This week in property: Highlights from Aug 13 to Aug 17
By EdgeProp Singapore
/ EdgeProp |
Property highlights of the week from Aug 13 to Aug 17:
Developers sold 1,724 private residential units in July, a 163.6% hike from 654 units in June, and a 55% increase y-o-y, according to URA flash estimates.
Property consultants attribute the sudden surge in residential sales to the property cooling measures - including higher ABSD and lower LTV rates - that took effect on July 6. Close to 1,000 units, or over 60% of the sales volume, were sold on July 5 alone, as buyers were “frantic” to avoid the cooling measures.
The new private home sales (excluding ECs) of 1,724 units for July compare with a total of 2,239 units launched for the month. Notably, the developers of Park Colonial and Stirling Residences brought forward their project launches to the day before the cooling measures took effect. This contributed to July having the highest number of units launched, since March 2013 with 3,489 units.
The latest property cooling measures will cause a “slowdown for the residential en bloc market in the near term”, says Tricia Song, Colliers International head of research for Singapore. Commercial and industrial property “could pick up the slack” for the rest of the year, she says.
Higher demand for the commercial and industrial segments will come from “healthy commercial properties deal pipelines and rising interest from real estate investment trusts and institutional investors for industrial assets”, Song adds.
Sales of industrial properties jumped 295% y-o-y to $797.4 million in 2Q2018, due to strong private investment sales which accounted for 95.7% of total sales volume in the industrial sector. Major deals included the sale of a 99% stake in Kingsland Data Centre for $295 million to Keppel DC REIT and Admirax for $106 million to BlackRock.
Singapore Central Business District office rents are forecasted to rise by about 10% to 12% y-o-y this year, given tighter vacancy in the CBD Premium and Grade A office segment. There is “firm interest” from financial, professional services, technology, and flexible workspace firms, says Duncan White, head of office services at Colliers International.
CBD office rents increased for the fourth consecutive quarter in 2Q2018 at a moderate pace compared to 1Q2018. CBD premium and Grade A average gross effective rents rose by 2.6% q-o-q to $8.82 psf pm, slower than the 4.8% q-o-q growth recorded in 1Q2018. The relatively slower pace of office rent growth is a “momentary consolidation”, as the leasing market has been experiencing a “rapid recovery” which saw an 11% y-o-y growth from 2Q2017, says White.
Overall office rents have climbed by about 7.5% year-to-date, and steady rental upticks are expected to continue for the rest of the year. But, demand may taper down to a 5% to 7% y-o-y increase in 2019. Total office sales transactions increased 8.7% q-o-q to $3.79 billion in 2Q2018.
Follow Us
Follow our channels to receive property news updates 24/7 round the clock.
EdgeProp Telegram
EdgeProp FacebookSubscribe to our newsletter
Top Articles
Search Articles