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Jurong hotel site draws surprise top bid of $238m

Jurong Hotel Site | SGRealist.com21-Nov: With the Jcube recently opened this year and Lend Lease’s shopping mall – Jem – to be completed by mid 2013, the Jurong Gateway is set to be a bustling hub in the years to come! And now as surrounding parcels of land along Jurong Town Hall Road and Jurong Gateway zoned commercial, there will be a critical mass of business operating in Jurong East, other than the current International Business Park (IBP).

Jurong hotel site’s top bid of $238m

A record price has been set for hotel land in Singapore – $1,167.35 per square foot per plot ratio (psf ppr). This is for the first hotel development site, a 99-year lease and maximum permissible gross floor area of 18,957sqm, at Jurong Town Hall Road.

A state tender drew 11 bids from major players in the industry including Ascott Holdings, City Developments and United Engineers Developments but Tamerton Pte Ltd, a wholly owned subsidiary of Resorts World Singapore (RWS) topped them all with its $238.2 million bid.

“The enthusiastic bidding shows developers’ confidence in the development of Jurong East into the next major commercial hub outside the central business district (CBD),” Mr Lee Sze Teck, senior manager of training, research and consultancy at property firm Dennis Wee Group.

Far East Organization unit Boo Han Holdings in partnership with the group’s listed vehicle, Far East Orchard, submitted a bid of $204.8 million or $1,003.56 psf ppr, placing it in second position.

This was 16.3 per cent lower than the top bid by RWS, which is also a wholly owned subsidiary of Genting Singapore.

Foray into Jurong a strategic move

HSR Property Group special adviser Donald Han said RWS’s foray into Jurong is a strategic move aimed at capturing the Malaysian visitors market.

“If they do not cater to some of their clients from Malaysia, who patronise their casinos but who do not have the budget for the $300-$400 rooms in Sentosa, they would lose out significantly on a potential income base,” Mr Han explained.

He added that the hotel development would most likely be a three-star property. The Jurong Country Club is just behind the hotel site and there will be plenty of retail amenities such as JCub, Jem, Westgate, IMM, Big Box in Jurong East.

Other bidders for the site were United Engineers Development ($984.50 psf ppr), Legend Land which is linked to Hotel 81 ($950.74 psf ppr), and City Development’s Redvale Investments and Redvale Developments ($784.12 psf ppr).

Though the record bid by Genting Singapore surprised most analysts BT spoke to, they are confident about demand for the upcoming hotel.

“The estimated breakeven of between $550,000 to $580,000 per room may appear to be slightly on the high side for an untested area like Jurong East, but it could still be acceptable for Genting which, because of synergies arising from its RWS operations, has a captive market to itself. Filling up the bulk of the rooms should therefore be more confidently executed for them than by others,” explained Savills Singapore research head Alan Cheong.

Other than providing accommodation for visitors to RWS, the hotel will also be well placed to cater to the growing business community in Jurong East, explained Mr Han.

“The timing is right and the fact that the hotel will be ready in the next three years or so, it will be right where the action is when the surrounding developments in Jurong Gateway are completed,” Mr Han said.

Promising long-term plans for Jurong Gateway

Said Jones Lang LaSalle national director Ong Teck Hui: “The long-term plans for Jurong Gateway do look very promising with a strong mix of office, retail, residential, hotel, entertainment and food & beverage uses. The site’s close proximity to Jurong East MRT station, upcoming developments like Jem, Westgate and others make it particularly attractive.”

RWS currently owns six hotels with 1,500 rooms. This development is the group’s first hotel away from Sentosa.

Jalan Bukit Merah / Alexandra Road Hotel Site

Ex-SAFRA Hotel Site Location |

CEL Development was awarded the 7,946.2sqm hotel land site at Jalan Bukit Merah/Alexandra Road under the Reserve List of the Government Land Sales Programme. URA had, on 22 September 2011, accepted a successful application for the site to be put up for sale. The site, was also the ex-SAFRA at Bukit Merah, was offered for sale on a 99-year lease.

CEL Development is a wholly owned subsidiary of Chip Eng Seng Corporation Ltd, a public listed company in Singapore since 1999. Their top bid of $189m, works out to be $8,494.76 psm based on the maximum permissible GFA of 22,249sqm.

The land parcel is located at the junction of Alexandra Road and Jalan Bukit Merah at the fringe of the city centre. Right besides Ikea and with Alexandra Village, Anchorpoint and Queensway Shopping Centre walking distance away, the hotel land site will avail its guests ample food & beverage and entertainment choices.

It is also conveniently linked to the rest of the island via Ayer Rajah Expressway and is served by the nearby Queenstown and Redhill MRT Stations.

Alexandra Hotel site |

In addition, the hotel land site is located near major tourist attractions like Orchard Road, Mount Faber, Vivo City and Sentosa. Business travellers will also enjoy the close proximity to the businesses and hotels in Central Business District and Marina Bay, which are just 15 minutes drive away.

