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SUCH is the demand for property in the Central Business District, with its proximity to the proposed integrated resorts, that this year’s first private residential property launch might never have been open to the public if two western funds had had their way.

Both the funds, whose names were not revealed, were keen to buy the tower blocks of One Shenton — a new project by City Developments Limited (CDL) — said its chairman Mr Kwek Leng Beng.

He was speaking at the soft launch preview of the 341-unit 99-year leasehold project on Friday. However, Mr Kwek declined both offers, preferring, he said, to cater to the Singaporean market first.

Setting what appears to be the market standard for such properties in the first half of the year, CDL is launching One Shenton at prices that range between $1,500 per square foot (psf) to $2,000psf, depending on the orientation and level of the unit.

“We are pricing the units attractively and reasonably, between $1,500psf and $2,000psf,” said Mr Kwek Leng Joo, managing director of CDL. However, this price range excludes the 11 penthouse units.

Mr Kwek’s words seem to be true, judging from the initial response to the project.

At 3.30pm on Friday, more than 70 people were seen lining up for the official soft launch scheduled for Saturday. Most were accompanied by agents from CB Richard Ellis (CBRE), Knight Frank and ERA, the firms appointed by CDL to market the project.

“Some of them are buyers who missed out on the Marina Bay Residences. They have come to see the showflat (picture), but the official buying starts on Saturday,” said CBRE marketing executive Cicilia Gunawan.

“I didn’t make an appointment with an agent, but I’m just trying my luck to see if I can get to the showflat,” said a gentleman who declined to be named. He said that he saw One Shenton as a good investment.

CDL believes the prices are within buyers’ means. “High-end luxury condominium prices may have shot through the roof, but they are still affordable,” said Mr Kwek Leng Beng, citing prices of high-end properties in other global capitals.

He said similar apartments in London, New York and Hong Kong are fetching prices that are more than double the prices here.

He recalled speaking with London-based Knight Frank agents who said that an apartment overlooking Harrods department store was going for £4,000psf ($11,930psf), while in New York, prices were around US$6,000psf ($9,220).

The demand for such high-end properties is fuelling the price hike here.

“What we are seeing is the release of the pent-up demand for these properties,” said Mr Kwek.

The 99-year leasehold One Shenton comprises units that range from a 517-square foot one-bedroom studio apartment to a 9,085sq ft penthouse. Built with an eye to attracting young professionals and businessmen, some 70 per cent of the development consists of one and two bedroom apartments.

The project has a Club Level on the eighth storey. It features leisure, spa and wading pools, alongside a 50m lap pool. It also has lounges, game rooms, a juice bar and a library. The Wellness Levels on the 24th and 25th storeys offer residents gym facilities, a spa, as well as an outdoor fitness area.

The One Shenton launch will be followed by other CDL projects in Balmoral Park-Stevens Road, Kim Lin Mansion site at Grange Road and the Quayside at Sentosa Cove.
 
SUCH is the demand for property in the Central Business District, with its proximity to the proposed integrated resorts, that this year’s first private residential property launch might never have been open to the public if two western funds had had their way.

Both the funds, whose names were not revealed, were keen to buy the tower blocks of One Shenton — a new project by City Developments Limited (CDL) — said its chairman Mr Kwek Leng Beng.

He was speaking at the soft launch preview of the 341-unit 99-year leasehold project on Friday. However, Mr Kwek declined both offers, preferring, he said, to cater to the Singaporean market first.

Setting what appears to be the market standard for such properties in the first half of the year, CDL is launching One Shenton at prices that range between $1,500 per square foot (psf) to $2,000psf, depending on the orientation and level of the unit.

“We are pricing the units attractively and reasonably, between $1,500psf and $2,000psf,” said Mr Kwek Leng Joo, managing director of CDL. However, this price range excludes the 11 penthouse units.

Mr Kwek’s words seem to be true, judging from the initial response to the project.

At 3.30pm on Friday, more than 70 people were seen lining up for the official soft launch scheduled for Saturday. Most were accompanied by agents from CB Richard Ellis (CBRE), Knight Frank and ERA, the firms appointed by CDL to market the project.

“Some of them are buyers who missed out on the Marina Bay Residences. They have come to see the showflat (picture), but the official buying starts on Saturday,” said CBRE marketing executive Cicilia Gunawan.

“I didn’t make an appointment with an agent, but I’m just trying my luck to see if I can get to the showflat,” said a gentleman who declined to be named. He said that he saw One Shenton as a good investment.

CDL believes the prices are within buyers’ means. “High-end luxury condominium prices may have shot through the roof, but they are still affordable,” said Mr Kwek Leng Beng, citing prices of high-end properties in other global capitals.

