21 Feb 2024
GLS Commentary on Orchard Boulevard & Plantation Close (EC)
Property Insight

The Government Land Sales (GLS) commentary sheds light on the highly anticipated tender outcomes for Orchard Boulevard and Plantation Close (EC), highlighting the buoyant sentiment and strategic investments in Singapore's property market. Orchard Boulevard, nestled in the prestigiousCore Central Region (CCR), attracted a winning bid of $428.3 million by United Venture Development,a testament to the location's desirability and scarcity of such prime development opportunities. Thisbid underscores the competitive nature of the tender, narrowly surpassing the second-highest bid by2.5%, reflecting developers' eagerness to secure a foothold in this elite enclave.

The Orchard Boulevard site is characterized by its exceptional connectivity, offering easy access to the vibrant Orchard Road shopping district and seamless commuting options via the OrchardBoulevard MRT station on the Thomson-East Coast Line (TEL). The strategic location, coupled with the rarity of new launches in the area, enhances the site's appeal, making it an attractive development prospect poised to cater to the nuanced demands of affluent buyers and investors looking for luxury and convenience.

On the other hand, Plantation Close in the emerging Tengah area garnered attention with a top bid of$423.4 million from Hoi Hup Realty and Sunway Developments. This reflects developers' confidence in the region's growth potential, marking it as a focal point for substantial residential development.The bid for Plantation Close (EC) signifies a strategic move by developers to establish a significant presence in this new residential hub, underpinned by the successful acquisition of adjacent sites and the area's transformative development plans.

The commentary underscores the Plantation Close site's potential to foster vibrant residential communities, leveraging its strategic location and the unique position of Executive Condominiums(ECs) in the housing market. ECs, bridging the gap between public and private housing, offer a blend of premium lifestyle amenities and future privatization prospects, making them a desirable investment for both developers and buyers. The regulated launch timeline for ECs ensures a balanced release of units, aligning with market demand and minimizing competition.

Both Orchard Boulevard and Plantation Close tenders reflect a strategic pursuit of opportunities within Singapore's diverse property landscape, from the high-end luxury market in the CCR to the growing demand for quality housing in new residential areas like Tengah. The successful bids highlight the developers' vision and commitment to contributing to Singapore's urban development,catering to the evolving preferences of residents and investors alike.

In essence, the GLS commentary on Orchard Boulevard and Plantation Close(EC) provides a comprehensive overview of the current state and potential of Singapore's property market. It showcases the strategic considerations and competitive dynamics that drive development and investment decisions in the city-state's real estate sector, illustrating the ongoing demand for both luxury living in central locales and innovative housing solutions in emerging residential communities.

Click here for the full report

Prepared By:
Mohan Sandrasegeran
Head of Research & Data Analytics

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District 8 led shophouse transactions with 33 deals, emphasizing its appeal due to its central location and vibrant commercial activities. Other notable districts included District 14 with eight transactions and Districts 1 and 2 with five transactions each, underscoring sustained demand in strategically located areas.

The rental market also showed strength, with total rental value rising from $34.9 million in the first 11 months of 2023 to $37.7 million during the same period in 2024, marking an 8.2% year-on-year growth. This increase reflects robust demand for shophouses as versatile commercial spaces, bolstered by their charm and strategic locations.

Tourism recovery played a pivotal role in boosting the market. International visitor arrivals surged from 12.4 million in the first 11 months of 2023 to 15.1 million in the same period in 2024, a 22.3% increase. This growth supported sectors like accommodation, retail, and F&B, further driving demand for commercial shophouse spaces.

Looking ahead to 2025, the shophouse market is poised for sustained growth. Factors such as anticipated Federal Reserve rate cuts, Singapore's strong global connectivity, and its positioning as a global business hub are expected to support investor confidence. The enduring appeal of conservation properties, coupled with the continued momentum in tourism, will likely bolster demand. These dynamics position the shophouse segment as a robust and attractive asset class within Singapore’s commercial property market.

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4Q2024 Flash Estimates: Singapore’s Property Market at a Turning Point

The 4Q2024 URA and HDB Flash Estimates reveal a notable recovery in the private property market and a tempered growth in the HDB resale market. According to SRI Research, the private property price index grew by 2.3% in 4Q2024, rebounding from a 0.7% decline in the previous quarter. This resurgence is attributed to easing interest rates and a wave of new project launches, which boosted buyer confidence and increased transaction volumes.

