Group to expand its portfolio by over 50% in next five yrs

CAPITALAND’S service residence arm, The Ascott Limited, is expanding its portfolio by more than 50 per cent in the next five years.

The division hopes to contribute more significantly to CapitaLand as it grows – perhaps accounting for as much as 20 per cent of group earnings in future.

Ascott chief executive Lim Ming Yan shared these plans for ‘transformational change’ with the media, in conjunction with the launch of the group’s project – Ascott Huai Hai Road Shanghai. The 278-unit property near the Xintiandi entertainment district is owned by Hong Kong-listed real estate group Lai Fung Holdings.

Ascott now has some 26,000 service residence apartments in its portfolio and it aims to raise this number to 40,000 by 2015.

The target is achievable looking at Ascott’s rate of growth, Mr Lim said. This year, the firm will be rolling out about 3,100 apartments. Of these, some 1,600 units across seven properties will be ready in the second half, in countries such as China and Indonesia.

Much of the envisioned growth will come from China. Ascott has just won contracts to manage four Ascott-branded properties in Ningbo, Hangzhou, Suzhou and Guangzhou. The biggest among these will be Ascott Guangzhou IFC, with 314 units, due to open next year.

South-east Asia is likely to be the next fastest growing market for Ascott. For instance, Mr Lim is positive about Singapore’s service apartment sector as the country develops as a regional business centre.

Occupancy rates for Ascott’s properties in Singapore exceed 90 per cent, and ‘we are constantly on the lookout for new opportunities’, he said.

India and Europe are also on Ascott’s radar. It could enter Italy, Switzerland, Turkey and the east European countries.

While merely taking on more management contracts is a fast way to grow, Ascott will continue to focus more on buying and running properties.

It owns and manages about 67 per cent of its portfolio, and is prepared to invest in key gateway cities, Mr Lim said.

Ascott could obtain capital for growth from private equity funds, such as the Ascott China Fund. It could also sell assets to Ascott Residence Trust for funds to re-invest.

Mr Lim did not say how much the entire portfolio expansion would cost.

But he disclosed that Ascott will invest $50 million to refurbish more than 10 of its properties in Asia and Europe over the next 12 months. This is on top of around $20 million it has put in to renovate some properties such as Somerset Liang Court.

As Ascott grows, it ‘can and should be a significant part of CapitaLand’, Mr Lim said. On average, it has accounted for some 10 per cent of the group’s earnings in the last few years, but it would be possible and ‘more meaningful’ to raise this to up to 20 per cent, he added.

Source: Business Times, 2 Aug 2010

A NETWORK of apartments and recreational spaces looks set to replace the vertical blocks that used to be the landmark of Gillman Heights.

Unveiling The Interlace on Friday, CapitaLand and Hotel Properties Limited (HPL) said they are ready to launch the project next month.

Featuring 1,040 apartments on a 99-year leasehold land of 871,884 square feet, The Interlace will have units that range in size between 807 sq ft for two bedroom apartments and 4,306 sq ft for “super penthouses”.

CapitaLand president and chief executive Liew Mun Leong declined to disclose how much the units will cost, but said the firm is trying hard to price them under $1,000 psf.

The Interlace sits on the site which used to house 608 units at Gillman Heights. The former HUDC estate was in the news following a $548 million collective sale inked in 2007, and subsequently, a series of legal cases when a minority group of owners challenged the sale. The deal was finally wrapped up in May this year.

The development of The Interlace is led by CapitaLand and two other shareholders, including HPL.

The construction cost is expected to be $250 to $270 psf and total investment is estimated at $1.4 billion. The construction contract is expected to be awarded by year-end and the project will be completed in 2014.

The Interlace is designed by Office for Metropolitan Architecture partner, Mr Ole Scheeren. The German is also known for leading the design and construction of the China Central Television Station (CCTV) headquarters in Beijing.

Instead of the standard design of residential developments in Singapore – in clusters of isolated, vertical towers – The Interlace responds to the issues and challenges of tropical living in an network of recreational and dwelling spaces integrated with the natural environment.

Nestled in a green belt at the Southern Ridges, The Interlace’s design features 31 apartment blocks, each six stories tall, stacked in a hexagonal arrangement to form eight large-scale courtyards. The project also features sky gardens and roof terraces.

