Reducing the manpower required on construction site

Prefabricated bathrooms units (PBUs) of better workmanship quality will be a feature of all newly launched Housing Board flats by 2019.

The Prefabricated Prefinished Volumetric Construction (PPVC) method – which involves constructing and assembling 3D modular units with finishes in a factory before it is transported to a construction site for installation – will also be used in 35 per cent of all HDB projects by that time. Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc LifeSignature at Yishun,  Brownstone EC, Visionaire EC, Inz Residence, The Criterion EC and Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

These modular components such as bedrooms, living room, household shelter and kitchen are combined in different configurations to create different flat layouts.

The measures mean that HDB, which is the largest local residential developer, will see a productivity improvement of 25 per cent by 2020 compared with 10 years before, said Mr Desmond Lee, Second Minister for National Development at the HDB Awards ceremony last night.

In recent years, materials that improved productivity have been introduced in new HDB flats.

Pre-finished vinyl strip flooring have replaced floor tiles in bedrooms since last year, and laminated unplasticised polyvinyl chloride doors – which are easier to install and more durable – were introduced this year.

The productivity improvements will translate to better on-site safety and manpower savings. A 50 per cent increase in project productivity is expected with the use of PPVC.

Residents near construction sites will also experience less noise and dust.

But the wider adoption of such technology comes at a cost – the industry can expect to incur higher construction costs of about 1 per cent for PBUs, and about 8 per cent for PPVC for every project.

An HDB spokesman said: “These costs are expected to come down as the technology matures and the industry capacities and capabilities build up over time.”

HDB added that this would not have an impact on the price of flats, and construction time of build-to-order projects will not be affected for now.

The spokesman added: “The use of volumetric construction will reduce the manpower required on site – the greatest impact would be on manpower savings and improvement in quality.

“The PBU is only a small component of the whole building project and hence manpower savings may not be significant.

“As contractors become familiar with PPVC construction, we will try to shorten the construction time.”

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Resale prices of condominiums continued to rise

Resale prices of condominiums continued to rise last month, lending weight to talk of a recovery in the property market.

Values of resale condos rose by 0.9 per cent from May to hit a three-year high last month, according to SRX Property flash estimates yesterday. Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc LifeSignature at Yishun,  Brownstone EC, Visionaire EC, Inz Residence, The Criterion EC and Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

Its resale index hit 171 last month, the highest since May 2014, when it registered 172.1.

Resale prices are up 2.2 per cent from June last year but down by 4.4 per cent from the last peak in January 2014.

Last month’s rise was an improvement from the revised 0.5 per cent increase in May, though a shade lower than the 1 per cent rise from January to February.

Mr Alan Cheong, senior director of research and consultancy at Savills, said: “The resale price growth in June was strong. Given that the resale market is typically a better reflection of the overall sentiment, it suggests there is some broad-based recovery in the market.”

However, OrangeTee head of research and consultancy Wong Xian Yang said: “Weak rents will continue to weigh on prices. This is especially so for the outside central region, where competition for tenants is expected to remain intense due to high volumes of completions in recent years.”

Last month’s price growth was driven by the core central region, where resale values rose 1.3 per cent from May, and the suburbs, which recorded a 1.1 per cent increase.

Resale prices in the city fringe remained unchanged last month, the SRX said.

Its estimates showed that resale transaction volumes fell by 12.5 per cent to 1,065 units last month from the 1,217 shifted in May.

But sales were up by 51.1 per cent from the 705 units sold in June last year.

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Unsold inventory has fallen to a record 22-year low

Singapore property prices are set to jump 10 per cent by the end of next year, according to United States banking giant Morgan Stanley.

The bank’s in-house experts expect private home prices to start rising next month – instead of early next year as it stated in a previous forecast. The forecast does not relate to Housing Board flats. Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc LifeSignature at Yishun,  Brownstone EC, Visionaire EC, Inz Residence, The Criterion EC and Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

The significant upswing in prices would reverse a four-year downcycle after a range of cooling measures was introduced to slow the market.

