2016's first EC launch outperforms recent projects

THE year's first executive condominium (EC) launch, Wandervale, saw about half of its 534 available units sold at its launch over the weekend, The Business Times understands.

Seen against the poorer sales performances of other recent ECs at launch, Wandervale's showing demonstrated that ECs can still attract homebuyers if located and priced right.

"In today's norm, to sell about 50 per cent of any launch, all the more of an EC project, is a commendable performance," said Mohamed Ismail Gafoor, chief executive of PropNex Realty. "It also goes to show that there's still a demand for ECs at the right price, at the right location."

Wandervale, developed by Sim Lian Group, is a 99-year leasehold development in Choa Chu Kang. It is within walking distance to the Choa Chu Kang MRT station and bus interchange.

Out of its 534 units, there are 130 three-bedroom units, 322 three-bedroom premium, and 82 four-bedroom units. They range from 958 sq ft to 1,249 sq ft across nine residential blocks of 13, 15, and 17 storeys respectively.

An average price of S$755 per square foot was set prior to its launch.

The healthy turnover seen at Wandervale's launch stands in contrast to recent sales at launch of other ECs. When contacted, a spokesman from Sim Lian said that the group can only confirm the launch sales figures at a later time.

The Brownstone, next to the upcoming Canberra MRT station, moved 185 units, or about 30 per cent, out of the 638 offered at its launch in July last year.

Sol Acres EC in nearby Choa Chu Kang Grove saw 247 out of its 707 offered, or about 35 per cent, sold at its launch weekend in August last year.

About 20 per cent of 525 units at Signature EC in Yishun were sold at its launch weekend in September.

Criterion in Yishun was expected to have sold 30 of its 505 units at launch in October last year.

Previous ECs have not had an equally good showing at their launches because there were too many taking place in a short period of time, said PropNex's Mr Ismail.

Wandervale's bright performance at launch comes even as Sim Lian adopted a cautious stance on the local market.

Sim Lian's group executive director Kuik Sing Beng told BT in an interview published last month that the group is mulling over a stronger presence overseas as Singapore's market softens.

"We foresee that the office, retail and residential markets will soften in the next one to two years. Looks like the government is unlikely to lift the cooling measures at the moment and they are trying to engineer a soft-landing," Mr Kuik said.

This means that developers' margins have been squeezed, and sales dampened, prompting many of them to seek new avenues for profitability.

Based on ballpark estimates, development margins for ECs have come down to 10-12 per cent from 15 per cent previously, while that for private condominiums have eased to 12-15 per cent from 15-20 per cent before the onset of cooling measures.

In response to continued calls by real estate developers for property curbs here to be tweaked or lifted amid continued sluggishness in the local property market, the Ministry of National Development said last month that it is "too early" to lift property market cooling measures now.

This article was first published on March 7, 2016.
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