http://www.businesstimes.com.sg/sub/...26340,00.html?
Published February 1, 2012
BBR struggles to sell high-end residential apartments
(SINGAPORE) Located in an exclusive neighbourhood near Singapore's Orchard Road shopping district, Nassim Hill condominium boasts 16 luxury triplex apartments with private rooftop pools and gardens.
Singapore property and construction firm BBR Holdings Ltd had expected strong demand for the luxury flats, but is now struggling with sales after the city-state introduced measures aimed at curbing demand from foreign buyers.
'The latest measures really hit the 8 Nassim Hill project because it is a foreigners' market in terms of clientele,' chief executive officer Andrew Tan said.
The company has sold nine out of 16 units so far, at an average price of $10 million, he said. The project was launched in 2007 and was completed in 2010.
However, it still hopes to report a 5 per cent rise in net profit last year, driven by a strong pipeline of construction works for government projects, Mr Tan said late last Friday.
The difficulties faced by BBR in selling premium apartments is symbolic of the slowdown in the local property market.
Last year, residential prices held up well despite a slowing economy, helped by near-record low interest rates and rising demand from overseas investors, in particular those from China.
'Across the board, sales have been declining, especially in the high-end side, where there is more pressure,' said SIAS Research's lead analyst, Ng Kian Teck.
In December, Singapore imposed tough measures targeting foreign buyers to cool property prices, a move expected to hurt high-end developers such as BBR.
BBR has three condominium projects including the one at Nassim Hill.
To counter the slowdown, BBR has started to focus more of its sales efforts on Chinese buyers, as their interest remains strong due to China's restrictions on its own property market.
'We have shifted the focus from European to Chinese buyers as the Chinese buyers are really rich and they also have their own (property) restrictions,' Mr Tan said.
'If they are looking for a place to park their funds, they would want a place that is stable, so Singapore and Hong Kong are where they would look,' he said.
BBR is also looking to develop more mid-end residential apartments that cater more for Singaporeans. One of its properties, the 140-unit Bliss@Kovan, has seen almost half of them sold, with 90 per cent of its buyers being locals, Mr Tan said.
The company reported net profit of $19.6 million in 2010.
BBR competes with construction and property firms such as Koh Brothers Group Ltd and larger rival CapitaLand. - Reuters
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