they want.

This week, the Capella will be where British carmaker Rolls-Royce launches its new model 200EX; fashion house Gucci will also flaunt its spring collection there.

The 111-room hotel sits on a site more than 12ha in size. It has 61 'standard' rooms and 11 suites, and each of its 38 villas has its own swimming pool.

A standard room, at $750 a night, is 77 sq m in size - almost twice the size of an average 40 sq m hotel room here.

The private villas, starting at about $1,800, offer at least 133 sq m of space.

The property is the first for the luxury brand in Asia and will be its flagship in the region, said Mr Horst Schulze, the chairman and chief executive officer of the West Paces Hotel Group, the parent company for the chain.

Deputy Prime Minister S. Jayakumar was the guest of honour at the opening of the hotel, which departed from the practice of having a soft opening ahead of its official debut.

To mark its opening, the hotel is offering guests who are staying two nights an extra night free. This deal is available till the end of May.

Price Is Right For Second Home

Source : The Straits Times, March 28, 2009

Despite industry talk that it isn't the wisest time to buy property right now, shipbuilding subcontractor Michael Chee, 52, brazenly went ahead with his search for a new pad.

He had only two criteria: It had to be easily accessible by public transport and it had to be cheap.

He said of his recent purchase, a three-bedroom unit in Northvale condominium located opposite the Choa Chu Kang MRT station: 'If I had a car, the location wouldn't have mattered to me, but I don't have a driving licence so I prefer to live near an MRT station or a bus interchange.

'I don't want to waste so much time on travelling and waiting for feeder buses. Time is money too.'

He paid about $640,000 for the 1,350 sq ft apartment last month and plans to move in in June.

'HDB prices are so high. If I buy an HDB flat near the MRT station, I will have to pay at least $450,000. I might as well pay a bit more and get to experience living in a condominium,' he said.

The condominium unit is his first private property purchase.

The family now lives in a five-room HDB flat in Choa Chu Kang.

His eldest child, a 26-year-old, will continue to live there with her husband and one-year-old daughter while he, his wife, a 50-year-old housewife, their 23-year-old daughter and 20-year-old son will move to the condominium.

'The search took only a few weeks because I was sure I wanted to buy an older condominium,' said Mr Chee.

'We went to see some new condominiums, but you have to make decisions based on drawings that may not be accurate and then you still have to wait a long time for it to be completed before you can move in.'

He paid half of the cost of the condominium up front from his savings and took a bank loan to finance the other half.

He said he has no plans to sell the HDB flat for now.

'With the economy in this state, at least if something happens to my job, I still have the HDB flat to fall back on. I could at least sell or mortgage it if I need the cash for the condominium payment,' he said.

On advice from others not to buy property now, he said: 'Why should I listen to others? Buying a house is a personal thing. It is up to your needs. If you like the place, the owners are willing to sell, the price is okay and you can afford to buy it, then why not?'

Bad Time To Buy? It Was The Best Time To Upgrade

Source : The Straits Times, March 28, 2009

It could not wait. Tired of ferrying their two-year-old daughter Rachel between their parents' place in Ang Mo Kio and their Jurong West home daily, the Lohs decided that it was time to uproot.

Ms Sharona Lee and husband Loh Yew Hoe bought a condo in Yio Chu Kang last year so it would be easier to drop off little Rachel at her grandmother's. -- ST PHOTO: MUGILAN RAJASEGERAN

And thus began their search for a new home in the Ang Mo Kio area last year.

'We knew it's not the best climate to buy property, but baby-sitting concerns were our utmost priority. This area also has some good schools, which will be timely for when Rachel grows up,' said Mr Loh Yew Hoe, 31, who works in a bank.

He and his wife, financial adviser Sharona Lee, 28, visited at least 20 HDB flats and condominium units in the neighbourhood before they finally settled on a two-bedroom unit in Seasons Park along Yio Chu Kang Road.

Said Mr Loh, who paid about $600,000 for the 1,100 sq ft unit last November: 'As Ang Mo Kio is a very popular place to live in, most of the five-room HDB flats we viewed were valued at about $500,000 and going for around $50,000 to $80,000 above valuation.'

