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(SINGAPORE) Midway into the year, the en bloc fever seems to be benefiting home-owners in the prime districts the most, with developers showing most interest in sites in those areas.

Plans afoot: City Developments intends to build luxury residences at its recently purchased Lucky Tower site (above) located at Grange Road

Not doing as well are sites in other parts of Singapore, as well as those in the prime district with high asking prices. Overall, the en bloc fever, while strong on the part of sellers, is waning when it comes to developers.

According to data provided by property consultancy CB Richard Ellis (CBRE), collective sale sites left behind in the first six months of this year outnumber those sites snatched up by developers. Only 31 sites, with a combined value of over $4 billion, were sold as of end-June, while another 39 sites launched this year with tenders closing by end-June are yet unsold.

Home-owners in the prime District 9 and 10 are seeing the most interest. Of the 31 en bloc sites sold so far, 20 are in these two districts. By contrast, a lot of the sites left behind on the shelf are in suburban areas. The trend means that future buyers can expect a substantial increase in the number of apartments on offer in the prime districts in about two years' time.

Right now, the 20 sites comprise about 1,100 units, but more than 2,000 units could be potentially developed.

Apartments on these 20 sites are widely expected to cater to the high-end segment, and with property prices in the luxury market on the upswing, it is no wonder that developers are choosing to concentrate their resources on the prime districts.

'Developers are looking at the high-end market as the market that will move,' said Foo Suan Peng, executive director of investment sales at Knight Frank. 'From their experience, the upgraders' segment of the market is still weak. Developers have confidence in the high-end market.'

He points to the recent launches of The Sail @ Marina Bay and St Regis Residences as two upmarket projects that have seen good take-up rates.

The demand for luxury properties is driven mainly by international investors, who are 'cash-rich and price-insensitive'. These investors are mainly interested in the prime districts, leading developers to snap up re-development sites there. But with supply of such prime sites increasing, the bargaining power is clearly with developers. For example, Silver Tower located on Cairnhill Road is still under negotiation.

Observers say that some prime sites are still on the table as developers may be unwilling to pay the prices asked. 'Prices have been moving too much already and are in an area that is becoming too painful for developers,' said Mr Foo. 'They have to pause to see where the market is going.'

However, this does not seem to have reduced sellers' appetite. Throughout July and August, at least another 14 sites will see their tenders close.

Among them are several located in prime locations - such as Orange Grove Condo at the corner of Orange Grove and Stevens roads, whose owners are asking for $175 million, which works out to $1,143 psf; Ardmore Point, located in the prime Ardmore Park location, whose going price is $220 million, which translates to a unit land price of $1,432 psf; and Grange Tower near Orchard Road, which is going for $188 million, or $1,255 psf. The latter two prices, could set new benchmarks for the price of freehold residential land in Singapore.

'I think that the en bloc fever will continue but the buyers will be more selective,' said City Developments group general manager Chia Ngiang Hong at the recent media launch of the property developer's latest high-end project.

CityDev managing director Kwek Leng Joo agreed, and added that he expects developer interest to continue to be strong for the prime districts. 'Finally, it boils down to location, location, location,' said Mr Kwek. CityDev recently bought the Lucky Tower site in Grange Road for $383 million, or $1,134 psf, and intends to develop the site into a luxury residential development in two years.

Some feel that for en-bloc sites outside the prime areas, a way to sell is to lower the asking prices.