Wednesday, November 23, 2011

Analysts see strong demand for Bedok project

Business Times: Wed, Nov 23
ANALYSTS said that the indicative selling price of $1,150 to $1,400 per square foot (psf) at CapitaLand's newest condominium, Bedok Residences, is higher than expected - but they still expect a strong launch performance.


Sales of the project will begin today but a queue started to form at the showflat on Sunday night. As at yesterday, there were around 500 people standing in line, said marketing agent ERA Realty.


OCBC Investment Research analyst Eli Lee, who visited the showflat on Monday afternoon, checked with three agents and found that they will only hire a replacement to wait in line if his team committed to buy and submitted cheques.


'From these data-points, we judge that there is robust demand for the launch and expect a strong sales performance in terms of both units sold and average selling prices later this week,' Mr Lee said.


Kim Eng Research also noted that the lack of condominium supply in Bedok Town Centre probably allows the project to set a higher price.


The 99-year-leasehold, 583-unit Bedok Residences is part of an integrated development comprising homes, a shopping mall and a transportation hub linked to Bedok MRT station.


'Demand for such integrated projects is expected to be strong as they provide convenient access to key transport nodes and retail outlets, not to mention their limited quantity. After all, there are only so many MRT stations in Singapore,' said Kim Eng's analysts in a fresh note.


Take-up could also be boosted by foreign purchasers, said Ku Swee Yong, chief executive of International Property Advisor.


'There is likely to be a fair amount of foreign interest in this project, and around 20-30 per cent of the units could be bought by non-Singaporeans,' he said.


CapitaLand decided to forgo the traditional balloting system (which is largely based on chance) and instead opt for the queue system for Bedok Residences, so that selection and purchases can be done on 'fairer, first-come first-serve basis', said ERA. The property firm added that many people in the queue outside the project's showflat are paid to stand in line by agents who represent potential buyers with keen interest in the property.


'We expect most of the queuers to be students and retirees as most of the interested buyers are working adults holding full-time employment and therefore are unable to take leave from work to be in the physical queue themselves,' ERA said. 'Similarly, the agents themselves are unable to join in the physical queue as they will have appointments, such as HDB appointments and viewings to attend to.'


Some of the agents also have more than one customer keen to purchase a unit, in the project, ERA added.




Source: Business Times © Singapore Press Holdings Ltd

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