The Lohs moved into their new home two weeks ago. Their place is now a five-minute walk to Ms Lee's mother's flat in Ang Mo Kio Avenue 5, compared to the 40-minute drive from Jurong West before.

It was also opportune timing, said Mr Loh, that the HDB resale market was still buoyant while they were selling off their HDB flat last year. The five-room flat, which the Lohs bought in 2004, sold for about double the price they bought it for.

Citing the 10 per cent to 15 per cent drop in private property prices, particularly in the suburban areas, in the last year, Mr Loh said: 'If I bought an HDB flat, I would be selling high and buying high, so I consider buying private property a better choice.'

New, Cheaper Private Condos See Brisk Sales

Source : The Straits Times, March 28, 2009

Despite the recent slump in the property market, new private properties are still being snapped up in the market.

Last month's sales of new private homes jumped to 1,323 units, harking back to the days of the property boom, said observers.

In January, only 108 units were sold.

The figure was largely propped up by two newly launched heartland condominiums - the 293-unit Alexis at Alexandra Road and the 517-unit Caspian in Jurong.

Prices started from $450,000 at Alexis and $340,000 at Caspian.

'Developers probably realised after January's dismal sales that they had to lower their prices, while buyers noticed these discounts and decided to buy,' said PropNex's corporate communications manager Adam Tan.

According to CBRE Research executive director Li Hiaw Ho, the majority of last month's buyers were HDB upgraders who put buying on hold while home prices surged in 2006 and 2007.

He estimated that private home sales this month would come up to about 400 to 600 units, bringing the total number of units sold to 1,800 to 2,000 for the January to March quarter.

'A few projects are still selling fairly well, but they are not as large-scale as the projects launched last month,' said Mr Li, who predicted that sales figures are likely to hover around 500 to 700 units a month for the second quarter of the year.

Developments that are anticipated to do well this month include Waterfront Waves in Bedok, which was first launched last year but relaunched in the middle of March, and Mi Casa condominium in Choa Chu Kang, which analysts are expecting to be launched at the end of the month.

They have 457 and 405 units respectively.

The rate of new launches this month is likely to be similar to last month's, said Dr Chua Yang Liang, the head of research and consultancy at Jones Lang LaSalle Singapore.

'This is backed by housing developers' confidence in the latent demand by genuine homebuyers, encouraging them to release more,' he said.

However, the islandwide take-up rate this month could dip as the market has been rather temperamental, especially in light of the volatile global stock market performance, he said.

So when is the right time to buy?

'Many people ask that question but they should really be asking themselves where they want to buy, what they are buying it for, and what are their risk profiles,' said PropNex's Mr Tan.

'Don't buy blindly just because the price is good. As some of these places have two or three years till their completion, one should also consider the property's surroundings, such as existing or future infrastructure. Go into this investment with about five to 10 years in mind.'

Land A House For Under $1 Million

Source : The Straits Times, March 29, 2009

But be prepared to compromise on location, condition, size and lease tenure

A landed home for less than $1 million? To many, a landed property is both a desirable dream home and the ultimate - yet unaffordable - status symbol.

A house to be auctioned in Jalan Mesra in MacPherson has a guide price of $800,000 to $900,000. -- PHOTO: KNIGHT FRANK

So they steer clear of looking for one, thinking they would never be able to afford it anyway.

But while the landed market is often less accessible than the condominium market, there are houses out there pegged below $1million.

Potential buyers just have to be prepared to look hard as their choices are limited, property experts say.

Also, these houses may sit on a small piece of land or be in relatively poor condition.

'If your budget is below $1million, expect to compromise on the location, size and condition of the house,' said HSR Property Group executive director Eric Cheng.

'It can be fun for a person who likes DIY, as you can really do up the house. But you have to take into account the renovation costs,' he added.

Where to look

First of all, rule out the central areas of districts 9, 10 and 11. Much of the coveted residential districts of 15 and 16 will also be out of reach, said managing director of RealStar Premier Property Consultant, Mr William Wong.

Buyers should look at areas in the north-east such as Hougang and Serangoon, he said.

There may also be opportunities in Upper Thomson and Sembawang, said Knight Frank auctioneer Mary Sai.

Mr Cheng said there are small single-storey terrace houses in Upper Thomson going for below $1million, though there is no parking space in front of these homes.

