Tag Archives: Residential

Oxley acquires residential units for $21.53mil

Oxley Holdings, via its fully-owned subsidiary Oxley Topaz Pte. Ltd., has exercised the option to acquire eight residential units at 21 Meyappa Chettiar Road for a total price of $ 21.53 million.

Zoned for residential use, the freehold property has a land area of around 898.1 sq m.

In an SGX filling, Oxley revealed plans to “redevelop the property, subject to obtaining all the necessary approvals from the relevant authorities”.

Oxley noted it had paid a sum of $ 215,300 upon the grant of the options and another $ 861,200 during the exercise of the options. The rest of the purchase price will be paid upon the completion of the acquisition.

It plans to fund the purchase by internal resources and bank borrowings.

Oxley does not expect the acquisition to materially affect the company’s earnings per share or net tangible assets per share for the current financial year ending 30 June 2018.

 

This article was edited by Keshia Faculin.

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URA to launch tender for residential site at West Coast Vale

The Urban Redevelopment Authority (URA) has accepted an application from a developer to put up the residential site at West Coast Vale for sale by public tender.

This comes after the developer committed to bid a price of not less than S$ 379.988 million in the tender for the site.

“As the minimum price committed by the developer is acceptable to the government, the site will be released for sale by public tender,” said the URA.

With a maximum permissible gross floor area of 54,857 sq m, the 1.9ha site was made available for sale on the reserve list of the second half 2017 Government Land Sales Programme.

Tricia Song, head of research for Singapore at Colliers International, noted that the West Coast Vale site has been triggered for sale despite the abundance of new and upcoming supply within the area.

“We think this is probably due to the brisk sales chalked up at 752-unit Parc Riviera which is now 87 percent sold as of October 2017, at a median price of S$ 1,250 psf, since it was launched in November 2016,” she said.

“Next to the Parc Riviera site is a new, yet-to-launch project Twin Vew – which can yield 570 units – that was sold in February 2017 to China Construction at S$ 592 psf per plot ratio (ppr).”

Song expects the top bid for the site to stand at “about S$ 443 million to S$ 472 million (S$ 750 to S$ 800 psf ppr), with a selling price of S$ 1,300 to S$ 1,375 psf”.

The trigger price of S$ 379.988 million translates to S$ 643.5 psf ppr, she added.

Meanwhile, the URA revealed that the public tender for the land parcel will be launched in about two weeks, while the tender period for the site will be about six weeks.

This article was edited by Romesh.

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Developers to acquire more residential sites

At least 13 housing site tenders are expected to close for the remainder of the year, reported Singapore Business Review, citing a report from Maybank Kim Eng.

These land plots are projected to yield an additional 3,600 dwellings, with most located in the central part of the city-state, said the research house.

“With a resurgent en bloc market providing many options to acquire fresh sites, we believe developers will be more selective and rational in their bids. We believe winners of accretive land deals could be re-rated on the back of Realisable Net Asset Value (RNAV) upgrades,” said its analyst Derrick Heng.

However, investors remain cautious on the residential sector as vacancy level remain high at 8.4 percent as of Q3 2017. Nevertheless, this could fall next year amid fewer completions and the demolition of projects sold en bloc.

Overall, Maybank Kim Eng estimates that around 7,900 private houses will be available next year.

Assuming 3,000 will be redeveloped, this will equal to a net supply of only 4,900 units, down from about 13,200 units per annum that were absorbed by the market over the past five years on average.

“If the historical rate of absorption is maintained, vacancy rates could potentially improve to 6.5 percent by end-2018,” noted Heng.

Even though rents of residential properties remain constrained due to high vacancy level, it could rebound if occupancy rate improves, said Maybank Kim Eng.

“Recall that during the previous en bloc cycle of 2005, vacancy rates fell from 8.4 percent at end-2005 to 6.5 percent by mid-2006 as households displaced in the en bloc process sought out new homes. A corresponding three percent uptick in rents then sparked the start of an upcycle.”

“We think an improving economy and accelerated demolitions from the current en bloc fever could provide further upside to rents in the next two years,” it added.

 

This article was edited by Keshia Faculin.

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Rosy outlook for residential market

The outlook for Singapore’s housing market appears bright, according to an article written by Cushman & Wakefield Singapore’s Research Head Christine Li that was posted on TODAYonline.

One main factor fuelling this positive sentiment is the hot en bloc sector, where a total of 18 housing projects collectively worth $ 6.34 billion have been sold so far this year to reach a 10-year high in terms of value.

“This en bloc wave will result in an additional 9,300 new homes injected into the market, going by estimates from the Urban Redevelopment Authority (URA),” she said.

The vibrant situation is also spurring more homeowners to pull their units from the resale market in an attempt to join in the en bloc frenzy.

“Even those with little chance of success are also trying their luck. As a result, there is now a shortage of resale properties on the market — a turnaround from the situation at this time last year, when there were too many (units). This lack of supply will stoke demand and prop up the market.”

The housing market’s promising prospects is also driven by the dwindling supply of units being sold by property developers.

“Our analysis shows that the market has remained in the oversold domain for three consecutive months, with the ratio of units sold over units launched exceeding 100 percent.”

“In fact, this ratio reached an all-time high of 225 percent in the third quarter this year, indicating that developers are selling units faster than they can replenish.”

Hence, home builders will need to acquire land for their future residential projects, otherwise, they would have nothing to sell. Li estimates that there are about 10 developers in need of land despite the strong en bloc sales market.

“As such, we expect the en bloc market to be sustained over the next 12 to 18 months or so, with potentially another 10 to15 sites being transacted during this period.”

Furthermore, transactions in the primary housing market could be propelled by a sharp rise in the number of HDB upgraders who have just met the Minimum Occupation Period (MOP) of five years.

“Based on our estimate, there are around 19,000 of them this year and a further 13,000 next year, a marked improvement from the previous years,” Li added.

 

This article was edited by Keshia Faculin.

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