Another Reserve List site has been triggered.

The Urban Redevelopment Authority (URA) said it will launch for sale a residential site at the junction of Upper Changi Road North and Flora Drive in two weeks’ time.

It said a developer has committed to bid no less than S$82 million for the three-hectare site. The minimum price is acceptable to the government.

URA said the land parcel can yield 390 units.

Some analysts said the top bid for the Upper Changi Road North site could range between S$160 million and S$185 million.

That would translate to about S$350 to S$400 per square foot per plot ratio.

A residential site at Sengkang West Avenue has already been sold via the Reserve List in February.

Together these two sites can potentially yield about 855 residential units.

There are another 16 residential sites remaining on the Reserve List of the first half of 2010 Government Land Sales (GLS) Programme that can potentially be triggered for sale.

Source: Channel News Asia, 12 Mar 2010

The luxury seafront condominium The Vision at the West Coast has received good response.

All of the 100 units allocated for its first phase of sale on the opening day of its private preview have been sold.

Prices for the two-bedroom to four-bedroom units range from around S$1,000 to S$1,2000 per square foot.

All the penthouse units have also been snapped up fetching S$3.6 million each.

The 99-year leasehold condominium by Hong Kong developer Cheung Kong offers a rare mix of strata terraces and 281 apartments.

Nearly half of the 14 strata terrace units were sold with the highest going for S$3.2 million.

Cheung Kong said that over 60 per cent of the buyers were home upgraders while the remaining were long-term investors in the property leasing market.

In view of the strong demand, it will be release 20 specially selected units for sale this weekend on a first-come-first-served basis.

These will comprise two-bedroom to four-bedroom units.

Source: Channel News Asia, 12 Mar 2010

Parliament has passed changes to the Stamp Duties Act. The amendments will give legislative effect to the seller’s stamp duty, which was re-introduced on February 20 as one of the measures to discourage property speculation.

Those who sell their residential properties and residential lands within one year of purchase February 20 will have to pay a duty of one per cent for the first S$180,000, two per cent for the next S$180,000 and three per cent for the balance.

Speaking at the second reading of the bill on Friday, Finance Minister Tharman Shanmugaratnam said the government first introduced the seller’s stamp duty in 1996 to cool the overheating property market.

It was subsequently suspended in November 1997. Relevant provisions in the Stamp Duties Act were subsequently repealed in 2005.

Another key change – the government will now be able to introduce, vary or remove the seller’s stamp duty, via a Ministerial Order that will be published in the Government Gazette.

The Finance Minister said the process of introducing and repealing provisions in the Stamp Duties Act each time the government wants to introduce, vary or remove the duty is not efficient, especially when it has to respond to changes in the property market cycle in a timely and calibrated manner.

Mr Tharman stressed that the government does not intend to change the seller’s stamp duty liberally.

He said: “Any future change to the seller’s stamp duty will be a carefully considered decision, taking into account all prevailing and projected factors at the time.”

Source: Channel News Asia, 12 Mar 2010

Frasers Centrepoint Trust is optimistic about the outlook for suburban malls in Singapore. It’s just completed a major revamp of the Northpoint shopping centre in Yishun.

Costing almost S$40 million, the renovations are part of Frasers Centrepoint Trust’s plans to rejuvenate all its malls.

More shops targeting youths and family attractions are part of the new tenant mix at Northpoint.

This includes 20 per cent more new F&B outlets, a library as a new anchor tenant and a new rooftop water playground.

The newly-renovated mall is able to accommodate more than double the number of tenants than previously, thanks to refurbishment and enhancement works.

The mall also boasts a new wing which Frasers Centrepoint said is helping to raise rental yields.

The total net lettable area has increased from 149,200 square feet to 235,000 square feet. Occupancy stands close to 100 per cent.

Rents have increased from on average of S$11 per square foot before the asset enhancement initiatives to S$13.20 per square foot now.

Wendy Low, GM, Frasers Centrepoint Malls, said: “Average rental has gone up by close to about 20 per cent increase. In terms of foot falls, we are now hitting 2.4 million traffic per month.

“That works out to something between 50 to 70 per cent increase. We’ve reconfigured the mall to make it even more conducive for our shoppers. When shoppers come to Northpoint, they’ll find that we have a better mix of tenants, wider corridors and in terms of circulation it’s more seamless.”

