Friday, April 17, 2009

Some 4,000 Show Up At Launch Of DBSS project, The Peak @ Toa Payoh

Source : Channel NewsAsia, 15 April 2009

Some 4,000 people showed up at the launch of "The Peak at Toa Payoh" on Wednesday - a project under the HDB's design, build and sell scheme (DBSS).

There were some 100 people lining up outside the development even before it was launched at 8am.

Analysts said that's not a bad turnout especially since a premium five-room flat there costs more than S$700,000.

The development offers some condominium-style facilities.

However, the project does not have swimming pools or gyms.

But it comes with a card-access security system at all ground-floor lift lobbies.

The Peak is the HDB's fifth DBSS project so far. - CNA/vm

Private Home Sales Dip 8% In March Following Feb's Bounce

Source : Channel NewsAsia, 15 April 2009

Sales of private homes dipped 8 per cent in March to 1,220, compared to 1,332 in February.

Latest data from the Urban Development Authority (URA) showed that new properties in suburban areas saw strong sales.

Double Bay in Simei saw the biggest sales, with 264 units changing hands. Mi Casa in Choa Chu Kang came in second with 101 units sold.

Properties located just outside the city also drew strong demand. The Arte at Thomson for example, saw 90 units changing hands at a median price of S$874 per square foot.

Developers also placed fewer new units for sale in March - 832 compared to 1,072 in February, down 22 per cent. - CNA /ls

Developers' Sales Carry Note Of Hope

Source : The Business Times, April 16, 2009

But healthiest quarterly sales in more than a year may not signal sustained recovery

A ray of hope dispelled some gloom in the private home market yesterday when new data showed developers selling 1,220 new units in March. This brings the number sold in Q1 2009 to 2,660 - the best quarterly performance since Q3 2007.

House hunting: Crowds at the Double Bay Residences showroom in Simei on March 6. The number of homes sold in Singapore in Q1 2009 has already reached about 60% of that for the whole of last year but observers caution that the property market still faces downside risks

But could this be a false dawn? Citing weak economic fundamentals, several industry watchers believe that it is still too early to say if a nascent recovery has begun.

According to Urban Redevelopment Authority (URA) figures from developer submissions, private home sales held up in March and dipped just 8 per cent below the 1,332 units sold in February. Both months' showings were markedly better than in January, when buyers took up just 108 units.

In fact, the number of units sold in Q1 2009 has already reached around 60 per cent of that for the whole of 2008.

'Most of the demand in the first three months of the year was from Singaporeans and permanent residents, a significant proportion of whom comprised HDB upgraders,' said CBRE Research executive director Li Hiaw Ho.

Indeed, new launches in mass-market to mid-tier projects contributed to the bulk of sales in March. The most popular was Double Bay Residences in Simei - developers UOL Group and Kheng Leong sold 264 units at a median price of $659 psf.

Far East Organization also sold 101 units at its Mi Casa condominium in Choa Chu Kang at a median price of $617 psf, while 90 units at City Developments' The Arte fetched a median price of $874 psf.

There is 'strong demand for lower-range properties in the outer areas that are priced below $1,000 psf,' observed PropNex CEO Mohamed Ismail.

The mass-market and mid-tier sectors also dominated recent launches. DTZ senior director of research Chua Chor Hoon noted that 95 per cent of all launches in Q1 09 were outside the prime districts 9, 10 and 11. Developers brought out 832 new units in March, down 22 per cent from the 1,072 in February.

In contrast, activity in the Core Central Region continued to lag behind in March. Reception to The Mercury at Shanghai Road was the strongest, with buyers taking up 62 units at a median price of $1,148 psf.

The retreat of foreigners from the luxury property market could be one reason for the weak performance, said Knight Frank's director of research and consultancy Nicholas Mak. 'Preliminary figures suggest that the percentage of foreign transactions stood at 16.8 per cent in Q1 2009, settling at levels observed in Q2 2003 when the Sars outbreak badly affected the market.'

