Tenants had heard it before: The Copthorne Orchid Hotel would be torn down for a condominium.

So there was a sense of deja vu when they learnt from reading The Straits Times last Monday that the 440-room hotel in Dunearn Road would go.

In 2005, City Developments Ltd (CDL) had said it planned to turn the hotel’s site into a condominium. But that did not happen.

CDL owns hotelier Millennium & Copthorne (M&C), which operates the Copthorne Orchid Hotel.

But its latest announcement seems to be for real. A CDL spokesman told The Sunday Times it wants to launch the condominium project as early as this July.

The property developer has not decided on a firm date to put the 150 units of the project on sale as it ‘had just obtained provisional permission to redevelop’.

Depending on how well the condominium sells and existing tenancy obligations, the building may be torn down only next year or later.

M&C held back its plans in 2005 ‘as there was a projected shortage of hotel rooms’, its spokesman said.

But its recent announcement was not good news to its tenants – one of which has been leasing space in the hotel for 35 years.

Madam Anne Lee, 52, owner of Anne Salon, was upset that the hotel withheld such important information as she renewed her lease just three months ago.

‘They must tell us so we can start looking for another landlord,’ said Madam Lee, who has been running her salon there since 1975.

Nice Express, which operates its Singapore-Kuala Lumpur express bus service from the hotel, was also not informed about the plans.

Mr Charles Lawrence, 56, operations and sales supervisor at Nice’s Singapore office, said: ‘I do not know whether to move or stay.’

This comes at a bad time for Nice as it spent $100,000 last year to renovate its office at the hotel.

When asked why tenants were not informed, an M&C spokesman said: ‘We have not sent out any notices as there is no firm date yet.

‘The terms of the tenancy agreement contain a three-month notice clause. We have sufficient time on hand to serve proper and timely notice to all our tenants.’

Source : Sunday Times – 28 Feb 2010

Frustrated buyers have pointed their fingers at permanent residents and private property speculators for pushing up HDB resale flat prices to record levels.

They claim the speculators snap up resale flats and then rent them out illegally or sell them quickly but legally after the stipulated one-year period.

A week ago, National Development Minister Mah Bow Tan said the Government is looking into ’something’ regarding measures for the HDB market.

Property experts reckoned the Government could extend the minimum occupation period for those who bought their flats with bank loans as well as make checks to ensure owners are not flouting the rules.

Under HDB rules, those who buy resale flats without housing grants can sell their flats after 21/2 years if they take a loan from HDB, or one year if they take a bank loan.

They can rent out the entire flat only if they have lived in it for at least three years.

Buyers who take up housing grants for their purchases can sell only after a minimum occupation period of five years.

‘Speculation is not an issue right now. But it may become an issue if buyers are sure that prices will continue to rise for the next year,’ said the managing director of C&H Realty, Mr Albert Lu.

ERA Asia-Pacific associate director Eugene Lim said the Government has already started to rein in the sizzling HDB resale market with the lowering of the loan-to-value limit (LTV) for housing loans taken from banks.

This means buyers can borrow less than before – at up to 80 per cent of the property’s valuation instead of 90 per cent previously.

This will likely affect deals for the high-value resale flats involving cash-over-valuation (COV) of anywhere from $50,000 to $90,000, as buyers will now have to fork out more down payment, in addition to the cash, said Mr Lim.

COV is the amount over and above the flat’s valuation that is payable only in cash.

There are not many other things the Government can look at, as it will not want to affect genuine demand, property experts said.

While the lower LTV limit will have an impact, it won’t be big, said Mr Chris Koh, director of Dennis Wee Properties.

‘It is the 5 per cent cash down payment and the COV that the buyers find challenging to come up with,’ he said.

An industry observer suggested that the Government may raise the first-time applicant’s housing grant to buy resale flats.

The Government can also extend the minimum occupation period for those who bought resale flats with bank loans to as long as 21/2 years, though this may not go down well with the banks as this may increase their risk exposure, property pundits said.