For more information, do check out our New Launches section soon as the Alexandra Road Hotel Site showflat will be coming up with exciting commercial retail shops up for sale in Dec 2012!!

New Private Home Sales Hit Record High in April

Private home sales in Singapore reached a record high of 2,487 units (excluding executive condos) in April, up 3.9 per cent from the preceding month’s 2,393 units and 37.8 per cent from 1,805 units sold in April last year.

These numbers are highest since July 2009 in which 2,772 units were sold. New home sales jumped 3 times in January 2012 compared to December 2011 and since then they are increasing by every passing month.

Including ECs, which are a public-private housing hybrid, developers sold 2,660 homes in April, down 12.3 per cent from the preceding month’s 3,032-unit sales but up 38.7 per cent year-on-year.

The figures, released by the Urban Redevelopment Authority (URA) on Tuesday (15 May 2012), are based on developers’ monthly sales data submissions.

“It is clearly the HDB upgraders who are entering the private property market; these are genuine buyers with mid to long-term perspectives sustaining the market in the first quarter of 2012. This trend of buying is not dampened by the latest round of cooling measures although it had effectively stamped out short-term speculation in the private property resale market,” said Mohamed Ismail, CEO of PropNex Realty.

The month of April saw some launches like Katong Regency which sold a total of 244 units at S$1,709 psf (per square foot) while Ripple Bay sold 174 units at S$876 psf, and The Hillsta sold 154 units at $1,054 psf and Palm Isles sold 153 units at S$871 psf.


“Home buyers are developing an interest in the mixed-used development like Katong Regency and thus that development was a top seller. The low bank borrowing interest rates and HDB upgraders’ interest had contributed and certainly helped boost the April sales figure,” added Ismail.

The high volume of sales largely fuelled by artificial low interest levels also increased expectations of a new property cooling measure round. Dr. Chua Yang Liang from Jones Lang Lasalle says “the policy to curtail excessive demand of developer sales could come into market within the next few weeks” according to Today newspaper.

These numbers came just a few days after Minister for National Development Khaw Boon Wan mentioned his concerns about growing number of small apartments dubbed shoeboxes. These apartments are popular among investors who live in HDB flats for the high rental incomes they generate.

The URA said 1,514 homes were sold in the suburbs or Outside Central Region (OCR), while 867 new private units were sold in the city fringes and 106 were sold in the city.

PropNex’s Ismail also noted that the high-end market seemed to be picking up momentum as the number of units sold above S$2,500 psf had doubled from March and the Core Central Region (CCR) sales had doubled too.

“Although investors had remained more cautious about the mid- and high-end markets, April saw a returning investor confidence as the high-end property market showed signs of increase,” he added.

Ismail expects the May sales figures to continue in the range of about 2,500 to 3,000 units as developers had lined up their string of new launches including executive condominiums such as Watercolours and One Canberra.

Outlook for 2012

Singapore’s property market has been on a bull run since the collapse of Lehman Brothers in 2008. Just as figures shows that Singaporeans are still rushing in to invest in properties, “To join them or to stay out and miss the boat. What can we expect moving forward?” are the questions in most of our minds right now.

As we move into 2012, we glance into the past to predict what to expect in the year ahead. Looking at the key trends in Singapore’s property market for 2011, we noted the following:

Trends in 2011

1) HDB prices rose faster than private property prices

2) URA’s private residential property price index peaked at 206.2 points, with especially buyers in the luxury segment holding back on their purchases

3) Investors are going into industrial and commercial properties.

I was talking to one of my buyers at Eon showflat the other day and he was asking me about my opinion on the property market in Singapore. “Do you think the property prices will go down this time? If so, how much will the prices fall?”

True. With worrying global economic situations especially with the troubles in Europe, combined with the dampening effect of the government measures and the large upcoming supply of completed private and public housing, it does seem like the RESALE market will be going in for a dip. However, with that said, if you’re expecting prices to fall significantly, don’t hold your breath as it may not happen. The supportive forces includes:

1) low interest rates,

2) high occupancy rates for mass-market properties at 97.5% (Citi’s property analyst – Wendy Koh)

3) future population growth, and

4) expected continued economic growth in Singapore and our near full employment (2%).

How much will the prices fall?


New launches are the next opportunities that investors (who are cash rich) looking into right now. With normal progressive payments, or even Interest Absorption Schemes (for certain projects with tie-ups with certain banks, e.g. Eon with OCBC), the investors are able to wait-and-see approach with just 20% downpayment and allow their property price appreciate with the upcoming developments within the locality.

In addition, prices for the new launches are expected to increase or at least not fall, as the developers had bought the land at a high price. With construction costs on the rise and increasing workers’ levies, we’re expecting the new launches to hit the sky and break new heights.

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