Northpoint is the second mall under Frasers Centrepoint Trust to under a major revamp.

The move is part of wider plans to rejuvenate all malls under its portfolio.

Next on the upgrading schedule is Causeway Point which it said has a good chance of starting this year.

Frasers Centrepoint Trust believes that the suburban malls segment shows promising growth potential.

Chew Tuan Chiong, CEO, Frasers Centrepoint Trust, said: “During the economic downturn, the suburban malls held up very well. This is convenient shopping, some non-discretionary.

“That kind of illustrated the strength of this concept. Going forward, again going with the rising affluence and rising population, we think that this sector of shopping is also to become even more attractive.

“If you look at Singapore, any area that is near the MRT station will be a good place to have a good shopping mall. And the suburbs are places where people spend a lot of time now, on the way home, other than work. These MRT stations and population centres have great potential for more quality shopping.”

Frasers Centrepoint Trust said it remains open to expanding its portfolio in Singapore and Malaysia, with Vietnam among the key markets in the region it is eyeing.

Source: Channel News Asia, 12 Mar 2010

The Housing and Development Board (HDB) has taken action against 56 flat owners for illegal sub-letting between January 2008 and December last year.

Most were fined between S$1,000 and S$21,000.

One owner had his flat repossessed for blatantly flouting HDB’s sub-letting rules.

Giving details of the case, HDB said it first received feedback on the unauthorised sub-letting of a unit in Block 336 Bukit Batok Street 32 on November 11 last year.

The flat was bought by Poh Boon Kay, who is a registered real estate agent. His wife was listed as an occupier.

He purchased the four-room flat from the open market in June 2007 without any loan.

HDB said the couple are also owners of five private properties. Its investigations found that the flat was sublet without its prior approval to three couples.

Mr Poh and his family did not live in the flat.

He was informed on November 25 to take immediate steps to evict the unauthorised sub-tenants, failing which HDB would take compulsory acquisition action.

However, the subtenants continued to occupy the flat. A notice to compulsorily acquire the flat was then served on December 23.

Mr Poh informed HDB on the same day that the sub-tenants had signed an undertaking to vacate the flat by the end of December.

A day later, the couple appealed. He claimed that the sub-tenant needed time to work out his finances before buying over the flat from Mr Poh.

He had therefore decided to rent out the flat to the sub-tenants in the interim.

On January 5, when the couple was interviewed by HDB, they claimed they did not know that they needed to seek the board’s prior approval before subletting the flat.

They also claimed that they were not aware of the policy for flat owners to fulfil the Minimum Occupation Period (MOP) of three years before they were eligible to sublet the whole flat.

HDB’s further investigations have shown that Mr Poh is also related to two other cases of unauthorised subletting at Bukit Batok and Telok Blangah.

With these further instances of unauthorised subletting related to Mr Poh, his claims that he is “unaware” of HDB rules cannot be substantiated.

HDB said as he has blatantly flouted HDB’s rules, there are no grounds for leniency and legal action has been taken to compulsorily acquire the flat.

HDB will also be taking legal action to compulsorily acquire the other two flats.

HDB would like to emphasise the severity of unauthorised subletting. HDB flats are meant for owner occupation. Flat owners who wish to sublet their whole flat must obtain approval from HDB and fulfil the MOP.

The current MOP for the subletting of flats is as follows:

*Flats bought directly from HDB – 5 years

*Resale flats purchased with CPF Housing Grant – 5 years

*Resale flats purchased without CPF Housing Grant – 3 years

Source: Channel News Asia, 12 Mar 2010

LIPPO Group has positioned itself in a pretty sweet spot by buying out ex-partner Ananda Krishnan’s stake in Overseas Union Enterprise (OUE), and upping its hold on the property company to 88.52 per cent.

With the deal, it has just enough interest to effectively dictate OUE’s direction – and also all the time it needs to decide whether to delist the latter, or turn it into a stockmarket darling.

For now, Lippo is unlikely to take OUE private. If history shows anything, it is that Lippo sees some worth in letting the latter stay listed.

When Lippo first joined hands with Mr Krishnan to buy into OUE in 2006, a general offer was triggered. OUE Realty (the 60:40 joint venture between Lippo and Usaha Tegas) ended up with a 94.51 per cent stake in the property company.

