Property Market Updates (3rd November 2010)

Far East plans $100m project at Ten Mile Junction site

Far East Organization is planning to build a $100 million development, comprising 338 small office-home office (SoHo) units and 121,000 sq ft of retail space, at the Ten Mile Junction site it won in a government land tender earlier this year. The developer in February paid $164 million or $437 per sq ft per plot ratio (psf ppr) for the 99-year leasehold site at the junction of Choa Chu Kang and Woodlands roads, which now houses the Ten Mile Junction shopping mall. Far East said it plans to build a residential project with 338 SoHo units and also retrofit the existing retail space to create a new mall called Junction 10. The SoHo project will be called The Tennery and will be launched in the first quarter of 2011. Far East said that more details on The Tennery will be released later this year. In the meantime, the developer has started marketing the retail space in Junction 10. It will spend some $28 million to retrofit existing space to create a 'rail lifestyle' concept. 'The railway history of the area dates as far back as the British colonial era. And with Junction 10's history as a railway junction, it has inspired us to bring to life some aspects of the railway into the mall,' said Chng Kiong Huat, Far East's executive director for development & planning. Supermarket chain Giant has taken up more than 30 per cent of the space at the mall to set up a hypermarket.

- The Business Times, P12

- Also quoted in The Straits Time, B21, “Ten Mile Junction's rail-themed facelift”.



DBSS site at Bedok Reservoir draws six bids

The tender for a land parcel at Bedok Reservoir Crescent, slated for public housing, closed yesterday with six bids received. CEL Development came out tops with a bid of $112.6 million, or $224.3 per sq ft per plot ratio (psf ppr) for the site, which could yield 430 homes under the Design, Build and Sell Scheme (DBSS). Analysts said the top bid was more subdued than bids in the past. The site is located about 10 minutes' walk from Bedok Town Park MRT station, which is expected to be completed in 2017. The top bid could translate to a break-even cost of about $430-$470 psf. The bids varied across a narrower range, compared to the previous tender for a DBSS site at Tampines Avenue 5/Central 8, where the top bid was $261 psf ppr.

- The Straits Times, B4

- Also quoted in The Business Time, P10, “Chip Eng Seng tops bid for DBSS site in Bedok”.



Weeding out rogue property agents

It will take a few years before new rules aimed at weeding out rogue property agents drive down the number of complaints, the Consumers Association of Singapore (Case) said yesterday. Case director Seah Seng Choon made the prediction as it emerged that property agents are among the 10 most-complained-about professions here. A code of conduct for the industry is being enforced by a new statutory body, the Council for Estate Agencies (CEA). The CEA has the authority to fine, suspend or revoke the licences of property agents who break the rules. From Jan 1, only CEA-registered agents will be allowed to work. The new code bans agents from representing both buyer and seller, or referring clients to moneylenders. They must also have a system for handling complaints and follow advertising guidelines.

- The Straits Times, P4



Behind those gyrating home supply estimates

A recent presentation on the estimated supply of private housing units in the pipeline has reignited the debate about the accuracy of official estimates. The presentation - by real estate firm International Property Advisor (IPA) - highlighted the fact that the number of private homes that are projected to be completed each year has fluctuated broadly over time. The URA compiles the number on a quarterly basis. URA said the estimated supply of private housing units in the pipeline is computed based on the expected completion dates of projects with planning approval (either provisional permission or written permission), which is obtained through URA's quarterly survey of developers. Analysts said that what is cause for concern now is that there are no pipeline figures for 2011 and 2012 that can be taken to be reasonably accurate - at a time when the sentiment in the real estate market is uncertain and more government measures to cool the property market could be on the horizon. The Ministry of National Development (MND) takes into consideration the pipeline supply when it plans its half-yearly government land sales (GLS) programme. Market consensus is that as the end of 2010 approaches, Singapore can expect another climb in the number of expected completions for both 2011 and 2012. The estimated supply of private homes due to be completed in 2011 has already fluctuated greatly since end-2006. In Q4 2006, URA said 5,876 new private homes would be completed in 2011. The estimate rose to 20,492 in Q1 2008 before dropping sharply to 9,196 in Q4 2009. In Q3 this year, an estimated 6,766 homes were expected to be completed in 2011.

- The Business Times, P1



Govt keeping a close eye on property market

Prime Minister Lee Hsien Loong said that the Government is keeping a close eye on the property market to avert the formation of an asset bubble. Recent measures to cool the market have dampened sentiment, but liquidity is awash in the region. The latest Government measures to stem overheating include reducing the maximum loan for buying a second residential property, imposing stamp duty on owners who sell properties within three years of buying them and tighter restrictions on those buying HDB resale flats. As for Singapore's future, Mr Lee said it could define itself as one of the world's most attractive global financial centres with a less reactive approach to currently emotional issues like regulation.

- The Straits Times, P3

- Also quoted in The Business Time, P2, “Govt keeps careful watch on property market: PM”.



Consumer confidence still positive: Nielsen survey

Consumer confidence here has remained 'unwavering' and 'positive' as compared to the last quarter, according to the Nielsen Global Consumer Confidence Index. The marginal increase of the index from 112 to 113 this time round could indicate consumers are confident on continued economic recovery. On Singaporeans' personal finances, the majority (72 %) felt that they were in good or excellent states. About 50% felt that now is the right time to buy things they want. The global average was 35%.

- The Business Times, P11