The Housing & Development Board has awarded the tender for the residential site at the junction of Sengkang West Avenue and Fernvale Link to Sunmaster Holdings.

The company submitted the highest tender for the site at S$200.5 million out of a total of 10 bids received.

The minimum offer price was S$70 million.

The land parcel is about 16,998 square metres and is for a proposed condominium development.

The lease term will be for 99 years.

The tender was launched in January this year and closed last Thursday.

Source: Channel News Asia, 8 Feb 2010

Residents of Neptune Court voted on Sunday to appoint law firm Tan & Au to undertake the privatisation of the sprawling estate.

Sunday’s meeting to amend the constitution, appoint a law firm and approve the privatisation committee lasted three hours amid heated outbursts from some residents.

One complaint was the alleged lack of transparency in how the Neptune Court Owners’ Association (NCOA) had gone about its plans.

“They claim there was an open tender in selecting a law firm, but none of us knew about it and it was done without our consent,” said a long-term resident who did not want to be named.

But addressing the meeting, NCOA’s president Tommy Wong, said: “We selected (Tan & Au) for their talent, experience and capability for detail such that owners will not suffer any financial loss … and their terms of no success, no payment.”

While the previous committee had consulted the law firm some two years ago, this is the first time the NCOA has moved to appoint it.

Some 250 residents, representing fewer than half of the 752 units, turned up for the meeting. In all, 205 residents voted to appoint Tan & Au while 20 objected.

The privatisation committee was endorsed with a majority vote of 146.

There is still some way to go before privatisation becomes reality, with the agreement of 75 per cent of all the owners needed. For now, the Neptune Court Privatisation Committee (NCPC) together with its lawyers plan to meet the Ministry of Finance – which owns the land – and Singapore Land Authority to negotiate a better privatisation fee, said NCPC’s chairman David Ho.

In 2007, the residents were quoted a fee of S$144 million to privatise the 99-year leasehold estate, but in June last year were given a new figure of just S$40 million, which worked out to roughly S$50,000 per unit.

Just down the road, the 480-unit Lagoon View estate last year was quoted an estimated S$12 million, or S$28,000 a unit.

Retired civil servant Yahya Aljaru, 69, and retired manager, Mr Fadzakir Fadzlil, 67, both of whom have resided at Neptune Court since 1975, are looking forward to privatisation and a likely en bloc sale effort thereafter.

“I will take it if they make me an offer I can’t refuse,” said Mr Fadzakir.

“I have simple needs. I don’t need a swimming pool, a snooker room. I will use the proceeds to go travelling and leave some for the kids.”

Source: Channel News Asia, 8 Feb 2010

MORE people were taken to task last year for illegally converting their private homes into dormitories, hostels and boarding houses as accommodation for foreign workers and students.

The Urban Redevelopment Authority (URA) investigated about 700 private residential properties and is still forcing boarders to vacate the premises of 140 owners. Overcrowding is common, making safety an issue.

The other 560 owners have since stopped taking in lodgers illegally.

In 2008, the URA investigated just 400 cases.

In particular, there was an 18 per cent increase in the number of unauthorised worker dormitories over the previous year, though figures were not available.

The illegal dormitories are being exposed as more people write in to the URA with their complaints, and tip-offs are provided by the public and other government agencies.

The URA said that private apartments and landed homes are meant for residential use and should not be converted into workers’ dormitories, which need permission to operate.

Under the Planning Act, illegal conversion of premises can result in a maximum fine of $200,000 and a year in jail. If the offence continues after conviction, a fine of $10,000 a day may be imposed.

Despite URA efforts, checks by The Straits Times showed that illegal workers’ dormitories are still prevalent, especially in Little India and Tiong Bahru.

Along Marne Road off Petain Road, The Straits Times found at least two terrace houses housing more than 10 workers each.

In Tiong Bahru, there were at least three such apartments. In other units, there were workers from China and Malaysia who refused entry to The Straits Times. But shoes outside the main door and the drying laundry were signs of the multiple occupants inside.

At three units, occupants said there were eight people living inside. One said the boss had obtained the flat for them.

One landlord, who wanted to be known only as Ms Huang, said she had rented her three-room unit in Kai Fook Mansion in Tiong Bahru Road to eight Malaysians at $1,700 a month.

She said she had nine tenants at first but was told by the URA in December that she could have only eight. Ms Huang said she had not made modifications to her flat.

Private homes as ad hoc accommodation have sprung up over the last few years because of a shortage of dormitories and boarding houses.

A single worker renting a room in one of these converted homes pays about $200 compared with $160 to $180 each month for a workers’ dorm in Jurong.

In the middle of last year, the URA found that 140 units in Grangeford condominium in Leonie Hill had been subdivided into 600 units. The developer was taken to action to recover the units.

The Ministry of Manpower warned employers of foreign workers that they are responsible for the well-being of their workers, including providing acceptable accommodation while they are employed.

