Launch of 6 more condos likely in next few months

Source : Business Times - 11 Feb 2009

DEVELOPERS of at least six mass-market private condos could release their projects in the next few months, riding on buying momentum generated lately by the Caspian condo near Jurong Lake - despite the recession.

Property consultancy CB Richard Ellis (CBRE) tips Oasis @ Elias, The Gale on Flora Road in Upper Changi and Ascentia Sky on Alexandra Road among projects for possible launch in the next two quarters.

Others include UOL’s 646-unit condo at Simei Street 4, Frasers Centrepoint’s project in Woodleigh Close and a 571-unit condo by NTUC Choice Homes at Lor 2/3 Toa Payoh near Braddell MRT Station.

All but one of these projects are on 99-year-leasehold sites bought through government land tenders in the past 14 months. The exception is The Gale, a freehold condo to be developed by Tripartite Developers as the latest in its series of condo projects in the Upper Changi location.

Frasers Centrepoint’s recent sales spurt for Caspian has shown where the base price is for the mass market.

The developer released the first 250 units of the 99-year-leasehold condo during a preview last week, at an average price of $580 per square foot (psf), followed by a second batch of about 130 better-facing units at $600 psf. So far, more than 330 units have been sold in the development, which is next to Lakeside MRT Station.

BT understands the developer is likely to offer a further 150 units during a public launch this weekend - and that pricing is likely to be calibrated upwards.

CBRE executive director Joseph Tan attributes the good response to Caspian partly to its timely launch, coinciding with the government’s announcement in Parliament that it will upgrade, expand and transform Jurong into a business and recreational hub.

‘The project is also priced competitively, within the affordability of HDB upgraders,’ he said. ‘The sales momentum seen at Caspian is an encouragement to developers to get their projects ready for launch in the second and third quarters of 2009.’

Knight Frank executive director Peter Ow said that in current conditions, mass-market suburban projects aimed at HDB upgraders are more likely to sell than projects in other segments.

‘After all, HDB upgraders buying private homes for their own occupation are the core group of buyers left today,’ he said. ‘Investors and ’specu-vestors’ are lying low. And as for foreign buyers, investing in overseas properties might not be a priority right now.’

Amid today’s tight lending climate, owner-occupiers are also more likely to secure finance from banks than investors, provided they have the means to service their loans, Mr Ow said.

He reckons that for condos in outlying areas near MRT stations, the price resistance for a new launch in today’s market would probably be in the $600-650 psf range on average.

Another analyst put a price resistance in a higher band of $750-$850 psf for condos in mature HDB estates such as Toa Payoh and Ang Mo Kio.