Other areas with houses below $1million include Jalan Gembira in MacPherson, Telok Kurau, Loyang Villas in Loyang and Sin Ming Walk, he said.

Aside from leasehold homes, freehold ones below $1million can also be found.

However, it is almost impossible to find a bungalow at those prices. Semi-detached houses and corner terrace units are also unlikely candidates, leaving buyers with just mid-terrace units, said Mr Wong.

Apart from the resale market, the auction market may from time to time offer some affordable landed home buys.

Property consultancy Knight Frank said it will have one freehold terrace house available for auction next month at under $1million.

With an indicative price of about $800,000 to $900,000, it is an old, narrow, two-storey terrace house sitting on 1,300sqft of land at 7 Jalan Mesra in MacPherson.

Some houses in the area were going for $700,000 to $800,000 a few years ago, before a run-up in property prices, with up to around $1million for a nicely-renovated one during the 2007 boom, said Ms Sai.

Recent deals in that area included one for a unit in Jalan Setia, with a land area of 885sqft, which went for $850,000 in November.

A typical houses

There are also a few areas with unusual landed homes costing way below $1million.

The Housing Board itself has 285 leasehold landed flats in Whampoa and along Stirling Road in Queenstown. These 99-year units were built in the 1970s by the Singapore Improvement Trust, the predecessor of the HDB.

Relatively small houses sitting on varying plots from just under 1,000sqft, can go for around $500,000 to $700,000, said Mr Cheng.

Such mid-terrace units are rather narrow, considering a typical mid-terrace unit sits on at least 1,600sqft of land, he said.

Then, there are houses with extremely short leases. Banks are not keen to offer loans for such properties, so buyers have to pay cash.

In Lorong 3 Geylang, for instance, run-down terrace houses can go for around $150,000. One such unit, with a land area of just 725sqft and a built-up area of about 1,300sqft, sold for half that sum last year. It had just 11 years left on the lease.

During the last boom, the landed homes sector was a laggard compared to non-landed homes. Because landed home prices have not risen as steeply or as fast as condominiums, their fall will not be as hard, experts say.

The most recent official data shows that landed home prices fell by 4.8per cent in the fourth quarter of last year.

Going forward, Realstar's Mr Wong projects that landed home prices could fall by another 10 per cent this year.

While sellers may dither over acting now or sitting tight, this is good news for buyers with a tight budget looking for landed homes.

Upgraders Snap Up Mi Casa Condo Units

Source : The Straits Times, March 31, 2009

BUYERS snapped up 97 units during a private preview at a Choa Chu Kang condominium, yet another sign that suburban projects are selling well with upgraders.

These sales at Mi Casa, Far East Organization's new development in the Choa Chu Kang town centre, comprise almost 80 per cent of the 123 units released.

Mi Casa has a total of 457 units in the estate.

Prices started at $580 per sq ft (psf). The average price achieved was $625 psf.

Two-bedroom units, with sizes that start at 990 sq ft, and three-bedders, sized from 1,259 sq ft, were sold.

Some also have an extra study unit. That brings the two bedders up to 1,119 sq ft and the three-bedroom flats to 1,281 sq ft.

The four-bedroom units have yet to be launched.

Buyers at the preview were mostly entrepreneurs and professionals, including teachers and engineers, said the private developer in a statement last night.

About 80 per cent of the buyers were 'upgraders' living in the surrounding vicinity and nearby areas such as Yew Tee, Bukit Batok and Teck Whye.

Foreign buyers, including Chinese and Malaysian nationals, accounted for about 12 per cent of sales.

Mi Casa - Spanish for 'my home' - is the first new private condo project built in the town centre in eight years since The Warren condo, which was launched in 2001.

The site for Mi Casa was acquired by Far East in May last year.

It is within walking distance of the train station, bus interchange, community library and the Lot 1 Shoppers' Mall.

Far East's chief operating officer for property sales, Mr Chia Boon Kuah, sees a healthy demand for new condos in that area.

'We are delighted with the preview sales so far,' he said in a statement yesterday.

'Currently, there are no new sites available in the Choa Chu Kang town centre in the government land sales programme.'