Employers who fail to provide acceptable accommodation for their foreign workers are in breach of the work permit conditions and may be fined up to $5,000 and jailed up to six months. Such employers could also be barred from hiring foreign workers in future.

Tiong Bahru residents interviewed said they were fine with foreign workers in their midst, but were concerned about the overcrowding in the walk-up apartments, which are about 800 sq ft to 1,000 sq ft and usually have two or three bedrooms.

Interior designer Jo Turner, 31, claimed that her ceiling sprang a leak because there were 10 workers sharing a toilet in the flat above hers.

Ms Turner, like advertising executive Eugene Yip, 38, was mostly worried about the workers cooking over an open flame. About a month and a half ago, unit 1P in Yong Siak Street, housing Chinese national workers, caught fire.

The Singapore Civil Defence Force said the fire was accidental and from an electrical source. This could have been caused by a short circuit or overloading of power outlets.

Source: Straits Times, 8 Feb 2010

SINGAPORE real estate investment trusts (S-Reits) appear to be back on the acquisition trail after facing some serious financial woes in recent times.

Several Reits here have been scouting the region, picking up good buys, now that the economy is back on an even keel.

Reits have proven very popular among investors here. They usually own a portfolio of a particular type of property and derive income from rents. Unitholders receive regular payments.

But it was a different story last March when a National University of Singapore forum on Reits noted that their overall value had plunged about 60 per cent after the onset of the global financial crisis.

Refinancing and recapitalisation risks were high. So too was S-Reit debt, estimated to amount to $4.6 billion last year.

But by September, a special report by Fitch ratings noted that S-Reits had managed to refinance most of their debt obligations and share prices were recovering.

Mr Vincent Yeo, chief executive of M&C Reit Management, the manager of CDL Hospitality Reit (H-Reit), believes the successful refinancing of loans and the flurry of capital-raising activities, particularly in the second half of last year, reflect easing credit conditions.

Credit margins, however, are still wider than before the crisis, a spokesman for Ascendas Reit (A-Reit) pointed out.

But the easing conditions seem to be enough. In the last three months, S-Reits increasingly bought assets, with most deals being done out of Singapore.

H-Reit, Keppel Land’s K-Reit Asia and Starhill Global Reit all went Down Under by investing in Brisbane and Perth. Starhill Global Reit also bought two retail properties in Kuala Lumpur.

In Japan last November, Mapletree Logistics Trust purchased a warehouse in Chiba, while Parkway Life Reit (PLife) acquired eight nursing homes.

At home, Mapletree Logistics purchased two warehouses and Frasers Centrepoint Trust proposed the acquisition of Northpoint 2 and Yew Tee Mall.

Australia, it appears, is the current favourite, said DMG and Partners analyst Jonathan Ng.

H-Reit’s $220.9 million purchase of five hotels in Brisbane and Perth is one example. The deal incorporated a 66 per cent discount and would render a net property yield of 8.4 per cent, higher than H-Reit’s portfolio yield of 5.2 per cent, said Mr Yeo.

A spokesman for Starhill Global Reit said property prices in Britain, Japan and Australia have become more attractive as capitalisation rates have reached an all-time high in the past decade.

OCBC Investment Research analyst Meenal Kumar said the best distressed deals are in the more developed markets. In Singapore, making yield-accretive purchases is more challenging and acquisition opportunities may vary according to property sub-sector.

Due to many assets being securitised in the past five years, more S-Reits are likely to look overseas for opportunities in future, said Mr Ng.

PLife has already defined Australia and Malaysia as additional core markets this year, in addition to Singapore and Japan, said chief executive of Parkway Trust Management, Mr Yong Yean Chau.

Reits will have to be mindful of how much debt they take on for acquisitions. Sticking to a debt level of 30 per cent to 35 per cent is reasonable, Mr Ng said.

Some Reits are also looking at divesting sub-optimal assets as a strategy or for the purposes of lowering debt, Ms Kumar noted.

Source: Straits Times, 8 Feb 2010

Residential property prices in Singapore increased 7.4% in last three months of 2009 as the property market made a quick recovery from a nightmarish start to the year, the latest published figures show.

This followed the previous quarter’s increase of 15.8%, a turnaround from a fall of 18% in the first half of 2009, leaving the annual price increase at 1.8%, said the Redevelopment Authority.

Prices of non-landed properties rose by 7.2% in the last quarter and 15.9% in the third quarter of 2009, the figures also show. Apartment prices were up 9.7% more, while prices of condominiums increased by 6.1%.

Looking ahead to 2010 luxury property is predicted to perform well in coming months. According to a report from real estate consultants Savills the sector could see price increases of up to 15% while the mass-market and middle end properties could see values increase by 5%.

