Wing Tai Sells Just 23% of Available Homes at Singapore Condo Project Debut

Wing Tai Holdings sold 23 percent of its upcoming condo project in Singapore’s suburban Jurong district during its launch weekend, a modest take-up for the developer which warned late last week of lower profits in its latest financial year.

The SGX-listed developer sold 71 homes at its 306-unit Lakegarden Residences project during the first two days of sales at an average price of S$2,120 ($1,581) per square foot. The units sold are equal to around 34 percent of the 211 homes made available during the launch according to an announcement on Sunday.

The reception was “modest” despite it being the first project introduced in Jurong since 2016, with PropNex Realty chief executive officer Ismail Gafoor speculating that a flood of 2,500 new condos put on the market over the past month may have turned the market in favour of buyers.

“We believe the modest take-up could be due to several factors, including homebuyers experiencing some degree of buyers’ fatigue,” PropNex’s Gafoor said. “Buyers are probably taking the time to reassess and weigh the available options before committing to a purchase.”

Buyers’ Fatigue Kicks In

Lakegarden Residences, located near Jurong Lake District in western Singapore, attracted mostly locals and permanent residents, particularly families and those looking to upgrade their homes already residing in the region, while foreigners accounted for 2 percent of buyers. according to the firm.

Wing Tai Property Management marketing head Stacey Ow Yeong said the project’s debut reflected healthy demand for private accommodation in Jurong Lake District, which the government is promoting as the city-state’s second central business district.

“We are confident that The LakeGarden Residences will continue to attract home-upgraders in this vicinity, as well as homebuyers who are excited about the strong potential of Jurong Lake District,” Ow Yeong said.

Lakegarden Residences will be built on the site of the former Lakeside Apartments, which Wing Tai bought in May last year for S$273.9 million. The company plans to erect two 19-storey towers on the plot where it will offer one- to two-bedroom units ranging from 484 square feet to 2,260 square feet. The project is slated to open by 2027 and also offers four duplex penthouses of up to 2,260 square feet.

The condo complex is the first private residential project launched in Jurong in seven years,  or since MCL Land, the Singapore subsidiary of Hong Kong Land, put its 710-unit Lake Grande project on the market in July 2016.

Tough Times for Wing Tai

A day before the Lakegarden Residences launch, Wing Tai announced in a bourse filing on Friday that it expects a “significant decrease” in net profit attributable to shareholders for the financial year ended 30 June.

The company attributed the profit slide in part to a decline in valuation of its investment properties, although the group noted that it continues to keep its net gearing low.

The Singapore builder has focused its investment activity in London, where it owns seven office properties, with another two assets in Hong Kong’s Kowloon East area.

In 2021 Wing Tai teamed up with Hong Kong-listed Champion REIT and a pair of private Hong Kong investors to purchase an 11-storey office building in the City of London for £258 million (then $360.8 million). City of London office values fell 21 percent in the first quarter of this year, compared to the same period in 2022, according to data from Savills.

Wing Tai’s project launch and profit warning came on the heels of the firm’s Wincove subsidiary backing out of a deal to acquire the Holland Tower residential site in District 10 after conditions of the sale were not met.

Supply Overflowing

Of the five major condo projects launched in Singapore over the past month, SingHaiyi Group had the most successful launch weekend as it sold more than 520 of the 1,008 homes in the Grand Dunman development in District 15 last month.

Over at Pine Grove in western Singapore’s Clementi area, UOL Group and its Singapore Land subsidiary recorded a take-up rate of 28 percent for the debut of their 520-unit Pinetree Hill project that same weekend.

City Developments Ltd’s The Myst condo project in Bukit Timah also received a cooler reception from buyers in July, with the SGX-listed builder finding buyers for only 27 percent of the 408 units made available during its first weekend of sales.

A deluge of new supply entering the market helped to pull down average home prices in Singapore for the first time in three years. The latest government data shows prices for new private homes fell 0.2 percent in the second quarter from the first three months of the year.