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Wheelock’s write-down for condo project likely due to regulations, say experts

The move by Wheelock Properties to take a write-down for a condominium project reflects difficulties faced by developers to sell residential units on land bought before the last set of cooling measures announced last year, property consultants said.

SINGAPORE: The move by Wheelock Properties to take a write-down for a condominium project reflects difficulties faced by developers to sell residential units on land bought before the last set of cooling measures announced last year, property consultants said.

Wheelock said on Monday that it was writing down S$110 million for The Panorama condominium project.

Consultants said the developer had paid a higher-than-expected S$790 per square foot per plot ratio for the Ang Mo Kio land site in January 2013, just three days before the government introduced its seventh round of property cooling measures.

Further restrictions on housing loans were later announced in June under the Total Debt Servicing Ratio (TDSR) framework.

The measures have led to a drop in housing prices and transaction volumes.

Industry experts said The Panaroma is likely to have been impacted by the regulations.

They view the write-down as a precautionary measure in anticipation of a further potential downturn.

Nicholas Mak, executive director at SLP International Property Consultants, said: "From the time the developer committed to purchasing land to the time sold, the government introduced more than one round of cooling measures.

"This affects the sales process of this project. It could possibly also affect other condominium projects where land was acquired before the cooling measures and TDSR were implemented.

“Based on the 100-odd residential projects currently offered for sale in the market, sales have been fairly slow.

"Every month, there are even some projects that may sell less than 10 units, so sales in the residential market actually have been quite adversely affected by the TDSR as well as other cooling measures."

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