This makes Mi Casa 'an attractive value proposition to HDB upgraders and private-residence owners in the neighbourhood', he added.

Buyers enjoy an early bird discount until the condo's official launch on April 10.

The suburban market showed some real signs of life last month when more than 300 units at Frasers Centrepoint's Caspian condo in Jurong were snapped up within three days.

More than 70 per cent of its 712 units have been sold since.

From Four-Star To Five After $80m Renovations

Source : The Business Times, March 31, 2009

PARK Hotel Group is sinking $80 million in the renovation of Park Hotel Orchard, which will reopen in the second quarter of 2010 as a five-star hotel.

Modernistic: The Park Hotel Orchard will close from tomorrow for renovations and will be rebranded as Grand Park Orchard

The four-star Park Hotel Orchard will close from tomorrow to facilitate the renovations and will be rebranded as Grand Park Orchard, the group's flagship hotel. Rates will start from $350.

The group will also be soft launching its 336-room Park Hotel Clarke Quay on May 1. Allen Law, director of Park Hotel Group, expects occupancy for the first month of operation to come in at 70 per cent, and to build up to the high 80s within three months.

Commenting on the performance of the group's hotels so far this year, Mr Law said: 'We do see a slight drop (in revenue per available room) compared to 2008, down 10-15 per cent. However, it is still a little above our 2007 level, which is healthy.'

In comparison, revpar for the group's hotels in 2008 was up 22-25 per cent year on year, he said.

When it reopens next year, the Grand Park Orchard will feature 309 rooms as well as a four-storey retail podium. The 83,000 square foot podium will house flagship stores of international brands.

The group's other properties include Park Hotel Hong Kong, Grand Park Otaru in Japan and Grand Park City Hall in Singapore.

Meanwhile, Capella Singapore, the luxury hotel on Sentosa Island, opened yesterday. The hotel - which comprises a presidential manor, 38 villas, 11 suites and 61 guest rooms - sees rates starting at $750 for guestrooms and suites and $1,800 for the villas.

Capella is offering various introductory packages, including a complimentary third night for every two nights' stay, valid through May 31.

Park Hotel Orchard To Get Makeover

Source : The Straits Times, March 31, 2009

AN ORCHARD Road fixture will be revamped and given a brand-new look by next year.

The four-star Park Hotel Orchard, located across Bideford Road from Paragon Shopping Centre, will be closed for renovations from tomorrow.

An artist's impression of the revamped Park Hotel Orchard, which will be transformed from a four-star to a five-star hotel with four storeys of retail. It will also change its name to Grand Park Orchard. -- PHOTO: COURTESY OF PARK HOTEL GROUP

When it reopens by the second quarter of next year, it will have been transformed into a five-star hotel with four storeys of retail space.

Its upgraded rooms and suites will also feature state-of-the-art technology, said its owners, the Park Hotel Group.

It will also boast a new name - Grand Park Orchard.

This is not the first name change for the 25-year-old hotel, which is still known among many Singaporeans by its first name - the Crown Prince Hotel.

The $80 million makeover has been in the works since it was bought over by Park Hotel Group in 2005.

Once an Orchard Road landmark with its eye-catching outdoor capsule lifts, the hotel looks distinctly dated now, overshadowed in recent years by newer and swankier neighbours such as Paragon and Ngee Ann City malls.

Other hotels along the stretch, such as the Meritus Mandarin, have already embarked on renovations.

Speaking at the unveiling event yesterday, Park Hotel Group director Allen Law said the revamp will create a new fashion-themed hotel.

Its familiar white and brown facade, for example, will be replaced by a glass one with a herringbone design more commonly seen in fabric.

'The idea is to transform the hotel into a fashionable icon. The facade is like a dress that clothes the building, and turns it into something elegant and stylish,' said Mr Law.

The facade will also have an eight-storey-tall LED screen for advertisements. At 27m by 21m, it will be one of the largest such screens in Orchard Road.

The 83,000 sq ft retail podium will have double-storey flagship stores of international brands, with entrances in Orchard Road.

Meanwhile, the hotel's lobby, currently on the ground floor, will be moved to the fourth floor.

Rates will likely start from $350 a night for a standard room, about $100 more than the current price.

