Archipelago hit by sales slowdown

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Archipelago, a 577-unit residential development at Bedok Reservoir, which was launched last week, is underperforming due to the latest property cooling measures, according to Singapore Business Review.

In a report, OCBC revealed that the project’s foreign and PR (permanent resident) markets, which comprise over 20 percent of its total buyers, are now burdened with the additional stamp duty.

“Its (UOL's) 577-unit residential project at Bedok Reservoir, Archipelago, was launched for sales in the first week of Dec 11 and has sold over 100 units to date at an average selling price of S$1,000 psf. The pace of sales and price levels came in somewhat below expectations,” said OCBC.

“Over 20 percent of buyers so far were reportedly foreigners and PRs; recent measures imposing additional buyer stamp duties would likely impact sales. We pare our ASPs assumptions and reflect this in a lower fair value estimate.”

However, OCBC remains optimistic for the company, due to its solid management team and forward planning to deal with the 2012 slowdown.

“We continue to prefer UOL due to its limited domestic residential exposure, which would shelter it against residential uncertainty ahead,” it noted.

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