THEREALDEALS

Ins&OutsofSingaporeRealEstate

Pricedeclineorhighercost?
The latest tender results for a condo site at Upper Serangoon Crescent / Upper Serangoon Road led to a quick conclusionthatdevelopersarefactoringinapricedeclineforselectedmassmarketsites,withsomesayingupto 20%.Landcostisonlyoneofthemajorcostcomponentsforthedeveloper,theotheristhecostofconstruction.The highestbidinthelatesttenderis$291psfpprbyAllgreen.Thisislowerthanthesalepriceofthesiteoccupiedby BoathouseResidences,whichwassoldfor$320psfpprinNovember2010.However,ifyouconsidera10%risein construction cost over the next year (works out to be about $30 psf) when the project launches and calls for constructiontender,thetwositessharethesamebreakevencost,inwhichcasethedeveloperisexpectingflatmass marketpricesoraslightdip,butnotasgloomyanoutlookasamajordecline.

Thereareatleast3factorscontributingtotheriseofconstructioncost.Constructionmaterialsuchassteelbarsand readymixedconcretehasseenpricesrisingby15%yoy.InFebruary,aroundoflevyincreaseandquotatightening wasenforcedonforeignworkers.Andmorerecently,salaryrequirementsforEmploymentPassareraised.Therising cost of construction is reflected in construction contracts, The Gale cost $270 psf to build in October 2009 but HedgesParkcost$326psfinJune2011.ExecutiveCondominiums(EC)arenotspared.EsparinaResidencesandPrive cost$195psftobuildinSeptember2010butBelysacost$216psfinMay2011.

Apart from the rising construction cost, there are other factors putting developers off in the latest tender. The supplyriskinthevicinityappearshigh,thereare2ECsites,3privatecondositesand1Design,BuildandSellScheme siteallwithinashortradiusof500m.Thesiteinquestionofmorethan900,000sqftofGFAisalsolargerthanan averageGLSsiteof550,000sqft.ItisnearlydoublethesizeofBoathouseResidencesandisexpectedtoyield860 units. GovernmentLandSale(GLS)sites
Developer:UE/Lee Metal Project:Austville Residences(EC) Units:540 ASP:$720psf Landcost:$321psf ppr Sold:May2010 Developer: Qingdao Est.units:550 Landcost:$391 psfppr Sold:Jun2011 Developer: Allgreen Est.units:860 Landcost:$291 psfppr Sold:Sep2011

Developer:Low KengHuat Project:Parkland Residences(DBSS) Est.units:630 Landcost:$206psf ppr Sold:Nov2010

2H2011GLS ReserveList(EC) Est.units:435 Developer:FarEast/Frasers Project:BoathouseResidences Units:493 ASP:$880psf Landcost:$320psfppr Sold: Nov 2010
Source:URA

Co.RegNo:198700034E MICA(P):090/11/2009

SEEAPPENDIXIFORIMPORTANTDISCLOSURESANDANALYSTCERTIFICATIONS

UPPERSERANGOON
Tenderresults
Austville Residences (EC) May2010 UE+LeeMetal 549,006 176.0 115.8 7 540 320.6 195.0 560 Boathouse Residences (Private) Nov2010 Frasers/ Far East 489,773 156.8 136.4 4 493 320.1 300.0 665

TheRealDeals8September2011
Analyst:OOIYiTung6564335712ooiyitung@kimeng.com

Developer GFA Highestbid$m Lowestbid$m Numberofbids Units Landcost$psf Constructioncost$psf Est.breakeven$psf

Parkland Residences (DBSS) Dec2010 LowKengHuat 753,480 155.2 113.3 2 630 206.0 160.0 400

Buangkok Drive (Private) Jun2011 Qingdao 631,283 247.0 145.2 4 550 391.3 320.0 765

Upper Serangoon (Private) Sep2011 Allgreen 927,553 270.3 242.0 3 860 291.4 330.0 665

Source:URA,HDB,KimEngestimates RecentconstructioncontractsforGLSsites 1.Privatecondominium

Source:URA,HDB,Company

Awarddate Jun2011 Aug2010 Jun2010 Mar2010

Project HedgesPark TheScala Treehouse Waterbank

GFA 462,325 418,257 513,129 647,605

Constructioncost $m 150.7 119.5 146.0 144.0

$psf 325.96 285.71 284.53 222.36

Contractor LianBeng LianBeng TiongSeng LianBeng

2.ExecutiveCondominium
Awarddate May2011 Sep2010 Aug2010 Project Belysa EsparinaResidences Prive GFA 342,280 613,548 726,483 Constructioncost $m 74.0 119.4 142.0 $psf 216.20 194.61 195.46 Contractor ChipEngSeng LumChang ChipEngSeng

