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Singapore retail properties put up for auction surge last year due to Covid-19 hit

In one auction sale, a ground-floor shop unit in The Midtown along Upper Serangoon Road, went for $1.07 million. PHOTO: SCREENGRAB FROM GOOGLE MAPS

Fiona Lam


Feb 2, 2022, 5:22 PM SGT

SINGAPORE (THE BUSINESS TIMES) - The number of Singapore shop units that went under the hammer last year surged as the retail sector was hit by recurring Covid-19 restrictions, according to real estate consultancy Knight Frank.

The number of retail properties listed for mortgagee sale jumped 62 per cent in 2021 to 84 from 52 the previous year. There were also 101 owner-sale listings of strata retail units last year, soaring from just 17 in 2020.

Property auction listings are made up mainly of mortgagee and owner sales.

In one auction sale, a ground-floor shop unit in The Midtown along Upper Serangoon Road, went for $1.07 million or about $3,654 per square foot (psf), which was 2.8 per cent below its opening price.

Sharon Lee, Knight Frank Singapore's head of auction and sales, said that auction listings for all property types totalled 670 last year, up 35.4 per cent from 2020, due to a spike in owner-sale listings.

However, the number of mortgagee-sale listings in 2021 fell by 5.6 per cent to 289.

"While disrupted auction processes contributed to an overall dip in 2020 mortgagee listings, the drop in 2021 in contrast was likely an outcome of certain real estate sectors such as industrial and residential being on the path to recovery and improvement," she noted.

Despite the auction cancellations in the second and third quarters of 2020, the total mortgagee listings in that year were still 5.6 per cent higher than in 2021.

"Banks' inventories of auction properties shrank, especially for industrial listings with recovery in the manufacturing sector," Ms Lee said.

Among industrial properties, there were 65 mortgagee listings last year, down from 97 in 2020. Knight Frank noted that expanding small and medium-sized enterprises bolstered demand for owner-occupied industrial space, especially in better locations. For example, a ramp-up factory at Northstar@AMK sold for $1.05 million, which was 19.3 per cent above its opening price.

Residential properties made up almost half of the total mortgagee listings in 2021. Of the 137 residential mortgagee listings, the bulk of them - 114 - were non-landed homes.

A quarter of these non-landed properties were located in Districts 9 and 10, listed at an average opening price of $2,218 psf. Ms Lee said this is 7.3 per cent lower than the average transaction price of $2,393 psf in 2021, based on caveats data downloaded as at Jan 17, 2022, which presents "a value opportunity" to buyers.

When it came to owner listings, about 41 per cent or 145 were residential properties. All the landed homes listed by the owners had opening prices of more than $2.5 million, and over half of them were above $5 million. "Owners generally held on to higher prices," Ms Lee noted.

Among the mortgagee-sale listings, a one-bedroom condominium unit at D'Oasia changed hands at $700,000 in the fourth quarter of last year. In the luxury segment, a four-bedroom duplex condominium in The Berth by the Cove fetched $3.76 million or 4.4 per cent above its opening price, as it rode on a resurgence of demand in Sentosa Cove.


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