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Property sales test price ceiling
According
to DTZ, units selling for $600,000-plus to $800,000 were the most
popular from January to April. In DTZ's analysis of 4,401 caveats
captured by URA, 1,515 or 34 per cent were lodged for apartments in
this price range.Of these 1,515 caveats, 92 per cent were for units
outside prime districts 1, 4, 9, 10 and 11. And 93 per cent were for
units of less than 1,400 sq ft.
Projects where plenty of recently released units were in the sweet
price range include Double Bay Residences in Simei, Mi Casa in Choa Chu
Kang and Waterfront Waves. Savills (Singapore) has reached a similar
conclusion from its own study of caveats - units below $800,000 have
been most popular in the outside central and rest of central regions.
Even in the core central region, it has been possible to find smaller
units for less than $800,000 - and buyers favour them. At The Mercury
near River Valley, for instance, 27 of 38 caveats lodged (71 per cent)
were for units priced below this level. Based on DTZ and Savills'
studies, buyer resistance generally sets in at $1 million to $1.5
million. DTZ noted that only 16 per cent of the 4,401 caveats lodged
from January to April were for units costing $1 million-plus to $1.5
million, while a mere 5 per cent were for units costing $1.5
million-plus to $2 million. Buyer resistance is unlikely
to apply as far as the ultra-rich are concerned. DTZ's data shows 4 per
cent of caveats in January to April were lodged for units worth more
than $2.5 million. These include caveats for three apartments at
Ardmore Park each worth more than $5 million. There were also caveats
for 23 Gallop Gables units priced from $2.5 million to $4 million.
- The Business Times, P1
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Private home sellers raise asking prices
Asking
prices for some properties that have just been completed or are close
to completion have jumped significantly in recent months. Still, lower
prices have also played a part in stronger sales. Some recent launches
have done well after developers finally cut their asking prices. For
instance, Parc Centennial in Kampong Java Road is now sold out, after
developer EL Development relaunched the 44 remaining units at an
average price of $1,175 psf, about 20 per cent lower than last year's
average price. But individual sellers are tending to raise, not lower,
prices. For instance, some sellers of high-floor units at Marina Bay
Residences are advertising their properties at $2,000 psf or more -
regarded by analysts as a key resistance level for many buyers. In late
February, an ad for RiverGate units displayed prices of $1,118 psf to
$1,399 psf. But last week, some ads for RiverGate, at Robertson Quay by
the Singapore River, offered units at prices starting from $1,380 psf,
with one ad even offering two three-room units at $1,900 psf. Some
sellers, with an eye to the longer term, are actually withdrawing
properties from the market, sensing an uptick in sentiment. Compared
with the situation three months ago, sellers are more willing to
negotiate prices today as there are more keen buyers. Market sentiment
has improved, but it is still early days as short-term fundamentals
have not exactly corrected.
- The Straits Times, B18
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Property issues in spotlight
Shares
of property developers led the market's charge last week, on optimism
that the real-estate sector will be one of the first to benefit when
the economy turns the corner. CapitaLand, for example, was up over 10
per cent to $3.80 last week, compared to a 3.7 per cent gain in the
STI. The stock is also up 37.7 per cent for May. One of the most
actively traded contracts last Friday was a call warrant on CapitaLand
issued by Macquarie Bank, which has a strike price of $3.283 and
expires on Oct 2. It gained five cents to 46.5 cents with 20.46 million
units traded.
- The Straits Times, B14
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FY09 profits ending March fall 24.8%
Out
of the total 83 companies that reported their results as at last Friday
- including those with no comparable year-on-year earnings - 58 are in
the black, while 25 made losses. Ascendas Real Estate Investment Trust
(A-Reit) saw a 12.6 per cent rise in full-year net profit to $211
million, from $187 million previously. Rental rates are also expected
to weaken by 10 per cent to 15 per cent in anticipation of a decline in
demand from most sectors, apart from oil and gas and infrastructure. Singapore's
largest company by market cap - Singtel - posted full-year net profit
of $3.45 billion, down 12.9 per cent from $3.96 billion a year ago.
