17 May 2024
GLS Commentary for Zion Road (Parcel A) & Upper Thomson Road (Parcel B)
Property Insight

The report on the tender results for Zion Road (Parcel A) and Upper Thomson Road (Parcel B) highlights significant insights into their respective real estate markets and development prospects within the Government Land Sales (GLS) programme.

Zion Road (Parcel A) Overview:

Zion Road (Parcel A) received a sole bid from CDL & Mitsui Fudosan at $1.11 billion, translating to $1,202 per square foot per plot ratio (psf ppr). This parcel is strategically placed within the Bukit Merah planning area and is part of a pilot program introducing a new category of serviced apartments with a minimum three-month stay requirement. This initiative aims to address the rental market's demand, particularly for those seeking longer-term accommodations.

The parcel's proximity to the 455-unit Rivière condominium, which was fully sold out, underscores the high market demand in the area. The lack of new project launches nearby further makes Zion Road (Parcel A) an attractive development opportunity. Positioned between Great World and Havelock MRT stations, its location ensures excellent connectivity, enhancing its appeal to developers.

Market trends in the Rest of Central Region (RCR), where this parcel is located, show signs of recovery with a modest increase in property prices. Given this backdrop, the expected launch prices for new properties on Zion Road (Parcel A) are projected between $3,000 and $3,300 psf.

Upper Thomson Road (Parcel B) Overview:

Upper Thomson Road (Parcel B) saw a bid of $779.56 million from GuocoLand and Intrepid Investments (a subsidiary of Hong Leong Holdings Limited), amounting to $905 psf ppr. Like Parcel A, Parcel B forms part of the GLS program in the emerging Springleaf Precinct and offers a first-mover advantage to its developer. Its strategic location near the Springleaf MRT station on the Thomson-East Coast Line (TEL) is pivotal, especially given the area's primary characteristic of landed housing.

The last non-landed GLS site awarded in the vicinity was at Chong Kuo Road in 2018, indicating a potential pent-up demand in the area. The success of recent developments in nearby Lentor also hints at a strong market appetite for new projects in emerging locales such as Springleaf Precinct. Expected launch prices for properties on Upper Thomson Road (Parcel B) are anticipated to be around $2,000 to $2,200 psf.

Both parcels present significant development opportunities, each with unique strategic advantages that cater to specific market needs. Zion Road (Parcel A) is poised to cater to the high demand for serviced apartments, while Upper Thomson Road (Parcel B) is set to capitalize on the scarcity of new launches in its area, offering a diversification in housing types. Developers are likely to find these parcels especially lucrative given their strategic locations, anticipated market demand, and the overall positive shifts in regional property market trends.

Click here for the full report

Prepared By:

Mohan Sandrasegeran

Head of Research & Data Analytics

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21 Nov 2024
Faber Walk GLS Land Bid: GuocoLand Tops Tender at $900 psf ppr

The Government Land Sale (GLS) site at Faber Walk, designated for residential (non-landed) development, was awarded to GuocoLand (Singapore) Pte. Ltd., TID Residential Pte. Ltd., and Intrepid Investments Pte. Ltd. at $349.9 million, translating to $900 per square foot per plot ratio (psf ppr). This bid exceeded the second-highest by 8.9%, reflecting the developers' competitive positioning. 

The Faber Walk site has several advantages. The planned transformation of Clementi MRT station into a Cross Island Line (CRL) interchange will enhance accessibility. The upcoming completion of the CRL is expected to improve connectivity to key areas in Singapore, boosting the site's appeal among homebuyers and investors. The lack of new residential launches in the area, as seen with the sold-out projects Clavon and Ki Residences at Brookvale, presents an opportunity to meet market demand.

Resale activity in the Clementi planning area has risen significantly, with non-landed and landed property transactions increasing by 20.6% and 14.3%, respectively, from January to October 2024 compared to the same period in 2023. This trend suggests a growing pool of upgraders who may be drawn to future developments at Faber Walk. The site's proximity to commercial hubs like the International Business Park and JTC Summit makes it attractive to expatriates and professionals in high-tech and industrial sectors.

Additionally, Faber Walk benefits from its location near reputable schools, notably Nan Hua Primary School, which has seen high demand in recent years. Families prioritizing proximity to such institutions may find this site appealing, further driving demand for its residential units.

The Jurong Lake District's transformation into a vibrant commercial and residential hub is likely to further increase interest in western Singapore. Improved infrastructure and business developments in the region will enhance convenience and connectivity, appealing to residents seeking work-life balance near major employment centers.

The site is projected to launch at competitive prices of $2,100 to $2,300 psf. Although future competition may arise from developments like The Elta at Clementi Avenue 1, the staggered launch timelines are expected to reduce direct competition.

The Faber Walk site is well-positioned to cater to a diverse demographic, including young families, professionals, and upgraders, offering a balance of exclusivity and value. Its strategic location, combined with improving infrastructure and market demand, presents an opportunity for developers to deliver a compelling residential development.

