2017 to welcome more bulk sales?

As Qualifying Certificate (QC) deadlines close in on more residential projects, bulk sales could the difference between having to pay hefty penalties and escaping by the skin of their teeth. The Qualifying Certificate which developers are issued with once they purchase a private residential land plot binds them in a contract to finish building the project within 5 years of acquiring the land and to sell all units within 2 years of obtaining a temporary occupation permit (TOP). Should there be remaining units after this time, the developers will be required to pay extension charges.

nassimhillcapitalandPhoto credit: CapitaLand

The Qualifying Certificate which developers are issued with once they purchase a private residential land plot binds them in a contract to finish building the project within 5 years of acquiring the land and to sell all units within 2 years of obtaining a temporary occupation permit (TOP). Should there be remaining units after this time, the developers will be required to pay extension charges.

iLiv@GrangeThe most recent bulk sale of the 45 remaining units at The Nassim has helped developer CapitaLand avoid having to possibly pay up to millions of dollars worth of penalties as their QC deadline is in August this year. Mr Wee Cho Yaw, chairman emeritus of United Overseas Bank has paid $411.6 million for the 45 units with a strata area of 16,466 sq m at an approximate 18 per cent discount on the current sale price of individual units. The development consists of 55 units housed in eight 5-storey blocks, and the other 10 units have been sold to individual buyers.

Other recent bulk sales include the 156 units sold at a 16 per cent discount at Nouvel 18 and 30 units sold at a 23 per cent discount at iLiv@Grange. Though this enbloc exit of units may relief the unsold inventory of some pressure, more completed units are entering the market this year and may we could be looking at more bulk sales in the year ahead.

 

Luxury apartments – Leased instead of Sold?

As the property market lull continues, developers of luxury properties are finding the going all the tougher. As the number of unsold units loom large in the horizon, some property developers have considered turning their private condominiums into serviced apartments instead.

iLiv@Grange

iLiv@Grange

The only other options are for those with deeper pockets to hold off their launches till the market turns around, or to offer steep discounts. Ardmore Residences is just one of the possible few luxury residential developments whose launch has been held off. Wealthy investors do not seem to be keen on hopping on the market for now, probably in lieu of the tightening measures placed around the housing and finance sectors. Since its completion last year, developers have chosen instead to lease out units at the Ardmore Residences for approximately $25, 000 per month. The Sculptura Ardmore condominium nearby has also not been launched.

Sculptura ArdmorePhoto credit: SC Global.

Although some marketing has been done for the iLiv @ Grange apartments in Grange road, it has not been officially launched as well. At its unveiling in 2010, developers were targeting selling prices of $3, 000 psf. But in the current market, that figure might be unrealistic. There has been talk of the developer, Heeton Holdings, possibly selling the units in bulk to a single buyer at $2, 200 to $2, 300 psf. Developers generally have a window of 2 years after completion of the project to sell off the units. Remaining units are not allowed to be rented out. Since Singapore may require more hotels and short-term accommodation, it may be a new venture should these luxury residential projects near the city centre to be converted into serviced apartments.