[UPDATE] New launches to look forward to in 2022

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/ EdgeProp Singapore
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December 24, 2021 2:05 AM SGT
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SINGAPORE (EDGEPROP) - This year, 27 new projects were launched, similar to the 26 new launches in 2020. Developers are estimated to have sold 30% more new homes this year compared to the previous year, notes Lee Sze Teck, Huttons Asia senior director of research.
Slated for launch in 2022 are 41 new private residential projects, with a total of 5,389 units. Based on the number of units, 22% are in the Core Central Region (CCR), 37% in the Rest of Central Region (RCR), and 41% in the Outside Central Region (OCR).
New home sales next year could be constrained by a lack of new supply, says Lee. “While the number of launches is higher than 2021’s, the number of available units is much smaller at 5,389.” The new cooling measures on Dec 16 may see developers push back their new launches or release fewer units for sale, he adds. “This will affect sales volume next year.”
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BELGRAVIA ACE SHOWFLAT SCALE MODEL - EDGEPROP SINGAPORE
The 107-unit strata landed housing project Belgravia Ace is likely to be the first new launch of 2022 (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Potential new launches in 2022 are generally of smaller scale compared to those launched this year. In the coming year, there are no mega projects above 1,000 units such as Normanton Park this year, observes Tricia Song, CBRE head of research for Southeast Asia. A higher proportion of new projects is located in the Outside Central Region (OCR), mainly developments on government land sale (GLS) sites sold in late 2020 and 2021.
Kicking off 2022 is strata landed housing project Belgravia Ace by Fairview Developments, a joint venture between Tong Eng Brothers and Yeap Holdings. It will preview the 107-unit development with 104 semi-detached and three terraced houses on Jan 8, with the official launch targeted to take place a fortnight later on Jan 22. Belgravia Ace is the last of three strata landed projects at Belgravia Drive, off Ang Mo Kio Avenue 5.
Qingjian Realty’s 105-unit project The Arden at Phoenix Road, off Choa Chu Kang Road, is expected to be launched sometime between late January and early February, notes Ismail Gafoor, CEO of PropNex Realty.
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Yishun Avenue 9 - EDGEPROP SINGAPORE
The site at Yishun Avenue 9 where Sing Holdings is developing into the 640-unit executive condo North Gaia, which is scheduled for launch sometime in late February-early March 2022 (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Targeted for launch sometime in late February or early March is Sing Holdings’ 640-unit executive condo (EC) project, North Gaia, at Yishun Avenue 9. Another EC project, the 628-unit project at Tengah Garden Walk by a joint venture between City Developments Ltd (CDL) and MCL Land, is expected to be launched sometime in 2H2022. (Discover insightful data of any Singapore condominium with our condo directory)
Other projects to watch out for include Bukit Sembawang’s 298-unit Liv@MB (redevelopment of the former Katong Park Towers) at Mountbatten Road; MCC Land’s new mixed-use development with 265 residential units at Tanah Merah Kechil next to the Tanah Merah MRT Station; and CDL’s new mixed-use project (redevelopment of Fuji Xerox Towers).
Source: CBRE Research