On the whole, most observers BT spoke to believe that the property market still faces downside risks - the coming months may see prices stay flat or fall and the number of units sold may decrease.

'Historically, economic recovery precedes property market recovery,' said DTZ's Ms Chua. 'Right now, there is no economic fundamental to support a bottoming of the property market.'

Just on Tuesday, the government cut its 2009 economic growth forecast again to a range of minus 6 to minus 9 per cent.

Already, there are signs of developers lowering prices to push sales. For instance, 6 units in Kovan Residences went for $782-$865 psf in February, achieving a median price of $809 psf. By March, 56 units were sold at a median price of $705 psf, with overall prices ranging from $597-$823 psf.

In fact, price cuts and the relatively affordable costs of smaller units could have spurred demand in the last few months, said DMG & Partners Securities analyst Brandon Lee. CIMB analyst Donald Chua also expects more price adjustments to happen at projects that have not been fully taken up.

In terms of new units that can be sold in the next nine months, few market watchers were confident of seeing the 1,000-a-month mark being crossed often. Some estimate that the transaction volume this year may range from 6,000-8,000 units in total. This would still be an improvement on 2008, when 4,264 units were sold.

Still, it's not smooth sailing. Even some popular projects are taking back units. URA data indicates that buyers returned 20 units at the Caspian and 10 units at the Alexis between February and March.

URA will release more concrete data on home sales on April 24. Among other factors, its real estate statistics for Q1 2009 will take into account options on units sold that subsequently lapsed later.

Property Transactions With Contract Dates Between March 30th - April 4th, 2009

Parco Set To Add Zest To Millenia Walk

Source : The Business Times, April 16, 2009

Japanese retail specialist to run hybrid dept store/ shopping centre

MILLENIA Walk mall may soon get the magic it needs to offer the wow factor to shoppers now it has signed Japan's Parco group as a tenant to take up 85,000 sq ft on three levels.

Parco@Millenia: Under an open-concept theme, Parco will sub-let space to sub-tenants, but they will not install roller shutters for their units. It is targeting sophisticated shoppers to tap the sizeable working population in the area, as well as tourists

Parco will invest about $10 million at Millenia Walk.

The Japanese retail mall operator and developer was credited with much of the early success of Bugis Junction mall here.

Parco@Millenia, which will open early next year, will be a hybrid between a department store and shopping centre.

Under an open-concept theme, Parco will sub-let space to sub-tenants, but they will not install roller shutters for their units.

The first level will feature an array of international cosmetics, fragrances and fashion-related products.

The second level will focus on local and Asian fashion and fashion-related labels.

Themed Japanese restaurants and food and beverage outlets will line the third level.

The $10 million that Parco is investing at Millenia Walk excludes investments by its sub-tenants.

Parco managed Bugis Junction's retail component from its opening in 1995 until 2006 - when ownership of the complex changed hands.

'Whereas at Bugis we focused on drawing the youth market, at Millenia Walk we will target more sophisticated shoppers to tap the sizeable working population in the area, as well as tourists,' said Lai Sau Kuen, general manager (corporate) at Parco Singapore.

She pointed out that The Promenade MRT Station, which opens next year will have an exit close to Parco@Millenia, boosting accessibility to the store.

In Japan, one of Parco's most celebrated achievements is in Shibuya, a railway stop on the fringe of Tokyo where Parco transformed a stretch of deserted carparks and hostels for workers into a hip district with iconic 'fashion buildings'.

In Singapore, besides its involvement with Bugis Junction, Parco was engaged by Far East Organization to introduce new-to-Singapore Japanese retailers and F&B operators at its Central at Clarke Quay.

That management contract expired early this year.

The 85,000 sq ft that Parco will occupy in Millenia Walk is part of the former DFS space.