The group's senior vice-president Mohamed K. Rafin is optimistic that business will roll in when the hotel reopens next year.

'By that time, the integrated resorts would have come up, and there would be an infusion of travellers,' he said.

Details on the retail tenants and room interiors will be made available in the coming months, Park Hotel Group said yesterday.

URA Launches Tender For Heavy Vehicle Site In Kaki Bukit

Source : The Business Times, March 31, 2009

The Urban Redevelopment Authority on Tuesday launched a tender to sell a land parcel at Kaki Bukit Road 2 for heavy vehicle park use.

The 98,231 sq ft site is being offered on 15-year leasehold tenure.

'The site is being released to help meet the heavy vehicle parking needs of transport operators and fleet owners.

Heavy vehicles that are allowed to be parked on the land parcel include trailers, buses, and any other vehicles which have a maximum laden weight exceeding 5.0 metric tons,' URA said.

The tender closes at noon on April 29.

Developers' Q109 Pte Homes Sales At 2,000-2,200: CBRE

Source : The Business Times, March 31, 2009

Developers sold between 2,000 and 2,200 new private homes in the first three months of this year, estimates property consulting group CB Richard Ellis. This is the highest sales volume since the third quarter of 2007.

'The return of sales volume shows that some liquidity has returned to the market and underlying demand remains healthy. Wary of the impact of the economic recession on job security, as well as stricter bank loan approvals, buyers zoomed in on new homes.

Shoe box units in city- fringe locations were popular. Projects such as Alexis, Nova 88 and The Mercury sold well, at prices ranging between S$900 per square foot (psf) and S$1,200 psf for unit sizes of 340 square feet (sq ft) to 750 sq ft. The majority of them were sold at an absolute quantum of less than S$600,000 per unit,' CBRE said in a release on Tuesday.

The projects with the highest number of units sold in Q1 2009 were Caspian (550 units sold), Alexis (293 units), Double Bay Residences (250 units) and The Quartz (178 units),CBRE said. All four condos are located near MRT stations.

Private Home Price Declines Moderate In Q1

Source : The Business Times, March 31, 2009

Property consultancy group DTZ says the steep fall in private home prices in Singapore during fourth quarter 2008 moderated to a slower pace in Q1 2009.

Average prices of freehold non-landed private homes in the prime districts of 9, 10 and 11 fell 3.7 per cent quarter-on-quarter to S$1,120 per sq ft in Q1 this year, slower than the 14 per cent quarter-on-quarter decline in Q4 last year.

The average price of luxurious homes in the prime districts also registered a slower decline of 3.6 per cent in Q1 2009, after sliding 22 per cent in Q4 2008.

Outside the prime districts, the average price of non-landed, 99-year leasehold homes slipped 2.6 per cent in Q1 2009, after falling 5.8 per cent in Q4 2008.

DTZ said that landed homes were the most resilient, posting average price falls of 1.5 to 2.2 per cent, compared with the 3.8 to 5.8 per cent price drops seen in Q4 2008.

Luxury Residential Rents Slide In Q1: DTZ

Source : The Business Times, March 31, 2009

The average monthly rental value for luxurious non-landed homes in Singapore's prime districts 9, 10 and 11 slid 18.8 per cent quarter on quarter to $5.20 (US$3.42) per square foot (psf) in Q1 2009, a level last seen in Q3 2006, according to property consulting group DTZ.

Meanwhile, the average rental value of non-landed homes in the prime districts fell 16.2 per cent quarter-on-quarter to $3.65 psf per month in Q1 2009.

John Hancock Tower May Be Sold For Half Its 2006 Price

Source : The Business Times, March 31, 2009

Boston skyscraper goes on the block today; it was bought for US$1.3b in 2006

(SEATTLE) Boston's John Hancock Tower, the tallest skyscraper in New England, may be sold to lenders led by Normandy Real Estate Partners for about half the US$1.3 billion paid in 2006 by Broadway Partners, which defaulted on its loan.

The John Hancock Tower: Probably worth less than US$750 million, according to a New York-based real estate research firm

The building goes on the block today in New York under state rules that govern mezzanine loan foreclosures. Mezzanine loans are intended to fill the gap between a first mortgage and the borrower's cash down payment.

