Issue 313

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 CONTENTS FROM THE

p2 Are Singapore Developers Facing Foreign

EDITOR
Welcome to the 313th edition of the
Singapore Property Weekly.
Competition Forced to Walk a Tightrope?
Hope you like it!
p8 Resale Property Transactions
Mr. Propwise
(May 14 May 19)

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 SINGAPORE PROPERTY WEEKLY Issue 313

Are Singapore Developers Facing Foreign Competition

Forced to Walk a Tightrope?

By Property Soul (guest contributor)

Government Land Sales for residential sites

in Singapore recently crossed the S$1 billion
mark. A 99-year leasehold site in Stirling
Road (Queenstown) was sold at a top bid of
S$1.003 billion. The winning consortium is
Chinas Nanshan Group and Logan Property
(a Chinese developer listed in Hong Kong).
Nanshan has been eyeing the Singapore
property market for a long time. In the past 12
months, it participated in 8 of 11 tenders in
Singapores land auctions.

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 SINGAPORE PROPERTY WEEKLY Issue 313
What is the role of the government?
In Singapore, land use is regulated by
Singapore Land Authority and Urban
Redevelopment Authority (URA). They make
decisions on zoning, plot ratio and
development charges which have a direct
impact on the value of the sites.
The Chief Valuer at IRAS sets a minimum
reserve price on the land parcels based on
recent property transactions. URA then sells
them to developers through public tenders.
The sites will be awarded to the highest
bidders if they dont fall below 85 percent of
the reserve price.
Chesterton Singapore reported that land
prices have increased by an average of 30
percent each year from 2011 to 2014. Land
auction data from URA also show that
suburban areas such as Tampines, Clementi
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and Jurong West have land prices that almost
doubled from 2008 to 2014.
The government can indirectly influence the
selling price of new sites in at least three
ways:
1) Increase or reduce the release of new sites
for public auction;
2) Impose or relax cooling measures to
restrict or stimulate the property market; and
3) Launch public flats to meet the demand for
public housing.
Where have developers profit margins
gone?
Building up the land bank and replenishing
the stock of sites are important to a property
developer. The successful acquisition of land
parcels means a pipeline of new projects to
launch.
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 SINGAPORE PROPERTY WEEKLY Issue 313

The successful launch of new projects can do developers were paying only a 13 percent
wonders to the companys financial results. premium on average.

The number of bidders in public auctions Land prices have shot up. But property prices
have increased from an average of 8.25 in are falling. How badly are developers
the second half of 2015 to 13.3 this year. In margins affected? In 2009, developer net
2017 so far, two out of four land tenders were margins stood at an average of 35.7 percent.
awarded to foreign bidders. Keen competition It dropped to 11.8 percent in 2014 for private
from cash-rich foreign counterparts are condominiums and 4 percent for ECs.
forcing local developers to bid aggressively. If
they are conservative in their bidding, they
will be easily outbid by China developers who
are eager to take a share of the Singapore
property market.

A recent report by Cushman & Wakefield

mentioned that developers are paying an
average of 29 percent more for residential
sites over comparable sites sold within the
past five years. In the second half of 2016,