DFS moved out in March 2003 and the space is now occupied by several smaller tenants such as enrichment schools, Robert Piano/Steinway & Sons and high-end home entertainment system retailer Atlas Experience.

Landlord Millenia Pte Ltd, part of the Pontiac Land Group, plans to relocate most of these retailers elsewhere in the mall.

Parco will join Harvey Norman and Space, a high-end furniture store, as anchor tenants at Millenia Walk.

Next to Serangoon MRT Station, Gold Ridge Pte Ltd this week announced the first anchor tenants for its $1.3 billion mall, which it has named nex, opening by end-2010.

NTUC FairPrice will open its fourth FairPrice Xtra hypermarket, which will be a 60,000 sq ft outlet.

Shaw Organisation has leased 40,000 sq ft for a 10-screen cineplex that will also mark the launch of its first luxury theatre concept. F&B group RE&S Enterprises, the company behind Japanese restaurants Kuriya and Ichiban Sushi, will operate a 12,000 sq ft food zone themed 'Japan Today'.

Food Junction Holdings will run a 17,000 sq ft food court with seating capacity of 500. The six-storey mall will have more than 600,000 sq ft of net lettable area.

Gold Ridge's owners include institutional investors advised by Pramerica Real Estate Investors (Asia) Pte Ltd. Guthrie Consultancy Services is project manager, retail consultant and marketing manager for the retail development.

URA Launches Tender For Short Street Hotel Site

Source : The Business Times, April 16, 2009

FOR the first time since September last year, the Urban Redevelopment Authority has launched a public tender to sell land.

The tender for the 99-year leasehold hotel site at Short Street in the Bras Basah-Bugis district will close on June 10.

The 12,535.6 sq ft site is ideal for a boutique hotel development located in an area with a 'synergistic cluster of arts, culture and education facilities', URA said in its release. The site is also near the future Rochor MRT station.

The site can accommodate a 12-storey hotel with about 90 to 100 rooms.

URA released the plot, which was on the reserve list of the Government Land Sales Programme, following a successful application by an unnamed party who has committed to place a minimum bid at the tender of $8.8 million, which works out to about $200 per square foot of potential gross floor area (GFA).

Singapore hotels are facing dual pressures of a global tourism slump, denting demand for rooms, as well as an increase in supply coming onstream.

On Monday, CBRE Hotels (Asia-Pacific) executive director Robert McIntosh said that going by the Singapore Tourism Board's forecast of nine million to 9.5 million visitors for this year, the average occupancy rate for Singapore hotels will decline from 81 per cent in 2008 to 71 per cent this year, while the average room rate will fall between 12.5 and 15 per cent this year.

Singapore has close to 10,000 rooms in the four- and five-star categories slated to come onstream by end-2012.

UK Property Slump Eases As Buyers Return: Surveyors

Source : The Business Times, April 16, 2009

Average number of sales per surveyor up for the first time since 2007

(LONDON) The slump in UK house prices eased last month after more than a year of declines lured buyers back into the market, the Royal Institution of Chartered Surveyors (RICS) said.

Slowly picking up: London, the south-west of England and Scotland were the best-performing regions for property prices, RICS says, while East Anglia was among the worst

The number of real-estate agents and surveyors saying prices fell exceeded those reporting gains by 73.1 percentage points in March, the lobby group said yesterday in London.

That compared with 78.1 in February and was the highest balance in 13 months.

The average number of sales per surveyor rose for the first time since 2007, climbing to 9.7 from 9.6.

The report adds to signs that the property market's downward spiral is slowing.

The Bank of England has cut its benchmark interest rate to a record low, mortgage approvals increased in February and Nationwide Building Society said prices rose for the first time since October 2007 last month.

At the same time, the economy is still battling the worst recession since at least 1980, and prices may fall further in coming months.

'We can all look forward to a tough year but one that in hindsight may yet signal the bottom of the market,' said Benson Beard, a surveyor at Bective Leslie Marsh in London.