- The Business Times, P5
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Indiabulls Reit posts net property loss of $568,000
The
Reit trust also booked a $1.01 billion impairment loss on development
properties and a $232.1 million loss due to changes in fair value on
investment property. These two items have not impacted on the trust's
cashflows or credit facilities. Inclusive of a $284 million income tax
credit due to reversing deferred tax liability in tandem with the
reduction in portfolio valuation, the trust posted a net loss of $960.1
million for the latest period, against a $52.8 million net income
forecast in its prospectus. One
Indiabulls Centre Tower 1 has since been completed, with the second
tower also completed except for the top floors for which the relevant
regulatory approvals are pending. Also, Tower 1 of Indiabulls Finance
Centre has been completed to initial plans. The board has decided to
stick to its earlier plan to include a residential component at One
Indiabulls Centre, and the plan is to launch the residential project
shortly.
- The Business Times, P7 |
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Developers' sales carry note of hope
A ray of hope dispelled some gloom in the private home market yesterday when new data showed developers selling 1,220 new units in March. This brings the number sold in Q1 2009 to 2,660 - the best quarterly performance since Q3 2007. According to Urban Redevelopment Authority (URA) figures from developer submissions, private home sales held up in March and dipped just 8 per cent below the 1,332 units sold in February. Both months' showings were markedly better than in January, when buyers took up just 108 units. In fact, the number of units sold in Q1 2009 has already reached around 60 per cent of that for the whole of 2008. Most of the demand in the first three months of the year was from Singaporeans and permanent residents, a significant proportion of whom comprised HDB upgraders.
- BT P1
Parco set to add zest to Millenia Walk
MILLENIA Walk mall may soon get the magic it needs to offer the wow factor to shoppers now it has signed Japan's Parco group as a tenant to take up 85,000 sq ft on three levels. Parco will invest about $10 million at Millenia Walk. Parco@Millenia, which will open early next year, will be a hybrid between a department store and shopping centre. Under an open-concept theme, Parco will sub-let space to sub-tenants, but they will not install roller shutters for their units. The first level will feature an array of international cosmetics, fragrances and fashion-related products. Parco will join Harvey Norman and Space, a high-end furniture store, as anchor tenants at Millenia Walk.
- BT P28
URA launches tender for Short Street hotel site
FOR the first time since September last year, the Urban Redevelopment Authority has launched a public tender to sell land. The tender for the 99-year leasehold hotel site at Short Street in the Bras Basah-Bugis district will close on June 10. The 12,535.6 sq ft site is ideal for a boutique hotel development located in an area with a 'synergistic cluster of arts, culture and education facilities', URA said in its release. The site is also near the future Rochor MRT station. The site can accommodate a 12-storey hotel with about 90 to 100 rooms. Singapore has close to 10,000 rooms in the four- and five-star categories slated to come onstream by end-2012.
- BT P28
M'sian economy set to improve in H2: Zeti
IN one of the first public statements on the economy by a senior government official, central bank governor Zeti Akhtar Aziz said yesterday that the Malaysian economy would be in 'a better position' in the second half of the year because of the effects of the fiscal stimulus package and a supportive monetary environment. Last month, the government announced a RM60 billion (S$25 billion) stimulus package aimed at reflating the economy, out of which RM15 billion are actual funds with the rest being indirect means such as financial guarantees. In addition, the central bank has slashed rates by over 150 basis points to 2 per cent currently, Malaysia's official forecast for the economy this year is a range between a one per cent contraction and one per cent growth, which is the figure Ms Zeti was referring to. MIER predicted that the central bank could cut interest rates to 1.5 per cent or lower, from 2 per cent at present, to bolster the economy. It also forecast inflation at 2 per cent this year and unemployment at 4.8 per cent.
-BT P13
Bleak Q1 profit forecast for China's listed firms
China's listed companies are poised to report their biggest earnings fall in at least 21/2 years, but that could be the beginning of an end for bad news as the economy starts to bottom out. Signs are mounting that, after a bleak first quarter, the tumble in earnings will begin easing in the current quarter with the rates of decline beginning to shrink, as Beijing's US$586 billion two-year economic stimulus plan kicks in. Chinese banks posted a combined 30 per cent earnings rise for 2008, and analysts expect they could still see 10-20 per cent earnings growth for all 2009, buoyed by government steps to push them to do more business to boost the economy.