‘The banks may not agree to extending the period, but this area needs to be looked into so that people will not look at flats as a quick one-year turnaround investment,’ said Mr Koh.

Mr Lu suggested that the Government ban private property owners from buying resale flats if their sole intention is to rent them out.

HDB flats are in demand as the well-located ones can easily command a rental yield of 7 per cent to 8 per cent.

HDB, he said, can conduct regular checks to see that the private property owners are living in their flats instead of renting them out during the minimum three-year occupation period.

‘This, however, does not solve the problem of private property owners renting out their HDB flats legally after the minimum three-year occupation period,’ Mr Lu said.

HDB owners can buy private property but they must continue to live in their flats.

However, those who have obtained prior approval from HDB to sublet their flats can live in the private property.

Some property experts suggest going back to the days when flats could not be easily rented out.

‘One possible measure is to revert to the old system of allowing HDB flats to be rented out only if the owner has valid reasons such as being posted overseas to work,’ said Mr Lu.

Mr Koh added that HDB flats should not be seen as a short-term investment as this changes the whole concept of government housing.

~ Extend minimum occupation period for those who buy HDB flats with a bank loan
~ Check to ensure that owners are not flouting occupation rules
~ Raise first-time applicant’s housing grant to buy resale flats
~ Ban private property owners from buying resale flats to use as rental property
~ Revert to old system where HDB flats may be rented out only for valid reasons

Source : Sunday Times – 28 Feb 2010

I am no expert when it comes to investing in property, but as I have invested in numerous properties over the last decade, I have gained some valuable experience.

I made money from some and lost money from others. Some say you need luck to make money in real estate, but I believe there are some fundamentals that one can use as a guide to make as infallible a decision as possible.

1 Good location

In property selection, particularly for investment purposes, the key is location. For owner-occupied properties, location may be less significant as individuals have different preferences. Some like

quieter locations away from commercial activities while others choose to be close to specific amenities.

Proximity and accessibility to schools, transport lines, shopping centres, factories and specific suburbs are some important factors to consider.

Even for an owner-occupied property, it is important to consider how other people would view the location should you decide to sell it one day. In short, try to be as objective as possible when it comes to location.

2 Good site

Is the property in a good site? Is it next to an MRT station, bus stop, monsoon drain or power cables? Or is it at a T-junction? There is nothing technically wrong with T-junctions, but some people believe it obstructs the flow of good luck in one’s life.

Is the site prone to flash floods and so on? Many people like to live near MRT stations, but some foreigners prefer to avoid the constant noise of the trains. They may prefer quieter areas.

When choosing the site of the property, consider the points that will appeal to your potential buyers in the future.

3 Good layout

Do you like the layout of the apartment or house? Many people prefer their living rooms to feel spacious. Are there many angles and nooks in the house? Some people may consider them bad fengshui.

A more practical consideration is whether the living room and bedrooms are irregularly shaped, with lots of unusable space. A good, clean layout will save you the time, effort and money that you otherwise would have to spend on redesigning around oddly shaped and oddly positioned living areas.

4 Good address

Securing a good address without paying a premium for it is like a windfall. It may not matter much to you now but a good address, such as a nice sounding road name or an auspicious sounding unit number like #08-08, may attract more interest and demand in the property and also a higher price when it is time to sell.

5 Good history

Many potential buyers like to know the background of the property they are buying. Who are the current owners? Why are they selling? Who built the property and how old is it? Is the property owner-occupied or rented out? These things matter in the making of personal and economic decisions.

If the property is for investment, then the purchaser should look into two other areas:

6 Good rental yield

What is the expected rental yield for the property? Is this an acceptable level for you? What is the median rent for properties in that area?

7 Good potential for capital appreciation

What is the median price for property prices in that area? What is the highest and lowest price for properties in that area over the last three, five and 10 years?

The writer is managing director of mortgage consultant Global Creatif Financial. The views expressed are her own.

Securing a good address without paying a premium for it is like a windfall…A good address, such as an auspicious unit number, may attract more interest and a higher price when it is time to sell.

Source : Sunday Times – 28 Feb 2010

They came, they saw, they bought.

