SINGAPORE VIEW A COLLECTION OF THE FINEST PROPERTIES & DEVELOPMENTS NOV 2019 - FEB 2020 NOVEMBER 2019 - FEBRUARY 2020 • 1 Contents 57 05 44 WELCOME 06 MARKET RESEARCH 10 ADVISORY SERVICES 13 AUCTION & SALES 21 33 78 50 INDUSTRIAL RESIDENTIAL LOCAL DEVELOPMENTS 39 56 INVESTMENT & CAPITAL MARKETS RESIDENTIAL INTERNATIONAL DEVELOPMENTS 47 84 OFFICE 78 ADVISORY RESIDENTIAL PRIME SALES 48 PROPERTY ASSET MANAGEMENT 84 RETAIL SINGAPORE VIEW • 2 NOVEMBER 2019 - FEBRUARY 2020 • 3 Welcome Uncertainty is the new norm, amid a lack of clarity Meanwhile, consumers have become more on how the trade war between China and the United cautious in their spending, as evidenced by slower States, Brexit, and escalating tensions in the Middle retail sales and tourism receipts. Notwithstanding, East will pan out. With business confidence and the limited supply of new prime retail spaces has investments chilled, the global economic outlook helped offset downward pressure on rents of choice continues to deteriorate. Softening sentiments has units. To draw shoppers, malls have introduced led to the International Monetary Fund to downgrade more lifestyle concepts and social spaces to its forecast of world economic growth to 3 per cent improve shopping experiences. Retailers have also in October 2019, 0.3 percentage points below its begun collaborating with technology companies to equivalent estimate six months ago. curate personalised offerings, to attract consumers. With the office rental market one of the bright spots Still, there remains pockets of opportunity in the despite the weaker economic outlook, Singapore’s Singapore real estate market for investors of office buildings have also attracted investor different risk appetites. The industrial property interest. Office occupancy stayed high, due to the market, for instance, offers prospects despite lack of new completions of office buildings in the weaker headline statistics of the manufacturing Central Business District and steady demand from industry. The rolling out of the 5G network will also multinational companies and start-ups which have exponentially increase the data handled by servers, been setting up regional offices in Singapore. raising the need for more data centres. Additionally, as the food delivery and catering sector expands, The “flight to safety” was also observed in the demand for central food kitchens and spaces to private residential market. Foreign home purchases house them is expected to grow in tandem. have increased, as buyers sought assets for wealth preservation or long-term appreciation. More Over the long term, staying ahead of market buyers also moved towards purchasing properties trends and technology will likely reveal rewarding in areas earmarked for future development, to opportunities to both investors and firms. hedge against potential downside risks. Danny Yeo Executive Chairman Knight Frank Singapore SINGAPORE VIEW EDITOR Hector Tan NOV 2019 - FEB 2020 RESEARCH CONTENT Lee Nai Jia MARKETING Phyllis Goh DESIGNER Regina Ang SINGAPORE VIEW • 4 NOVEMBER 2019 - FEBRUARY 2020 • 5 Market Research Synopsis Residential Retail As the brick and“ mortar market continued to face competition from the According to URA statistics, the Property Price Index Average gross rents of prime retail spaces (PPI) of private residential properties increased by 1.5% OUTLOOK FOR PRIVATE HOME PRICES remained largely flat q-o-q in Q2 2019 amid e-commerce market, the retail market is quarter-on-quarter (q-o-q) to 150.8 in Q2 2019. The moderated growth in visitor arrivals and weaker Source: URA, Knight Frank Research slowly reaching a new equilibrium. increase in the price index comes after a 0.7% q-o-q retail sales by both local and overseas shoppers. decline in Q1 2019. However, it remains premature to MARKET ACTUAL PROJECTED Notwithstanding the weaker spending, rents of conclude whether the uptrend will be sustained over SEGMENT (AS AT Q2 2019) prime retail spaces continues to hold for their the next two quarters. visibility and strong traffic. As the brick and Q-O-Q Y-O-Y BY END 2019 mortar market continued to face competition UPCOMING RETAIL SUPPLY FROM MAJOR CHANGE CHANGE (Y-O-Y CHANGE) A confluence of reasons may have contributed to from the e-commerce market, the retail market is DEVELOPMENTS IN KEY PRECINCTS (Q3 2019 – 2023) the higher price index. First, the unveiling of the Draft slowly reaching a new equilibrium. Now, millennial Source: URA, Knight Frank Research Master Plan 2019 may have boosted buyers’ interest in NON-LANDED shoppers also prize practicality and comfort over Note: Only retail development(s) of at least 50,000 sqft NLA is included 2.0% 1.4% -1.0% TO 