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 SINGAPORE PROPERTY WEEKLY Issue 313
Are developers committing suicide?
Back in August 2013, City Development
Limiteds Kwek Leng Beng told the media that
if the Qualifying Certificate is there, it will be
suicidal to keep tendering at high prices just
because we want a land bank.
According to the Qualifying Certificate
regulation, new projects must be sold within
two years after obtaining the Temporary
Occupation Permit, or face extension charges
on the unsold units. If developers cant sell all
the units in their project after five years, they
have to pay Additional Buyer Stamp Duty on
the remaining units.
With a gross floor area of 954,327 sq ft, the
Stirling Road site can be developed into a
maximum of 1,110 units. The bidding price of
S$1.003 billion translates into S$1,050.71 psf.
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The average construction cost of a mass
market condominium is $350 psf. Assuming
the developer takes 30 percent of the total of
land cost plus construction cost (i.e. 30% of
$1,050 + $350 = $420 psf) to cover all
necessary expenses and a minimum profit
margin, the developer would have to sell at a
minimum launch price of $1,820 psf ($1,050 +
$350 + $420) in order to make a profit.
This is an aggressive jump from the nearby
new project Queens Peak, which was
released last November with a launch price of
$1,580 psf. One reason why Queens Peak
was selling well is largely the result of
strategic pricing by developer MCC Land (HY
Realty). It was also launched at the right time
when homebuyers believed that prices have
come down to a reasonable level for such a
good location.
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 SINGAPORE PROPERTY WEEKLY Issue 313
Will the Stirling Road site share the same
luck? Who can guarantee the market
condition by the time the project is ready to
launch?
What is the potential price to pay?
The last price record for a residential site was
created 20 years ago when Hong Kong
tycoon Li Ka-shings Cheung Kong Holdings
paid $683 million or $456 psf for the 99-year
Costa del Sol site on Bayshore Road in
January 1997. What happened to the
developer after they paid the top price?
Not long after Cheung Kong won the land
auction, Singapore was hit badly by the Asian
Financial Crisis. This was followed by the
dot.com bubble bursting, SARS outbreak and
economic recession in Singapore in the mid-
2000s.
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When Costa del Sol was launched in May
2000, the initial launch price was $765 psf.
The developer told the media and early
buyers that selling prices would stay the
same in subsequent launch phases even if
property prices fell. But by February 2005,
prices had been lowered to $650 psf for the
re-launch of about 600 units.
After the projects completion in 2003, for
several years blocks of units in the project
were still unsold and left vacant. It was not
until August 2007 that Hotel Properties Ong
Beng Seng and his family helped to clear an
entire block of 180 remaining units that the
906-unit project finally concluded its 10-year
episode.
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 SINGAPORE PROPERTY WEEKLY Issue 313

In the Stirling Road record-breaking auction,

MCL Land was the second highest bidder
who lost to the Chinese developer at the price
of S$925.7 million. Is it a terrible loss or a
blessing in disguise? Only time will tell.

By guest contributor Property Soul, a

successful property investor, blogger, and
author of the No B.S. Guide to Property
Investment.

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 SINGAPORE PROPERTY WEEKLY Issue 313

Non-Landed Residential Resale Property Transactions for the Week of May 14 May 19

