Source : Today - 13 Nov 2008
INVESTORS here now have the opportunity to cash in on distressed properties in the United States.
Yesterday, property investment group IP Global said it would be the first to offer such properties for sale, through its Singapore real estate partner Adhome Realty.
The first development on the block is a downtown Los Angeles residential project at prices that are, on average, 30 per cent lower than before the onset of the US sub-prime crisis.
The 13-storey Great Republic Lofts, located in an iconic historic insurance building, is due for completion next January. It houses six freehold one-bedroom loft-style units on each level.
Ranging in size from 665 sq ft to 981 sq ft, the fully-furnished units are selling from US$328,000 ($491,700) to US$484,000. The units went for as high as US$620,000 when the development was marketed last June.
Said IP Global managing director Tim Murphy: “The turmoil in the financial markets and general concerns over property values in the US has created low-cost opportunities suitable for wily investors seeking credit crunch resilient property hotspots.”
IP Global predicts demand for such apartments to rise, as the population in downtown Los Angeles is set to increase by 5 per cent to 1.32 million by 2011.
The firm expects to trot out developments in other US hotspots, including New York and Las Vegas, “in the next few weeks”.
It said: “Property values are relatively low and growth returns and gross rental returns are good.”
The firm added that it had managed to secure “manageable deposits on loan to value rates of up to70 per cent” at a time when banks are reluctant to lend.
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