Month: March 2025

Investors are expressing their interest in deploying capital into property markets in Asia Pacific that have ample liquidity, according to Hamish MacDonald, head and chief investment officer of APAC Real Estate at BlackRock.

Property sectors set to benefit from economic tailwinds this year include accommodation, logistics, and alternative assets. MacDonald says Australia, Japan, Singapore, and Auckland, New Zealand are the markets with high liquidity. This is the order of focus for BlackRock this year. He expects investor sentiment to be more positive this year compared to 2023 and 2022. Institutional investors will be initiating more talks about deploying and recycling capital in selective Asia Pacific real estate markets this year. In Singapore, BlackRock has been acquiring serviced apartment properties. In partnership with YTL Corp, it bought Citadines Raffles Place for approximately $290 million in October last year. In February 2024, it teamed up with Hong Kong-based accommodation operator Weave Living to purchase Citadines Mount Sophia for $148 million. This week, the property has been reopened under the name of Weave Suites – Hillside. MacDonald says the latest transactions in Singapore demonstrate the firm’s belief that there is a need for more serviced apartment supply in the city-state. Yet, the demand for this type of accommodation remains high. The focus will not be on building an aggregated portfolio, but on targeting the deals more. “We prefer existing properties which we can refurbish, reposition, and add new amenities with our partners,” he says. MacDonald is positive about opportunities in Singapore, saying that the country continues to attract significant capital inflows and high-skilled labour, thus supporting its business growth. Japan will remain a target for real estate investors this year, notes MacDonald, who adds that the firm is bullish about the Japanese economy. “Our analysis of domestic pricing power, wage growth, and corporate reform shows that real estate growth is supported,” he says. Daigo Hirai, head of Japan real estate at BlackRock APAC, says the Japanese residential market has been recording relatively strong rental uplift in recent quarters due to a combination of factors. “In major cities like Tokyo and Osaka, residential rents are expected to grow 7% and 8% this year. Additionally, tenants are seeking larger-sized apartments instead of compact units such as studios,” he says. BlackRock is aiming to collaborate with a seasoned operator to oversee a hybrid residential investment strategy. This strategy will cater to both inbound tourist accommodation requirements and domestic rental demand. By doing so, BlackRock will ramp up its investment presence in cities dominated by tourists such as Kyoto and Fukuoka. Hirai reveals that the best assets in this plan are close to train stations in residential-commercial areas such as Osaka’s Namba district. They also include smaller developments with a maximum of 50 units. Hirai adds that the company will consider acquiring assets with JPY1 billion ($8.93 million) to JPY3 billion to accommodate its exit strategy. Meanwhile, MacDonald says BlackRock’s focus in Japan is on residential assets, and the primary goal is to invest in potential acquisition deals at a considerable discount. Ben Hickey, Head of Australia Real Estate at BlackRock, says the Australian real estate market is supported by long-term population growth projections. It is also typically characterised by low vacancy rates and under-supply of most property sectors. Hickey says any investment plan in Australia should take into consideration whether rental growth can surpass inflation, a favourable exit strategy, and the ongoing long-term supply-demand imbalance. For this reason, BlackRock is putting its weight behind four niche asset classes in Australia – childcare properties, last-mile logistics assets, life science real estate, and self-storage properties. Hickey explains that all these four sectors benefit from the country’s enduring population growth and are a rarity in terms of domestic supply and when compared to the wider regional markets. “This enables us to record sizable returns with minimal risk,” he says, adding that the company cannot rely on an optimistic interest rate outlook to generate its real estate returns.…

In recent years, many people have noticed that show flats have been getting smaller. This is not surprising, as our perception of size is often relative to what we are used to. The sizes of the homes we grew up in, whether they were HDBs or condos, were bigger in the 1990s and 2000s. For example, the average size of a new condo in 1995 was 1,272 sq ft, compared to 858 sq ft in 2015. By 2024, the average size had slightly increased to 929 sq ft.

However, it’s important to note that demographics have changed significantly over the years. In 1995, the average household size was four, decreasing to 3.1 in 2024. This means that the average space per household member has also shrunk, from 318 sq ft in 1995 to 300 sq ft in 2024.