As of yesterday, more than 300 of about 350 units in The Estuary condominium that were released for sale have been snapped up.

The MCL Land project in Yishun is the first major property launch since measures were announced by the Government last week to curb speculation.

These were: stamp duty to be paid if the buyer sells the property within a year, and lending institutions allowed to lend only up to 80 per cent of the property’s value, not 90 per cent.

Yesterday, more than 80 pairs of shoes were seen outside The Estuary’s showflat when The Sunday Times visited at 1.30pm.

The number increased steadily to more than 100 pairs by 2pm as people came to check out the 99-year leasehold condo.

Most were families with young children or young couples, lured by the condo’s proximity to Lower Seletar Reservoir and attractive prices of about $750 per sq ft.

Inside, all the 15 tables set aside for prospective buyers were filled most of the afternoon.

Sales of the 350 released units began last week. The project has 608 units – comprising one-, two-, three- and four-bedroom types.

‘It’s been encouraging so far despite the measures,’ said an MCL Land staff member, noting that demand was evenly distributed across the various apartment types.

‘At first, there was more interest in the one-bedroom units but when the measures were announced, this died off a little.’

One- and two-bedroom units have usually been popular among speculators at launches over the past year. They make up nearly 40 per cent of units in The Estuary, which is near Khatib MRT station.

Small apartments have been targets for speculators because the lump-sum outlay is relatively more affordable.

The Government’s measures to curb excesses have come at the right time, said Madam Angie Ng who bought a three-bedroom unit at The Estuary for about $930,000 yesterday.

‘I’m relieved actually. We were waiting for this launch and then the measures came. That’ll help curb speculators and prices won’t be jacked up,’ she said.

Madam Ng, 36, who works in the banking industry, is married with two children and lives in a five-room flat in Yishun.

Property agents said The Estuary’s relatively distant location from the city also meant it might not be as attractive for speculators.

The prices were the key lure for the buyers, about 70 per cent of whom live nearby in Woodlands and Marsiling.

‘For upcoming projects in Singapore, the prices are at least $900 psf,’ said ERA agent Shayne Lim, 34, noting that prices have even reached $1,200 psf in Ang Mo Kio.

‘And there hasn’t been a new condo in the Yishun area for over 10 years,’ she said of the good buying response.

People in the real estate sector will also be monitoring sales at another condo – Vision@West Coast – which is set to be launched soon.

Located on West Coast Highway, the 99-year leasehold development has 281 apartments and 14 strata houses. Sizes start at about 800 sq ft for a two-bedroom unit and rise to 5,000 sq ft for the strata houses.

‘Demand should be strong as the location also boasts sea views,’ predicted property agent Jimmy Tan.

The asking price for the project, he added, could be around $1,100 psf.