Postal Area Transacted Price Postal Area Transacted Price

Project Name Tenure Project Name Tenure
District (sqft) Price ($) ($ psf) District (sqft) Price ($) ($ psf)
2 SPOTTISWOODE RESIDENCES 624 1,208,000 1,935 FH 10 ONE BALMORAL 1,410 3,284,000 2,329 FH
2 ICON 560 1,020,000 1,822 99 10 ST REGIS RESIDENCES SINGAPORE 1,507 3,500,000 2,323 999
2 ICON 936 1,610,000 1,719 99 10 LEEDON RESIDENCE 2,110 4,900,000 2,323 FH
2 ICON 926 1,480,000 1,599 99 10 ONE BALMORAL 969 2,200,000 2,271 FH
3 ASCENTIA SKY 3,089 4,200,000 1,360 99 10 THE GRANGE 1,744 3,750,000 2,151 FH
3 TANGLIN VIEW 1,152 1,255,000 1,090 99 10 ONE BALMORAL 2,228 4,484,000 2,012 FH
4 THE INTERLACE 3,864 2,900,000 750 99 10 POLLEN & BLEU 1,184 2,344,750 1,980 99
5 PARC IMPERIAL 409 657,000 1,606 FH 10 CYAN 1,130 2,200,000 1,947 FH
5 THE PARC CONDOMINIUM 980 1,200,000 1,225 FH 10 POLLEN & BLEU 1,184 2,272,900 1,920 99
5 BLUE HORIZON 1,216 1,210,000 995 99 10 LOFT @ NATHAN 452 845,000 1,869 FH
7 SOUTHBANK 592 878,000 1,483 99 10 DRAYCOTT EIGHT 1,173 2,100,000 1,790 99
8 THE URBANITE 484 700,000 1,445 FH 10 ONE JERVOIS 1,066 1,700,000 1,595 FH
9 OUE TWIN PEAKS 570 1,770,000 3,103 99 10 SPANISH VILLAGE 700 1,115,000 1,594 FH
9 RIVERGATE 1,894 3,800,000 2,006 FH 10 THE TRIZON 2,013 3,200,000 1,590 FH
9 SCOTTS 28 1,658 3,300,000 1,991 FH 10 VENTUNO BALMORAL 1,313 1,998,000 1,521 FH
9 THE INSPIRA 1,216 2,088,800 1,717 FH 10 VALLEY PARK 1,615 2,180,000 1,350 999
9 WATERFORD RESIDENCE 1,044 1,635,000 1,566 999 10 BALMORAL GATE 1,711 2,300,000 1,344 FH
9 SAM KIANG MANSIONS 1,281 2,000,000 1,561 FH 10 BEAVERTON COURT 2,056 2,550,000 1,240 FH
9 ASPEN HEIGHTS 1,582 2,130,000 1,346 999 10 CITY TOWERS 1,701 1,920,000 1,129 FH
10 GRAMERCY PARK 2,626 7,497,260 2,855 FH 11 SOLEIL @ SINARAN 506 980,000 1,937 99
10 TOMLINSON HEIGHTS 2,745 7,800,000 2,842 FH 11 PARK INFINIA AT WEE NAM 969 1,850,000 1,910 FH
10 ARDMORE PARK 2,885 8,000,000 2,773 FH 11 PARK INFINIA AT WEE NAM 1,464 2,500,000 1,708 FH
10 ONE BALMORAL 592 1,461,000 2,468 FH 11 SOLEIL @ SINARAN 1,098 1,825,000 1,662 99
10 ROBIN RESIDENCES 1,066 2,568,000 2,410 FH 11 SKY@ELEVEN 2,713 3,850,000 1,419 FH

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 SINGAPORE PROPERTY WEEKLY Issue 313