- BT P14
Homes sales remain strong
THE bumper private property sales recorded in February were no fluke. For a second straight month, home hunters defied the weakening economy to buy more than 1,000 units last month. Property consultants say buyers are attracted to what they regard as good buys in the moderately priced mass market. Still, they warn that these strong buying levels are probably not sustainable. Last month, property developers sold 1,220 new private homes, just shy of the 1,332 units sold in February. It was the first time in over a year that the market has seen two consecutive months with more than 1,000 units sold. Sales for both months were a stunning contrast to the dismal 108 in January. Another striking figure: First-quarter new private home sales hit 2,660 units, representing 62% of all new homes sold during the whole of last year. February sales - boosted mainly by two new launches Alexis and Caspian - were the highest since August 2007. Figures compiled by the URA also showed 832 new housing units were launched last month, compared with 1,072 units in February and just 204 units in January. Most units sold last month were in the mass market, along with a few city-fringe small-format apartments at condominiums such as Domus and The Mercury.
- ST p1
HDB prices on their way down
One-third of sales in Q1 were at below valuation which is good news for buyers eyeing resale flats. The level in some areas was far higher and some buyers did not have to put up much cash upfront to buy their dream home. The trend indicates that HDB flats are now coming down at a quicker rate after holding up better than private residential properties. Top 10 areas sold below value were: Clementi (5-rm) - $500K ($70K below valuation), Tampines (exec) - $515K ($65K below valuation), Geylang (5-rm) - $525K ($63K below valuation), Bukit Merah (5-rm) - $610K ($60K below valuation), Bukit Panjang (Exec) - $400K ($56K below valuation), Toa Payoh (5-rm) - $555K ($53K below valuation), Queenstown (4-rm) - $442K ($48K below valuation), Bishan (5-rm) - $540K ($48K below valuation), Clementi (5-rm) - $400K ($45K below valuation) and Clementi (4-rm) - $310K ($45K below valuation) – data from ERA, PropNex, C&H Realty
- ST pA4
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Landed home values hold up well
A landed home often offers more space as well as a certain prestige. Its value also typically holds well over the years as the market has a limited supply of landed properties. The landed home market does not attract many speculators because it is relatively small. Foreigners are not ordinarily allowed to buy landed homes. Many landed home sellers also have better holding power and can wait for a better price, said executive director, residential, of OrangeTee.com. In the first quarter, landed home values slipped by an average of 1.5 per cent to $542 psf for leasehold houses and fell by 2.2 per cent to $1,193 psf for prime freehold houses. In comparison, private flats fell by a greater margin of 2.6 to 3.6 per cent, according to DTZ. Rental yields for landed homes are lower than condominiums. Most investors who buy landed property for investment are looking more into capital appreciation than long-term rental income. 'Landed properties generally double in value every seven to 10 years, said managing director of RealStar Premier Property Consultant.
- The Sunday Times, P24 – 5 April
More expats fall prey to rogue property agents
More expatriates have become victims of tricky landlords, dodgy tenancy agreements, disappearing deposits and other rental snares. According to the Consumers Association of Singapore (Case), foreigners lodged 32, out of a total of 365, complaints against real estate agents from last October to March this year. This was a 23 per cent increase from the 26, out of 516, complaints within the same period a year earlier. Case said that most of the complaints it received concerned rental agreements. Commonly cited were overcharging and failure to honour agreements, especially with regard to refunds. Dennis Wee Group said: 'At the moment, only about one-third of real estate agents here are CEHA-certified.'
- The Sunday Times, P12 – 5 April
Singapore to lead Asia Reit recovery on bank funding
Real estate investment trusts in Singapore and Australia will be the first in Asia-Pacific to recover from the economic slowdown on their ability to secure funding from banks, according to a new survey. Singapore has the region's best environment for Reits in terms of property market growth and regulatory support, Sydney-based Trust Company Ltd said in the annual Reit survey. 'In Singapore, every Reit has so far been able to successfully refinance debt as it's fallen due,' Trust chief executive officer John Atkin said. 'It's a credit crunch, not a property crunch and by that I mean the fundamentals of the real estate market are quite good,' UBS AG senior property analyst John Freedman said.