Over the past 29 years, the average size of condos per capita has decreased by 5.7%. This is a commendable achievement, considering Singapore’s limited space. This would not have been possible without the government’s intervention. In 2008, several condo projects in the Rest of Central Region (RCR) introduced smaller “Mickey Mouse” units, with the smallest being only 24 sq m. These units were sold at a lower price, making it more accessible for people to invest in property.

As these projects became increasingly popular, more and more developers started building smaller units, which raised concerns about the living environment’s quality. In response to this, the Urban Redevelopment Authority (URA) issued guidelines on the maximum allowable number of dwelling units (DUs) in 2011. These guidelines required developers to use an average size of 70 sq m for projects outside the Central Area. In addition, certain areas like Telok Kurau, Kovan, Joo Chiat, and Jalan Eunos had a more stringent requirement of 100 sq m. However, despite these guidelines, the average size of DUs continued to decrease in the following years.

In 2019, the URA further tightened the guidelines, and the average DU size for projects outside the Central Area increased by 21.4% to 85 sq m. This effectively stopped the decline in average DU size. However, in the Central Area, the average DU size dropped to its lowest of 725 sq ft in 2020. To address this issue, the URA extended the guidelines to the Central Area in 2023, requiring 20% of DUs to have a net internal area of at least 70 sq m.

In June 2023, the URA also harmonized the definitions of strata area and gross floor area (GFA). This includes areas like air-conditioning ledges as part of the strata area, which led to a decrease in the size of DUs. Despite this, the average DU size in the Rest of Central Region (RCR) increased by 19.5% to 944 sq ft since 2015. Conversely, the average DU size in the Core Central Region (CCR) decreased by 11.7% to 1,092 sq ft in 2024.

Looking ahead, the harmonization of GFA definitions may lead to a downward trend in the average DU size. However, with advancements in smart home features and better provisions in terms of fittings, buyers are getting better value for their purchases compared to 10 years ago. All in all, the URA’s intervention has managed to keep the average size of DUs in check, making them more affordable and accessible for buyers.…

SENSEMinistry of National Development (MND) has recently announced enhancements to the Silver Housing Bonus (SHB) and Fresh Start Housing Scheme (Fresh Start). These enhancements are part of the government’s continuous efforts to support senior citizens in right-sizing and to improve public housing access for lower-income households residing in HDB rental flats.Under the SHB, senior citizens are incentivized to better prepare for retirement by unlocking the value of their residential assets and transferring it into their CPF Retirement Account (RA). Currently, to be eligible for the SHB, applicants must be 55 years or older, earn a monthly income of not more than $14,000, have an existing property with an Annual Value (AV) not exceeding $21,000, and their replacement property must be a HDB flat of three rooms or smaller (excluding three-room terrace).However, starting from 1st December 2020, applicants will be qualified for the SHB cash bonus if they can prove that their right-sizing exercise results in a net increase to their CPF RA account balance from any source, including CPF housing refunds. This means that seniors with outstanding loans on their residences using their CPF accounts may no longer need to make a cash top-up to be eligible for the SHB. Additionally, the SHB has been extended to allow seniors who own higher-valued properties to qualify. Now, applicants with properties with an AV of over $21,000 but not more than $13,000 are eligible, which is estimated to benefit 15,000 additional seniors. The cash bonus will be pro-rated at the rate of $1 for every $6 increase in their RA, up to a maximum of $10,000. Successful applicants who right-size to a two-room or smaller HDB flat (including Community Care Apartments) will receive an additional non-pro-rated cash bonus of $10,000.On the other hand, the Fresh Start Housing Scheme, launched in 2016, offers financial assistance and social support to Second Timers (ST) families who have previously bought a subsidised HDB flat to help them achieve homeownership. Under the current scheme, applicants can purchase two-room flexi or three-room standard BTO flats with shorter lease lengths, ranging from 45 to 65 years, lasting until the youngest owner turns 95. These flats have an extended Minimum Occupation Period of 20 years, compared to the usual five years. Enhancements to the scheme include an increased financial support of $75,000, up from the previous $50,000. This consists of an initial disbursement of $60,000 credited to the applicants’ CPF Ordinary Account (OA) before their key collection dates, and the remaining $15,000 will be disbursed over the next five years to support mortgage payments. The eligibility criteria have also been expanded to allow First-Timer (FT) families to apply, although they are still ineligible for the Fresh Start Housing Grant as they can benefit from the larger Enhanced CPF Housing Grant (EHG) of up to $120,000. Nonetheless, they can still take advantage of the reduced cost of shorter-lease BTO units and the social support provided under the program. Eligible FT families can apply for Fresh Start in April 2025, and the revisions to the Fresh Start Grant amount will take effect from the July 2025 BTO exercise.…

The Ministry of National Development (MND) recently announced changes to the Additional Buyer’s Stamp Duty (ABSD) regime for licensed housing developers. The revisions will take effect on March 6.

