Urban Resort: CapitaLand to launch freehold condo soon

Source : Business Times - 2 Aug 2008

CapitaLand plans to launch in the second half of this year a freehold condo - Urban Resort - with about 70 units on the Silver Tower site in Cairnhill. The average price is expected to be above $3,000 psf, CapitaLand Residential Singapore CEO Patricia Chia told reporters after the group announced second-quarter results.

CapitaLand has also sold 11 of the 40 units released so far at Latitude at Jalan Mutiara in the River Valley area at an average price of $2,400 to $2,500 psf. Over at Tong Watt Road, it has sold close to 30 of 80 units released recently at The Wharf Residence; prices range from $1,500 to $1,900 psf.

CapitaLand leads a consortium that will redevelop Farrer Court which is slated for launch in the first half of next year.

Asked about his outlook for the Singapore residential market, Mr Liew said: ‘Demand is still very good for the mass market. (For) the mid-range, there are still good signs of take-up; I think prices are still holding well for the mid-range.

‘But in the high-end, there’s not going to be massive demand. (In terms of prices), obviously it won’t be the $5,600 psf record price that we achieved for a penthouse at Orchard Residences last year. But prices will still be above $3,000 psf.

‘So prices will still be way above the last peak, pre-Asian crisis. Demand is still there. People who sold their properties through en bloc sales still have to buy apartments,’ he said.

Given Singapore’s limited land resource and with population projected to grow to 6.5 million, in the ‘long term, property prices will go up’, Mr Liew said, adding: ‘It’s a no-brainer.’

‘I think we’re overinfected with the housing slump in the US. That sort of mood comes to Singapore that property prices (here) will (also) go down. But look at the fundamentals, look at demand fundamentals. I think we are much stronger in Asia,’ Mr Liew noted.

The group’s earnings are underpinned by progressive recognition of $4 billion residential sales in Singapore in 2006 and 2007.

CapitaLand’s chief investment officer Kee Teck Koon said that in Singapore, the group has hardly any residential stock or inventory that it is holding. ‘So there is no issue of writing down. Most importantly, those new projects we’ve got, we have underwritten a value that is very supportable even at current prices,’ he added.