‘I think luxury property prices are still some 20 to 25% off the peak. In terms of the high net worth individuals, I think a lot of confidence is coming back to the market. There is a lot of liquidity around that’s pushing them back into real estate,’ said Michael Ng, managing director of Savills Singapore.

However, the majority of people who buy property in Singapore are unhappy about some aspect of the service they get from estate agents, according to a new survey.

Some 80% of all property transactions in Singapore are done through real estate agents and most of these end up with customers encountering some sort of bad service, the report from Ngee Ann Polytechnic has found.

Bad or wrong advice were the most common complaints followed by a failure to get fair prices, they survey found. Overall 77% of respondents from diverse age groups, professional and educational backgrounds, were unhappy, said Nicholas Mak, real estate lecturer.

The survey also showed that 73% felt that more training is needed included a full accreditation system. The government is currently working on a new regulatory framework for estate agents.

‘Some of them also felt that their real estate agents neglected their opinions or suggestions,’ he added.

Source: Property Community, 8 Feb 2010

It’s starting to look like a self-fulfilling prophecy, as far as prices in the high-end residential segment in Singapore are concerned. Anecdotally, there’s evidence that some cash-rich speculators are also back in the market, according to some property consultants.

Notable secondary market transactions in the week of Jan 8 to 15 at The Tate Residences, Ardmore II and Scotts Square have seen a spike in prices.

One was the sale of a 2,207 sq ft, 27th storey apartment at The Tate Residences on Claymore Road, developed by Hong Leong Holdings. The 85- unit luxury condo has two 36-storey towers, and is very close to completion.

The unit changed hands for $6.5 million ($2,946 psf). The seller purchased the apartment when it was launched in September 2006 at $5.046 million ($2,287 psf), and enjoyed a capital appreciation of 29% in about three years. This price is pretty close to the levels seen in the heady days of August to September 2007, when a 3,229 sq ft unit on the 27th floor changed hands in a sub-sale for $11.3 million or $3,500 psf.

There’s been a lot of excitement along Claymore Road, particularly as the rumour mill is once again rife with speculation of The Claymore’s “en bloc potential”. Located next to The Tate Residences, the 146-unit luxury freehold condominium was completed in 1985 and is still considered a landmark luxury condo in that location. As early as 2007, owners of The Claymore had flirted with the possibility of an en-bloc sale, going as far as appointing CB Richard Ellis and DTZ as joint marketing agents. According to sources, it did not achieve the 80% consensus needed for a collective sale to take place.

“The Claymore definitely has en bloc potential,” says a property consultant who declined to be named. “But, the owners are reluctant to sell, because when looking at replacement units, it’s hard to find something comparable in the same location.” Unit sizes at The Claymore are large. The smallest are three-bedroom apartments 2,680 sq ft in size. Four-bedroom apartments measure 3,348 sq ft while the penthouses are 4,919 sq ft each.

The most recent transaction at The Claymore was in November last year, when a three-bedroom, 13th floor apartment changed hands for $8.38 million ($2,503 psf). The previous owner had purchased the property in March 1996 for $5.2 million ($1,553 psf), and enjoyed a 61% capital appreciation over the last 14 years.

The last time an apartment at The Claymore crossed the $2,500 psf barrier was during the most recent peak in May 2008, when a three-bedroom apartment on the 17th floor was sold for $6.8 million ($2,537 psf).

Further up Claymore Road is the prestigious Ardmore Park enclave, where the 303-unit Ardmore Park developed by Wheelock Properties epitomised the height of luxury in the mid-1990s. Even today, it’s the yardstick for luxury property prices. Riding on its success, the developer launched the 118-unit Ardmore II in September 2006 and, to date, the project is 100% sold and close to completion. After it was launched, prices ranged from $2,087 psf to a high of $3,208 psf in May 2007 at the peak of the market. At that time, Ardmore Park apartments were changing hands in the resale market at $1,837 to $2,773 psf.

With anticipation of the private preview of Ardmore III mounting, at prices said to be $3,500 psf or higher, an apartment on the 24th floor of Ardmore II was sold for $5.566 million ($2,751 psf) in a sub-sale. The seller bought the unit when it was launched in October 2006 for $4.833 million ($2,389 psf). The last time an apartment at Ardmore II breached the $2,700 psf mark was February 2008, when an 11th floor apartment sold for $5.675 million ($2,804 psf).

Meanwhile, at the 338-unit Scotts Square located on Scotts Road, also by Wheelock Properties, an apartment on the 25th floor was sold for $3.35 million ($3,537 psf), according to a caveat lodged last month. The seller purchased the 947 sq ft apartment in August 2007, when the project was launched, for $3.735 million ($3,944 psf). At the peak of the market, a 1,249 sq ft apartment on the 28th floor had changed hands in a sub-sale at $5.558 million or a high of $4,451 psf.

The 45-storey tower is expected to be completed in 2011, and will house luxury retail and commercial space on the first five levels.

Source: The Edge, 8 Feb 2010