The ABSD remission timeline for developers undertaking complex projects will also be extended from six to 12 months. This move is intended to incentivize developers to undertake urban transformation developments, optimize land use, rejuvenate older estates, and adopt new construction technologies.

The six to 12-month extension will apply to projects such as en bloc redevelopments that will yield at least 700 units upon completion and have at least 1.5 times the number of homes of the existing development. Other projects eligible for the extension include those with complex technical or instructional requirements, such as those integrated with major public transport facilities.

Additionally, projects approved under the Strategic Development Incentive (SDI) scheme and those aiming to achieve higher productivity targets through the adoption of new construction technologies, methodologies, or practices will also receive the extension. If a project meets the criteria in more than one category, it will be granted a one-year extension. These changes will apply to all residential land acquired on or after March 6.

Currently, licensed housing developers purchasing residential redevelopment sites are subject to an upfront 5% ABSD, which is non-remittable, and another 35% ABSD, which is remittable when all units in the project are completed and sold within five years.

The latest revisions build upon changes announced in February last year, which offered a lower clawback rate for residential developments with at least 90% of units sold.

CEO of PropNex Realty Ismail Gafoor says, “Such extensions will give developers more flexibility and may help to mitigate development risks to some extent, as they have more time to sell units, particularly for mega projects.”

Senior Director of Data Analytics at Huttons Asia Lee Sze Teck believes that the ABSD revisions will provide a much-needed boost to the en bloc market, especially for bigger projects. However, Christine Sun, Chief Researcher and Strategist at OrangeTee Group, notes that developers may still face challenges despite the deadline extension, as other factors, such as buyer and seller negotiations, can affect the success of en bloc sales.

Meanwhile, Tay Liam Hiap, Managing Director of Capital Markets and Investment Sales at ERA, points out that the extension could benefit older projects with expansive land areas, such as Braddell View and Pine Grove. These projects may yield around 2,000 new homes, which could take more time to sell. However, he also warns that the six to 12-month extension may not be sufficient for developers to sell out these projects.

Overall, the policy change is expected to have a positive impact on the en bloc market. However, Gafoor suggests that developers may remain cautious due to the high cost of redevelopment, upcoming private housing supply, and potential policy risks.…

The Land Transport Authority (LTA) has announced plans for two new MRT lines that are currently undergoing feasibility studies. The lines are expected to be completed in the 2040s and could potentially benefit over 400,000 households.

One of the proposed lines, the Seletar Line, is aimed at serving areas such as Woodlands, Sembawang, Sengkang West, Serangoon North, Whampoa, Kallang, and the Greater Southern Waterfront. The other line, tentatively called the Tengah Line, is intended to supplement the public transport network in the west and northwest regions, serving areas like Tengah, Bukit Batok, Queensway, and Bukit Merah.

Transport Minister Chee Hong Tat, in a speech to parliament on March 5, shared that the two lines may eventually be joined. This will depend on the results of LTA’s feasibility studies.

Chee also announced LTA’s plans to proceed with the West Coast Extension (WCE), which will extend the Jurong Region Line (JRL) to connect with the Circle Line (CCL) and Cross Island Line (CRL). The WCE will be implemented in two phases, with the first phase connecting the JRL to the CRL by the late 2030s and the second phase connecting the JRL to the CCL’s Kent Ridge Station by the early 2040s.

Upon completion, the WCE is expected to cut travel time by up to 20 minutes for residents travelling from the West to the city centre.

In addition to expanding the rail network, the government has earmarked up to $1 billion over the next five years to maintain high-reliability standards in both newer and older train systems. This investment will go towards implementing condition monitoring systems for targeted maintenance, adopting new technologies to improve efficiency, and providing training programmes for rail workers.