Source:URA,HDB,Company

Primarymarketsales ThesaleofAustvilleResidences(EC)hasbeenrelativelyslow,ithasachievedabout54%takeupsinceits launchinJanuary2011.Tocompare,BelysaatPasirRis(launchedinMay2011)hasbeenfullysoldatan ASPof$690psfwhileRiverparcatPunggol(launchedinJuly2011)hasalreadyachievedatakeuprateof over 60% with an ASP of $700 psf. A reason could be pricing. The developers breakeven for Austville ResidencesisthehighestamongsttheECslaunchedandthereforetheprojectisaskingforanaverageof $720psf,$20higherthantheaveragepriceofECunitsataround$700psf.Thesaleof540unitBoathouse Residencessawabout100unitssoldinthefirstweekoflaunch,achieving$880psf.

SaleofAustvilleResidences
Month Jul2011 Jun2011 May2011 Apr2011 Mar2011 Feb2011 Jan2011 Units soldin Takeup month % 19 54% 23 50% 29 46% 26 41% 36 36% 62 29% 95 18% Lowest price $psf 585 585 602 590 600 600 599 Median price $psf 728 713 719 709 707 721 719 Highest price $psf 773 768 773 762 775 777 772

Source:URA

MARKETSNAPSHOT

TheRealDeals8September2011
Analyst:OOIYiTung6564335712ooiyitung@kimeng.com

UpcomingVVIPLaunches ThreeBalmoral(District10)
A 40unit freehold development by Tong Eng locatedintheheartofthecity.Allunitsenjoy unobstructed panoramic view of the pristine GoodwoodHill.

PropertyPriceIndices
Index SRPIOverall(July11) RESIComposite(2Q11) URAPPI(2Q11) HDBResale(2Q11)

Change +0.2% 0.5 +2.0% +3.1%

Level 166.6 4.5 203.0 180.3

*Shhh... if you have not yet been invited, you are probablynotaVVIP.Waitforthepubliclaunch.

GovernmentLandSales(GLS)
RecentlyAwardedSites West Coast Link / West Coast Crescent (35.5k sqm, 360units)AwardedtoFarEastfor$175.8m,($460.6psf ppr) ChoaChuKangRoad/PhoenixRoad(32.3ksqm,335 units) Awarded to Far East and China Construction for $142.8m($410.5psfppr) Punggol Way / Punggol Field, EC (75.5k sqm, 720 units)AwardedtoFrasersCentrepointandKeongHong Constructionfor$219.5($270psfppr) Upper Serangoon Road / Pheng Geck Avenue (30.3k sqm, 330 units) Awarded to Tuan Sing for $185.2m ($567.3psfppr) Serangoon Garden Way (28.4k sqm, 80 units) AwardedtoCDL/HongLeongfor$105m($343.5psf) Punggol Field / Punggol Walk (48.8k sqm, 550 units) Awarded to Capital Development / ZACD for $169.6m ($323psfppr) Upper Serangoon Crescent / Upper Serangoon Road (86.2k sqm, 860 units) Highest bid of$270.3m ($291.4 psfppr)fromAllgreen ConfirmedList(RecentlyOpenforTender) Jalan Loyang Besar / Pasir Ris Rise (36.3k sqm, 355 units)Tenderclosingon4October Pasir Ris Drive 3 / Pasir Ris Link, EC (39.0k sqm, 390 units)Tenderclosingon11October Flora Drive (41.9k sqm, 415 units) Tender closing on 19October YishunCentral7/CanberraDrive,EC(67.9ksqm,725 units)Tenderclosingon25October ReserveList(RecentlyOpenforTender) JalanJurongKechil(14.2ksqm,240units) BuangkokDr/SengkangCentral(55ksqm,495units) TanahMerahKechilRd(39.2ksqm,470units) StirlingRoadA(44.5ksqm,445units) StirlingRoadB(44.1sqm,445units) EliasRd/PasirRisDr3(32.7ksqm,295units) HillviewAve(35.4ksqm,405units) SengkangSquare(64.4ksqm,710units) Upper Serangoon View/ Upper Serangoon Road, EC (43.3ksqm,420units)
Source:HDB,URA

Recenttransactions
Project TheRivervale Watermark HoltResidences NinResidence KovanResidences TheMinton MelvillePark EastpointGreen AscentiaSky Rivergate Uber388 Zenith Queens OleanderTowers HighOak Pinevale Celestia CrystalLodge EmeraldPark Summerdale Reflections AtriumResidences TheFloravale ForesqueResidences
Source:URA