Postal Area Transacted Price Postal Area Transacted Price

Project Name Tenure Project Name Tenure
District (sqft) Price ($) ($ psf) District (sqft) Price ($) ($ psf)
11 IRIDIUM 1,184 1,508,000 1,274 FH 15 NEPTUNE COURT 1,636 1,298,000 793 99
11 HILLCREST ARCADIA 1,798 1,410,000 784 99 16 COSTA DEL SOL 1,238 1,565,000 1,264 99
12 THE RIVERINE BY THE PARK 1,206 1,750,000 1,452 FH 16 COSTA DEL SOL 1,345 1,670,000 1,241 99
12 NOVA 88 603 870,000 1,443 FH 16 COSTA DEL SOL 1,475 1,600,000 1,085 99
12 VISTA RESIDENCES 1,173 1,618,000 1,379 FH 16 CHANGI COURT 969 875,000 903 FH
12 ONE ST MICHAEL'S 936 1,150,000 1,228 FH 16 THE BAYSHORE 1,012 895,000 885 99
12 RIVIERA 38 883 1,080,000 1,224 999 16 THE BAYSHORE 980 825,000 842 99
12 THE ARTE 1,625 1,980,000 1,218 FH 16 CASA MERAH 1,970 1,600,000 812 99
12 THE ARTE 1,399 1,690,000 1,208 FH 16 BAYWATER 2,131 1,228,000 576 99
12 TRELLIS TOWERS 1,163 1,400,000 1,204 FH 17 HEDGES PARK CONDOMINIUM 872 830,000 952 99
12 THE ARTE 1,873 2,225,000 1,188 FH 17 BLUWATERS 818 740,000 905 946
13 BLOSSOMS @ WOODLEIGH 1,421 1,600,000 1,126 FH 17 DAHLIA PARK CONDOMINIUM 1,507 1,200,000 796 FH
14 KEMBANGAN SUITES 581 780,000 1,342 FH 18 THE PALETTE 1,163 1,080,000 929 99
14 COSMO 710 935,000 1,316 FH 18 RIS GRANDEUR 1,356 1,200,000 885 FH
14 DAKOTA RESIDENCES 1,044 1,315,000 1,259 99 18 MELVILLE PARK 1,335 890,000 667 99
14 GRANDLINK SQUARE 1,163 1,150,000 989 FH 18 ELIAS GREEN 1,528 852,000 557 99
14 CANNE LODGE 1,453 1,420,008 977 FH 19 THE TEMBUSU 1,216 1,900,000 1,562 FH
14 EVERGREEN VIEW 2,013 1,800,000 894 FH 19 NAUNG RESIDENCE 764 940,000 1,230 999
14 GROSVENOR VIEW 1,776 1,530,000 861 FH 19 RIVERSAILS 1,109 1,075,000 970 99
14 SUNNY GROVE 1,109 915,000 825 FH 19 RIVERSAILS 1,109 1,060,000 956 99
15 THE MEYERISE 1,302 2,983,000 2,290 FH 19 THE SUNNYDALE 1,259 1,150,000 913 99
15 THE SHORE RESIDENCES 1,055 1,570,000 1,488 103 19 BOATHOUSE RESIDENCES 1,561 1,420,000 910 99
15 WATER PLACE 1,216 1,450,000 1,192 99 19 CHILTERN PARK 915 831,888 909 99
15 STILLZ RESIDENCE 980 1,095,000 1,118 FH 19 PALM GROVE CONDOMINIUM 1,841 1,620,000 880 999
15 THE MEDLEY 1,410 1,370,000 972 FH 19 BLISS@KOVAN 1,765 1,535,550 870 FH
15 MANDARIN GARDENS 1,528 1,400,000 916 99 19 BLISS@KOVAN 1,679 1,460,000 869 FH
15 MANDARIN GARDENS 2,013 1,680,000 835 99 19 FLORENCE REGENCY 1,701 900,000 529 103

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 SINGAPORE PROPERTY WEEKLY Issue 313

Postal Area Transacted Price

Project Name Tenure
District (sqft) Price ($) ($ psf)
20 CLOVER BY THE PARK 1,292 1,380,000 1,068 99
20 SIN MING PLAZA 1,076 1,150,000 1,068 FH
21 GARDENVISTA 1,345 1,700,000 1,263 99
21 CLEMENTI PARK 1,873 2,010,000 1,073 FH
21 PANDAN VALLEY 1,335 1,420,000 1,064 FH
21 SIGNATURE PARK 1,701 1,800,000 1,058 FH
21 SOUTHAVEN II 1,539 1,520,000 987 999
21 CLEMENTI PARK 1,722 1,400,000 813 FH
21 PINE GROVE 1,755 1,360,000 775 99
21 KISMIS VIEW 2,110 1,368,000 648 99
23 HILLVIEW HEIGHTS 990 1,020,000 1,030 FH
23 HAZEL PARK CONDOMINIUM 1,206 1,098,000 911 999
23 YEWTEE RESIDENCES 1,453 1,230,000 846 99
23 HILLVIEW REGENCY 1,130 906,000 802 99
23 MAYSPRINGS 1,270 960,000 756 99
23 PALM GARDENS 1,206 850,000 705 99
25 WOODGROVE CONDOMINIUM 1,658 1,050,000 633 99

NOTE: This data only covers non-landed residential resale property

transactions with caveats lodged with the Singapore Land Authority.
Typically, caveats are lodged at least 2-3 weeks after a purchaser
signs an OTP, hence the lagged nature of the data.

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