“In developing the dramatic external form, we have also focused … on creating comfortable internal spaces,” said CapitaLand Residential Singapore chief executive Patricia Chia.

“The name reinforces the interconnectivity between man and the space, community and natural environment surrounding him.” Tan Hui Leng

Source: Today, 5 Sep 2009

One is on the former Gillman Heights site; the other is in Cairnhill.

SINGAPORE’S largest property developer CapitaLand is set to roll out two more residential launches this year – the 1,040-unit The Interlace on the site of the former Gillman Heights, and a 165-apartment luxury project in Cairnhill Road on the site of the former Char Yong Gardens.

The company yesterday unveiled the design for the The Interlace, which it is developing with Hotel Properties Ltd. The project will cost about $1.4 billion all up, including the $548 million – or $363 per sq ft of potential gross floor area – paid for Gillman Heights in 2007

Prices could start from about $700,000 for a two-bedroom apartment, CapitaLand said. The project will be launched next month.

The Interlace was designed by Ole Scheeren, a partner at the Office for Metropolitan Architecture – the firm behind the design of the distinct 54-storey China Central Television Station headquarters in Beijing. For The Interlace, Mr Scheeren wanted to break away from the standard kind of residential project in Singapore comprising a cluster of isolated, vertical towers.

Instead, the design for The Interlace explores a new take on tropical living with an expansive and interconnected network of communal spaces. Thirty-one apartment blocks, each six stories tall, will be stacked in a hexagonal arrangement to form eight large-scale courtyards. The interlocking blocks will resemble a ‘vertical village’ with cascading sky gardens and private and public roof terraces.

‘This is a great opportunity to create and build a residential destination at the Gillman Heights site that will challenge the present architectural definition of the living space,’ said Patricia Chia, chief executive of CapitaLand Residential Singapore.

The Interlace will offer a variety of homes, from two and three-bedroom units to penthouses, when sales start in October. CapitaLand declined to say how the apartments will be priced in psf terms, but said that the construction cost for The Interlace will be around $250-$270 psf.

It added that it will not be ‘greedy’ when it comes to the profit margin it is looking for and that homes will be ‘affordable’. Analysts have previously estimated a breakeven cost of around $750 psf for the site, with an average selling price of $900 psf.

The next launch for CapitaLand is the 165-unit freehold condominium at the former Char Yong Gardens, which will be rolled out before the end of this year. The project, designed by Kerry Hill Architects, will be a luxury development, said CapitaLand chief executive Liew Mun Leong.

CapitaLand bought Char Yong Gardens for $1,788 psf of potential gross floor area, including development charges payable to the state, at the height of the property boom in 2007.

More launches are planned for 2010, including one at Farrer Road on the former Farrer Court site. CapitaLand forked out a record $1.3 billion for that site in a collective sale in 2007.

However, the en bloc market is unlikely to rebound to such levels again in the near future, Mr Liew said. The Laguna Park development on the East Coast is currently being offered for $1.2 billion, which would be the second-highest price ever for such a transaction.

Mr Liew said: ‘Given the cost of the land, given the construction cost and given the demand, it is too early for developers to confidently say the world economy has recovered and there will be buyers who can afford the price.’

He also said that a 5 to 15 per cent increase in private home prices here would be ‘reasonable’ given pent-up demand and the low interest rates. ‘(But) if it jumps 30 per cent, then I will be a little bit concerned about whether it is sensible,’ he added.

Private home sales in Singapore jumped 52 per cent month-on-month in July to 2,767 units. A record 1,825 units were sold in June – but that number was easily surpassed just a month later. And prices are beginning to edge up. New projects released in recent weeks have been priced higher than in early 2009.

Source: Business Times, 5 Sep 2009

THREE prime condominium projects that struggled to generate interest last year saw a surge of buyer activity over the weekend after developers cut their prices.

The freehold 19-storey Parc Centennial in Kampong Java Road – where all 51 units are served by private lifts – sold 32 units at $1,115 per square foot (psf) to $1,233 psf, or from $1.27 million to $1.93 million. This price level is about 20 per cent lower than last year’s $1,450 psf, and the interest absorption scheme is included.

