(July 17): A large-scale luxury development in Singapore sold only a tiny fraction of units when it started accepting bookings, reflecting the struggles of the priciest segment in the city-state’s otherwise stratospheric property market.
The W Residences Marina View condominium began pre-sales last Saturday, and buyers booked only two of its 683 units over the weekend, according to people familiar with the matter who asked not to be identified sharing private information. The complex is located in the heart of the country’s central business district, a short walk from skyscrapers that house global financial institutions and multinational companies.
The units’ preview prices started from about S$3,200 (US$2,491 or RM10,583) per square foot, which means the cheapest one-bedroom units were advertised for S$1.8 million. Five-bedroom units were priced at S$11.6 million and up, according to marketing materials seen by Bloomberg News.
The project’s weak debut shows how property developers face an uphill challenge trying to attract wealthy homebuyers to luxury towers in Singapore’s iconic business district, which lines its downtown waterfront. The government in 2023 doubled already hefty taxes on foreigners’ property purchases, while locals have gravitated to suburban private homes that are closer to schools and other amenities.
Last weekend, LyndenWoods, a mass-market condominium project about 9km from the downtown luxury residence, sold over 94% of its 343 units in a single day, despite new curbs that were added in early July. Average pricing was about S$2,450 per square foot.
Overall private home prices in Singapore have climbed roughly 40% over the past five years. However, apartment prices within the so-called core central region — which covers the CBD and other high-end neighbourhoods — have lagged behind, with a smaller increase of about 19%.
The W Residences Marina View is being built by IOI Properties Group Bhd (KL:IOIPG), a Malaysian developer that paid S$1.5 billion in 2021 for the site. The project will be managed by Marriott International. A spokesperson for the developer said there was “strong interest” from individuals who were invited to its private previews, and “it’s natural that buyers are taking a measured approach amid a wave of new launches” in the area.
The 99-year leasehold development has yet to be built, and buyers could pull out in the early stages of a sale if they pay a fee.
“Developers are likely to be more cautious and recalibrate their land acquisition plans following the poor demand” for properties in the prime city centre, said Nicholas Mak, chief research officer at property portal Mogul.sg. “They will avoid a price war at all costs.”
A nearby high-end residential project called Skywaters Residences, which is part of a broader development backed by Alibaba Group Holding Ltd and local developer Perennial Holdings Pte, has sold just two of its 190 units since it launched more than a year ago.
One 7,761-square-foot apartment sold for S$47.3 million, while the other smaller unit went for S$30.9 million. Such prices are comparable with mansions in land-scarce Singapore.
Local property giant City Developments Ltd, which is building another “ultra-luxury development” in the business district, hasn’t set a launch date for its Newport Residences project, which will feature serviced apartments and 246 residential units.
Developers have largely refrained from offering major discounts, betting that they can still attract wealthy locals and foreigners who have residency in Singapore, granting them lower property levies.
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