Total investment sales of commercial property registered an all-time historic record of $50.8 billion in 2007. It is a whopping 66% jump from 2006 sales of S$30.5 billion – a record once thought untouchable. Incidentally, the aggregate investment sales figure for eight long years of recession - from 1996 to 2003 - was only $54.9 billion. Investment sales refer to major investment transactions like office buildings and shopping centres, as well as sites bought for development including collective sale deals. Investment sales are considered a barometer of developers' and big investors' mid-to-long-term confidence in the market.

Office investment sales more than doubled, from S$4.4 billion in first-half 2007 to around $10.5 billion in the second half.

The largest single property sale in the public sector in 2007 was the S$2 billion sale of Marina View Parcel A to MGPA, followed by the S$1.7 billion sale of the former NCO Club and Beach Road camp grounds to a consortium comprising City Developments, Dubai World and Elad Group.

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In the private sector, the top deal was Farrer Court, which was sold for S$1.3 billion to a consortium including CapitaLand, Hotel Properties, Wachovia and a foreign fund. The next biggest transaction was MGPA's S$1 billion purchase of Temasek Tower.

In the third quarter of 2007, retail rents in Orchard area achieved about S$40 to S$41 per square foot (psf) per month. And for the same quarter, retail rents increased 3.3% to 3.5% year on year.

Prime asking rates for the premium office buildings in Raffles Place have now touched $21.00 per sq ft. 6 Battery Road is the most expensive building quoting $21 psf and One Fullerton and Republic Plaza are not far behind at $20 psf and $19.80 psf respectively. Most other prime buildings in Raffles Place are quoting around $18 psf including UOB Plaza, Maybank Tower, OUB Centre and Tung Centre.

Malls at Orchard Road are now enjoying occupancy rates of around 95% to 98%. This is due to higher sales productivity on the back of a robust economic growth. 2007 sales grew 5% to 7% compared to 2006 and customer traffic also increased by 27% over the past four to five years.

Almost 2 million sq ft of new retail gross floor area is set to open in the Orchard Road area up to 2011, an increase of 33% of the current retail space on Orchard Road. Most new office space will come from brand new malls including the launch of Ion Orchard and Orchard Central in 2008. It is a decade since a new shopping mall was built at Orchard Road. In 2008 alone, 930,000 sq ft of new shops are expected to launch in Orchard and Scotts Roads. Besides the new malls, the additional space includes extensions to existing buildings such as Paragon Shopping Centre, Specialists' Shopping Centre and the adjacent Hotel Phoenix.

The addition of such retail space in Orchard Road is expected to soften retail rents along the shopping the infamous belt. In fact, monthly growth of rents along Orchard Road slowed to 2.6% in 2007, to hit S$45.50 psf in December 2007.

After a seven-year depression, the real estate market came back with a vengeance and 2007 was a spectacular year – in particular collective sale records. In all, about S$12.5 billion worth of collective sales was completed, 50% more than 2006's S$8.2 billion and far exceeding the $2 billion total in 2005. The 2007 sales figures are the highest in 13 years, due to a robust regional economy and ever increasing arrivals of expatriates in Singapore.

Take up rate for new homes hit a record 15,000 new homes in 2007. It is a 34.5% growth over the 11,147 new homes sold in 2006. The take-up rate of new homes in 2008 should be between 9,000 and 11,000 units. The Singapore property market this year looks set to be driven by mid-end and mass-market homes which are expected to experience about 10% to 15% price rise. Prices and take-up of luxury homes are expected to moderate having gone through a fast pace for more than a year.

Foreigners and permanent residents (PRs) chalked up 7,902 sales from January to November 2007, which accounted for 24.9% of total residential sales.

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Altogether, supply of landed homes will remain subdued with only 1,872 landed units under construction and another 2,579 landed units being planned from 2007 to 2012.

Demand for bungalows should remain strong in 2008, due to limited supply and the booming Singapore economy.

In all, the overall price index for private homes could climb by anywhere between 10% and 25% in 2008, depending on how the US sub-prime woes pan out and the behaviours of the global financial market in 2008.

The consumer price index (CPI) surged 4.2% in November 2007 year on year, a 25-year high. Part of the reason is because housing value has a significant weight in the CPI.

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