Developer EL Development sold only six units in April and May last year when the project was originally released for sale. And at a private preview in March this year, it sold a 2,486 sq ft penthouse unit for $1,005 psf.

It held a preview this past weekend and has now sold all the two-bedroom units, which start from 1,098 sq ft. The three-bedders increase in size to 1,572 sq ft.

Managing director Lim Yew Soon said he had raised the prices of the remaining 12 three-bedroom units at Parc Centennial by 2 per cent.

Over at the 302-unit Martin Place Residences in River Valley, a soft launch over the weekend saw sales of 80 units at $1,450 psf on average, out of a total of 100 units launched.

Developer Frasers Centrepoint Homes said the ‘attractive pricing’ drew buyers. It released units priced from $1,260 psf to $1,700 psf, compared with the initial 28 units sold at $1,700 psf to $2,000 psf last year.

Singaporeans made up 62 per cent of the buyers at Martin Place Residences, with the rest being permanent residents and foreigners.

Earlier, CapitaLand had reported strong weekend sales at its 173-unit The Wharf Residence.
About 95 per cent of the buyers chose not to take up the stamp duty waiver and interest absorption, preferring a straight 8 per cent price cut, it said yesterday.

Prices started at just below $1,000 psf for units with private enclosed space and many of the weekend deals were done at less than $1,300 psf, industry sources said.

Attractive price cuts, coupled with the recent stock market rally and a fear of losing out, are some of the key factors spurring buyer interest, experts said.

Compared with the situation late last year, buyers are more confident and developers seem to be taking advantage of improving sentiment to relaunch projects at attractive prices, said PropNex chief executive Mohamed Ismail.

Source: Straits Times, 19 May 2009

HOMEBUYER sentiment continued to hold up over the weekend, with units of CapitaLand’s The Wharf Residence selling fast.

The property giant launched 100 units last Friday, of which 85 were snapped up that same day.

The Wharf Residence is a 999-year leasehold condominium, located off the hip Mohamed Sultan Road, comprising four residential towers and 13 conservation shophouses.

Over the weekend, CapitaLand released more units and sold another 24. During its launch last year, 25 units were sold. The weekend sales bring the total number of units sold to 134, as of 4pm yesterday.

With 173 apartments in the development, CapitaLand has chalked up a respectable tally of nearly 80 per cent sold.

In a press statement yesterday, CapitaLand said that it sold the units at an average price of between $1,300 and $1,600 per sq ft (psf). Prices are down, lower than the range of $1,429 psf to $1,708 psf seen in the third quarter of last year.

Another selling point could have been the stamp duty absorption and interest absorption scheme.
Ms Patricia Chia, chief executive of CapitaLand Residential Singapore, said that four out of five of the homebuyers were locals. The rest of the buyers hailed from Indonesia, Malaysia, China, Japan, Canada and Vietnam.

She added that the heritage homes will be launched for sale soon.

The sales of The Wharf Residence suggest that the healthy performance of the property market, as seen by the strong showing in new private home sales last month, is set to continue.

Source: Straits Times, 18 May 2009

GILLMAN Heights owners can heave a sigh of relief now that the estate’s buyers Ankerite have confirmed that the group will go ahead with the purchase of the development.

Property giant CapitaLand, majority shareholder of Ankerite, told The Straits Times in a statement last night that ‘lawyers of both parties are working towards May 22 to complete the purchase of the site’.

Source: Straits Times, 18 May 2009

Its latest move follows a report in The Straits Times over the weekend that Ankerite had failed to complete the sale by its due date, last Friday.

This caused anxiety amongst some owners at the 607-unit estate in Alexandra Road, who feared that the buyers got cold feet, as some owners had committed to buying other properties.

Earlier reports indicated that owners stood to get between $870,000 and $950,000 for their units.
The sale – first inked in early 2007 for a record $548 million at the height of the property market boom – has been dogged by controversy as minority owners fought at every turn to overturn the sale.

It was finally thought to be a done deal in February after the Court of Appeal dismissed a last-ditch plea by minority owners to reverse the transaction.