Under Singapore Exchange (SGX) listing rules, the free float of a company’s shares cannot fall below 10 per cent. OUE Realty was short of just another 5.49 per cent to take OUE private, and it could have paid just $10.20 a share, but it did not do so. Instead, it placed out new shares at a slightly higher $10.50.

Compare this with today’s situation, and it would seem like there is less incentive for Lippo to delist OUE. First, Lippo would have a larger stake of 11.48 per cent out there to buy. Second, OUE’s share price has increased since; it was $11.14 at market close yesterday. The price has stayed above $11 after Lippo paid that amount per share for Mr Krishnan’s stake on Tuesday.

History aside, there could be other restrictions at play. To part-finance the $957 million buyout of Mr Krishnan’s shares, Lippo had to borrow from banks. One would never know if the loans came with certain covenants, such as a requirement to keep OUE listed.

Most unequivocally, Lippo said on Tuesday that it aims to keep OUE listed. Of course, it is a case of ‘never say never’ in the business world, and it takes only the right price to get anything done. But so far, the signs point to OUE staying on the exchange.

Lippo stands to gain in some ways from this. There are the usual benefits which accrue to listed companies – the ability to raise funds from shareholders or issue debt, just to name a few.

The question now is whether Lippo would be keen to spur investor interest in OUE. More trading in the counter could help it reach its full value, which would ultimately benefit Lippo, the majority shareholder.

This would be hard without raising OUE’s free float, which is just slightly over 10 per cent. The good thing for Lippo is that unlike four years ago, when regulators were breathing down its neck, it is in no hurry to decide whether to place out more shares. It can wait for an attractive price to come about before doing so.

Apart from bringing more shares into the market, Lippo would also need to convince investors of OUE’s potential. There are still lingering doubts over the health of Singapore’s property market. And some analysts even suggested that cashing out was a smart move by Mr Krishnan, given the possibility that OUE’s earnings would come under pressure later from a possible oversupply of hotel rooms in Singapore.

But in all, it would be fair to say that Lippo has gotten itself into a rather comfortable driver’s seat at OUE. The market will be keeping its eyes peeled for what plans Lippo has for the company next.

Source: Business Times, 12 Mar 2010

MCC Land, part of Chinese state- owned enterprise Metallurgical Corporation of China (MCC Group), has emerged top bidder for an executive condominium site at Yishun Avenue 11.

Its bid of $127.8 million or $281 per square foot per plot ratio (psf ppr) was 7.5 per cent above the next highest offer of $261.68 psf ppr from fellow mainland Chinese group Qingjian Realty.

The tender for the 99-year leasehold plot drew 10 bids, with the lowest bid from SK Land (owned by a Lee Boon Teow) at $103 psf ppr.

If MCC Land is awarded the site, it will mark the MCC Group’s maiden Singapore property development.

MCC Land managing director Tan Zhiyong told BT that the group’s proposed scheme for the site is an eco-friendly project with over 400 units comprising two, three and four-bedroom apartments. The breakeven cost will be in the $500-550 psf region and the plan is to launch the project this year.

Mr Tan would not be drawn on likely selling prices but said: ‘We will keep it affordable, given the buying eligibility criteria for exec condos of a maximum $10,000 monthly household income.’

The developer will not build any shoebox units in the project, he said. ‘We want to follow the Singapore government’s vision for ECs. Let the people have enough room to pro-create and set up a family.’

This is the second time MCC Land has taken part in a Singapore Government Land Sales tender. Its first attempt, a week ago, was the tender for an EC site near Buangkok MRT Station. In that tender, it emerged second-highest bidder, pipped by a tie-up between Frasers Centrepoint and Lum Chang Building Contractors – by 1.4 per cent.

While MCC Land is new to Singapore, the MCC Group’s Singapore construction unit China Jingye Engineering Corporation Ltd (Singapore Branch) has been doing business here for almost 14 years. It is the main contractor for Universal Studios at Resorts World Sentosa.

Mr Tan told BT that if the group is awarded the Yishun EC site, it will ‘definitely explore’ the possibility of handling the project’s construction in-house. ‘But we will consider outside parties to handle the construction if they can do it cheaper. Whatever it is, we will not compromise on quality,’ he said.

‘Looking at the beautiful environment in the location – it is next to parks – we will complement this by using environmentally friendly technology and concepts for our project, such as having solar panels for the general areas and recycling rainwater for non-potable use.’

