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Keen interest expected for Bukit Batok site

Analysts are expecting keen competition for a mixed residential and commercial site in Bukit Batok – the first site put up for sale in the area in several years.

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The 99-year-leasehold site in Bukit Batok West Avenue 6 was launched for sale by public tender yesterday by the Urban Redevelopment Authority (URA).

The 14,696.7 sq m plot could yield about 425 residential units and up to 6,000 sq m of gross floor area of commercial space, URA said in a statement.

It is one of four confirmed list sites under the Government Land Sales programme for the first half of this year.

The site is about 1km from Bukit Batok MRT station, and not far from amenities such as Millennia Institute, Bukit Batok Polyclinic and West Mall. Analysts told The Straits Times the site could garner much interest from developers and investors.

“We expect keen competition for the mixed site in Bukit Batok West Avenue 6 as there have not been any land sites that were launched for sale in Bukit Batok in the last three to four years,” said real estate agency PropNex key executive officer Lim Yong Hock.

Mr Lim added that the upcoming high-speed rail terminus in Jurong East and the transformation of the Jurong Gateway business precinct could also have a “positive spillover effect” on Bukit Batok, which is near Jurong.

Cushman & Wakefield research director Christine Li said the upcoming development of Jurong Innovation District – announced in Budget 2016 – is another draw. The district, envisioned as an industrial park of the future, will be built as part of the Government’s push to encourage innovation.

Analysts estimate the site tender to attract up to eight or 10 bids.

“The top winning bid could range between $570 and $620 psf per plot ratio… The developer could be selling the residential units from $1,150 to $1,200 psf onwards,” Ms Li added.

JLL national director for research and consultancy Ong Teck Hui expects residential units to be priced at about $1,000 psf, with a bid price of $530 to $610 psf per plot ratio.

“There should be keen interest from HDB upgraders, including those in Bukit Batok new town, as the selling price could be close to entry level for private homes.”

The tender will close on May 24.

[Source: The Straits Times]

 
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Posted by on April 4, 2016 in Government Land Sales

 

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Commercial site in Jurong East draws strong interest

Lakeside Jurong East

A TENDER for a commercial site in Jurong East, at Venture Avenue that drew nine bids outstripped market expectations.

Experts said the keen response to the Jurong East commercial site could signal that developers are responding to potential demand from investors looking for alternatives to residential property.

Colliers International director of research and advisory Chia Siew Chuin added: “The commercial sector has not yet been affected by the Government’s property measures, although the planning authority is likely to be monitoring the unit sizes of planned commercial developments.

“As a result, interest from both investors and end-users is expected to be robust.”

Sim Lian JV (Vision) lodged the top bid of $701.1 million – or $1,009 per square foot – which was nine per cent above the $643 million offered by Capitaland unit Victory One for the commercial site in Jurong East.

Sim Lian’s $1,009 psf bid for the commercial site in Jurong East easily exceeded market expectations of $800 psf ppr, said CBRE research associate director Desmond Sim.

The Sim Lian offer makes the expected breakeven price of the commercial property in Jurong East to be about $1,700 to $1,750 psf, said Mr Nicholas Mak, head of research at SLP International.

Jones Lang LaSalle national director of research and consultancy Ong Teck Hui also noted that the highest bid exceeded the top offer for Paya Lebar Square at $872 psf ppr in April, 2011.

“Since the Paya Lebar Square tender, demand for strata offices has surged tremendously resulting in optimistic bidding in today’s tender,” he said.

Jurong East is seen as a key commercial hub in the west, and includes existing and upcoming retail and lifestyle offerings like JCube, JEM and Westgate, said Mr Sim.

Ms Chia added: “With the prospects of growth for the entire Jurong East area as a regional commercial hub, a new project on the subject site would enjoy steady demand for its office units when completed.”

(Source: The Straits Times)

 
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Posted by on March 15, 2013 in Commercial, General

 

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12-way battle for plum Jurong site

ImageA PLUM Jurong West residential site sparked a 12-way battle among developers although the tough new property curbs seem to have kept bids from going through the roof.

Experts had expected the top bid to range from $540 to $680 per sq ft per plot ratio (psf ppr) when the tender was launched last November, but that was before the cooling measures hit a few weeks ago.