'The last month has definitely seen an increase in buyer numbers and agreed sales.'

RICS's main price index has been negative since August 2007.

Economists expected this month's reading to be minus 77, according to the median estimate of 12 forecasts in a Bloomberg News survey.

London, the south-west of England and Scotland were the best-performing regions, RICS said.

East Anglia was among the worst.

UK prices have plunged after a decade-long boom, taking values to levels last seen in 2004, as the global financial crisis pushed the economy into a recession and banks restricted credit.

UK house prices declined 16.5 per cent in the year to February, the Land Registry reported on March 27.

Property values fell an annual 12.3 per cent in February, the Department of Communities and Local Government said yesterday in London.

From a month earlier, the figures dropped 2.7 per cent.

The Bank of England has responded to the recession by cutting its key rate to 0.5 per cent from 5 per cent in October.

Last month it started pumping money into the economy through purchases of government bonds.

The average cost of a home loan fixed for two years, one of the most popular, fell to 4.01 per cent in March, the Bank of England said on April 9.

While the rate hasn't dropped as much as the bank's benchmark, it is still lower than the 6.08 per cent average in August.

The number of new buyers registering with agents climbed for a fifth month, with the index reaching the highest since 2003, RICS said.

Surveyors' optimism about sales and prices rose on the month, according to the report.

UK mortgage approvals rose 4 per cent in February, the Council of Mortgage lenders said yesterday.

The RICS 'report does offer support to the view that the aggressive monetary easing is helping to stabilize the housing market,' said James Knightley, an economist at ING Financial Markets in London.

Still, rising unemployment 'runs the risk of a double dip in the housing market as people struggle to meet mortgage payments and more forced sellers emerge'.

The economy contracted 1.6 per cent in the fourth quarter, the most in almost 30 years.

Bank of England governor Mervyn King has said that the decline in output in the first quarter will be similar.

The central bank on April 9 kept the benchmark interest rate at 0.5 per cent, the lowest since the bank was founded in 1694, and said it will continue its programme to buy £75 billion (S$168 billion) of government and corporate bonds to stimulate the economy. -- Bloomberg

Abu Dhabi Property Market Tops In M-E: Survey

Source : The Business Times, April 16, 2009

(DUBAI) Abu Dhabi is likely to be the best performing real-estate market in the Middle East and North Africa in the next 12 to 24 months, according to an annual survey by the consulting firm Jones Lang LaSalle Inc.

A 'balanced' growth story, oil wealth and a relative undersupply of housing make the emirate the most attractive investment market in the region, the survey said. Property prices in Saudi Arabia and Qatar also are likely to outperform markets in other countries, the report added.

The worst financial crisis since the 1930s has weakened the property market in Gulf states as banks curtailed mortgage lending and speculators pulled out.

Real-estate prices in Dubai may decline 20 per cent more after falling 34 per cent from their peak last year, EFG-Hermes Holding SAE, Egypt's biggest publicly traded investment bank, said last month.

Though all Middle East and North Africa real-estate markets are in a 'downturn stage', Saudi Arabia is the least affected and Dubai, which is struggling with the global economic crisis and a major supply coming to the market, is furthest from a recovery, the report said. Property prices will fall in all markets in 2009, with the smallest decline in Saudi Arabia, and liquidity should return in 12 to 18 months and support a broad recovery by 2011, the survey said.

Investors' yield expectations have increased to about 11 per cent from 9 per cent in the last survey, according to the report. -- Bloomberg

4th Best Place For Business

Source : The Straits Times, April 16, 2009

SINGAPORE has been named the fourth best country in the world in which to do business, an achievement that could help pull the country out of its worst recession in history.

Singapore also maintained its regional top-dog position as the economy with the best business conditions in the Asia-Pacific. -- PHOTO: BRYAN VAN DER BEEK

The annual ranking of business-friendly countries, compiled by financial magazine Forbes Asia, saw Singapore jump four spots from last year, leapfrogging Britain, Sweden, Ireland and Finland.

