RESIDENTIAL MARKET Property players divided over URAs Q3 data Property consultants have given mixed reactions to the latest third-quarter private housing data released by the Urban Redevelopment Authority (URA). Pointing to indications of weakness setting in, some analysts highlighted that the 3,951 private homes (excluding executive condos) sold in primary and secondary markets in July-September 2013 was just 57 per cent of the volume in the preceding quarter, in addition to being the weakest showing since Q4 2008 during the global crisis, when 1,639 units were transacted. Also, price indices for non-landed private homes in Core Central Region (CCR), where the choicest homes are located, and Rest of Central Region (RCR), which covers city fringe locations, slipped 0.3 per cent and 0.9 per cent, respectively, quarter on quarter. However, others looked at the bright side of things. A 2.2 per cent quarter-on-quarter hike in the index for Outside Central Region, though small compared with the 3.8 per cent increase in Q2, reflected the still-strong sentiment for mass-market suburban condos. Constrained by the total debt servicing ratio (TDSR) framework and earlier rounds of cooling measures, buyers are focusing on units priced between $800,000 and $1.3 million, which are more likely to be found in OCR, noted ERA Realty key executive officer Eugene Lim. Units in this price range are typically below 900 square feet. And small units typically have a higher per square foot (psf) pricing, which probably explains the rise in the OCR price index, he added. Also supporting demand for private homes in OCR are newly minted permanent residents who are now required to wait three years before they can buy public housing flats in the resale market. OCR prices will continue to rise - albeit at a slower pace - over the next six months, Mr Lim said. He argued that it may also be possible for prices in RCR - which includes Tiong Bahru, Bishan and Toa Payoh - to rebound depending on what gets launched. URAs overall price index for private homes inched up 0.4 per cent in Q3 over the previous quarter, identical to the flash estimate released earlier this month. In Q2, the index rose one per cent. URAs All Residential rental index climbed at a slower pace of 0.2 per cent quarter on quarter in Q3, a tad below the 0.3 per cent increase in Q2. The vacancy rate for non-landed private homes climbed from 6.3 per cent at end-Q2 to 7 per cent at end-Q3 - its highest level since Q3 2009. These two indicators are seen as portending downward pressure on private housing rents, especially after factoring in the record level of private home completions forecast for Q4 and full-year 2013. Developers received Temporary Occupation Permit (TOP) for 3,685 private homes in Q3, taking the total for the first nine months to 9,519 units. Based on developers submissions to URA, another 6,305 private homes are slated for completion in the fourth quarter, taking the full-year figure to 15,824. This would surpass the record 14,582 units completed in 1997; the figure for last year was 10,329. New launches since the TDSR framework took effect in late June have been posting a patchy performance. The latest winner appears to be The Inflora condo in Upper Changi. A consortium led by Hong Leong Holdings that is developing the 396-unit project did roaring sales yesterday, with 250 options granted as at 6pm . More options to purchase are in the process of being issued, it said in a release. Prices start from over $400,000 for a one-bedder apartment. Unit sizes range from 462 sq ft for a one-bedder to 1,302 sq ft for a four-bedder, and 1,463 sq ft for a dual-key apartment. Word on the street is that all 128 one-bedders have been snapped up. The average price for the eight-storey, 99-year leasehold project is understood to be slightly below $900 psf. Source: Business Times –26 October 2013 Q3 resale flat prices drop - first time in over 4 years As a raft of property and credit measures continue to work their way through the property market, prices for resale Housing and Development Board (HDB) flats fell for the first time in over four years. Data from HDB yesterday showed that the resale price index (RPI) fell 0.9 per cent in Q3, compared with a 0.5 per cent gain in the previous quarter. This is the first time the index has declined since Q1 2009. Measures introduced between June and August, such as the total debt servicing ratio (TDSR) framework, a tighter mortgage servicing ratio (MSR), lowering the maximum loan tenure, allowing singles to