MCL Land submitted the top bid of $438.9 million – or $651 psf ppr – for the 99-year leasehold residential site on Jurong West Street 41.

That was at the upper end of the range but MCL Land chief executive Koh Teck Chuan told The Straits Times that the measures did have a dampening effect on the bids.

“Given the last few tenders, we would probably have seen bids above $700 psf ppr without the measures. Developers have taken into account the cooling measures and are taking a more measured approach, but they are not bearish,” he added.

The MCL bid was just 3 per cent more than the $424.9 million – or $631 psf ppr – offered by UOL Group unit Secure Development.

Other bidders for the 22,357 sq m plot included a joint bid by Frasers Centrepoint, Far East Orchard and Sekisui House, Low Keng Huat and Mezzo Development, which lodged the lowest bid of $243.8 million – or $362 psf ppr.

MCL’s Mr Koh said the project will have 650 to 700 units of one- to four-bedroom apartments.

Experts said the strong showing in the tender indicates that developers still want good sites.

The Jurong plot is 450m from the Lakeside MRT station, which will eventually be linked to the Jurong Region Line, and there will be clear views of Jurong Lake, noted CBRE’s executive director of residential, Mr Joseph Tan.

“The keen interest from developers resulted in bids coming in very close. The top six bids were within 10 per cent of each other,” he added.

“This shows that developers are still on the hunt for sites with good location attributes and demonstrates their confidence that the market will respond positively to the project.”

Based on the competitive number of bids and high land prices submitted in the tender, it seems that some developers do not expect private home prices to fall in the next one year or so despite the latest measures, added Mr Nicholas Mak, head of research at property consultancy SLP International.

Colliers International’s director of research and advisory services, Ms Chia Siew Chuin, said that “there appears to be no loss of optimism from developers” for the first tender of a pure residential site after the punitive cooling measures were unveiled on Jan 11.

“Buyer demand should come from professionals working in the industries in the Jurong and Tuas areas as well as upgrader demand from the Housing Board estates in Jurong East and Jurong West,” she added.

Mr Ong Teck Hui, Jones Lang LaSalle’s national director of research and consultancy, expects average selling prices for the launch to be close to $1,200 psf or higher.

Mr Lee Sze Teck, senior manager for training, research and consultancy at Dennis Wee Group, notes that while Jurong East will be the biggest commercial hub outside the central business district, it has limited land parcels for residential development.

Those who want to live near the hub might have to look to Jurong West instead. The Canadian International School next to the site also provides a good catchment of tenants, he added.

(Source: The Straits Times)

 
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Posted by on January 31, 2013 in Government Land Sales

 

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Home in on the suburbs

Looking to invest in real estate next year? We ask property consultants for their recommendations

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Suburban condominiums have generally fared better than those in prime districts this year, and the trend could continue into 2013.

Property analysts told The Sunday Times that their top picks for next year were mostly in the western and northern suburban regions.

Interest could also shift to districts at the city fringes.

Those who do not want city living yet want the convenience of being near the city will look to the city fringe, said DWG senior manager Lee Sze Teck.

Though the spotlight will likely be on suburban and city fringe hot spots next year, investors should not rule out homes in the prime districts despite a fairly lacklustre 2012 as economic conditions improve.

Rich investors from overseas may seek unsold units in premier locations next year to take advantage of low interest rates and excess liquidity, said Colliers International director of research and advisory Chia Siew Chuin.

Ms Chia added that signs of recovery in China and other major economies could bring more foreign buyers back into the prime market.

But regardless of the market segment, buyers should look out for homes near MRT stations and in districts where price movements have been subdued, analysts said.

These could be areas that have seen few exciting new launches but have the potential for future development.

Other factors to consider are accessibility, congestion and the uniqueness of the development, said Savills research head Alan Cheong.

Buyers should take into consideration the traffic conditions in the surroundings once all the units, both private and public, are completed, Mr Cheong said.

The Sunday Times takes a look at the property consultants’ top picks for 2013.

1 Jurong East

There is a buzz in Jurong East, now that it is firmly established as a commercial hub in the western part of Singapore.