LTA believes that these efforts will allow them to continue delivering convenient, reliable, and resilient public transport for commuters.…

Elias Green, a 99-year leasehold condo located in Pasir Ris, will be up for collective sale by public tender on March 6th. The property’s marketing agent, ERA Realty Network, has set a guide price of $928 million for the sale.

Originally completed in 1994, Elias Green occupies a land area of approximately 516,871 sq ft which is zoned for residential use with a gross plot ratio of 1.4. The condo consists of multiple blocks and has a total of 419 apartments, ranging in size from 1,367 to 1,636 sq ft. With a remaining lease of 65 years, the site’s 99-year lease began in 1991.

According to ERA, the guide price of $928 million translates to a land rate of $1,355 psf per plot ratio (ppr). This figure includes an estimated land betterment charge of $150.8 million for intensification and a top-up to a fresh 99-year lease. It also takes into account a 10% bonus gross floor area.

The marketing agent also notes that the owners of Elias Green are currently in the process of submitting an Outline Application to the Urban Redevelopment Authority (URA) for a residential development with a gross plot ratio of 1.8. If approved, the development’s land rate would be approximately $1,245 psf ppr.

If the collective sale is successful, based on the guide price, owners are expected to receive gross sale proceeds ranging from approximately $2.04 million to $2.31 million per unit.

Tay Liam Hiap, managing director of capital markets and investment sales at ERA Singapore, emphasizes that the Pasir Ris Town area is undergoing significant enhancements as part of the Housing and Development Board’s (HDB) “Remaking Our Heartland” initiative, which will boost its vibrancy and connectivity.

“As part of this transformation, the new Pasir Ris Bus Interchange is expected to be completed by 2025. This will integrate with the future Pasir Ris Integrated Transportation Hub, which will also include the Cross Island Line (CRL) slated to be operational by 2030, to further enhance connectivity across Singapore,” Tay adds.

This is the second attempt by owners at Elias Green to launch a collective sale. The first attempt was in 2018, when the condo was launched for tender at $780 million. The latest asking price of $928 million is 19% higher than the previous one.

The tender for Elias Green will close on April 22 at 2pm. Potential buyers can check out the latest listings for properties at Elias Green, such as condo projects with the most expensive average per-square-foot price in District 18, condo rental transactions in District 18, and upcoming new launch projects. They can also find information on past condo rental transactions, as well as the most unprofitable landed transactions in the past year.…

The government tender for Media Circle (Parcel A) in the one-north area has recently closed on March 4. The winning bid of $315 million for the 99-year leasehold site was submitted by a consortium of three companies – Qingjian Realty, Forsea Holdings and minority investor Hoovasun Holding. This bid was for the residential and commercial zoned site that measures 82,125 sq ft and has a potential to yield about 325 housing units. The bid has translated to a land rate of $1,037 psf per plot ratio (ppr).

The development by the Qingjian-Forsea consortium will feature two high-rise residential towers with commercial spaces on the first level, according to a press statement released by the companies. This bid has been the highest among the three bids received for the site. The second highest bid of $298 million was submitted by EL Development, while the lowest bid of $295 million was submitted by SingHaiyi Group.

The winning bid by Qingjian-Forsea is lower than the land rate the companies previously paid for the neighbouring Media Circle GLS plot which will now be the site of the upcoming Bloomsbury Residences with 358 units. In January 2024, Qingjian-Forsea were awarded the 114,462 sq ft site for $395.28 million, or $1,191 psf ppr. According to Du Dexiang, managing director of Qingjian Realty, they have full confidence in the transformation of Media Circle, supported by a well-designed master plan and the government’s continued investment in the one-north precinct as announced in the 2025 budget. This project will be another important step in their commitment towards developing high-quality residential communities that align with the growth of one-north.

This will be the third joint venture between Qingjian and Forsea following their award of an executive condominium site at Jalan Loyang Besar in August last year, which had the top bid of $557 million ($729 psf ppr). The site can potentially yield 710 new homes.

According to Lee Sze Teck, senior director of data analytics at Huttons Asia, Qingjian’s latest bid for Media Circle (Parcel A) reflects the developer’s confidence in the demand for homes in the area. If awarded, the developer will have influence over the supply and pricing of new homes in Media Circle. He also pointed out that the Media Circle area is a unique location within one-north, surrounded by greenery and black and white bungalows. The neighbourhood currently has a limited number of non-landed residential properties, with only 987 units, and out of those, only 100 new homes remain unsold.