3.0% non-landed properties located in areas earmarked for ISLAND-WIDE branding of the products. FRINGE AREA DOWNTOWN CORE ORCHARD future development, contributing to a price increase REST OF CENTRAL AREA SUBURBAN NON-LANDED this quarter. Second, given the price gap between CCR 2.3% -0.5% -1.0% TO 2.0% Overall island-wide prime retail rents remained buyers and sellers, improvements in prices may largely flat q-o-q at S$30.50 per sq ft per month 300 be reflecting the sale of choice properties, where NON-LANDED 3.5% 3.3% -1.0% TO 4.0% (psf pm) in Q2 2019. The retail market is reaching buyers were willing to “bridge” the price gap by paying RCR a new steady-state on the whole. Rents of prime a premium. This phenomenon usually occurs for retail spaces at the Orchard Road remained 250 NON-LANDED 1.2% negotiations over choice properties that are in prime OCR 0.4% -1.0% TO 3.0% unchanged at S$34.50 psf pm in Q2 2019. Tight districts. Third, there has been an uptick in foreign supply in the precinct, coupled with stable foot buyers since March, which may have supported prices LANDED 1.2% fall from locals and tourists helped support prime 200 HOMES -0.1 % -1.0% TO 2.0% in both the Core Central Region (CCR) and Rest of retail rents in the area. There was no change in Central Region (RCR). prime retail rents in Marina Centre, City Hall and Bugis Precinct in Q2 2019. Healthy shopper 150 Secondary sale transactions in Q2 2019 increased to traffic in the precinct supported prime rents 1,840 units from 1,623 units in Q1 2019, a 13.4% q-o-q in the precinct, despite dampened shopper increase. New sales also increased to 2,159 units in Q2 sentiments. Prime retail rents in the City Fringe 100 2019, which was a 28.4% q-o-q increase from 1,681 “ precinct stood flat at S$25.60 psf pm in Q2 2019. units in Q1 2019. There has been an uptick in foreign buyers Malls that served a large residential catchment 50 since March which may have supported continued to do well. In Q2 2019, prime rents in NETT LETTABLE RETAIL SPACE (’000 SQ FT) Looking ahead, we anticipate prices to improve prices in both the CCR and RCR. suburban malls recorded a slight uptick of 0.1% sustainably, supported by demand for new private q-o-q, albeit a y-o-y decline of 0.4%. The uptick 0 residential properties in areas earmarked for future reflected the rents of high traffic areas that 2019 2020 2021 2022 2023 development. appealed to F&B retailers. TOTAL SUPPLY OF PRIVATE HOMES, TOTAL SALES, AND URA PRIVATE RESIDENTIAL PROPERTY PRICE INDEX AVERAGE GROSS RENTS OF PRIME RETAIL SPACES*, Q2 2019 Source: URA, REALIS, Knight Frank Research Note: Transaction volume based on caveats lodged as at 23 June 2019. Source: Knight Frank Research * Prime spaces refer to rental-yielding units between 350 and 1,500 sq ft with the best frontage, connectivity, footfall and accessibility in a mall which are typically ground level of a retail mall and/ or the basement level of a retail mall that is linked to a MRT or bus station. ** Island-wide prime rents moved marginally in Q2 2019 TOTAL UNITS SOLD IN SECONDARY MARKET (LHS) TOTAL UNITS SOLD IN PRIMARY MARKET (INCLUDE EC) (LHS) ALL PRIVATE RESIDENTIAL PROPERTY PRICE INDEX (INCLUDE EC) (RHS) LOCATION ISLAND-WIDE ORCHARD ROAD MARINA CENTRE, CITY FRINGE SUBURBAN CITY HALL, BUGIS 9,000 155 8,000 All Private Residential PPI 7,000 150 6,000 145 5,000 $ PER SQ FT PER MONTH S$30.50 S$34.50 S$29.40 S$25.60 S$28.60 4,000 140 3,000 Number of Units Sold 2,000 135 1,000 0 130 Q-O-Q CHANGE NO CHANGE** NO CHANGE NO CHANGE NO CHANGE 0.1% Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Y-O-Y CHANGE 0.1% NO CHANGE NO CHANGE NO CHANGE 0.4% SINGAPORE VIEW • 6 NOVEMBER 2019 - FEBRUARY 2020 • 7 MARKET RESEARCH SYNOPSIS UPCOMING OFFICE SUPPLY (‘000 SQ FT GROSS), AS AT Q2 2019 Office Source: URA (as at Q2 2019), Knight Frank Research 2019 2020 2021 2022 BEYOND “ 2022 Office rental growth moderated in Q2 2019, on the back Robinson Road/Tanjong Pagar precinct increased at a MARINA BAY / RAFFLES PLACE 180 368 755 1,527 of lower net absorption and occupancy levels. The weaker slower pace by 0.4% q-o-q in Q2 2019, compared to the economic outlook resulting mainly from the uncertainties 1.3% q-o-q increase in Q1 2019. Upcoming SHENTON WAY/ ROBINSON ROAD / 185 788 151 37 of a protracted trade war contributed to lower growth TANJONG PAGAR projections by businesses. The office occupancy rate Supply is expected to come on stream progressively developments MARINA in the Central Business District (CBD) decreased by 1.8 from H2 2019.
Details
-
File Typepdf
-
Upload Time-
-
Content LanguagesEnglish
-
Upload UserAnonymous/Not logged-in
-
File Pages45 Page
-
File Size-