MCC Land will continue to seek good development land – be it residential, commercial or mixed-use sites – across the island, he said.

MCC Group – with dual listings on the Hong Kong and Shanghai bourses – is involved in engineering, procurement and construction, mining, paper-making, equipment fabrication and property development. It is a Fortune 500 company.

Seven of the total 10 bids in yesterday’s tender exceeded the $150-210 psf ppr that the site was estimated to fetch when it was launched in January by the Housing & Development Board.

But market watchers yesterday were not too surprised by the strong bids, pointing to robust sales recently for the launch of The Estuary, a 99-year leasehold private condo project in a better location in Yishun that fronts Lower Seletar Reservoir and is near Khatib MRT Station.

More than 500 units in The Estuary have been sold at an average price of $758 psf. ‘The developer of the latest EC site in Yishun might be able to achieve an average selling price of about $650 psf,’ said an industry observer.

CB Richard Ellis executive director Li Hiaw Ho said that while the latest EC plot may be less accessible, future residents will nonetheless enjoy a serene environment as it is close to Yishun Park and Orchid Country Club. ‘It’s also a short drive from Northpoint mall and other amenities at Yishun Central,’ he said.

ECs are a hybrid of public and private housing. EC projects have initial eligibility, ownership and resale restrictions similar to public housing, but these are lifted after 10 years.

Other bidders in yesterday’s tender included United Engineers unit Maxdin (about $257 psf ppr), Far East Organization ($256 psf ppr) and JBE Development, controlled by Hongkonger Patrick Lam, who developed The Luxe in Handy Road, at $227 psf ppr.

Source: Business Times, 12 Mar 2010

WITH reference to yesterday’s report, ‘Agent targeted foreigners in rental scam’, we would like to offer the following guide to employers recruiting foreign talent as well as individual foreigners who are leasing residential properties in Singapore.

• Request for verification of property ownership such as the latest property tax statement or utilise the e-Valuation List service at the Internal Revenue Authority of Singapore (Iras) website to find out the name of the property owner for $2.50.
• If the property is an HDB flat, request for a copy of the Housing Board’s approval letter to the landlord for subletting.
• Avoid paying a security deposit and advance rent by cash or cash cheque. Make out the cheque payable directly to the landlord. If you have no cheque account, buy a cashier’s order with the appropriate payee’s name.
• Whenever possible, make an appointment to meet the landlord to satisfy yourself that the prospective lease is in good faith.
• When responding to Internet advertisements, ensure that the source of the advertisement is from a credible website or property portal. If in doubt, contact the agency of the estate agent who posts the advertisement online to ensure it is not a hoax.
• Be aware of comparative rentals in the area where one is planning to lease a flat/ apartment and be wary of anyone who touts an incredibly low or attractive rental.
• Be sure that tenancy agreements signed are stamped by Iras as it is an offence to evade stamp duty on tenancy agreements. Moreover, if the tenancy agreement is not stamped, it may not be admissible in a court of law in the event of a legal dispute.
• Appoint an accredited estate agent or an agent from an accredited agency who has professional indemnity insurance.

Dr Tan Tee Khoon
Chief Executive Officer
Singapore Accredited Estate Agencies

Source: Straits Times, 12 Mar 2010

A PLANNED jumbo-scale commercial development on the current Majidi army camp site could make shopping in Johor Baru city a vastly different experience when the RM12 billion (S$5 billion) project is completed over the next decade.

The blue-print of South Key – the fully-integrated commercial development – which envisages street malls, offices, hotels and shop-lots, is to be built on 300 acres (121.4 ha, about the size of 270 football fields) in the city, said CH Williams Talhar & Wong director Danny Yeo Soon Kee.

Australia’s Cox Architects is involved in the project. The whole development has been planned in accordance with a security study that was ‘four to five inches thick’, Mr Yeo told BT. ‘A lot of security issues have been taken into consideration and CCTVs – even in the back lanes – would be linked to a centralised monitoring system overseen in conjunction with the police.’

CH Williams is the marketing agent for the project which is being developed by South Key Properties Sdn Bhd, a private company held by a group of shareholders including 30 per cent owner Kumpulan Prasarana Rakyat Johor (KPRJ).