purchase Build-to-Order (BTO) flats, as well as a three-year wait for all new permanent residents before they can buy a resale flat, all took their toll, analysts said. Further siphoning interest from the resale market in Q3 was a steady supply of BTO homes in the works. The official RPI drop was also larger than the earlier flash estimate of minus 0.7 per cent. Consultants attributed this to a delayed impact from the tighter MSR introduced in August, as well as from the TDSR implemented in June. The number of resale flats sold in Q3 fell 13.5 per cent to 4,529 units, from 5,235 units in Q2. All flat types, from one-room to executive, saw fewer units changing hands. The largest absolute fall came from the four-room flat segment. It saw a 13 per cent drop in transactions to 1,670 units from 1,922 in Q2. The cash premium of cash-over-valuation (COV) also fell. ERA Realty data shows that the median COV fell by a third from the previous quarter to $18,000 in Q3. HDB data showed notable quarterly drops in COVs in some pockets of the market in Q3, such as a $20,000 fall in median COVs for executive flats in Pasir Ris to $50,000, and a $19,000 decline in median COVs for five-room flats in Toa Payoh to $54,000. Sellers are generally more accommodating at the moment, said Eugene Lim, key executive officer at ERA Realty. Already, more and more larger flats (five-room and executive) in non-mature estates are being transacted at valuation or below valuation, he said, adding that there was concern from three- and four-room flat owners, too, that COVs will fall further if they did not sell now. A report by the Singapore Real Estate Exchange said about 10 per cent of resale flats sold last month transacted with no COV. Meanwhile, Minister for National Development Khaw Boon Wan wrote on his Facebook page yesterday that the actual number of private and public homes that will be ready for occupation by 2016 is now expected to be 204,400 units, surpassing his ministrys earlier projection of 197,550 units. For this year, more than 21,000 residential units have already been built; another 9,220 units will be ready by year-end. As for new BTO homes, HDB should hit its target of 25,000 units for the year, having launched 20,161 BTO flats to date and offering another 4,950 BTO flats next month. Another 4,455 Sale of Balance Flat (SBF) units have been offered this year, with another 3,000 to be offered next month. Consultants generally agree that the number of resale transactions will come in below 20,000 units this year, which will be the lowest on record. They also see continued moderation of COVs, although Mr Lim from ERA said it was unlikely that the median will reach zero because of strong economic fundamentals. On the rental front, the number of subletting transactions fell 5 per cent to 7,505 cases in Q3, from Q2s 7,891 cases. The number of flats approved for subletting edged up 0.6 per cent to 44,966 homes. Source: Business Times –26 October 2013 Property to be costlier for foreigners Costlier homes are on the cards for foreigners under Malaysias Budget 2014, with stiffer taxes and a doubling of the minimum price of properties to RM1 million (S$391,000). Among some of the more severe measures expected to hit the sector are a 30 per cent real property gains tax (RPGT) that will be levied on gains on property disposed within five years, and at 5 per cent in the sixth and subsequent years for non-citizens. The market had been bracing itself for measures to curb spiralling home prices. Taking aim at speculators, Prime Minister and Finance Minister Najib Razak prohibits developers from implementing projects that have features of Developer Interest Bearing Scheme, to prevent developers from incorporating interest rates on loans in house prices during the construction period. He also wants developers to increase the transparency of home prices by displaying sales price details, including all benefits and incentives offered, such as exemption of legal fees, stamp duty, sales agreements, cash rebates and free gifts. On a positive note, Mr Najib left stamp duties untouched and exempted the sale, purchase and rental of residential properties from the Goods and Services Tax (GST). However, because GST will be levied on non-residential properties, it would result in double taxation as stamp duties of 1-3 per cent still apply. Developers in Iskandar Malaysias Medini zone may have an advantage in that they are exempt from price caps and bumiputra quotas. Malaysians will also have to pay higher RPGT. For gains on