He said similar apartments in London, New York and Hong Kong are fetching prices that are more than double the prices here.

He recalled speaking with London-based Knight Frank agents who said that an apartment overlooking Harrods department store was going for £4,000psf ($11,930psf), while in New York, prices were around US$6,000psf ($9,220).

The demand for such high-end properties is fuelling the price hike here.

“What we are seeing is the release of the pent-up demand for these properties,” said Mr Kwek.

The 99-year leasehold One Shenton comprises units that range from a 517-square foot one-bedroom studio apartment to a 9,085sq ft penthouse. Built with an eye to attracting young professionals and businessmen, some 70 per cent of the development consists of one and two bedroom apartments.

The project has a Club Level on the eighth storey. It features leisure, spa and wading pools, alongside a 50m lap pool. It also has lounges, game rooms, a juice bar and a library. The Wellness Levels on the 24th and 25th storeys offer residents gym facilities, a spa, as well as an outdoor fitness area.

The One Shenton launch will be followed by other CDL projects in Balmoral Park-Stevens Road, Kim Lin Mansion site at Grange Road and the Quayside at Sentosa Cove.

Source : Weekend Today - 6 Jan 2007

CDL chief launches second condo in area, is keen on nearby sites

PROPERTY tycoon Kwek Leng Beng has a vision for Marina Bay - he wants to build his own ‘mini-city’ in the new downtown.

Mr Kwek, the executive chairman of Hong Leong Group and City Developments (CDL), yesterday launched his second residential development in the prime area.

He is now eyeing the two office buildings next to it.

At the soft launch of CDL’s One Shenton in Shenton Way yesterday, Mr Kwek declared his interest in adjacent Shenton House and UIC Building, both down the road from One Shenton.

‘We are interested to build a mini-city here if we can,’ he said.

‘I would plan it with condominiums, offices, shopping malls and hotels, so then I would have a comprehensive development.’

He added that the new downtown presents a good opportunity for such a development because it is a ‘well-planned’ district.

As a developer, Mr Kwek has one of the biggest presences in the downtown area, with 10 office buildings in Shenton Way and Raffles Place already under his belt.

These include Hong Leong Building and The Arcade as well as CDL’s flagship building, Republic Plaza.

As well, CDL launched Marina Bay’s first condo, The Sail @ Marina Bay, back in 2004.

The 1,111-unit development, located diagonally across from One Shenton, has been one of the hottest properties in the market since its launch.

But One Shenton is likely to be CDL’s last fully residential project in the downtown area, said Mr Chia Ngiang Hong, CDL’s group general manager.

If CDL snags Shenton House and UIC Building, they are likely to be kept as office buildings, rather than being converted to condos - as in One Shenton’s case.

Mr Kwek also said that CDL will bid for the ‘white site’ next to One Shenton that the Government will release for sale in May. Such a site can be used for any purpose.

CDL had previously said that it is interested in another Marina Bay site, allocated for a boutique hotel, that the Government is due to release soon.

But despite his big plans for Marina Bay, Mr Kwek was realistic about the cost that would be involved in achieving them.

‘Today, you have a lot of fierce developers coming in. They are prepared to pay high prices,’ he said.

CDL failed in its bid last year for the Collyer Quay site close to The Arcade, which was won by rival tycoon Ng Teng Fong’s Sino Land instead.

However, Mr Kwek still stands a chance to colonise a part of Marina Bay. UIC Building was put on the market last month for $830 million, while a collective sale for Shenton House is in the works.

Source : Straits Times - 6 Jan 2007

HOTEL Royal Limited (HRL), which is calling an extraordinary general meeting (EGM) on Jan 27 to seek approval to sell Dapenso Building for $58.4 million, yesterday said that it will book a net gain of $31.2 million from the sale.

HRL announced in October that it would put the 11,000 sq ft Dapenso Building on Cecil Street up for sale. Property firm Colliers International was hired to conduct a public tender. On Dec 7, HRL said Colliers had received an offer for $58.4 million from Remarkable Investment Pte Ltd, which entered into a conditional sale and purchase agreement. Yesterday, HRL said it will convene the EGM to seek approval for the proposed sale, which qualifies as a major transaction.

In a filing to the Singapore Exchange, HRL said Colliers had initially valued the 99-year leasehold property at $46 million.

‘The offer from the purchaser was the best offer received . . . and exceeds the value of the property as indicated in the valuation by $12.4 million,’ HRL said.

The company said the net book value of the building stood at $27.3 million at the end of 2005, so the gain from the sale amounts to $31.2 million.

HRL said that while the property was acquired as a long-term investment, one reason for selling now was the possible threat that the development of the new business and financial centre at Marina South would shift the central business district further away from where the property is.

