05:55 AM Dec 23, 2010

SINGAPORE - The record $36 million deal for a bungalow at Paradise Island on Sentosa Cove has reportedly been called off.

According to Lianhe Zaobao, the buyer - identified in earlier media reports as Mr Shen Bin, a 31-year-old Chinese national who is a Singapore Permanent Resident - has backed out of the deal and lost about $500,000 in deposit, agent fees, legal fees and procedural fees.

The newspaper said the buyer called off the deal after he realised he paid over the market rate, after reading media reports surrounding the sale. The deal - touted as the priciest in the upscale waterfront housing district - came to light in June, based on caveat records captured by the Urban Redevelopment Authority and was said to have been signed on May 3.

Currently the chief financial officer, Mr Shen Bin is slated to take over his father, Mr Shen Wen Rong's company, Chinese firm Sha Steel.

Source: www.todayonline.com

Record price set for Sentosa Cove bungalow; GCB in Cluny Hill goes for $1,841 psf but overall volumes dip

Published September 25, 2010
By KALPANA RASHIWALA

THOSE looking to buy the most luxurious bungalows in Singapore may not have turned up in huge numbers this past quarter, but they have signed under impressive figures on their cheque-books.

Another record price has been set on Sentosa Cove. This time a prime seafronting bungalow along Ocean Drive on a 7,690 sq ft plot area has been sold for $2,536 per square foot (psf) on land area. This surpassed the earlier record of $2,403 psf posted just in May this year for a bungalow on Paradise Island; however that property has a bigger land area of about 14,983 sq ft resulting in a much higher absolute price of $36 million.

The latest deal, which took place last month, amounted to $19.5 million. The bungalow is near The Coast at Sentosa Cove condo. Its buyer is understood to be Indian citizen Dalip Kumar Seth, the boss of Sunrise & Co Pte Ltd, a sporting goods wholesaler/distributor which represents the Yonex and Mikasa brands. He is a Singapore permanent resident.

On the mainland too, the Good Class Bungalow (GCB) market saw a near-record price last month.

A house at Cluny Hill was sold for $28 million or $1,841 psf based on its land area of 15,210 psf. On a psf basis, this is believed to be the second highest price ever achieved in the GCB market, surpased only by the $1,899 psf that was recorded in 2007 for 32H Nassim Road. However, that was for a smaller land area of 13,423 sq ft.

GCBs are an exclusive housing form on mainland Singapore governed by stringent planning requirements. There are only about 2,400 such bungalows in Singapore's 39 gazetted GCB Areas. Typically the minimum land area of a GCB is 1,400 sq metres (15,069 sq ft).

However, when GCB Areas were gazetted in 1980, there were some existing sites within these areas smaller than 1,400 sq m. They are still considered GCBs due their surrounding environment and are bound by the other planning requirements for GCBs such as a maximum two-storey height.

Market watchers note that the $1,841 psf for the latest deal at Cluny Hill surpasses the $1,800 psf which a GCB at Nassim Road sold for in April this year. That property is on 24,187 sq ft land area, reflecting an absolute price of $43.53 million.

Among the other major GCB deals in Q3 are a $21 million (about $1,300 psf) deal at Swettenham Green; the buyer is understood to be plastic surgeon Woffles Wu.

There was a also a transaction at Chatsworth Road for $25 million or $1,499 psf. The seller is understood to be Pacific Asset Management's managing director and chief investment officer Ho Tian Yee.

CB Richard Ellis' analysis shows that the average price for GCBs sold so far this year is $1,050 psf, about 26 per cent higher than the $831 psf for GCB transactions for the whole of 2009.

Rising prices have widened the gap in expectations between buyers and sellers and slowed down demand this quarter, say some industry players like CB Richard Ellis director (luxury homes) Douglas Wong.

Based on the property consultancy's analysis of URA Realis caveats captured upto Sept 23, a total 16 GCB deals have been done this quarter for a total $253.4 million - down from 36 transactions for $777.7 million in Q2 and 31 deals at $516.2 million in Q1.

The final number for Q3 may be higher since the quarter is not over and more caveats may be filed over the next few weeks.

Despite the weaker volume this quarter, the 83 deals clinched year-to-date have a total sale value of nearly $1.55 billion - just 10 per cent shy of the record $1.72 billion for the whole of last year, when there were 109 deals. CBRE believes the market is on track to achieving about 100-120 GCB transactions amounting to $1.8 billion for full-year 2010.

'Demand for GCBs has slowed in the third quarter primarily because the price expectations between owners and buyers have widened. On one hand, owners can afford to hold as they're not in a hurry to sell; on the other, buyers can afford to purchase but are not prepared to pay what the owners are asking,' says Mr Wong.

This trend had set in even before the government announced measures to cool the property market on August 30 and had no direct impact on the GCB market, he reckons.

Agreeing, RealStar Premier Property managing director William Wong says: 'Reducing the maximum loan-to-valuation from 80 per cent to 70 per cent (for those already servicing existing mortgages) doesn't affect buyers in this segment as most would borrow around 50-70 per cent - if they borrow at all.'

Another cooling measure - extending the 3 per cent sellers' stamp duty to the sale of properties within three years of purchase - also will only have a marginal impact as most bungalow buyers purchase with a mid- to long-term perspective, he adds. 'Right now we're facing another stand-off phase which usually happens whenever there's a new announcement.

'Some bungalow buyers are waiting and hoping to see a drop in price but most sellers are not reducing. Instead quite a number have actually revised their prices upwards lately in view of the buoyant economy, coupled with a better-than-expected stockmarket performance,' Mr Wong says.