disposal up to the third year, the tax has been doubled to 30 per cent, reducing to 20 per cent in the fourth year and 15 per cent in the fifth. In the sixth and subsequent years, no tax applies to citizens, but companies will be taxed 5 per cent. Source: Business Times –26 October 2013 Blooming good sales at inflora Drawn by low prices, home buyers thronged the showflat of The Inflora condominium in Loyang when it opened for sale yesterday. Smaller units at the Hong Leong Group development were especially popular, with one-bedroom flats snapped up for just over $400,000. The rush was such that many buyers could not even book a unit, and nearly two-thirds of all 396 units were sold by 6pm. Buyers and analysts said The Infloras units were probably among the cheapest in recent launches. Hong Leong, which has seven large condominium projects in the vicinity of Flora Drive, is said to have bought the site for a historically low price. Source: The Straits Times –26 October 2013 Buyers snap up cheap units at new condo Low prices attracted droves of home buyers to The Inflora, Hong Leong Groups latest project, when it opened for sale yesterday. The Flora Drive condo, not far from Changi Airport, sold like hot cakes with at least 250 units, or nearly two-thirds of all 396 units, sold yesterday. Buyers favoured smaller apartments, with one-bedders going for just over $400,000. When The Straits Times visited the showflat at 4pm, all 128 one-bedroom and 136 two-bedroom units had been snapped up at the 99-year leasehold project. One-bedders range from 462 sq ft to 495 sq ft, while two-bedders range from 742 sq ft to 882 sq ft. Smaller units were such a hit that many buyers went home disappointed at missing out. One prospective buyer, who wanted to be known only as Mr C.P. Tay, said he was drawn to the project by its low total prices. He had lodged a cheque for a one- or two-bedroom unit but was unsuccessful in the ballot. The Inflora features 84 three-bedders of between 1,033 sq ft and 1,582 sq ft; 32 four-bedders from 1,302 sq ft to 1,334 sq ft; and 16 dual-key units from 1,463 sq ft to 1,582 sq ft. The project is being developed by a consortium made up of Hong Leong Holdings, City Developments and TID. Buyers The Straits Times spoke to cited low prices as the main draw. Mr Daniel Ng, a senior marketing director, bought a 474 sq ft unit for $455,500 - or $960 per sq ft (psf). He said he had been surprised by the low prices when his marketing agent contacted him. Their marketing campaign also highlighted how much the project is, he said. The prices are on the low side and, when the neighbouring projects have been developed, I would expect this projects prices to be drawn up to be on a par with everything around. Industry experts said that units at The Inflora are probably among the cheapest of the slew of launches in recent months. In the past six months, the lowest transacted price for a shoebox unit - smaller than 538 sq ft - was $1,041 psf at DNest in Pasir Ris The property player had acquired a huge tract of land in the vicinity of Flora Drive in the 1970s. It is behind seven large condo projects there - Azalea, Ballota, Carissa, Dahlia, Edelweiss, Ferraria Park and The Gale. The Inflora is near the Japanese Primary School and the upcoming Singapore University of Technology and Design. Elsewhere, Chiu Teng Groups Creek@Bukit condo was open for viewing yesterday. Property agents said indicative average prices of units were between $1,500 psf and $1,600 psf. The freehold project in Bukit Timah is expected to open for bookings next Friday. Source: The Straits Times –26 October 2013 204,500 homes set to be ready by 2016 The projected number of homes that will be built by 2016 has gone up to 204,461 units, said Minister of National Development Khaw Boon Wan in a Facebook post yesterday. This was up from a previous forecast of 197,559 units made in January. We are making good progress in our ramp-up of the home-building programme, Mr Khaw said. The increase in the projected total was solely due to more private homes and executive condominium (EC) units set for completion over the next three years. Housing Board flat numbers to be completed remain the same. So far this year, 9,519 private homes have been built and 6,305 more will be finished by Dec 31. Over the next three years, 4,884 more private homes are scheduled to come onstream. As for ECs, a hybrid of public and private housing, 1,253 units have been completed so far this year and 406 more are due to be completed by the year end. An expected 