The Real Group Blog

Local Real Estate Updates

1.    4 bungalows sold for 5.5million each despite subdued property sentiments

Despite the current quiet residential market, all four strata bungalows in a freehold cluster housing development near Eng Neo Avenue were snapped up at $5.5 million each at a preview on Friday last week.

The $22 million transaction works out to $1,128 psf of built-up area. The buyer was a European with a Singaporean wife. ‘The units were bought partly for the buyers’ own use and partly for investment,’ said Jerry Tan, managing director of JTResi, the sole marketing agent for Quartet on Vanda.

The bungalows, which are expected to be completed early next year, are being developed by Stanley Quek’s Region Development on a 12,300 sq ft site at Vanda Crescent off Dunearn Road. Each two-storey unit has an attic, a basement and a swimming pool. Built-up areas range from 4,844 sq ft to 4,919 sq ft.

‘The market is not as dead as people may perceive it to be. For better quality developments that are priced sensibly, there will be buyers,’ Mr Tan said.

-As adapted from Business Times 15 May 2008

2.    CDLs gain up 31% in quiet Singapore Market

Singapore developer City Developments (CDL) reported a 31 percent growth in first-quarter net profit to $164.97 million.

Revenue in the three months ending March 31, however, fell 1.3 per cent to $758.75 million.

CDL sees weaker times ahead and has held back launches here given the quiet market.

“Property market sentiment may remain subdued in the next 12 months with problems linked to the United States sub- prime crisis still looming and given the expected credit tightening by some financial institutions,” it said. “But the current uncertainty is a ‘temporary environment’ and Singapore’s nimbleness in responding to economic changes will provide the Republic with the resilience to cope,” it added.

First-quarter profits, CDL said, were recognised from projects such as City Square Residences and One Shenton, as well as joint-venture projects such as The Sail @ Marina Bay, St Regis Residences and Parc Emily.

The group has profits yet to be recognised from residential developments sold over the last three years that are still being built.

First-quarter earnings per share were 18.1 cents, up from 13.9 cents, while net asset value per share was $5.84 as at March 31, up from $5.72 as at Dec 31.

-As adapted from The Straits Times 15 May 2008

Asia Real Estate Updates

1.    Subprime hurting Japan, Australia property: GIC

Government of Singapore Investment Corp (GIC), the sovereign wealth fund with an estimated $330 billion in assets, said the U.S. subprime crisis is beginning to hurt Asia-Pacific property markets such as Japan and Australia.

“The contagion effects of the subprime crisis can potentially accelerate the downward spin of the current property cycle,” Seek Ngee Huat, president of GIC Real Estate, told a property industry conference on Thursday.

“Some market weakening is being sensed in Asia, particularly in Japan and in Australia.”

In Australia, latest data shows a slump in demand for mortgages , down 6.1 percent in March from February, and a slowdown in house price growth, though the picture is mixed across the country.

In Japan, housing starts fell 15.6 percent in March from a year earlier, while a growing backlog of unsold apartments threatens to dent already feeble economic growth.

Seek’s comments follow similar remarks by Dubai World, an investment firm owned by the Dubai government, that it had become more cautious with property investments due to the U.S. subprime mortgage problem.

-As adapted from Reuters 15 May 2008

2.    Keppel to develop marina in China

Keppel Land Limited has entered a joint venture with Sunsea Yacht Club (HK) Company Limited to develop an integrated residential cum marina lifestyle development in Zhongshan, Guangdong Province of China.

Keppel Land will have an 80 per cent stake in Sunseacan Investment (HK) Company Limited (Sunseacan Investment). The project will begin with premium waterfront homes in the affluent Pearl River Delta region of Zhongshan, located on MoDao Island in the Shenwan Town of Zhongshan City.

“Waterfront living has become a worldwide trend as a premier choice for residence,” said Kevin Wong, Group CEO of Keppel Land. “Leveraging our extensive experience in developing world-class waterfront precincts, such as Keppel Bay and Marina Bay Financial Centre in Singapore, Keppel Land continues to create quality live-work-and-play environments in premier landmarks across Asia.”

-As adapted from Asia Property Report 12 May 2008

3.    China’s property growth to slow: Xinhua News Agency

China´s rapid property growth is showing signs that it may be about to slow down. According to Xinhua news agency, the pace of property price growth in 2008 is expected to decrease but will stop short of going into reverse.

Xinhua reported that the reduction in growth will be felt across the country and that prices rises will eventually settle “far below” that of last year.

The drop off in growth is believed to be partly due to a range of initiatives implemented by the Chinese government to reduce speculation. The moves, the report said, are “gradually restoring rationality to real-estate demand,” the report said.

Property prices rose 10.7 percent year-on-year in March, compared with 10.9 percent growth in February.

-As adapted from Asia Property Report 10 May 2008