Cheung Kong Property eyeing GLS sites

Cheung Kong Property Holdings Limited, which is slated to commence sales for its eighth residential project in Singapore next month, is keen to clinch more sites under the Government Land Sales (GLS) programme - be it commercial, residential, or mixed-use sites.

Group executive director Justin Chiu indicated that Cheung Kong wants to be more active in property development in Singapore and is interested in sites near the Marina Bay Financial Centre (MBFC), jointly developed by the group and its partners Hongkong Land and Keppel Land.

"We have looked at the whole list and there are some pieces of land we are interested in and we are talking to some partners," he told BT. "If we can form a partnership, then we will take up some land from the application list. We tried last year but we were not very successful. This year, hopefully, we can do something."

While Mr Chiu did not identify any particular site that is of interest, there is only one white site at Central Boulevard in the Marina Bay downtown under the current GLS reserve list. The site is estimated to yield 105,000 square metres of commercial space.

A site of such size, however, will require the group to team up with joint venture partners. Cheung Kong Property has a staff of over 30 in Singapore, spearheading the property development, marketing and management of its development projects in the region.

He pointed out that Singapore was a core market for the group, alongside Hong Kong and mainland China. The group is looking to achieve a balanced portfolio here comprising commercial and retail projects for recurring income and residential projects for trading income.

Explaining the group's bidding patterns in Singapore, Mr Chiu said that Cheung Kong Property does not seek to time the market. Instead, it takes a long-term view and "look at each piece of land on its own merit".

Its eighth project here named Stars of Kovan is a residential cum retail project whose plush showflat costing S$10 million is ready to open by the end of this month. Sales are expected to begin in early May with early bird discounts.

Located at the junction of Upper Serangoon Road and Tampines Road near Kovan MRT station, the project comprises 390 residential apartments, five strata terrace units that are three storeys high and 46 British-inspired commercial shops on the street level. Some 61 per cent of the units are two-bedroom units, 23 per cent are one-bedders and 15 per cent are three-bedroom units.

Average prices for the 390 residential apartments are expected to hover around S$1,550-1,600 per square foot (psf), which translates to about S$800,000 for one-bedders, S$1.2 million for two-bedroom units and S$1.5 million for the three-bedroom units, said Francis Wong, director of Property Enterprises Development (Singapore) Pte Ltd, a member of the Cheung Kong Property Group.

"Our marketing campaign will roll out primarily in Singapore and simultaneously in Hong Kong and Britain," he added.

Taking reference from street-level retail transactions here, Mr Wong said that the retail units at Stars of Kovan are likely to sell within the range of S$5,500-7,000 psf given the limited retail supply in the vicinity and strong buying power of Kovan residents. He expressed bullishness about what he sees as a potential pent-up demand for private residential units, after 2014 and 2015 each saw over 7,000 units sold by developers vis-a-vis the average 12,600 units per year in the past 10 years. Meanwhile, future completions are tapering off sharply after 2018, Mr Wong said.

Elsewhere, Cheung Kong Property is looking to launch a mixed residential and commercial project at Convoys Wharf in London towards the end of this year or early next year.

Since the reorganisation of all property businesses of Cheung Kong (Holdings) and associate Hutchison Whampoa under Cheung Kong Property Holdings last year, Cheung Kong Property is "an independent company that needs to report profits every year", so it is seeking investments worldwide, Mr Chiu said.

The group is looking for more projects in the UK and, at the same time, scouring for opportunities in new markets such as Australia and Canada.

Currently, mainland China still accounts for 92 per cent of its total development landbank (13.6 million sq m). Despite concerns of a slowdown in China and tightening of policies in top Chinese cities to rein in prices, Mr Chiu said that these have not impacted the group's projects. It is still set to launch another project in Beijing in May.

The country is still projecting 6.5 per cent growth "which is quite reputable", he said, adding that many buyers in China are still flush with cash amid a lack of investment products there.

This article was first published on April 15, 2016.
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