Tenure 99yr FH FH 99yr 99yr 99yr 99yr 99yr 99yr FH FH 999yr 99yr 99yr 99yr 99yr FH FH 99yr 99yr 99yr FH 99yr 99yr

Price ($psf) 731 1,906 1,413 1,082 1,085 913 672 859 1,265 1,903 1,372 1,951 1,262 886 912 695 703 697 1,056 674 2,222 864 671 1,323

Planningarea Sengkang SporeRiver Tanglin ToaPayoh Hougang Hougang Tampines Tampines BukitMerah SporeRiver Bedok Tanglin Queenstown ToaPayoh BukitTimah Tampines Geylang Geylang BukitMerah JurongWest BukitMerah Geylang JurongWest BukitPanjang

PropertyStocks
Name CapitaLand CityDev HoBee HPL KepLand SingLand UOL Wheelock WingTai

Price 2.67 10.21 1.335 2.08 3.01 6.45 4.65 1.66 1.34

RNAV 3.97 13.27 2.76 4.41 5.25 10.42 N.A. N.A. 3.03

Disc/ Prem to RNAV 33% 23% 52% 53% 43% 38% N.A. N.A. 56%

Disc/ Premto NTA/share* NTA/share 3.18 16% 7.18 42% 2.13 37% 2.63 21% 2.72 11% 10.57 39% 6.39 27% 2.32 28% 2.25 40%

N.A.=NoCoverage*Asatlatestreported

DEVELOPERSLANDBANK
Developer District 06 09 10 10 11 17 18 18 18 18 19 19 23 23 Sentosa 01 02 04 04 04 04 19 22 03 09 10 10 15 16 20 26 Sentosa Sentosa 02 16 02 05 09 12 12 21 09 10

TheRealDeals8September2011
Analyst:OOIYiTung6564335712ooiyitung@kimeng.com

CityDev

KepLand

CapitaLand

HoBee UOL Allgreen Wheelock

Landbank SouthBeach(BeachRoad) Futura(LeonieRoad) BoulevardHotel(CuscadenRoad) LuckyTower(GrangeRoad) BuckleyClassique(BuckleyRoad) HedgesPark(FloraRoad) NVResidences(PasirRis) PasirRisGrove,parcel3+stateland(PasirRis) PasirRisDrive8,parcels4+5(PasirRis) Tampines/UppChangiRdNorth H2OResidences(SengkangWestAve) BartleyRoadGLS(BartleyRoad) ChoaChukangGLS(EC)(ChoaChuKangDrive) SegarRoadGLS(EC)(SegarRoad) ResidencesatW(SentosaCove) TotalUnsoldUnits MarinaBaySuites(MarinaBay) Keppel&GETowerssite(TanjongPagar) ReflectionsatKeppelBay(KeppelBay) KeppelBayPlot3(KeppelBay) KeppelBayPlot4(KeppelBay) KeppelBayPlot5(KeppelBay) SengkangGLSsite(SengkangSquare) TheLakesideResidences(LakesideDrive) TotalUnsoldUnits TheInterlace(GillmanHeights) UrbanResort(CairnhillRd) Dleedon(FarrerRd) TheNassim(NassimRd) MarinePoint(MarineParade) BedokTownCentreSite(BedokCentral) BishanGLSsite(BishanStreet14) YioChuKangsite(YioChuKangRd) TotalUnsoldUnits SeascapeatSentosaCove(SentosaCove) PinnacleatSentosaCove(SentosaCove) TotalUnsoldUnits SpottiswoodeResidences(SpottiswoodePark) BedokReservoir(BedokReservoirRd) TotalUnsoldUnits Skysuites@Anson(EnggorStreet) ProjectatWestCoastRd(WestCoastRoad) RVResidences(RiverValley) RiverBay(MarThomaRd) Riviera38(MarThomaRd) TheCascadia(BukitTimahRoad) TotalUnsoldUnits ScottsSquare(ScottsRoad) Ardmore3(ArdmorePark) TotalUnsoldUnits

Tenure 99 Freehold Freehold Freehold Freehold 99 99 99 99 Freehold 99 99 99 99 99

99 Freehold 99 99 99 99 99 99

99 Freehold 99 Freehold Freehold 99 99 Freehold

99 99

Freehold 99

99 Freehold 999 999 999 Freehold

Freehold Freehold

Unsold Units 119 122 203 178 64 212 56 752 1,517 605 190 560 490 602 207 5,876 82 620 330 307 234 94 622 45 2,334 372 41 1,324 55 150 469 650 140 3,201 113 357 470 38 640 678 209 80 248 147 102 35 821 93 84 177