Source : Sunday Times – 28 Feb 2010

UNITED Industrial Corporation (UIC) has won in-principle approval from the Urban Redevelopment Authority to convert its UIC Building in Shenton Way into a mainly residential development. But no firm decision has been made on the building’s fate. The UIC board is assessing all alternatives to ensure the best use for the property, according to UOL group chief executive Gwee Lian Kheng. He disclosed this yesterday as the property group announced a near tripling in full-year profits to $424.2 million in the 12 months ended Dec 31. The sharp jump was predominantly attributable to UIC having become a 32 per cent associated company of UOL. Net profits included a negative goodwill sum of $281.1 million from the acquisition of shares in UIC. Earnings from associated company Nassim Park Residences also contributed to the surge in profits. UOL posted a record-breaking year in revenues, which rose 12 per cent from $899 million to just over the $1 billion mark. ‘Our strategy of tapping the demand of mass- and mid-market housing segments was well timed,’ said Mr Gwee. ‘This has helped us reach a major milestone of becoming a billion-dollar company by turnover.’ Strong sales from the group’s Double Bay Residences and Meadows@Peirce contributed to the revenue rise. The group’s property development arm represented 53 per cent of revenue. Higher average rental rates brought about a 12 per cent rise in revenue from investment properties to $141.7 million. Revenue from hotel operations declined 13 per cent to $294.5 million as revenue per available room fell amid a slowdown in tourism, the group’s statement said. Pan Pacific Hotels Group, the group’s listed hotel subsidiary, saw revenue fall by 9 per cent due to weaker performance in the group’s hotels. Mr Gwee said the ‘difficult period for the hotel industry may be over’ and that efforts would be made to ’secure more hotel management contracts, thus increasing fee-based income’. The developer remains focused on Singapore’s resilient mass and mid-tier to high-end residential market. A total of 1,138 residential units are in the pipeline this year. Developments at its Dakota Crescent and Toh Tuck Road sites are expected to be launched by the second quarter of this year. A total of 616 and 172 units respectively are estimated to be made available at these sites. In the second half of the year, the group will launch a development in the Spottiswoode area, where it had purchased Spottiswoode Apartment and Oakswood Heights in 2007, releasing about 350 units. Overseas, another 1,014 units are in the pipeline – 520 in a mixed development in Tianjin, China, and another 494 units in a development located in Kuala Lumpur. Full-year earnings per share wUNITED Industrial Corporation (UIC) has won in-principle approval from the Urban Redevelopment Authority to convert its UIC Building in Shenton Way into a mainly residential development. But no firm decision has been made on the building’s fate. The UIC board is assessing all alternatives to ensure the best use for the property, according to UOL group chief executive Gwee Lian Kheng. He disclosed this yesterday as the property group announced a near tripling in full-year profits to $424.2 million in the 12 months ended Dec 31. The sharp jump was predominantly attributable to UIC having become a 32 per cent associated company of UOL. Net profits included a negative goodwill sum of $281.1 million from the acquisition of shares in UIC. Earnings from associated company Nassim Park Residences also contributed to the surge in profits. UOL posted a record-breaking year in revenues, which rose 12 per cent from $899 million to just over the $1 billion mark. ‘Our strategy of tapping the demand of mass- and mid-market housing segments was well timed,’ said Mr Gwee. ‘This has helped us reach a major milestone of becoming a billion-dollar company by turnover.’ Strong sales from the group’s Double Bay Residences and Meadows@Peirce contributed to the revenue rise. The group’s property development arm represented 53 per cent of revenue. Higher average rental rates brought about a 12 per cent rise in revenue from investment properties to $141.7 million. Revenue from hotel operations declined 13 per cent to $294.5 million as revenue per available room fell amid a slowdown in tourism, the group’s statement said. Pan Pacific Hotels Group, the group’s listed hotel subsidiary, saw revenue fall by 9 per cent due to weaker performance in the group’s hotels. Mr Gwee said the ‘difficult period for the hotel industry may be over’ and that efforts would be made to ’secure more hotel management contracts, thus increasing fee-based income’. The developer remains focused on Singapore’s resilient mass and mid-tier to high-end residential market. A total of 1,138 residential units are in the pipeline this year. Developments at its Dakota Crescent and Toh Tuck Road sites are expected to be launched by the second quarter of this year. A total of 616 and 172 units respectively are estimated to be made available at these sites. In the second half of the year, the group will launch a development in the Spottiswoode area, where it had purchased Spottiswoode Apartment and Oakswood Heights in 2007, releasing about 350 units. Overseas, another 1,014 units are in the pipeline – 520 in a mixed development in Tianjin, China, and another 494 units in a development located in Kuala Lumpur. Full-year earnings per share were 53.7 cents, up from 18.5 cents the year before. Net asset value per share as of Dec 31 stood at $5.29, up from $4.26 previously. A final dividend of 10 cents per share has been proposed. UOL shares closed 11 cents higher at $4 yesterday before the results were announced. Source : Straits Times – 24 Feb 2010 ere 53.7 cents, up from 18.5 cents the year before. Net asset value per share as of Dec 31 stood at $5.29, up from $4.26 previously. A final dividend of 10 cents per share has been proposed. UOL shares closed 11 cents higher at $4 yesterday before the results were announced. Source : Straits Times – 24 Feb 2010