Private property transactions saw a substantial quarter-on-quarter rise, with volume increasing by 25.0% to 6,715 units and transaction value surging 33.6% to $15.7 billion. The $1.5 million to $3.0 million price segment led the market, growing from 63.6% of sales in 2023 to 70.3% in 2024, reflecting buyers' preference for affordability and value. Overall, private property prices in 2024 increased moderately by 3.9%, down from the 6.8% growth recorded in 2023, signaling a stabilizing market influenced by Government Land Sales (GLS), inflationary pressures, and earlier cooling measures.

In the HDB resale market, prices grew at a slower pace of 2.5% in 4Q2024, compared to 2.7% in 3Q2024. Annual growth, however, reached 9.6%, nearly doubling the 4.9% increase in 2023. Cooling measures introduced in 3Q2024 have tempered million-dollar transactions, which declined by 13.9% quarter-on-quarter to 285 units in 4Q2024. Despite this, the overall number of such transactions in 2024 remains historically elevated, supported by demand for spacious executive flats and flats in mature estates.

Newer flats in mature estates dominated the million-dollar resale segment, accounting for 375 out of 382 transactions for flats with lease commencement dates from 2013 onwards. These properties are favoured for their accessibility, modern layouts, and longer leases, highlighting the importance of strategic urban planning in addressing buyer preferences.

In summary, the 4Q2024 estimates depict a recovering private property market and a resilient HDB resale segment, shaped by adaptive buyer sentiments and strategic interventions. Both markets are set for stable growth in 2025, underscored by a balance of robust demand, limited supply, and regulatory oversight.

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Property transactions in Sentosa experienced a significant increase, growing by 43.8% year-on-year. From January to November 2024, 128 units were sold compared to 89 units during the same period in 2023. This impressive growth highlights Sentosa’s continued appeal as a premium residential destination.

Key developments like The Residences at W Singapore Sentosa Cove and Cape Royale significantly contributed to this growth. The Residences at W Singapore led the market with 81 units sold at a median unit price of $1,802 psf, demonstrating its appeal through luxurious waterfront living, premium facilities, and proximity to lifestyle hubs. Cape Royale also performed well, achieving a median price of $2,234 psf for 15 units. These projects continue to attract buyers looking for exclusive properties that combine luxury, tranquillity, and convenience.

In the landed property segment, detached houses garnered strong interest. A top transaction was recorded at 2XX Ocean Drive, where a property sold for $16.0 million at $1,844 psf, with a generous area of 8,675 square feet. Similarly, 8X Cove Drive fetched $14.2 million at $1,777 psf, further highlighting the strong demand for exclusive landed homes.

Among non-landed properties, Cape Royale achieved the highest transacted price of $9.6 million at $3,069 psf, underscoring its position as one of the most exclusive developments. Other notable transactions include a unit at Turquoise, sold for $9.0 million at $1,304 psf, and luxury condominiums such as The Oceanfront @ Sentosa Cove, Seven Palms Sentosa Cove, and Marina Collection. These recorded median unit prices ranging from $1,665 psf to $2,941 psf, catering to varied buyer preferences for spacious layouts, waterfront living, and premium amenities.

The overall performance of Sentosa’s property market reflects a strong preference for ultra-luxury living. The Residences at W Singapore stood out with multiple high-value transactions, including three separate sales around $6.1 million to $6.2 million, at unit prices between $1,825 and $1,892 psf. These results underscore its consistent popularity among buyers seeking prime locations and vibrant lifestyle offerings.

Sentosa’s enduring reputation as a luxury enclave is underpinned by its integration of exclusivity, tranquil beachfront living, and proximity to Singapore’s business districts. It offers a lifestyle investment opportunity for high-net-worth individuals seeking properties with capital appreciation potential. The appeal is further bolstered by the phased expansion of Resorts World Sentosa, introducing luxury hotels, a waterfront promenade, and non-gaming attractions like Minion Land at Universal Studios Singapore. These enhancements will drive both tourism and residential demand, ensuring Sentosa’s continued status as a world-class destination.

Looking ahead, Sentosa’s unique blend of serene waterfront living and urban convenience will maintain its status as a highly sought-after residential locale. With exciting transformations, enhanced infrastructure, and global recognition for luxury waterfront living, Sentosa’s property market remains a compelling proposition for investors and residents alike. The steady demand for premium residences underscores the island’s appeal, solidifying its position as one of Singapore’s most prestigious real estate markets.

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