Demand for retail strata units remains strong

Demand for retail strata units remains strong

The proliferation of mixed developments in suburban areas in recent years has pushed up sales for shops substantially, with demand for strata-titled retail units experiencing strong growth.

More than 600 shop units were sold last year, more than double the 300 units sold in 2009.
At the Promenade @ pelikat in the Upper Serangoon area, comprising 270 retail units and 164 residential units, shop prices start at S$2,350 per square foot.

208 units were launched under Phase One two weeks ago and developer Oxley Holdings says 90 per cent of the shops have been sold.

Analysts say demand for such strata retail units will remain strong going forward.

Prices of strata-titled commercial units have risen by some 20 per cent in the last couple of years, analysts said.

The yields for residential properties, depending on the location and market conditions, can be as low as 2% and as high as 3.5% to 4%, whereas in commercial market the yields tend to be better falling between 4% and 6%.

Retail strata titled investment does not attract the additional buyer’s stamp duty, it has less complications, or less lure towards meeting any government cooling measures as well. Thus, its fast gaining popularity among property investors.

Source : Channel NewsAsia – 23 Apr 2012