However, just two weeks before the sale completion date, on April 30, Ankerite raised some issues. Two points of contention were: a sum of $750,000 transferred out of the estate management fund; and separate monies allocated for a lawsuit against the estate’s management corporation (MCST) by a contractor who built the estate’s clubhouse and swimming pool in 2002.
MCST members said these issues were raised ‘at the last minute’, but Ankerite clarified yesterday that it took time to carry out the ‘due diligence process’ and access to relevant documents was granted by the MCST only on Apr 23 and Apr 24.

Ankerite said the sales committee lawyers Lee and Lee notified them that these issues were resolved on the afternoon of May 15 – the sale completion date. However, Rajah and Tann wanted proof that the outstanding lawsuit had been settled, and only received a copy of the settlement agreement on Saturday, May 16.

‘With this settlement agreement…the lawyers are working to complete the purchase as soon as possible,’ said Ankerite’s lawyers.

MCST chairman Kok Chong Weng said he was glad to hear a date has been set to complete the deal, but added that residents might be looking at options to see if any compensation can be claimed for the delay.

Meanwhile, chief executive of CapitaLand Residential’s Singapore operations Patricia Chia said in a statement yesterday that ‘going forward, we are looking at presenting our other projects such as the proposed development at the Gillman Heights Condominium site at the appropriate time’.

About 80% of buyers for the 134 units sold to date are Singaporeans

CAPITALAND has sold another 24 apartments over the weekend at The Wharf Residence at Tong Watt Road, off Mohamed Sultan Road, the listed property group said in a release yesterday.

This comes after the sale of 85 apartments on Friday following a relaunch of the 999-year-leasehold project.
The apartments are priced at between $1,300 and $1,600 per square foot (psf) inclusive of a package comprising stamp duty absorption and an interest absorption scheme.

Buyers who do not opt for this package will enjoy an 8 per cent discount.
Last year, CapitaLand priced apartments in the development at $1,500 to $1,900 psf, again inclusive of the stamp duty/interest absorption package.

However, buyers were not given the choice of not opting for this package.

With the latest sales achieved up to 4pm yesterday, CapitaLand has sold 134 of the total 173 apartments in the project.

About 80 per cent of buyers for the 134 units sold to date are Singaporeans.

The rest are from Indonesia, Malaysia, China, Japan, Canada and Vietnam, said CapitaLand Residential Singapore CEO Patricia Chia.

The apartments comprise two to four-bedroom units ranging from 1,012 to 2,196 square feet, as well as five penthouses (2,745 to 5,565 sq ft).

The development also includes 13 conserved shophouses, dubbed the Vintage Collection houses, ranging from 4,478 to 4,930 sq ft in strata area.

Ms Chia said CapitaLand has received queries for the conserved houses and will launch them for sale soon.

Source: Business Times, 18 May 2009

CapitaLand releases units at The Wharf Residence, Frasers Centrepoint to launch Woodleigh project in July or Aug

DEVELOPERS are riding the wave of buying interest to launch more units.

CapitaLand yesterday released 100 two and three-bedroom units at The Wharf Residence, a 999-year leasehold condominium near Mohamed Sultan Road which comprises 173 apartments and 13 shophouses.
CapitaLand could make more units available today as the launch stretches into the weekend.
The release of more units at The Wharf Residence comes as activity in the higher end of the property market is starting to stir. According to URA’s April statistics, buyers snapped up 64 units out of 75 launched at Bukit Sembawang Estates’ Verdure at Holland Road. The median price of the transactions was $1,416 psf.

‘Sentiment is better now,’ said Knight Frank executive director (residential) Peter Ow. Some buyers feel that property prices have dropped enough, he added.

And even if prices have not bottomed, they believe that there is probably ‘no harm in going in now, rather than letting money sit in the bank’. Some buyers are also worried about missing out on a real estate recovery, he said.

Separately, Frasers Centrepoint mentioned at its results briefing last week that it will launch its Woodleigh project in July or August this year. Prices will be at a level that ‘the market will accept’, said its chief executive, Lim Ee Seng.

The company’s Caspian at Lakeside has seen strong take-up since its launch in February. Of the 712 units in the development, 611 had been sold as at May 7, Frasers Centrepoint said.Source: Business Times, 16 May 2009

The group sold 85 units – mostly two-bedders – at an average price of between $1,300 and $1,600 per square foot (psf).