A fully-owned subsidiary of the state government, KPRJ also holds a 20 per cent stake in Iskandar Investment Bhd (IIB), the entity tasked with attracting investors into the Johor economic zone. National investment agency Khazanah Nasional owns 60 per cent of IIB and the Employees Provident Fund the remainder 20 per cent.

South Key’s gross development value is estimated at RM12 billion, with the project stretching over 12-15 years; the first phase would see the launch of four storey shop-lots, and is scheduled for the middle of the year.

Mr Yeo said that ’specific businesses’ would be invited to participate as it was important to have the right tenant mix which at this point includes signature corporate offices, banks and financial institutions.

‘The whole thing will be strata titled,’ he said, adding a massive car park would be located below the entire development which would boast ‘a different shopping experience.’

Half of Camp Majidi has been vacated while arrangements are being made for the rest to relocate. According to media reports, the camp had been privatised in the 1990s.

The development is located within the ambitious Iskandar Malaysia economic zone which the government has actively promoted since it was unveiled in 2006.

Various incentives have been dangled at investors including lower taxes for companies in specific sectors to set up in Iskandar but it is unclear how many have taken up the offer.

Despite being strategically located next to Singapore, the southern city lacks ‘buzz’. Previous attempts to launch commercial and retail developments in the 1990s met with mixed success, with the result that resuscitation efforts are still on-going for those that floundered

Mr Yeo believes South Key would be different. Besides being located across the Causeway, the project has been designed to contain the ingredients attractive to investors and visitors, and also addresses the apprehension that most Singaporeans feel about the state of crime in Johor Baru.

Source: Business Times, 12 Mar 2010

A CHINESE firm new to Singapore’s residential development scene has topped the bidding for an executive condominium (EC) site in Yishun.

Beijing-headquartered MCC Land (Singapore), which lost out on last week’s tender for an EC site in Sengkang, was the highest bidder for the 15,074 sq m Yishun plot.

Its $127.8 million bid, or $281.31 per sq ft (psf) of gross floor area, easily beat earlier analysts’ expectations of $150-$210 psf of gross floor area.

Qingdao-based firm Qingjian Realty – which is behind the Natura Loft HDB design, build and sell scheme in Bishan – came in second, with a bid of $118.89 million or $261.71 psf of gross floor area.

Maxdin, part of United Engineers’ unit Greatearth Holding, was edged into a close third place with its offer of $117 million or $257.53 psf of gross floor area.

Among the other unsuccessful contenders were Far East Organization, Sim Lian Land and Boon Keng Development.

Most bidders also tendered for the Sengkang site last week.

Many of them are construction companies with the know-how to control and manage building costs, and are well placed to keep development expenses as low as possible, experts noted.

‘The results of this second EC site tender demonstrate developers’ fervour in acquiring sites for mass-market housing,’ said CBRE Research executive director Li Hiaw Ho.

MCC Land is part of listed Metallurgical Corporation of China, one of the world’s largest engineering and construction firms.

It has provided engineering and construction services in Singapore, and in 2008 clinched a contract for Universal Studios Singapore at Resorts World Sentosa. Qingjian Realty also began operations here as a contractor.

The Yishun EC plot can yield about 385 units and is near the completed Lilydale EC project. In the resale market of January-February this year, units there were selling at between $510 psf and $540 psf.

Although not within walking distance of an MRT station, the Yishun site is close to Yishun Park, Orchid Country Club and Lower Seletar Reservoir.

CBRE Research said the winning bid will translate into a break-even price of around $520 psf.
At this level, the final selling price of the EC units is likely to be around $600-$650 psf, said Colliers International’s executive director of investment sales Ho Eng Joo.

The winning bid, he said, took its cue from last week’s Sengkang EC tender, which attracted a higher-than-expected top bid of $315 psf of gross floor area.

Mr Li said the success of the recent launch of The Estuary private condominium in Yishun Avenue 1 had boosted developer confidence in selling EC projects in this location to first-timers. Over 500 units of The Estuary were reportedly sold at a price of $750-$800 psf, he said.

The winners of the Sengkang and Yishun EC tenders have to set aside 95 per cent of units in the initial month of sale for first-time home buyers.

ECs were introduced in 1995 to bridge the gap between public housing and private apartments. Only those with a gross monthly household income of $10,000 or less can apply.

Source, Straits Times 12 March 2010