1,355 EC units will be completed over the next three years. But the bulk of the completions will be in 2016, likely due to delays, market watchers said. The revised estimates yesterday were released alongside the Urban Redevelopment Authoritys (URA) private property price index data for the third quarter. Overall private home prices rose 0.4 per cent, mainly owing to a 2.2 per cent increase in the suburban region, URA data showed. That outweighed a 0.3 per cent dip in city centre prices and a 1.1 per cent slide in the city fringe. This marked the first time city fringe prices have fallen since the first three months of last year. New sale volumes plunged 46 per cent to 2,430 units and resale volumes tumbled 35 per cent to 1,340 units in the third quarter. Developers also held back major launches, releasing 3,313 new units for sale - 25 per cent less than in the second quarter. Private home rents inched up 0.2 per cent in the third quarter. This was despite the number of vacant units climbing from 5.6 per cent in the second quarter to 6.1 per cent in the third quarter, the URA said. The stock of completed private residential units also grew by 3,478 units in July through last month. Source: The Straits Times –26 October 2013 More bang for your buck at Toh Tuck The Toh Tuck Road enclave, nestled between Bukit Timah and Bukit Batok, has been rejuvenated in recent times by strong demand for homes in the area. The corridor features condominiums and landed housing estates with low- to medium-rise homes and has been a popular residential area since the 1960s. Many buyers are drawn to the area because of its proximity to prestigious schools and amenities such as shops and eateries. These can be found along Jalan Jurong Kechil, Chun Tin Road, Cheong Chin Nam Road and in shopping malls such as Bukit Timah Plaza, Bukit Timah Shopping Centre and Beauty World Centre. The upcoming Beauty World MRT station is set to be another boon to the area. With interest in the area growing, several older residential projects have lately undergone en bloc sales and been redeveloped into new condominiums. One upcoming project is The Creek @ Bukit, which is likely to be launched soon. The five-storey development by Chiu Teng sits on the site of the former Green Lodge, sold collectively for $191.9 million in September last year to a then-undisclosed private investor. The breakeven cost for a new condo built on the 151,075 sq ft site is expected to be about $1,100 per sq ft (psf), according to a Business Times report last September. Other en bloc sales in the area include Goodluck View, Rainbow Gardens and Kismis Lodge. Goodluck View was collectively sold to a Hiap Hoe unit and Superbowl Management in June 2007 for $73.3 million and has been redeveloped into the freehold 118-unit condo The Beverly. Another older project, Rainbow Gardens, was sold en bloc to the LaSalle Asia Opportunity II fund several years ago. It was developed into Terrene at Bukit Timah by UOL, which took a half-stake in the site in October 2009. The 172-unit project is on a 999-year leasehold. Kismis Lodge, a pair of freehold walk-up apartment blocks, was sold collectively for $84.18 million to a consortium of private investors in March. It is likely to become a mixed strata or conventional landed residential project. Source: The Straits Times –26 October 2013 Networks for AMK, Toa Payoh, Choa Chu Kang Cycling path networks will soon be built in Ang Mo Kio, Toa Payoh and Choa Chu Kang, as part of a move to promote cycling islandwide. Announcing the plans, Parliamentary Secretary for Transport Muhammad Faishal Ibrahim yesterday said cycling has become a mode of transport that people use to travel not only within towns but also to another town or to their workplace. Over time, you can expect all the different towns being connected to one another, he said. We will be able to see more and more people cycling not only as a mode of transport to work but also to carry out daily activities. The cycling path network in Sembawang has been completed, he said, making it the second town with a full network after Tampines. This will allow residents to pedal to the MRT station and amenities such as Sun Plaza and Sembawang Mart. Cycling networks will also be completed in Marina Bay, Yishun, Pasir Ris, Taman Jurong and Changi Simei by 2015. Some 190km of paths will be constructed by 2020. Meanwhile, short cycling links will be built to connect three MRT stations - Bishan, Buangkok and Yew Tee - to nearby park connectors by early next year. Bicycle wheeling