Significant sites

One of the significant projects that is likely to command attention if launched next year will be Malaysian group IOI Properties’ mixed-use development at Marina View, says Ong Teck Hui, senior director of research and consultancy at JLL Singapore. A mega development with some 905 residential units, Marina View is expected to attract buyers due to its CBD location in Marina Bay, next to Shenton Way MRT Station, he notes. “It will also be the first residential project launch in the Marina Bay area since 2014 when Marina One Residences was placed on the market.”
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Another project is the integrated development at Jalan Anak Bukit by a joint venture between Far East Organization and sister company Sino Group. “The project is set to be the most significant development in the Beauty World precinct, standing at the crossroads of Lower and Upper Bukit Timah, Jurong Kechil and the Pan Island Expressway,” notes Ong. “Buyers can expect an attractive mixed development of some 845 residential units with amenities and travel convenience from the nearby Beauty World MRT Station.”
MARINA VIEW GLS WHITE SITE - EDGEPROP SINGAPORE
With 905 residential units, IOI Properties’ new mixed-use development at Marina View will be the first new launch in the Marina Bay area since the release of Marina One Residences in 2014 (Photo: URA)
The redevelopment of the former Flynn Park condo at Pasir Panjang that was sold en bloc to a joint venture between Hoi Hup and Sunway Developments in September is another potential new launch to watch. Hoi Hup and Sunway Developments snapped up two other freehold land parcels on either side of Thiam Siew Avenue for $815 million in November. The sites are expected to be redeveloped into a new 800-unit condo project. It is considered to be the largest residential development site purchased since the July 2018 property cooling measures were introduced. (See potential condos with en bloc calculator)
Amid unsold inventory dwindling to an all-time low of around 15,000 units as at end-November, activity in the collective sale market picked up in 4Q2021. Most of the projects sold were small to medium-sized residential sites, in contrast to the larger collective sale sites sold in 2017 and 1H2018, notes CBRE’s Song. This is because developers were wary of committing to large sites due to the 25% additional buyer’s stamp duty or ABSD (plus 5% non-remittable ABSD) imposed in July 2018, should they not be able to sell all units within a five-year time-frame.
“So far, most developers have little or no difficulty in meeting the five-year ABSD timeline for current projects,” says Huttons’ Lee. “While the latest cooling measures are expected to slow down price appreciation, there is little pressure on most developers to reduce prices.”
Flynn Park condo - EDGEPROP SINGAPORE
The redevelopment of Flynn Park condo by the Hoi Hup-Sunway Development joint venture could be launched next year (Photo: Savills SIngapore)

Collective sales to slow down

Last year, collective sales totalled just $127.3 million, notes Ong Teck Hui, senior director of research and consultancy at JLL Singapore. Deals picked up markedly this year, with 11 collective sales sites sold for $2.67 billion.
“This is still a far cry from the last cycle when residential collective sales totalled $8.1 billion in 2017 and $10 billion in 2018,” points out CBRE’s Song. The combined number of residential units across all the collective sale projects sold in 2021 so far amounts to 540 units. As such, demand in the residential market due to collective sales displacements is currently rather limited, she adds.
The recent pick-up in collective sales is likely to slow down given the 10% hike in ABSD for property developers buying private residential sites to 35%, should they fail to sell all the residential units within five years. “This is onerous on developers, and en bloc hopefuls will have to temper their price expectations to increase their chances of a successful en bloc,” says Huttons’ Lee.
COLLECTIVE SALES IN 2021 - EDGEPROP SINGAPORE
In addition to higher ABSD and tighter total debt servicing ratio (TDSR), the government has ramped up its supply of land under the 1H2022 Government Land Sales (GLS) programme by 40.9%. This is the largest increase in percentage terms since 2H2016, says Lee. The Confirmed List will see a supply of 2,290 private residential units (excluding ECs), which is the largest supply since 1H2018.
“While developers need to replenish their land bank, the increased supply of land, together with the cooling measures dampening demand, will likely exert downward pressure on land bids,” notes Lee. “This will have an impact on the eventual selling prices.”
The site at Tanah Merah Kechil - EDGEPROP SINGAPORE
The site at Tanah Merah Kechil purchased by MCC Land, which will be developed into a new mixed-use development with 265 residential units is slated for launch sometime in the middle of next year (Photo: Samuel Isaac Chua/EdgeProp SIngapore)

‘Wealth tax’

Lee sees the increase in ABSD as a form of wealth tax, aimed at slowing down the flow of “hot money” into the property market. “Singapore is a well-known safe haven because of its political stability and strong rule of law,” he says. “Despite travel restrictions, the number of foreigners (including Singapore permanent residents) has shown a sharp increase in 2021 compared to 2020. The jump in the number of companies buying private properties is worrying.”
The tightening of TDSR to 55% from 60% is “a pre-emptive move” to encourage financial prudence in case of a sudden increase in interest rates, adds Lee. In particular, purchases by Singaporeans have spiked in 2021. “This will ensure that households are not financially stretched or burdened should there be an increase in interest rates,” he says.
As with all cooling measures, Lee says there will be an initial “knee-jerk reaction” as everyone tries to understand and assess its impact.

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