Shoebox units help Sky Vue sell

Shoebox units help Sky Vue sell

Capitaland's reversal of its former CEO's stand against shoebox units appears to have paid off.

The company, which is now led by Lim Ming Yan following the retirement of Liew Mun Leong, said the initial sales launch of Sky Vue at Bishan Central saw 430 units sold out of 505 units released for sale this past weekend. The strong response fuelled cautious hopes of a pick-up in market sentiment following several rounds of property cooling measures.

The property giant sold 410 units at an average price of $1,500 per square foot (psf) on Saturday, the first day of sales, plus 20 more yesterday, with one-bedroom and two-bedroom units being the most popular. This compares with 90 units sold this past weekend at Thomson Three, bringing the total to 250 sold out of 320 units released to date, according to a UOL spokesman. The average price of the 99-year-leasehold development, a joint venture between UOL Group and Singapore Land, is about $1,350 psf.

The TDSR rules, which took effect in late June, require financial institutions, when granting property loans to individuals, to ensure that the borrower's monthly total debt repayments do not exceed 60 per cent of their gross monthly income.

CapitaLand's strategy of building homes that are smaller than 500 sq ft - or shoebox units once decried by its former boss Mr Liew as being "almost inhuman" - in order to attract buyers seeking lower total price quantums appears to have panned out for Sky Vue.

That stands in contrast to the company's Sky Habitat just next to Sky Vue. As at Sept 18, 173 units out of a total of 250 units released at the 509-unit Sky Habitat have been sold. Its larger-sized units could be a key factor why the project's released units have not sold out yet, since its average selling price of $1,589 psf is not far off that of Sky Vue's, and its design by renowned Israeli architect Moshe Safdie is seen as a plus.

When asked to compare Sky Vue's performance against Sky Habitat, which still has about 70 per cent unsold units, a CapitaLand spokesman said: "Sky Habitat and Sky Vue are conceptualised and designed with different segments of markets in mind. While some buyers favour iconic architecture designed by famous architects and larger unit sizes, we have not forgotten those who prefer layouts with more livable space. We believe each product will appeal and cater to the needs of potential homebuyers from different market segments."

Three Sky Habitat units were sold at an average price of $1,510 psf in July, under an ongoing promotion called the selective unit discount scheme, where units are on sale at a 6 per cent discount, the spokesman added.

One other analyst said that the strong performance of both Sky Vue and Thomson Three is a testament to pent-up demand and relatively strong purchasing power in the Bishan and Thomson vicinity. But he said that must be compared against the performance of other projects, such as The Skywoods in the Dairy Farm area and Keppel Land's The Glades.
Wong Heang Fine, CEO (residential) of CapitaLand Singapore, said: "Most of our buyers are young couples who appreciate the well-articulated layouts and lifestyle amenities of Sky Vue and its proximity to the Bishan MRT station and Junction 8 shopping mall."

The average price of a one-bedroom unit at Sky Vue is $750,000 while that of a two-bedroom unit is $933,000. The average price of a two-bedroom suite is $1.15 million and that of a three-bedroom unit is $1.58 million. 

Source: Business Times –28 September 2013