ramps will also be rolled out to make it easier for cyclists to cross overhead bridges. The first such ramp will be tried out at a bridge across Aljunied Road next year. Separately, a cycling proficiency programme has been launched in Tampines, the only town where cycling is allowed on pedestrian footpaths. Named Bike Smart Tampines, the programme aims to equip students with the skills to navigate footpaths and roads safely on two wheels. It includes a hands-on session to teach children bike-handling skills and traffic rules. It was launched yesterday at Qiaonan Primary by Education Minister Heng Swee Keat, and will subsequently be rolled out to all 22 schools in Tampines. Safe cycling workshops have been conducted in schools before. But the programme is the first to tackle cycling on footpaths and places greater emphasis on cycling techniques. Mr Heng hopes to encourage more students to learn cycling skills, which he said is a useful life skill. He did not rule out having cycling proficiency programmes in other schools outside of Tampines: As to how fast this can be promoted, it depends very much on ensuring that we have a proper infrastructure and that it is safe for the students. Source: The Straits Times –27 October 2013 Pedalling the park connectors NORTH: A stretch of about 10km of the northern park connector network runs below or along the overhead MRT track, allowing riders to go from Marsiling or Woodlands estates to Khatib. The route passes shopping centres such as Causeway Point, Sun Plaza and Northpoint, as well as Yishun Industrial Park. Cycling between Woodlands and Khatib in Yishun takes about 30 minutes, twice as long as the MRT ride. A stretch of the Marsiling network that runs along Housing Board flats is lined with palm trees and gives cyclists an unobstructed view of the Woodlands Checkpoint. At the Woodlands Waterfront Promenade, cyclists can gaze across the Strait of Johor to Johor Baru. From the Canberra park connector, there is a 3km branch that peels away towards Sembawang Park where Beaulieu House stands. WEST: The western loop of the park connector network links Jurong, Clementi, Bukit Batok, Choa Chu Kang and Bukit Panjang. It also serves private estates like Hillview. Residents can ride from Bukit Batok to Bukit Panjang, passing Little Guilin park, Lot One mall in Choa Chu Kang and Junction 10 mall. Some sections in Bukit Batok and Bukit Panjang must be shared with pedestrians and cyclists may have to dismount and push their bikes. The western loop takes cyclists to various leisure spots including the Bukit Timah Nature Reserve, Chinese Gardens, West Coast Park and near the Jurong Bird Park. There is one overhead bridge to be crossed at Jurong Town Hall Road before reaching the Chinese Gardens. There are plans to extend this network. A path will be built from Dairy Farm Road to Rifle Range Road, continuing along the Pan-Island Expressway past Bukit Golf Course and link to the proposed MacRitchie Park Connector along Lornie Road. NORTH-EAST: Students living in Punggol, Sengkang or Buangkok and studying at the ITE College Central in Ang Mo Kio can use the north-eastern Park Connector Network loop, and ride to school. Joining the network via the Punggol Waterway or Sengkang Riverside Park, they can ride through Lorong Buangkok towards Ang Mo Kio Avenue 5. It takes about 30 minutes to cover about 7.5km. Riders can also use the network to reach the Yio Chu Kang MRT station or Ang Mo Kio town. The north-eastern loop takes cyclists past Punggol Park, Singapores last remaining kampung at Lorong Buangkok, the picturesque 4.2km stretch of the Punggol Waterway, and the expansive Lorong Halus Wetland. They can also take in views of Pulau Ubin and the Strait of Johor from the Punggol Promenade. CENTRAL: The central section of the park connector network has both the oldest and newest sections. The section between Bishan Park and Braddell Road is 21 years old, and the Pelton section is so new that it has not yet been marked on the official online map onemap.sg Using the 7.6km Kallang Park Connector, those who live in Ang Mo Kio and Bishan can cycle to the Kallang Riverside Park (30 mins), Whampoa Market (30 mins) or Upper Paya Lebar Road (45 mins). But they face at least six overhead bridges and a confusing stretch at Moonstone Lane where the park connector goes onto the road. From Kallang Riverside Park, cyclists can head on to Marina Bay, Gardens by the Bay and the Esplanade. They can also go towards picturesque Tanjong Rhu Promenade and the Geylang park connector, although