Cash-Rich Singapore developers may spur more record land deals

By Pooja Thakur Mahrotri / Bloomberg | February 14, 2018 4:55 PM SGT
Singapore looks set for another year of record-breaking property deals as developers flush with cash replenish their land banks.
Developers’ land purchases may reach S$16 billion ($12 billion) this year, squeaking past last year’s tally, according to Christine Li, a director of research at Cushman & Wakefield Inc.
Developers’ cash from home sales and bank financing may total S$22.9 billion, according to Li, a war chest built up when the property market was sluggish. Now, builders are bidding more aggressively for land as rising apartment sales and prices signal an end to a four-year downturn.“Against this backdrop, land deals could continue to set record prices in 2018, especially for sites with little competition in the vicinity,” she said.
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Signs the market is heating up:
  • Frasers Property Ltd. in December paid a record per-square foot price for a residential site near the Singapore River.
  • City Development Ltd.'s winning bid last month for a river-front plot suggested the firm will need to sell units at a 20 percent premium to current prices in the area, according to Colliers International Group Inc.
“With the residential market on the cusp of a sustained recovery, developers are likely to continue replenishing their land banks, via public land tenders and private collective sales,” said Tricia Song, director and head of research at Colliers Singapore.