This price gap will probably mean fewer transactions in the next two to three months, he reckons. Giving a similar take, CBRE's Mr Wong predicts relatively slow sales until perhaps early next year, by which time pent-up demand would have built up. 'That's when we're likely to see an increase in GCB transactions again.'


Source: http://www.businesstimes.com.sg

The luxury enclave saw the return of buying interest on the back of an improving global economy, report STEVEN MING and ZENG ZHEN

Published September 23, 2010
STEVEN MING and ZENG ZHEN

SENTOSA Cove, Singapore's first gated waterfront residential enclave located on the eastern shores of Sentosa island, is taking shape with the completion of some 920 upscale condominium units and 200 waterfront and hillside bungalows since its inception in 2004. In tandem with the buoyant home sales on the mainland and coupled with the opening of the integrated resorts (IRs), the luxury enclave of Sentosa Cove saw the return of buying interest on the back of an improving global economy.

There are now nine condominium and seven landed housing developments for sale. The most recent launches include City Developments' 228-unit The Residences at W Singapore Sentosa Cove, and Ho Bee & IOI's 151-unit Seascape, both of which saw good take-up.

Non-landed

Amid favourable market conditions, sales remain strong for non-landed residential homes in Sentosa Cove. There were 104 sales transactions registered from January to July 2010.

Despite falling short of the 130 sales transactions recorded for 2009, the sales value for the first seven months of 2010 has outperformed that of last year, with $541 million recorded thus far compared with $497.9 million in 2009.

With the release of new projects, the primary market enjoyed a 430 per cent increase in volume, albeit from a relatively low base in the previous year. In the secondary market, because only The Oceanfront@Sentosa Cove received Temporary Occupation Permit (TOP) in March this year, the sub-sale activity has turned relatively quiet with only 21 caveats, down from 101 in 2009, whilst resale activity has firmed up by 57.9 per cent from 19 in 2009 to 30 transactions.

The first seven months of this year have seen rising prices across the board. Fuelled by higher prices of new launches in the vicinity, the prices of projects that were launched before 2010 have shown an increase ranging from 2.2 per cent to 30.8 per cent, with some surpassing their previous peaks in 2007.

As a result, the average price of non-landed residential in Sentosa Cove has soared from $1,691 per sq ft in 2009 to $2,344 per sq ft in 2010, representing a 38.6 per cent increase.

Appreciation in capital values of non-landed homes has lent support to the investment activities in Sentosa Cove, especially the sub-sale transactions in those projects approaching TOP dates.

Caveat matches of 19 sub-sales from January to July show that 94.7 per cent, or 18 sub-sales, yielded a profit between $179,400 and $3.06 million, significantly higher than the 71.7 per cent for the whole of 2009.

In addition, the average gain per unit almost doubled from $600,025 in 2009 to $1.16 million in the first seven months of 2010. This was a result of increased percentage of sub-sales that yielded gains exceeding $1 million.

So far this year, the sub-sales of nine units in The Oceanfront@Sentosa Cove have earned profits from $1,005,970 to $3,056,700, accounting for 47.4 per cent of the total profitable sub-sales.

On the other hand, there were only seven out of the 67 profitable sub-sales that reaped a profit of more than $1 million in the preceding year.

Landed

Unlike Good Class Bungalows (GCBs) on the mainland, the landed housing segment in Sentosa Cove is unique as it offers an exclusive waterfront.

More importantly, the landed houses in Sentosa Cove appeal to a wider market as foreigners who do not have permanent residence status are allowed to purchase them.

According to the caveats lodged between January and July 2010, 39 landed houses in Sentosa Cove have been sold, only one less than the total recorded for the whole of 2009. The transaction value has surged by 20.5 per cent from $507.3 million in 2009 to $611.3 million in the first seven months of 2010, attributed to the 19 houses costing more than $15 million each that were transacted during this period. In stark contrast, there were only nine transactions above $15 million in the preceding years from 2005 to 2009.

Of these 39 sales, foreign buyers chalked up 19 transactions or 48.7 per cent, with Chinese investors being the most dominant, inking 12 transactions, or 63.2 per cent, of all foreign purchases in the reviewed period. The Chinese buyers have ranked top among the foreigners since 2009; overtaking the Indonesians.

The average unit price based on land area climbed from $1,568 per sq ft in 2009 to $1,892 per sq ft in 2010, up by 20.7 per cent. In terms of unit price, the most expensive home sold this year was a terrace house in The Villas@Sentosa Cove which was transacted at $8 million or $2,929 per sq ft in May.

Interestingly, this house was first bought in June 2007 from the developer for $4.6 million or $1,682 per sq ft, yielding the vendor a profit of $3.4 million.

Outlook

On the economic front, Singapore has probably not seen better days. The government has revised the GDP growth forecast for 2010 up to 15 per cent from its previous forecast of 7 to 9 per cent.

Despite this, the market is not absolutely immune from external downside factors. Market sentiment has been affected by the rising concerns over the uncertainty of US economic recovery and the eurozone debt crisis. Meanwhile, the government's latest tightening measures, coupled with the ample supply from the government land sales programme, has cast a cloud over the property market.

Nevertheless, we expect that these cooling measures would have limited impact on the luxury developments in Sentosa Cove. The government's measures are designed to curb speculation, especially in the mass-market and public housing re-sale segments.

Still, the sales activity in Sentosa Cove may soften in the near term as buyers adopt a wait-and-see approach to the new measures.

However, the broader fundamentals for the private residential market are still good, and driven by the low interest environment, and abundant liquidity from Asia's booming wealth, Sentosa Cove would continue to attract both local and foreign buyers who take a mid to longer term view of the market.

Steven Ming is executive director, Savills Singapore and Zeng Zhen, senior manager, Savills Research & Consultancy

Source: http://www.businesstimes.com.sg