DEVELOPERSLANDBANK(contd)
Developer Guocoland BtSembawang District 02 10 26 09 09 09 09 15 16 16 18 18 19 19 19 27 03 09 09 10 10 11 23 10 15 17 19 9 9 9 10 Sentosa

TheRealDeals8September2011
Analyst:OOIYiTung6564335712ooiyitung@kimeng.com

FrasersCentrepoint

WingTai

MCLLand

SCGlobal

Source:HDB,URA

Landbank Tenure TanjongPagarGLSwhitesite(PeckSeah/ChoonGuan) 99 LeedonResidence(LeedonHeights) 99 TheWaterline(YioChuKangRd) Freehold TotalUnsoldUnits TheVermontonCairnhill(CairnhillRd) Freehold PatersonSuites(PatersonRd) Freehold StThomasWalk(StThomasWalk) Freehold TotalUnsoldUnits StarHubCentre 99 FlamingoValley(SiglapRd) Freehold WaterfrontGold(BedokReservoirRd) 99 WaterfrontIsle(BedokReservoirRd) 99 Seastrand(PasirRisDrive3) 99 PasirRisGLSsite(FloraDrive) 99 BoathouseResidences(UpperSerangoonRoad) 99 EsparinaResidences(Sengkang) 99 PunggolGLSmixedsite(PunggolCentral) 99 EightCourtyards(YishunAve2) 99 TotalUnsoldUnits AscentiaSky(Redhill) 99 HELIOSResidence(CairnhillCircle) Freehold BelleVueResidences(OxleyWalk) Freehold LeNouvelArdmore(ArdmorePark) Freehold Anderson18(ArdmorePark) Freehold L'VIV(NewtonRd) Freehold ForesqueResidences(PetirRoad) 99 TotalUnsoldUnits NOBHill(EweBoonRd) Freehold CasaNassau(EastCoastRd) Freehold PasirRisGLSsite(JalanLoyangBesar) 99 Terrasse(HougangAve2) 99 TotalUnsoldUnits TheMarq(PatersonHill) Freehold Hilltops(CairnhillCircle) Freehold MartinNo.38(MartinRd) Freehold TheArdmore(ArdmoreRoad) Freehold SevenPalms(SentosaCove) 99 TotalUnsoldUnits GrandTotal

Unsold Units 500 261 44 805 76 25 221 322 240 239 24 110 462 380 493 7 685 187 2,806 59 69 38 43 157 42 355 763 70 65 580 230 945 38 210 28 50 32 358 19,556

SINGAPOREDISTRICTMAP

TheRealDeals8September2011
Analyst:OOIYiTung6564335712ooiyitung@kimeng.com

01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BoatQuay,Chinatown,HavelockRoad,MarinaSquare,RafflesPlace,SuntecCity AnsonRoad,Chinatown,NeilRoad,RafflesPlace,ShentonWay,TanjongPagar AlexandraRoad,TiongBahru,Queenstown Keppel,MountFaber,Sentosa,TelokBlangah BuonaVista,Dover,PasirPanjang,WestCoast CityHall,HighStreet,NorthBridgeRoad BeachRoad,BencoolenRoad,Bugis,Rochor LittleIndia,FarrerPark,SerangoonRoad Cairnhill,Killiney,LeonieHill,Orchard,Oxley Balmoral,BukitTimah,GrangeRoad,Holland,OrchardBoulevard,RiverValley,TanglinRoad Chancery,BukitTimah,DunearnRoad,Newton Balestier,Moulmein,Novena,ToaPayoh PotongPasir,Macpherson Eunos,Geylang,Kembangan,PayaLebar Katong,MarineParade,Siglap,TanjongRhu Bayshore,Bedok,ChaiChee Changi,Loyang,PasirRis PasirRis,Simei,Tampines Hougang,Punggol,Sengkang AngMoKio,Bishan,BraddellRoad,Thomson Clementi,UpperBukitTimah,HumeAvenue BoonLay,Jurong,Tuas BukitBatok,ChoaChuKang,HillviewAvenue,UpperBukitTimah Kranji,LimChuKang,SungeiGedong,Tengah Admiralty,Woodlands Tagore,YioChuKang Admiralty,Sembawang,Yishun Seletar,YioChuKang

Source:expats2singapore.com

TheRealDeals

8September2011

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