Singapore also maintained its regional top-dog position as the economy with the best business conditions in the Asia-Pacific. New Zealand was fifth in the ranking, Australia eighth and Hong Kong ninth.

Business-friendly economies like Singapore, which are able to attract entrepreneurs, investors and workers, are 'in a much better position than others to rebound' from the economic downturn that has gripped the world, Forbes said.

Its survey ranked 127 countries according to criteria such as taxes, red tape, investor protection, stock market performance, promotion of free trade and freedom of expression and organisation.

The only three countries ahead of Singapore in the ranking were Denmark, the United States and Canada.

To top it off, 17 Singapore-listed firms also made it to this year's Forbes Global 2000 list of the world's 2,000 biggest public companies, ranked by profits, assets, sales and market value. Last year only 14 firms from Singapore were featured.

In fact, with the financial meltdown centred around the United States and Europe, Asian companies featured more prominently on the list this year. A total of 681 firms from the region made the list, 61 more than last year.

But the US is still the single dominant country with 551 firms represented - including the list-topper, General Electric - although this number is down by 47 from last year.

Japan, the clear leader in Asia, fielded 288 firms to the Global 2000 list, 29 more than last year. China, at number two, had 91 companies on the list, an increase of 21 from last year.

Read the full report in Friday's edition of The Straits Times.

Housing Construction Falls Sharply

Source : The Straits Times, April 16, 2009


WASHINGTON - HOUSING construction plunged to the second lowest level on record in March, reversing a big jump from the previous month.

US home construction took a bigger-than-expected drop in March, and an indicator of future building resumed falling. -- PHOTO: AFP

Meanwhile, new claims for state unemployment benefits unexpectedly plunged.

The Commerce Department said on Thursday construction of new homes and apartments dropped 10.8 per cent last month to a seasonally adjusted annual rate of 510,000 units.

That was the second lowest construction pace in records that go back 50 years.

The decline was worse than economists had expected and February activity also was revised lower.

Applications for building permits fell 9 per cent in March to a record low of 513,000 units.

New jobless claims down

But it's not all bad news on the economic front as new jobless claims fell by 8 per cent to 610,000 in the past week, official figures showed.

This is the third consecutive deline suggesting some easing of pressure in the weak labour market.

The figure marked a drop of 53,000 from the previous week's revised figure of 663,000, the US Labour Department said.

It was much better than analyst expectations of 658,000 initial claims. But despite the drop in new claims, the number receiving unemployment benefits topped six million - rising by 172,000 to 6,022,000 in the week to April 4, indicating difficulties in finding new jobs. -- AP

Home Sales Remain Strong

Source : The Straits Times, April 16 2009

More than 1,000 private homes sold for the second month in a row in March.

THE bumper private property sales recorded in February were no fluke.

For a second straight month, home hunters defied the weakening economy to buy more than 1,000 units last month.

Double Bay Residences in Simei was the highest seller in March.

Property consultants say buyers are attracted to what they regard as good buys in the moderately priced mass market.

Still, they warn that these strong buying levels are probably not sustainable.

Last month, property developers sold 1,220 new private homes, just shy of the 1,332 units sold in February.

It was the first time in over a year that the market has seen two consecutive months with more than 1,000 units sold. Sales for both months were a stunning contrast to the dismal 108 in January.

Another striking figure: First-quarter new private home sales hit 2,660 units, representing 62 per cent of all new homes sold during the whole of last year.

February sales - boosted mainly by two new launches Alexis and Caspian - were the highest since August 2007.

Figures compiled by the Urban Redevelopment Authority also showed 832 new housing units were launched last month, compared with 1,072 units in February and just 204 units in January.

Most units sold last month were in the mass market, along with a few city-fringe small-format apartments at condominiums such as Domus and The Mercury.