Click

here

for the full report 

   

Prepared By: 

Mohan Sandrasegeran 

Head of Research & Data Analytics 

  

  

Email:

mohan@sri.com.sg


  

Property Insight
18 Nov 2024
Norwood Grand and Meyer Blue Lead October 2024 Property Market Surge

Norwood Grand and Meyer Blue Lead October 2024 Property Market Surge

In October 2024, developer sales experienced a robust increase, with 738 units (excluding ECs) sold, an 84% surge from September’s 401 units. This growth was largely attributed to the launches of Norwood Grand and Meyer Blue, which accounted for over half of the sales at 56.4%. Norwood Grand emerged as the top seller with 292 units transacted at a median price of $2,081 psf, benefiting from its strategic location near Woodlands South MRT and proximity to schools and amenities. Meyer Blue followed with 124 units sold at a median price of $3,240 psf, appealing to buyers with its prime location in the Rest of Central Region (RCR) and freehold status.

Other notable projects included Pinetree Hill and Hillock Green, with steady sales across different price segments. The data reveals strong local demand, with Singaporeans making up 88.5% of total transactions. Purchases by Singapore Permanent Residents (PRs) and foreigners increased, with PRs accounting for 8.8% of sales and foreigners contributing 2.7%. Foreign buyers showed a slight rebound, marking their highest monthly purchases since May 2023.

November is set to be a dynamic month, with six new launches targeting diverse buyer needs, ranging from Chuan Park to Union Square Residences. This wave of launches aims to capture growing interest ahead of the year-end holiday season. Favourable interest rates, improved financing conditions, and strategic launch timings indicate a positive outlook for the final quarter.

This surge underscores the market's responsiveness to well-located and thoughtfully developed projects. Developers’ strategic timing, coupled with improved buyer confidence, reflects a vibrant property market poised for sustained momentum.

Click

here

for the full report 

Prepared By: 

Mohan Sandrasegeran 

Head of Research & Data Analytics 

  

  

Email:

mohan@sri.com.sg


  

Property Insight
07 Nov 2024
EC Market Trends 2024: Price Growth and Investment Insights

Executive Condominiums (ECs) represent a unique segment in Singapore's housing market, appealing to both first-time buyers and upgraders due to their blend of public and private housing features and relative affordability. These hybrid developments have shown steady price growth, driven primarily by limited supply and strategic regulatory frameworks. For example, EC developers are only allowed to begin sales 15 months after securing a site or once foundation works are completed, whichever is sooner. This strategy helps prevent oversupply and supports price stability, ensuring ECs remain a resilient asset class.

Over the past few years, the pricing landscape for ECs has transformed. In 2022, the average price for new ECs stood at $1,329 per square foot (psf). This rose to $1,406 psf in 2023, marking a year-on-year increase of 5.8%. In the first nine months of 2024, the average price reached $1,460 psf, reflecting a more moderate 3.8% rise. These upward trends underscore the high demand for ECs, particularly among young families and upgraders seeking a bridge between public and private housing with long-term value potential.

Demand for ECs remains robust, as evidenced by impressive take-up rates in recent launches. For instance, Altura, introduced in the third quarter of 2023, reached a 95.8% sales rate. Similarly, Lumina Grand, launched in the first quarter of 2024, achieved 83.2% sales. This strong buyer interest reflects a willingness to invest at higher price points, particularly in developments that boast strategic locations and lifestyle amenities. In 2024, half of the EC units sold ranged between $1,500 and $1,600 psf, highlighting buyers' confidence in the value of these projects.

The resale EC market has also gained momentum, particularly for older ECs that have attained privatized status. Units that are over ten years old saw significant price increases, with the average price rising by 15.5% year-on-year to $1,171 psf in 2024. In comparison, newer resale ECs saw a more moderate price increase of 5.7%. Some projects, like The Dew, recorded an impressive 20.2% increase, which may be attributed to nearby new launches and proximity to popular schools. This trend emphasizes the appeal of matured ECs, especially as they become available to a broader pool of potential buyers.

In recent quarters, the price gap between new and resale ECs has narrowed, reflecting a difference of only 6.9% by the third quarter of 2024. Contributing factors include the limited supply of new ECs and the five-year Minimum Occupation Period (MOP) requirement before resale. This narrowing gap presents ECs as a structured, appealing investment, with the potential for value appreciation as they transition to full privatization.

New developments, like Novo Place at Tengah New Town, continue to attract buyer interest. Positioned near the upcoming Jurong Region Line MRT station, Novo Place benefits from enhanced connectivity and strategic location. Given the limited EC supply and successful launches in nearby areas, this development is likely to generate significant interest among potential buyers.

Overall, ECs have maintained their position as a desirable housing choice within Singapore’s real estate market. Their unique status, regulatory-backed supply alignment, and consistent demand from both new and resale markets ensure ECs remain attractive to buyers. Combining affordability, strategic location, and capital appreciation potential, ECs present an enduring appeal for many Singaporeans.

Click

here

for the full report 

Prepared By:

Mohan Sandrasegeran

Head of Research & Data Analytics

Email:

mohan@sri.com.sg

  

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