While mezzanine lenders seeking to foreclose must hold an auction of ownership interests, they start out ahead of other bidders because they are credited the unpaid balance of their loan as part of their bid. Normandy controls about US$472 million of loans on the Hancock Tower, according to people familiar with the financing who asked to remain anonymous.

'By the time the process gets to a public auction, the most likely winner will be the senior-most foreclosing mezzanine lender,' said David Furman, a partner at law firm Gibson Dunn & Crutcher. 'It is allowed to credit bid the amount of its loan; therefore, it can usually outbid everyone else.'

Normandy, based in Morristown, New Jersey, was founded in 2002 by Finn Wentworth and David Welsh, who worked together at Gale & Wentworth, a real estate investment and development firm.

A spokesman for Normandy said the firm does not comment on 'transactions in process'. Spokesmen for Broadway and Green Loan Services LLC, the unit of SL Green Realty Corp hired by the mezzanine lenders to oversee the loan workout, declined to comment.

The Hancock Tower, at 200 Clarendon Street in Boston's Back Bay neighbourhood, is probably worth less than US$750 million, according to Reis Inc, a New York-based real estate research firm.

Occupancy and rents have fallen since Broadway bought the 1.76 million square foot building in December 2006, said Reis.

The auction might help reveal how far commercial property prices have fallen. 'This sale will be a test of where values are in the office market,' said Michael Knott, a senior analyst at real estate research firm Green Street Advisors Inc.

Mr Knott said Normandy's desire to salvage its investment might lead to a higher bid than what a new buyer would be willing to pay. 'This is one of the most recognisable buildings in one of the leading markets in the country,' he said.

Also included in today's auction are the eight-storey garage at 100 Clarendon Street adjacent to the Hancock Tower and 10 Universal City Plaza, a 35-storey building in Los Angeles's San Fernando Valley that's located next to the Universal Studios Hollywood theme park.

After Broadway defaulted on mezzanine loans secured by stakes in both properties in January, the mezzanine lenders hired Green Loan Services to oversee the workout and Green hired property broker Eastdil Secured LLC to conduct today's auction.

It wasn't supposed to end this way.

The Hancock Tower, a 60-storey glass building designed in the 1970s by architects IM Pei and Henry Cobb, was the crown jewel in Broadway's US$3.3 billion purchase of 10 buildings from Boston-based Beacon Capital Partners LLC in December 2006. Broadway has acquired US$15 billion of office buildings since it was founded in 2000 by chief executive Scott Lawlor.

When Broadway bought the Hancock Tower, debt financing was readily available and office landlords were increasing rents and filling all the available space. The Hancock building was about 99 per cent occupied when Broadway bought it. At the time, some buyers even counted impending vacancies as a plus because it meant they might be able to charge higher rents when they signed new tenants or renewed leases.

Broadway's stakes in the Hancock Tower and 10 Universal City Plaza are part of the collateral for US$723.8 million in mezzanine debt originally underwritten by Greenwich Capital, a unit of Royal Bank of Scotland Group, and Lehman Brothers Holdings.

The Hancock Tower also has a first mortgage with an original face amount of US$640.5 million and 10 UCP has a first mortgage with an original face amount of US$294.8 million.

Unlike a mortgage, where the bank has a lien on the actual property, a mezzanine loan is secured by a pledge of equity ownership in the borrowing entity, usually a limited liability company; that pledge is akin to an indirect claim on the building.

Mezzanine loans also tend to have shorter terms than first mortgages.

Things went awry for Broadway soon after the purchase. The US real estate market peaked in early 2007 and lending dried up as defaults in the residential sub-prime mortgage market spread to commercial real estate.

When the US$723.8 million of mezzanine loans came due in January last year, Broadway paid a fee to extend the repayment deadline. As the credit crisis deepened, the firm put assets up for sale to raise cash and cut jobs.

By the time the last extensions expired in January this year, the firm had nowhere to look for refinancing because loss-ridden banks had stopped making loans pending a federal bailout of the financial services industry. Broadway defaulted on the mezzanine loans, paving the way for today's foreclosure auction. - Bloomberg

Office Location Here Is 10th Most Costly

Source : The Business Times, March 31, 2009

S'pore's total annual occupancy cost per workstation stands at US$16,540: DTZ

Total annual occupancy cost per workstation in Singapore slipped 3 per cent year-on-year to US$16,540 in the latest 2009 global ranking by DTZ.