The company’s directors also think that landlords of older office developments in the area will be enticed to redevelop their buildings into residential units, in anticipation of increased demand for homes by those intending to work in the Marina Bay integrated resort.

‘The emerging trend of redevelopment and conversion of use is also expected to catch on to meet the growing popularity of ‘downtown living’,’ HRL said.

‘This will affect the concentration of a critical mass of commercial properties in the locality of the property.’

Source : Business Times - 6 Jan 2007

HAVING lowered its projections for 10-year government bond rates from 3.5 per cent to 3 per cent, Citigroup has upgraded the target prices of the real estate investment trusts (Reits) it covers.

However, while CapitaMall Trust Management (CMT) continues to be favoured as a ‘buy’, Ascendas Reit (A-Reit) has been downgraded to a ‘hold’, owing to its top price performance in the last quarter. Citi maintains a ’sell’ on CapitaCommercial Trust (CCT), arguing that a couple of the trust’s major tenants could be subject to rental caps.

Asset enhancement is the key force behind value creation at CMT, said analyst Wendy Koh, who raised her target price for the Reit from $2.69 to $3.21. CMT’s stock price closed at $2.85 yesterday.

CMT has started asset enhancement at Bugis Junction, which is expected to add $4 million - or 10 per cent - to net income, she said. Asset enhancement at Raffles City could also add 25 per cent to net income and value, where CMT plans to add 150,000-200,000 square feet of retail space.

Asset enhancement is also ongoing at IMM, and other assets with potential include Sembawang Shopping Centre, Hougang Plaza and Jurong Entertainment Centre. Through such programmes, CMT has raised the value of some properties by 30-75 per cent, said Ms Koh.

It is Citi’s top pick among Singapore Reits, with the highest expected total return of 15 per cent, comprising a 10.7 per cent share price return and a 4.3 per cent expected dividend yield.

A-Reit, on the other hand, has seen its stock price rise 27 per cent since October 2006, Ms Koh said in her Jan 4 report. She raised the target price for A-Reit from $2.35 to $2.72, and downgraded the stock to a ‘hold’. A-Reit units closed at $2.56 yesterday.

A-Reit registered the highest quarter-on-quarter rise in occupancy rates for its multi-tenanted buildings to 94.3 per cent, while its high-tech industrial parks and science and business parks sectors achieved growth to 96 per cent and 93 per cent respectively.

‘A-Reit could also acquire another $400 million worth of yield-accretive assets in FY08 without raising equity as its assets are revalued,’ Citi said. However, with increased competition from other industrial Reits, ‘the days of rapid growth in DPU (distribution per unit) might be over’.

Despite raising the target price for CCT from $2.04 to $2.30, Ms Koh reiterated a ’sell’ on the Reit, citing rich valuations and a risk of DPU disappointment. CCT’s price closed at $2.54 yesterday.

‘At current price, we estimate CCT offers the lowest yield of just 3 per cent among the listed Reits in Singapore,’ she said.

Key tenants at CCT’s Capital Tower, with leases expiring in 2007 and 2008, are subject to rental caps. In addition, with more than 90 per cent of the space in the tower to be renewed only in December, it is unlikely to benefit fully from rising rental rates, said Ms Koh.

‘We believe we were too optimistic on its rental reversion for 2007 and 2008 previously. DPU growth in 2007 is likely to be just 7.7 per cent. The bulk of growth will likely take place in 2008 with DPU expected to rise by 24 per cent.’

Source : Business Times - 6 Jan 2007

Foreigners are boosting demand for condominium apartments, say experts
 
While the euphoria and hype of the high-end residential property market have yet to filter down to the mass and mid-market segment, where home prices are still in the doldrums, it is a happier situation in the rental market.

Rents for private residential apartments across the board are edging towards their 1997 peak, say experts.

“Rentals are picking up quite a lot — by 8 per cent to 10 per cent on average — much higher than sale prices. We’re seeing a lot of foreigners and this is what is boosting the market. They are only 10 per cent to 20 per cent below the peak,” said Mr James Lee, founder and chief executive of James Lee Realty.

In comparison, prices of mid and mass- market private condominiums are still between 30 per cent and 40 per cent below the peak. The spike in rentals is not confined to the private sector; even Housing Board flat rentals are seeing a rise.

In some prime areas, rents have gone up by 20 per cent while rents for HDB flats in suburban areas like Jurong have gone up by about 10 per cent according to anecdotal evidence, say market watchers.

For example, said Mr Lee, a month ago his agency secured a lease for a two-bedroom apartment in Spring Dale condominium at Upper Bukit Timah for $1,800 per month. The earlier rental which expired in October was $1,400 per month.