their paths will be blocked by construction work on the Singapore Sports Hub. This section holds the most promise as a commuting option since it connects Ang Mo Kio and Bishan to Marina Bay. But the overhead bridges without ramps, steps to some stretches of the network and poorly maintained sections are obstacles. EAST: The eastern loop of the park connector network connects Bedok, Tampines and Pasir Ris and private estates in Kembangan, Telok Kurau and Frankel Avenue. Those living in these estates can cycle to the Loyang Industrial Park, a journey of between 10 minutes and an hour, depending on where they start from. It is effortless to push their bicycles on the gentle ramps of the overhead bridge across the Pan-Island Expressway between Bedok North and Simei Avenue. But they will have to pedal harder up a gentle but 500m slope at Pasir Ris Drive 3 and Loyang Avenue. Beyond Loyang, the park connector runs to laid-back Changi Village, Changi Beach Park, Changi Coast Road and finally the East Coast Park, from which it loops back to Bedok, Marine Parade and Telok Kurau, completing a 40km circle. SOUTH: The 8.5km Ulu Pandan park connector takes Ghim Moh and Dover Road residents to major industrial clusters in Jurong and West Coast. It connects to the 4.3km Jurong park connector as far as the Jurong Bird Park and the 3.1km West Coast park connector. Those heading towards West Coast will ride over a one-of-a-kind overhead bridge with bicycle and pedestrian lanes across the Ayer Rajah Expressway, possibly reaching their destinations in less than half-an-hour. Lying some 2.5km east of the Ulu Pandan park connector is the Alexandra park connector and Alexandra Canal Linear Park. Both sections run in a 3.1km straight line across Tanglin Road, Delta Road, ending near the Zion Riverside Food Centre which is famous for its char kway teow. The Alexandra Canal Linear Park, which was set up in April, has a butterfly garden about the size of a five-room HDB flat. Source: The Straits Times –27 October 2013 Spore investors flock to overseas properties Singaporean buyers are heading to overseas property markets in droves, hitting familiar favourites such as London and Australia, but also new spots such as Canada and New Zealand. Indeed, there has been a spike of about 60 per cent in interest in London properties in the first five months of this year. This is due to the launch of more iconic and well-located Zone 1 projects such as Battersea Power Station, 190 Strand, One Blackfriars, and Baltimore Tower. Over 50 units per month were snapped up by Singaporeans in the first five months of this year. The number of Singaporeans who already own three or more UK properties has increase by some 2.8 percentage points, from 6.4 per cent in 2012 to 9.2 per cent in 2013. According to Mary Timlin, sales and marketing director at Redrow Homes London, a major attraction for Asian investors lies in their being able to finance their purchases in a foreign currency against the weakening pound. Meanwhile, overseas buyers who buy Londons property are not liable for capital gains tax on the capital growth and some of them like to secure properties today for their childrens further education in London, she said. Even as investors flock to familiar favourites, new spots such as New Zealand are also receiving their share of interested buyers. According to Rob Young, sales director for Conrad Properties Group, a real estate development and investment company, the New Zealand property market has traditionally seen keen interest from mainland Chinese. Indeed, the two projects rolled out by the developer this year - Urba Residences and Queens Residences - were well received by both New Zealanders and Asian investors. The 143-unit Urba Residences, which is located at 5 Howe Street, Auckland, was 85 per cent sold out within 12 weeks. Of this, 12 per cent of the buyers were offshore investors - half from Australia and the other half from South-east Asia, said Mr Young. Put simply, the local demand is extremely strong, as well as interest from South-east Asia and Mainland China, he said. Queens Residences, which offers 273 residential units in the heart of Aucklands central business district, was launched in early August and met with similar success. New Zealand attracts investors due to its transparent and stable business environment and positive outlook with consistent economic growth, strong currency, and population growth, noted Mr Young. Other factors, such as the countrys transparent real estate sector, favourable