This was due entirely to a decline in office rents. 'Prime office rents in Raffles Place fell 15.8 per cent in Q4 2008, resulting in a drop of 3 per cent for the whole of 2008,' DTZ Singapore senior director Chua Chor Hoon said.

The latest ranking placed the Republic as the 10th most expensive location out of 114 districts worldwide covered in the latest 2009 survey, which compared the total occupancy cost per workstation measured in US dollars as at end-2008. Singapore was seventh in the 2008 survey, which was based on end-2007 figures.

Tokyo (Central 5 wards) and London (West End) traded places. The former, which had been in fifth position in 2008, is now the most expensive location, while London's West End, which had been the most expensive office market since 2001 when DTZ first compiled the rankings, was in fifth spot in the 2009 survey.

'Due to the strong appreciation of the Japanese yen and increase in space utilisation standard per workstation, Tokyo (Central 5 Wards) occupancy costs per workstation grew 26 per cent year-on-year despite weakening occupier demand in the second half of 2008. Similar trends were noted in Hong Kong and Singapore, where occupancy costs started trending down towards the fourth quarter of 2008,' DTZ said in its report.

Total annual occupancy cost per workstation for Tokyo (Central 5 Wards) rose 26.1 per cent to US$22,820 in the 2009 survey. Paris, the second most expensive location in the latest survey, saw a 0.4 per cent decline to US$22,300. The cost for Hong Kong slipped 13.3 per cent to US$21,930, placing it in third position, followed by Dubai, with total occupancy cost per workstation of US$21,620 per annum.

DTZ defines total occupancy cost as the average total cost of leasing prime net usable space. This includes rents and outgoings such as maintenance costs and property tax, if these are normally payable by the occupier, but excludes rent-free periods, fitting-out costs and other leasing incentives.

The property consulting group's analysis of office occupancy costs is based on the space allocated to each office-based employee across 114 business districts worldwide.

As space utilisation standards per workstation differ in each business district due to local practices and culture, a comparison of the office occupancy costs based on the amount of space allocated to each employee gives a better comparison of the total costs of office occupation. The space takes into account not only the direct area used for a desk-station or a cubicle, but also common areas which the tenant/occupier has exclusive use over.

In terms of rents and other outgoings per square foot, Moscow, Hong Kong and London (West End) were the top three most expensive office locations in the 2009 survey. However, due to a higher space utilisation standard per workstation, Tokyo (Central 5 wards) was the world's most expensive office location on a cost per workstation basis. Its space utilisation per workstation was 144 square feet compared to Moscow (84 sq ft), Hong Kong (118 sq ft) and London's West End (118 sq ft).

The firm noted that apart from local market dynamics of supply and demand, as well as changes in space utilisation standards per workstation, occupancy costs of the business districts studied were also significantly affected by the volatile fluctuations in local currency values against the US dollar, the base currency used in the ranking.

DTZ observed a slight decline in the average space utilisation standard per workstation worldwide to 146 sq ft over the course of 2008. 'Going forward, space utilisation standards across most regions are likely to decline as companies focus on space optimisation and cost reduction measures. These include flexible work practices like hot-desking and teleworking, thereby utilising existing space more efficiently to avoid taking on more space or to consolidate and free up space for sub-leasing,' it added.

Looking ahead, the report said that amid the uncertainty of a long global economic downturn and further contraction in occupier demand, occupancy costs are expected to decline in many business districts. 'Prospects of an impending supply glut in some markets and the wider adoption of flexible work practices leading to reduced space consumption will also be factors helping to drive occupancy costs down, especially across Europe and Asia-Pacific,' DTZ said. It said that occupancy costs are expected to fall in 2009 for 78 per cent of the 114 business districts studied globally. 'Only 3 per cent of all business districts surveyed expect a slight increase in occupancy costs, with the remaining 19 per cent expecting occupancy costs to remain stable.'

In Asia-Pacific, 76 per cent of the markets surveyed foresee office occupancy costs to decline while 24 per cent predict occupancy costs will remain stable over the year.