With the high proportion of foreigners working within one-north, Science Park and Tanglin Trust School, Lee believes the area offers a strong pool of quality tenants and is close to diverse retail and dining options such as Anchorpoint Shopping Centre, Alexandra Central Mall and Timbre+ One North.

Leonard Tay, head of research at Knight Frank Singapore, believes that the project could launch with starting prices of $2,300 psf. He also pointed out that while the site is in a quieter section of one-north business park, it is still within walking distance to Mediapolis, making this project a perfect choice for investors as well as buyers in the media and entertainment industry. The tender for the adjacent site, Media Circle (Parcel B), which measures 107,936 sq ft, will close on April 29.…

HPL, a prominent player in the property and hotel industries, is taking steps to expand its global presence with the acquisition of InterContinental Auckland for NZ$180 million ($138.5 million). This marks HPL’s first venture into the New Zealand market and its second acquisition of an InterContinental hotel, following the InterContinental Maldives Maamunagau Resort.

JLL’s Asia Pacific Hotels & Hospitality Group, which advised on the sale by Precinct Properties in New Zealand, notes that this off-market transaction is the largest hotel asset sale ever in the country. This move by HPL follows the recent launch of The Boathouse Tioman, a luxury resort in Malaysia featuring 31 bungalows, and the opening of The Four Seasons Hotel Osaka, a 176-room hotel in Japan, last year.

HPL’s latest acquisition in Auckland is in line with its strategy to expand its portfolio of luxury hotels in key markets throughout the Asia Pacific region. The company’s experienced hospitality management team and strong partnerships with operators such as IHG Hotels & Resorts drive this growth.

“The proposed purchase of InterContinental Auckland presents a unique opportunity for us to acquire a premium asset in New Zealand,” says Stephen Lau, chairman of HPL Hotels and Resorts. The property is conveniently connected to the bustling lifestyle precinct Commercial Bay, which opened in January 2024. Guests of the hotel can enjoy stunning views of the Waitematā Harbour, adds Lau.

Although the existing InterContinental Auckland has 139 rooms, there is potential for expansion up to 190 rooms by converting the current office space, should demand require it in the future. HPL is confident that this acquisition will prove to be a valuable addition to their portfolio and contribute to their success as a leading global hospitality company.…

According to recent research by Colliers, institutional investments in real estate in the Asia Pacific (Apac) region totalled US$83.2 billion ($112 billion) in the second half of 2024, an increase of 6% from the previous year. This brings the total investments for the full year to US$155.9 billion, up 12% from 2023. The figures cover the top nine markets in the region: Australia, Mainland China, Hong Kong, India, Japan, Singapore, South Korea, New Zealand, and Taiwan.

The steady rise in investments demonstrates the resilience of the Apac real estate market and sets the stage for a strong 2025, according to Chris Pilgrim, Colliers’ managing director of global capital markets, Asia Pacific. He notes that local investors have been the main driving force behind the growth in key markets such as South Korea, Taiwan, and New Zealand, accounting for over 80% of real estate inflows in these countries in the second half of 2024.

The office sector was the largest contributor to investment volume in Apac, accounting for US$26.5 billion (32%) of the total in the second half of 2024. For the full year, office investments reached US$51.4 billion, up 14% from the previous year. The industrial and logistics sector was the second biggest contributor, with US$22.6 billion in investments in the second half of 2024, accounting for 27% of the total. The sector saw a robust growth of 29% year-on-year, with total investments reaching US$39.4 billion in 2024.

In a significant rebound, the retail sector recorded investments of US$15 billion in the second half of 2024, driven by large deals in Australia and South Korea. Total retail investments for the year stood at US$26.1 billion, a 27% increase from the previous year.

Pilgrim predicts that domestic investors will continue to dominate most markets in 2025. However, he expects offshore investments to increase as investor confidence improves and attractive valuations become available. While the office and industrial segments are expected to maintain their strength, Pilgrim also sees potential growth in the retail, hospitality, and alternative asset classes as investors capitalize on the recovering market and changing consumer trends.

He concludes that with a strong economic outlook and continued policy support, the Apac real estate market is poised for sustained investment activity in 2025.…