“We see signs of an imminent turnaround from sharply rising transaction volumes, which suggest a narrowing of buyer and seller expectations, growth in prices from late June implied by the upward revision in the Urban Redevelopment Authority’s price index value in the second quarter, and price increases in the resale segment as evidenced from higher frequency monthly indices,” said the report.

The bank explained that rising prices, along with developer sales volumes “sustaining a growth rate of more than 50 per cent year on year so far this year, suggest a much improved outlook for property developers after what has been a four-year downcycle”..

It also cited other positive market behaviour such as a recent surge in collective sales. It said this has displaced some 1,500 home owners across seven projects – estimated to get average proceeds of $1.8 million each. “With leverage, this adds up to $13 billion of potential capital inflows that could find their way back into the property market, more than the entire value of developer sales in 2016.” The bank said more collective deals could be around the corner.

Maybank Kim Eng analyst Derrick Heng had said in a separate recent report that more than $3 billion in collective-sale deals have been concluded so far this year, with another 30 properties at various stages of the en bloc process.

Morgan Stanley noted unsold inventory has fallen to a record 22-year low of 17,000 units as of June, or 1.4 years on current sales volumes. “Inventory absorption accelerated on improving buyer sentiment and as households deployed excess cash after staying on the sidelines through the 2014 to 2016 lull…

“Underpinned by rising demand outpacing tight supply, we believe the coming property price upcycle supports a combination of street revalued net asset value upgrades and narrowing revalued net asset value discounts, driving a further re-rating in developer stock prices,” said Morgan Stanley.

The bank noted City Developments has the largest land bank among its listed peers, at six years’ worth, “and we believe, the highest earnings sensitivity to rising Singapore average selling prices, as well as highest share price sensitivity to rising property prices empirically”.

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Reigniting the community spirit

SINGAPORE — Kampung Admiralty, a one-stop hub in Woodlands the includes two residential blocks and is aimed at reigniting the community spirit of yesteryear, welcomed its first residents on Saturday.

The elderly residents received the keys to their newly-completed studio apartments from Transport Minister Khaw Boon Wan.

About 99 per cent, or 103 flats, at this “modern kampung” have been take up so far. Of these, 44 were booked under priority schemes to help elderly residents live near their married children or parents. This will benefit near by executive condo residents such as those from Parc Life EC. Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc Life ECSignature at Yishun, The Criterion ECBrownstone EC, Visionaire EC, Inz Residenceand Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

About 60 per cent of those who bought a flat there are existing residents of Woodlands or nearby towns.

The apartments, which come in two different sizes – 36 sqm and 45 sqm – are fitted with elderly-friendly features to enable those aged 55 years and above to live independently. They include resilient vinyl strip flooring which is slip- and moisture-resistant, and retractable clothes rack that are suitable for indoor and outdoor drying.

Apart from the residential blocks, the 11-storey development, which is next to the Admiralty MRT station, has a host of facilities and amenities, all under one roof.

They include the two-level Admiralty Medical Centre, which offers specialist outpatient consultations, endoscopy and day-surgery procedures. The centre is managed by Alexandra Health System (AHS).

Elderly residents can make use of the Active Ageing Hub, which provides active ageing progrmmes, such as senior learning opportunties, along with centre-based and home-care services for frail seniors.

There is also a childcare centre which can cater to about 200 children.

The integrated development will also have a hawker centre, shops and F&B outlets, a bank and a supermarket.

The community garden at level 9 hopes to promote greater opportunities for residents to interact over gardening-related activities, while the community plaza on the ground floor will serve as a gathering point for them.

The project is developed by the Housing and Development Board, along with the Ministry of Health,  AHS, the National Environment Agency, National Parks Board, Land Transport Authority and Early Childhood Development Agency.

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Vision of Punggol as a sustainable and waterfront town

SINGAPORE: Residents in Punggol have a new community space that offers vantage views of Punggol Waterway.

