Singapore’s en-bloc market is exhibiting signs of life again, with the collective value of transactions nearly doubling from last year’s total.
This year, residential estates Shunfu Ville and Harbour View Gardens were sold for a total sum of $671.25 million, data from OrangeTee Research and the Urban Redevelopment Authority showed. In contrast, a single transaction took place in 2015. Mixed-use development Thong Sia Building was sold for $380 million.
The jump in sales value coincides with more competition for land parcels between developers, as supply from the Government Land Sales (GLS) programme continues to shrink.
“This is evident by the high number of participants in recent tenders,” said Mr Wong Xian Yang, head of research and consultancy at OrangeTee. “As such, developers are exploring other options such as the collective sales market,” he added.
Mr Chris Koh, director of property firm Chris International, expressed similar views. “Recent GLS tenders have been very, very competitive. And I think with asking prices having come down, there is more reason for developers to look at the en-bloc market to pick up some sites,” he said.
According to market analysts, the ongoing sale of Raintree Gardens will likewise attract healthy interest from property developers. The 175-unit Potong Pasir development, which has a minimum asking price of $315 million, will have its tender closed on Oct 5.
“The tender for Raintree Gardens… would be a litmus test for the collective sale market. If successful, that would add another $315 million, assuming they meet their asking price, which would bring the total en- bloc sales value in 2016 to nearly $1 billion,” said Mr Wong.
As compared to previous years, the volume of developments being put up for en-bloc is low, he added. For instance, at least 12 en-bloc transactions took place every year from 2011 to 2013, Mr Wong said.
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