Nearly Half of Singapore Condo Project Sold on Launch Day

Sim Lian Group sold nearly half of a 386-unit condo project in Singapore’s Bukit Panjang area on its launch day this past weekend, as residents and investors continued to show an appetite for new homes in the city-state.

Despite rising interest rates and government cooling measures, buyers snapped up 187 homes at The Botany at Dairy Farm on Saturday 4 March, beating analyst predictions as they acquired nearly half of the units being built in the complex close to the Bukit Timah Nature Reserve.

“Its take-up rate of 48 percent is better than our expectations, which hovered at around the 40 percent mark,” said Ismail Gafoor, chief executive officer at property agency PropNex. “We think this is a strong performance, and is reflective of the genuine demand for mass market homes, amidst the limited unsold OCR (Outside Central Region) new private homes inventory.”

While Sim Lian’s sales outperformed a major complex on the West Coast that was launched the previous week, the take-up rates for both projects still lagged 2022 levels, when developers like CDL were able to sell out even condos in fringe locations like Tengah Town as quickly as they could make them available.

Resilient Demand

Spread across five resort-style blocks on a 168,597 square foot (15,663 square metre) site, the project on Dairy Farm Walk is being jointly developed by Sim Lian Land and Sim Lian Development, both subsidiaries of Sim Lian Group.

All 36 one-bedroom units and about 93 percent of 104 two-bedroom units of The Botany found buyers on Saturday, while at least 20 percent of the larger homes – which range up to five bedrooms – were sold.

According to a company statement on Sunday, buyers paid an average of S$2,070 ($1,540) per square foot for the units sold a day earlier, with Singaporeans accounting for 85 percent of buyers.

Gafoor sees the near sell-out of the Botany’s smaller units as a sign of resilient demand for more broadly attainable homes, while rising borrowing costs may be hobbling larger transactions.

“Some owner occupiers who prefer to look at the bigger units may take a longer time to review their finances and to commit to the purchase, in view of the high interest rates,” he said.

Noting that more than half of the purchases were made by home buyers with HDB addresses, Marcus Chu, CEO of APAC Realty and ERA Asia Pacific, said the robust take-up for the suburban project demonstrates enduring interest among local residents for affordable private housing from buyers who want to upgrade from subsidized apartments provided by the Housing and Development Board.

The project, which is expected to obtain its temporary occupation permit by 2027, is just one block away from the 75-hectare (2.5-acre) Dairy Farm Nature Park and within a 15-minute walk of the Hillview MRT station. The project also benefits from its location directly opposite the German European School Singapore and is within a two-minute drive of the Bukit Timah Expressway (BKE).

Gafoor said the project will also benefit from the ongoing rejuvenation of the Beauty World precinct, which lies across the Bukit Timah Nature Reserve around 3 kilometres (1.9 miles) to the south, with the government aiming to transform that area into a green urban village.

Dairy Farm Over Pasir Panjang

Sim Lian is building the condo on a 99-year leasehold site which they purchased in a government land sale one year ago for S$347 million, or around S$980 per square foot of accommodation.

The Botany proved to be more in demand than a major project launched one week earlier, with local developer Hoi Hup Realty and Malaysia’s Sunway Group having found buyers for 38 percent of the 270 units in their Terra Hill condo complex on February 25th and 26th. Units in that complex in Pasir Panjang on the West Coast sold for an average of S$2,650 ($1,964) per square foot on launch weekend.

Trades of new private homes in the suburbs rose sharply in January as the debut of new projects led to 185 transactions. This came after house-hungry Singaporeans had depleted developer inventories late last year, leading to just 27 home transactions in December when.

January sales were dominated by MCC Land’s launch of its Sceneca Residence project in Tanah Merah, which sold 157 units at a median price of S$2,083 per square foot.