Located near transport and shopping facilities, the new town square will be used for a variety of activities such as exercise, food and music events.  This will benefit nearby residents such as those from The Vales EC in Sengkang and The Terrace EC in Punggol. Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc Life ECSignature at Yishun, Brownstone EC, Visionaire EC, Inz Residence, The Criterion EC and Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

Speaking at the opening on Sunday morning, Deputy Prime Minister Teo Chee Hean said Punggol has seen a huge transformation, with over 30,000 housing units added in the past decade, as well as eco-friendly initiatives for clean energy and waste management.

DPM Teo, who is also MP for Pasir-Ris Punggol, said these developments have brought the estate closer to the vision of Punggol as a “sustainable and waterfront” town.

The town square is the latest project under the Remaking Our Heartland plan for Punggol, which aims to transform HDB estates into more vibrant homes.

Since the first public housing project in Punggol was completed in 2000, HDB has completed some 43,000 flats in the town as of the end of 2016.

Residents in Punggol can look forward to more facilities over the next few years with another 6,500 housing units to be added, along with more eating houses.

Upcoming developments include a sports centre and an intra-town cycling network, with more than 30km of cycling paths implemented.

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Bidding war for residential sites escalated further

A RESIDENTIAL site at Woodleigh Lane near Bidadari housing estate is the latest to draw aggressive bidding.

This time, 15 bidders took part, with CEL Unique Development, a joint venture between Chip Eng Seng, Heeton and KSH, putting in the highest bid of S$700.7 million, which translates to about S$1,110 per square foot per plot ratio (psf ppr). Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc Life ECSignature at Yishun, Brownstone EC, Visionaire EC, Inz Residence, The Criterion EC and Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

Keen competition was evident, with a tight margin of 0.8 per cent between the first and second bids. The top four bids were also all neck-and-neck with a tight 3.6 per cent margin. A total of five bids came in at above S$1,000 psf ppr.

Analysts say the tender price works out to a breakeven price of S$1,500-1,600 psf, and an eventual sale price of about S$1,800 psf.

A year ago, a psf ppr price figure of above S$1,000 would have caused jaws to drop, but this is gradually becoming a norm in recent tenders.

In June, Singapore Press Holdings and Kajima Development put in a top bid that translated to S$1,181 psf ppr for a mixed-use Bidadari site.

In May, Hong Kong’s Logan Property and Chinese developer Nanshan Group put in a bid that works out to S$1,050 psf ppr for a Stirling Road plot. Both this and SPH’s bid carried a total quantum above S$1 billion.

Listed Chip Eng Seng and KSH said in disclosures that they plan to build a condominium comprising 16-storey residential blocks on the Woodleigh site, with a total of over 800 units.

Corson and Wingjoy Investment, units of Keppel Land and Wing Tai respectively, put in the second highest bid of S$695 million, or about S$1,101 psf ppr.

City Developments’ Verwood Holdings paired up with Logan Property to put in the third highest bid of S$688.1 million, or about S$1,090 psf ppr.

Desmond Sim, head of CBRE Research, Singapore and South East Asia, called the results “unsurprising”, as the site had been identified as a high-profile one from the start, being located right beside Woodleigh MRT station and within the up-and-coming Bidadari precinct.

Besides, market sentiment has been picking up for some time now, and developers have been keen to restock their land bank with key development sites in order to keep their businesses running, he said.

Ong Teck Hui, national director for research and consultancy at JLL, said: “The bidding war for residential sites has escalated further in this tender, driven by bidders’ determination to secure this attractive site in a market that is potentially recovering.”

Indeed, many analysts are anticipating a bottoming-out of the market at the end of this year, and for residential prices to appreciate again starting 2018.

Christine Li, director of research at Cushman & Wakefield added that the tender results show that when a choice city-fringe site is up for sale, there will be no shortage of interest.

Asked if the current land bidding behaviour will undo the effects of property cooling measures, Mr Sim from CBRE said it is difficult for the government to gauge the amount of state land to release for sale, because if it were to attempt to do so, it could easily tip the balance over and create an oversupply situation – a repeat of what happened in 2012.

“One factor that could keeps the property market in check is the resale market. If the resale market finds it hard to match its prices with those in the new home sale market, this could attract some demand going to the resale market instead in the future.”

Meanwhile, aggressive bidding in land tenders has already pushed some developers into the private en bloc market.