Sizes of two-bedroom units start at 1,012 sq ft. Assuming a price of $1,300 psf, one would cost about $1.32 million.

Some of the 100 units released yesterday were the remainder from an earlier launch.

According to Urban Redevelopment Authority (URA) records, CapitaLand introduced 80 units to the market in July last year and sold 24 until September that year at median prices above $1,500 psf.

The Wharf Residence is expected to receive its temporary occupation permit in 2013. CapitaLand is offering buyers a package deal of stamp duty absorption and interest absorption. BT understands that those who do not take up this package may get to pay up to 8 per cent less.

ANOTHER buyer who purchased luxury condominiums in bulk under the deferred payment scheme is now having trouble paying up.

Keppel Land said yesterday that an Indonesian investor who bought 51 units at The Suites @ Central in Devonshire Road has asked for more time to cough up the final payments.

The investor paid $1,806 per sq ft (psf) for the freehold apartments, which were bought in June 2007, Keppel said in a filing to the Singapore Exchange. It would not disclose the total price of the units or whether the investor is an individual or an institution, such as a company or a fund.

But a check of the Urban Redevelopment Authority’s (URA) Realis caveats shows that a series of 51 units were sold at that time for a total of $127 million. The units were not bought in a single block and do not appear to make up entire floors, but span the second to the 33rd floors.

The units were bought under the deferred payment scheme. This means the buyer made a downpayment of 20 per cent of the purchase price and then deferred the rest of the payments until the apartments were completed.

The Suites @ Central was completed in February, but the buyer failed to pay up on time.

Two other buyers, both Singaporeans, also missed the payment deadline, Keppel said. One had bought two apartments in the fully-sold project; the other had bought three.

Keppel has received payment for the other 101 apartments in the 157-unit project, which is a 60-40 joint venture between Keppel and Chip Eng Seng.

The Indonesian buyer has asked for an extension of the payment deadline in order to ‘arrange funds for payments’, Keppel said.

The developer has agreed to a six-month extension starting from yesterday, but is requiring the Indonesian buyer to pay $500,000 per month during the extension period. The first payment has already been received, Keppel said.

Other developers have also recently reported problems collecting payments for units they sold under the deferred payment scheme.

MCL Land ran into trouble last month with the buyer of its Fernhill condominium off Stevens Road. The buyer, reported to be a company called Concordia Overseas controlled by a Hong Kong resident named Chan Ki, had purchased all 25 units in the project and managed to resell five soon after.

But when the time came to make payment for the 20 units it still owned, Concordia missed a few deadlines. It subsequently managed to resell 19 units in time to meet the final deadline, but reportedly at a loss.

The price Concordia paid for the units was $1,410 psf, but the Business Times reported that it fetched only $1,180 psf for the 19 units it resold.

Market watchers said that if the Indonesian buyer of the 51 units at The Suites @ Central has to offload the apartments in a hurry, it may end up making a loss.

The average price of apartments at the project has fallen to about $1,470 psf, according to five caveats lodged for units that have been sold so far this year.

More buyers with payment problems could surface in the coming months, as the property slump coincides with the fallout from the deferred payment scheme, which was scrapped in October 2007.

Some 29,250 homes planned for completion between last year and 2013 were offered with the deferred payment scheme, the URA revealed last year. Analysts have estimated that about 14,000 were actually sold under the scheme.

But even if a handful of buyers default, it may not be statistically significant, noted Mr Nicholas Mak, director of research and consultancy at Knight Frank.

At CapitaLand’s RiverGate, about 2 per cent of buyers have missed payments since the project was completed in March, the developer said on Thursday. Most of the project’s buyers had opted to take the deferred payment scheme.

‘Two per cent is not an alarming figure,’ said Mr Mak. ‘Once in a while you get cases like a single buyer unable to pay for 51 units but, if you look at the bigger picture, it may just be a small proportion.’

But he added that next year will be the time of reckoning, as many projects that were sold during the height of the market – in the second half of 2007 and early last year – will be completed then, with the bulk of their payments due.

Source: Straits Times, 9 May 2009