DBS Vickers advocates a “selective stockpicking stance” in Singapore’s property sector in 2011; it says the sector is trading at mid-cycle valuations and stock performances “will continue to be led by volatile macroeconomic news flow.”

It adds, the office sector has ongoing re-rating catalysts, supported by the office upcycle and further details on the M+S JV (60% owned by Malaysia, 40% held by Temasek).

Tips office rents and capital values to rise by another 10% next year. In the residential space, it says prices will be capped by policy concerns even as liquidity and near term structural positives support prices; “government policy overhang will keep rampant price appreciation in check, especially in the mass market segment.”

On a 12-month horizon, prefers commercial landlords as well as developers with large balance sheet capacity to reinvest for landbanking and RNAV growth.

Top picks include Keppel Land (K17.SG), UOL (U14.SG), Singapore Land (S30.SG) and Capitaland (C31.SG).