“With the imbalance between demand for land and the number of development sites available in the government land sales programme, we will likely see more collective sales committees being formed in older estates. More developers will probably seek this avenue as an option for replenishing land banks,” Mr Sim said.

At last week’s Real Estate Developers’ Association seminar, some industry players described the compounding effect of aggressive land bidding, saying that since there can only be one winner for a site, each tender exercise leaves a large amount of capital on the sidelines waiting to be deployed into the next land parcel, thus feeding an upward spiral.

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Blooms of spring showing

It has been a long winter for Singapore’s property market, but the first blooms of spring are showing. The signs of a revival are strong, such as greatly increased sales volumes and fierce bidding for land by developers ready to fork out eye-watering sums.

The latest pointer to an upturn was the keenly contested Toh Tuck Road site, which drew 24 developers – a record for a non-landed government sale site. Upcoming executive condo launches include Anchorvale Lane EC, Rivercove EC while existing ones include Parc Life ECSignature at YishunBrownstone EC, Visionaire EC, Inz Residence, The Criterion EC and Northwave EC, The Terrace EC,  The Vales EC, Hundred Palms Residences EC, Sol Acres EC and The Bellewoods EC. Rivercove Residences floor plans and Rivercove Residences EC details will be available shortly.

Malaysian developer S P Setia offered $265 million for the 18,721.4 sq m plot, which works out to $939 per square foot (psf) per plot ratio, surprising analysts, who were expecting bids capped at $200 million.

“Developers have a positive view of the market from 2018,” said Ms Tricia Song, head of research at Colliers International.

“The land price for the Toh Tuck site was way above expectations, implying a breakeven cost of $1,490 psf,” she added, noting that a 10 per cent profit margin would imply an average selling price of $1,660 psf.

“Based on that profit margin, the developer is probably looking at a 10 to 15 per cent price appreciation over the next three years.”

Private home sales figures have also whetted the appetite of developers. A total of 977 units were sold in February, treble the 303 units sold in the same month last year, raising expectations for new home sales figures to be released next Monday.

Mr Alan Cheong, head of Singapore research at Savills, was unequivocally bullish on his assessment of the market.

“The market has turned around and, on the ground, people are now recommitting,” he said.

Mr Cheong noted that unchanged cooling measures, like the total debt servicing ratio (TDSR), have made the revival of the market look more gradual, preventing it from “turning in its full glory”.

But property watchers should not expect a revival akin to a roaring dragon come back to life. Mr Cheong likened it to “a newborn baby” that was “still fragile”.

“The turnaround in sentiment is noticeable and broad-based, but it lacks the horsepower to accept certain strides in prices – although a gradual creep in prices upward can be accepted by the market,” he said, adding that seasoned property agents were now busy closing deals.

Most analysts were cautiously optimistic, forecasting higher sales volumes, but adding that prices would continue declining and hit bottom by the end of this year.

Dr Lee Nai Jia, head of South-east Asia research at Edmund Tie and Company, said that “because of the current excitement, there will be more en bloc sales”.

“Developers are also encouraged by sales at Park Place Residences, as the units are quite expensive. This makes them optimistic that while bid prices may be high, there is demand for good-quality homes,” Dr Lee said.

Land prices are unlikely to come down, as foreign developers have shown strong interest and could be more focused on getting boasting rights to having developed a property in Singapore than making maximum profit, he added.

Meanwhile, Mr Desmond Sim, CBRE’s head of research for Singapore and South-east Asia, was more cautious, saying that it is “too early to call it a turnaround”.

“There is a lot of positivity in the market after the tweak in cooling measures, but if you couldn’t buy because of TDSR two months ago, you still can’t buy now,” he noted.

Mr Sim added that while the record low number of unsold units, land prices and aggressive bidding favour a positive reading of the market, macroeconomic factors and the fact that “larger units are not being sold” call for a more balanced view.

“A housing purchase is not like buying a Louis Vuitton bag – macroeconomic views still matter,” he said, citing higher unemployment rates and the likelihood of further interest rate hikes.

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