HDB upgraders were the hottest group of buyers. CBRE Research said that last month alone, they bought 550 to 600 units at mass market projects such as Caspian, Double Bay Residences, Kovan Residences, Livia, Mi Casa and The Quartz at median prices of $610 per sq ft (psf) to $740 psf.

A survey of first-quarter caveats lodged for this market segment indicated an average price of $695,000, said CBRE Research executive director Li Hiaw Ho. 'This is probably a good time for HDB home owners to upgrade to private property as the price gap between private properties and HDB resale flats has narrowed.'

Said Colliers International director for research and advisory Tay Huey Ying: 'Developers have lowered their price expectations for new launches and generally cut prices of unsold units. Buyers are biting as there is pent-up demand.'

The top three sellers in March were Double Bay Residences, Mi Casa and The Arte. About 85 per cent of units sold last month were priced below $1,000 psf, said PropNex chief executive Mohd Ismail.

The high-end showed some life with 70 units launched and some sales, including one Orchard Scotts unit at $2,220 psf.

But overall, only 100 prime units were launched in the first quarter, or just 4.7 per cent of all units launched, well down from the 39.4 per cent of all units launched in the fourth quarter last year.

Knight Frank director of research and consultancy Nicholas Mak said this was partly due to the retreat of foreigners from the luxury market.

Preliminary data suggests foreign deals stood at 16.8 per cent in the first quarter - a level last seen when Sars badly hit the market in 2003, he said.

Market analysts say it is a good start to the year, but they do not expect the strong buying to continue long-term.

'In the short term, this rate of buying can continue provided developers lower or maintain their prices,' Chesterton Suntec International's research and consultancy head Colin Tan said of March sales.

But in the long term, it is not sustainable, he said. 'The last time the market sold so many new units (14,811 units) was in 2007. That was when the deferred payment scheme was available. And it has since caused indigestion in the top end of the market.'

Unless the Singapore economy and employment market improve significantly this year, only 6,000 to 7,000 new private homes are expected to be sold, said Mr Mak.

He said healthy demand for mass market homes is likely to continue only as long as average HDB resale prices do not fall by more than 7 per cent year on year.

'Many in the mass market segment are buying now and banking on their future earnings to service their loans as they are afraid of missing the boat,' said Mr Mak.

The Peak Piques Interest Of 4,500 Potential Buyers

Source : The Straits Times, April 16 2009

Most potential buyers keen on four- and five-room flats.

POTENTIAL buyers yesterday thronged the showroom for The Peak @ Toa Payoh, a new project built under the Design, Build and Sell Scheme (DBSS).

Four thousand five hundred viewers turned up at the showroom at yesterday's launch, said Ms Kellie Liew, executive director of projects at HSR Property Group, the marketing agent for The Peak.


Most were keen on four- to five-room flats, citing location and HDB grants as factors influencing their decision.

Ms Cerise Chiew, 24, a teacher, hopes to buy a five-room unit. 'I can get a first-timer HDB grant. Toa Payoh is quite a good location and, if you want to sell in the future, you can get a higher price.'

Service crew member Sharon Ye, 26, was looking at four- and five-room units for her cousin. She said DBSS projects trumped private properties, as owning a private property meant losing out on many benefits, like Public Utilities Board bill rebates and town council subsidies.

Salesman Sam Tan, 38, was considering applying for a four-room flat to be near his mother. He is also eligible for a first-timer grant. He said he would pick a DBSS unit over one in a condominium since he would not use condo facilities, such as a swimming pool or a gym, but would still have to pay maintenance fees.

A few property hunters drew a comparison with Natura Loft, a DBSS project in Bishan, saying prices at The Peak were lower and the location more accessible. But some were not as convinced, including businessman Richard Lim, 37. 'I'm not going to buy because the room size is very small. I can get a 99-year condo unit for about the same price but bigger.'

Interested buyers have until April 28 to apply for the 1,203 available units.