long-term economic indicators, lack of land tax and stamp or conveyance duties, add to its allure. The fact that the property market is at the bottom of its property cycle helps too. According to the Real Estate Institute of New Zealand, the Auckland median dwelling price has increased a remarkable 103 per cent over the last 10 years, and is predicted to continue. We have waited some four years for the New Zealand property market to strengthen, said Mr Young. Indeed, Singapore has now replaced Japan as the fourth largest foreign investor in New Zealand, according to Statistics New Zealand, which show that total foreign direct investment from South-east Asia hit NZ$4.4 billion (S$4.5 billion) in the first three months of 2013, up from NZ$2.8 billion a year before. Canada too has seen a surge in interest from Asian investors. According to Virata Gamany, director of Vision International Properties, a breakdown of buyers of some of its recent projects showed that roughly 35 per cent of the units were bought by Asian investors. Its latest project, Sage Gardens condominium in St Alberta for instance, saw all the units set aside for Asian investors snapped up. During its Asian tour - for which 25 units of its Phase 1 launch was reserved - the developer sold 17 units in Malaysia, and 15 units in Singapore. As a result, it had to cancel the planned preview for Hong Kong which was scheduled for the following weekend. On the broader investment front, Singaporean investors have returned to the Australian property market with a vengeance, snapping up some US$585 million worth of real estate - comprising all commercial property transactions above US$10 million - between January and September this year. This is a 105 per cent increase compared with the same period last year. Of the different commercial assets, investors have flocked to the office class (63 per cent of overall investment), followed by retail (22 per cent), and industrial (9 per cent). Perhaps unsurprisingly, key cities such as Sydney (40 per cent of overall investment) and Perth (27 per cent) continued to draw the most investor dollars, followed by Melbourne (18 per cent) and Brisbane (12 per cent). Source: Business Times –28 October 2013 COMMERCIAL MARKET URA Q3 data confirms pick-up in office leasing market Latest figures from Urban Redevelopment Authority confirm the views of some industry players that the office leasing market has emerged out of a downturn. URAs office rental index in the central region rose 0.8 per cent in the third quarter over the preceding quarter. This marked a bigger increase compared with the 0.2 per cent gain registered in Q2. However, the islandwide office vacancy rate climbed to 9.6 per cent at end-Q3 from 8.8 per cent three months earlier. For private-sector office space, the vacancy rate rose from 9.5 per cent to 10.4 per cent. The higher islandwide vacancy was amid a net addition of about 1.3 million sq ft of available office space in the third quarter of this year - from the completion of major projects such as Asia Square Tower 2, The Metropolis Tower 1 and Nexus@ One-North. On the demand side, the islandwide office market saw net increase in occupied space of about 495,000 sq ft in Q3, higher than 205,000 sq ft in Q2. URAs All Industrial rental index rebounded 4.4 per cent in Q3 after dipping 0.1 per cent in Q2. Its multiple-user factory rental index increased 4.4 per cent in Q3 after inching up 0.1 per cent in the second quarter. Multiple-user warehouse rents recovered 4.6 per cent in the July-September period from the 2.4 per cent decline in Q2. At the same time, vacancy rates eased slightly to 7.5 per cent at end-Q3 from 7.6 per cent at end-Q2 for factory space and to 6.7 per cent from 7.2 per cent for warehouse space, according to URAs data. URAs shop rental index climbed 0.4 per cent in Q3, contrasting with a 0.8 per cent slide in Q2. The shop price index, however, appreciated at a slower clip of 0.4 per cent in the third quarter, compared with the 1.7 per cent increase in Q2. In similar fashion, the price index for office space rose one per cent in Q3, compared with Q2s 1.5 per cent gain. Prices of multiple-user factory space continued to inch up 0.9 per cent after posting a 0.5 per cent gain in Q2. Multiple-user warehouse space posted the most dramatic turnaround, rising 10.4 per cent in the third quarter, after slipping 5.9 per cent in the previous quarter. Source: Business Times –26 October 2013
Posted on: Mon, 28 Oct 2013 08:02:00 +0000
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