The focus is mainly on Jurong Gateway, an area around the Jurong East MRT station, which has been jazzed up by the development of commercial sites such as the Jem and Westgate shopping malls.

The Government is keeping up the rapid pace of development in Jurong East, with the sale of a residential site to MCL Land for $369.4 million, or $705.10 per square foot per plot ratio (psf ppr), in May.

A hotel site was also bought for $238.2 million last month by Resorts World Singapore, a unit of Genting Singapore. This translates to $1,167 psf ppr, a record price for hotel land.

Mr Ku Swee Yong, chief executive of International Property Advisor, said job creation in the area is likely to be strong, which will drive up residential rental demand and capital values.

New malls built in Jurong East will create new jobs, as will hospitals such as the Ng Teng Fong General Hospital, which is under construction. Also, up to 5,000 existing jobs could move to Jurong East as government agencies relocate their premises there, Mr Ku noted.

As a consequence of the large developments there, rental demand is likely to rise as more locals and foreigners move in.

However, the downside of the rapid pace of development in Jurong East is that the area could become more congested in future as it becomes more densely populated, analysts said.

2 Alexandra

Upcoming launches are likely to boost prices in the Alexandra area, which was given a facelift several years ago by the transformation of Alexandra Canal into a waterway and park connector.

Gross rental yields here could climb as high as 5 per cent, said DWG’s Mr Lee.

The most recent condo launch in Alexandra was the 373-unit Ascentia Sky in 2009.

Upcoming launches include 508-unit Echelon along Alexandra Road, which could be launched within the next few months.

Also, two land parcels in Alexandra, at Prince Charles Crescent and Alexandra View, were sold this year.

However, prices may have already started to rise. Resale prices in the Redhill and Alexandra area have climbed 6 per cent in the third quarter of this year compared to the same period in the preceding year, Ms Chia said.

3 Woodlands

Woodlands is also designated as one of Singapore’s regional centres, but prices here have not appreciated as much as those in the other regional centres due to a relative lack of new launches recently.

Since 2011, there have been only two new launches: Woodhaven in June last year and Parc Rosewood in January this year.

But the area’s image as a remote northern outpost could change soon. One factor is the completion of the Thomson MRT line in 2019, which could drive up home prices by as much as 30 per cent, analysts said.

The three stations along the new line – Woodlands, Woodlands North and Woodlands South – will serve the residents of more than 4,300 private homes as well as those living in HDB flats, which dominate the area.

Also, Singaporeans’ growing interest in buying second homes in Johor Baru could increase cross-border activity and add buzz to Woodlands, said Colliers’ Ms Chia.

However, since Woodlands is still quite far from the city centre, not everyone may want to live there, said SLP International research head Nicholas Mak.

4 Geylang

Although it is more known for its red-light district, Geylang has been thrust into the spotlight by a slew of new launches.

At least 40 projects, yielding 2,190 units, will be launched or completed in this area in the next five years or so.

Most developments in Geylang are small. Recently completed condos include the 78-unit Casa Aerata at Lorong 26 and the 62-unit Centra Suites at Lorong 25A.

The stigma of Geylang’s sleaze factor has been holding down prices. Banks are also known to be reluctant to finance home purchases there.

However, that makes it an attractive investment option for cash-rich investors interested in yield accretion, said Colliers’ Ms Chia.

Yields are a tad under 4 per cent, which is slightly higher than the average of 2 per cent to 3 per cent for condos islandwide.

5 Potong Pasir

The Potong Pasir area is near the Central Business District and Orchard Road, and is undergoing rejuvenation.

Projects under construction in the area include Nin Residence and 18 Woodsville, and Sennett Residence and Sant Ritz will be launched next year.

There was healthy demand for a 99-year leasehold mixed-use site at Upper Serangoon near the Potong Pasir MRT station. It was sold in September this year for $793 psf ppr.

Also, the Bidadari Cemetery has been cleared and is zoned for residential use, though the exact details of land parcels have not been released yet.

However, DWG’s Mr Lee noted that Potong Pasir currently lacks retail amenities.

(Source: The Straits Times)

 
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Posted by on December 26, 2012 in Investment Tips, Residential

 

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