Singapore’s recent rounds of property cooling measures have started to take their toll, according to Keppel Land.
Based on the preliminary projections from the Urban Redevelopment Authority (URA) in the first quarter of this year, approximately 3,700 new homes were sold, 12.7 percent lower compared to Q4 last year. Home prices climbed at a slower rate of 2.1 percent in Q1, registering the sixth straight quarter of moderated growth since the third quarter of 2009.
Keppel Land sold 85 homes in the first quarter, primarily from The Lakefront Residences, where approximately 91 percent of 591 units released have been sold as of end-March 2011.
To meet the housing demand near MRT and key transportation links, Keppel Land acquired a prime residential site near Sengkang MRT in March. The development is expected to produce up to 622 homes and is scheduled for launch by the end of the year.
Meanwhile, the office market has continued to build up. Grade A rentals increased by four percent quarter-on-quarter to S$10.30 psf in the first quarter and are estimated to increase 10 to 12 percent for the full year, according to CB Richard Ellis (CBRE).
Pre-commitment level at Ocean Financial Centre (OFC) grew from 80 to 82.3 percent, with new commitments acquired from international companies in the professional services and energy sectors.
OFC has acquired the Temporary Occupation Permit (TOP) for part of its office building in March 2011 and new occupants, including law firms Stamford Law and Drew & Napier, have moved in.
Keppel Land’s property fund management vehicles continue to grab acquisition opportunities in the country. Real estate investment advisory firm Alpha Asia Macro Trends Fund has jointly acquired a Grade A office building Capital Square for approximately S$889 million with NTUC Income.
K-REIT Asia’s strategy to be a top landlord in Singapore’s primary business and financial districts has been strengthened by the acquisition of four additional strata floors in Prudential Tower for S$125.1 million, which effectively raised its interest in the Grade A office tower to 93 percent from 73 percent.