The rise has been even steeper in prime areas like Balmoral Road in District 10. “A three bedroom unit used to be signed on for $6,000 a month two years ago. Last month,

we rented one out for $8,500,” said Mr Lee.

He reckons rentals have jumped by about 20 per cent in the last 18 months and are set to go even higher.

In the mid-market segment, too, rentals are beginning to go beyond the reach of young professionals.

Ms Hena Yeo, a young professional renting a studio apartment in Bayshore Park, snagged a good deal in mid-2005 when she rented a 624-square foot apartment for $1,050 a month.

It was a bargain, considering the locale. For her money, Ms Yeo is getting the works, with full condominium facilities as well as the added bonus of Bus Plus service to the financial district, a small supermarket, a laundromat and wireless broadband access at the clubhouse café.

“I’m happy here. By renting, I get the facilities I need without having to pay the maintainance fees,” said Ms Yeo.

But her lease expires in May and should she still want to continue staying at Bayshore, it is going to cost her more than $1,500 a month — almost 50 per cent more what she is paying now.

“Prices at Bayshore Park have been fluctuating, several months ago the rental price for a two-bedroom there was at $1,500. I recently rented one out at $1,800,” said Mr Lee.
.
Prices at Bayshore — a typical example of a mid-market condominium — are approaching the peak of 1997, when rentals for two-bedrooms reached $2,400.

In the online classified portals, landlords are asking for rentals of between $2,000 and $2,200. On a per-square-foot (psf) basis, that translates to $2.20psf to $2.40psf.

According to Knight Frank’s real estate highlights report for the third quarter of 2006, the rental for new private residential units in the East Coast ranged between $1.65psf and $2.20psf.

But some condominiums such as Bayshore Park are doing even better. Expect to see more such rental hikes in the new year, say experts.
Foreigners are boosting demand for condominium apartments, say experts
 
WHILE the euphoria and hype of the high-end residential property market have yet to filter down to the mass and mid-market segment, where home prices are still in the doldrums, it is a happier situation in the rental market.

Rents for private residential apartments across the board are edging towards their 1997 peak, say experts.

“Rentals are picking up quite a lot — by 8 per cent to 10 per cent on average — much higher than sale prices. We’re seeing a lot of foreigners and this is what is boosting the market. They are only 10 per cent to 20 per cent below the peak,” said Mr James Lee, founder and chief executive of James Lee Realty.

In comparison, prices of mid and mass- market private condominiums are still between 30 per cent and 40 per cent below the peak. The spike in rentals is not confined to the private sector; even Housing Board flat rentals are seeing a rise.

In some prime areas, rents have gone up by 20 per cent while rents for HDB flats in suburban areas like Jurong have gone up by about 10 per cent according to anecdotal evidence, say market watchers.

For example, said Mr Lee, a month ago his agency secured a lease for a two-bedroom apartment in Spring Dale condominium at Upper Bukit Timah for $1,800 per month. The earlier rental which expired in October was $1,400 per month.

The rise has been even steeper in prime areas like Balmoral Road in District 10. “A three bedroom unit used to be signed on for $6,000 a month two years ago. Last month,

we rented one out for $8,500,” said Mr Lee.

He reckons rentals have jumped by about 20 per cent in the last 18 months and are set to go even higher.

In the mid-market segment, too, rentals are beginning to go beyond the reach of young professionals.

Ms Hena Yeo, a young professional renting a studio apartment in Bayshore Park, snagged a good deal in mid-2005 when she rented a 624-square foot apartment for $1,050 a month.

It was a bargain, considering the locale. For her money, Ms Yeo is getting the works, with full condominium facilities as well as the added bonus of Bus Plus service to the financial district, a small supermarket, a laundromat and wireless broadband access at the clubhouse café.

“I’m happy here. By renting, I get the facilities I need without having to pay the maintainance fees,” said Ms Yeo.

But her lease expires in May and should she still want to continue staying at Bayshore, it is going to cost her more than $1,500 a month — almost 50 per cent more what she is paying now.

“Prices at Bayshore Park have been fluctuating, several months ago the rental price for a two-bedroom there was at $1,500. I recently rented one out at $1,800,” said Mr Lee.

Prices at Bayshore — a typical example of a mid-market condominium — are approaching the peak of 1997, when rentals for two-bedrooms reached $2,400.

In the online classified portals, landlords are asking for rentals of between $2,000 and $2,200. On a per-square-foot (psf) basis, that translates to $2.20psf to $2.40psf.

According to Knight Frank’s real estate highlights report for the third quarter of 2006, the rental for new private residential units in the East Coast ranged between $1.65psf and $2.20psf.

But some condominiums such as Bayshore Park are doing even better. Expect to see more such rental hikes in the new year, say experts.

Source : Weekend Today - 6 Jan 2007