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Demand for shoe-box apartments to stay

2011 jan 19

http://www.propertyguru.com.sg/property-management-news/2011/1/29534/demand-for-shoe-box-apartments-to-stay

The demand for “shoe-box” apartments will likely stay, said Ching Chiat Kwong, CEO of Oxley Holdings.

“If you look at the way Singapore is developing — high economic growth, rising home-owning aspirations, more local and expatriate singles, young couples who prefer dogs rather than kids — you can see a very clear demand pattern emerging,“ he said. “There is a market for good-quality, affordable private homes in good locations.”

Oxley hopes to capitalise on this demand. The Catalist-quoted company specialises in developing 350 sq ft to 400 sq ft private apartments with one bedroom, living room and fully fitted kitchenettes.

Three months after its October 2010 listing, Oxley has already sold out five of its “shoe-box” apartment projects. Loft@Holland was totally snapped up within two hours of its launch a week ago. This year, the company will launch at least two commercial projects and at least nine “shoe-box” apartment projects.

Buyers of the apartments are not only young couples and singles but investors as well, said Mr. Ching. “The rental yields from these properties tend to be good, so they make attractive investments as well.”

Despite the real estate market curbs announced last week, Oxley’s stock has recently rallied past the 40 cent-level on strong buying interest, after it slumped to as low as 31 cents – a sign that the market may have begun noticing the company’s potential.

Mr. Ching does not seem to be very concerned by the curbs. “The key is affordability, and this becomes even more important under the new rules,” he said. “The projects we will launch this year are in prime locations, and more importantly, they are affordable. We will also launch several major commercial developments which are not impacted by the residential property curbs.”

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