- The Business Times, P4
Sentosa dream gets hazy
While key hotel projects and the Resorts World at Sentosa integrated resort are largely on schedule, things are not going as well at Sentosa Cove. The plan was for some 2,500 oceanfront villas, waterway bungalows, hillside mansions and upscale condominiums to be built on the 117-hectare site. Earlier projections were that the bulk of the new homes would be ready by 2010. But industry sources now say fewer than 1,000 homes are likely to be completed by the end of this year. One problem is that sales and prices of new homes on the island have dropped sharply in the last two quarters, exacerbated by the number of foreigners leaving Singapore. Colliers' data shows that only one non-landed residential unit in Sentosa was sold in Q4 2008. In the first three months of this year, the number rose to eight. Colliers' data shows that the transacted price of non-landed properties at Sentosa Cove averaged $1,318 psf in Q1 2009 - down 45.8 per cent from the peak average of $2,431 psf recorded exactly one year ago in Q1 2008.
- The Business Times, P1 (see attached “6 April BT Sentosa dream gets hazy”)
AT&T to upgrade S'pore ops
US telecommunications titan AT&T is set to give its Singapore data centre and customer support facilities a multi-million dollar facelift this year under a US$1 billion regional investment plan. Singapore is the firm's headquarters for the Asean region and plays host to two key AT&T facilities. The company plans to move more support functions to its 270-man local worldwide customer service outfit. AT&T's Singapore data centre will be further upgraded over the course of 2009.
- The Business Times, P32
Q1 jobless rate likely to exceed Q4 2008: MOM
Singapore’s jobless rate in the first three months of the year is likely to exceed the 2.5 per cent posted in December last year. Manpower Minister Gan Kim Yong said that the unemployment rate for the first quarter is expected to be higher than the last three months of 2008. Singapore's jobless rate averaged 2.3 per cent last year, up from 2.1 per cent in 2007. Mr Gan said that schemes such as the Skills Programme for Upgrading and Resilience (SPUR) and Jobs Credit Scheme are helping companies to cut costs to save jobs.
- The Business Times, P9
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More projects with small units to be released this weekend
More projects with small apartments are being released for sale, with one offering units of just 344 sq ft - slightly over half the size of a squash court. A preview for the freehold Kembangan Suites at Jalan Masjid - which has 60 mainly small flats and eight shops - starts today. Its prices will be revealed only at 10am with sales starting at noon. Starting prices are at least $300,000 for the one-bedroom units, which range from 344 sq ft to 527 sq ft, according to the marketing material. The project also offers 581 sq ft two-bedroom units. The 104-unit Domus in Irrawaddy Road will be released for sale this weekend with the interest absorption scheme. Prices will start from just below $500,000 for the 25 studios of 474 sq ft, said Savills Residential, which is marketing the project. The project has penthouses, including a 926 sq ft double-storey one-bedroom penthouse. Domus is next to a fairly new launch - I-Residences, where prices are hovering around $900 psf. In Balestier, The Mezzo - on the site of the former Ruby Plaza - will also be released for sale in a special preview tomorrow. It has 127 units including 20 one-bedders of 560 sq ft. The Mezzo is offering a 6 per cent annual rental guarantee for two years, apart from the interest absorption scheme. The rental guarantee kicks in right after the temporary occupation permit date. The one-bedders will be priced from about $540,000 and the two-bedders from about $715,000, said HSR.
- The Straits Times, B26 HSBC's new home loan offers 'loyalty discount'
HSBC has unveiled a new home loan pegged to Sibor that rewards longer-term borrowers with an interest rate that gets increasingly competitive over time. For its new 'loyalty package', HSBC customers will see a year-on-year decrease in the interest spread until the 10th year, when it will hit zero. During the first year, borrowers will pay an interest rate spread of 1.5 per cent above the three-month Sibor. The spread is then reduced by 0.075 percentage point at the end of each anniversary year. Premier customers’ interest rate spread will be cut by 0.1 percentage point at the end of each anniversary year. In the 10th year of the loan, the interest rate spread will be reduced to zero for all customers. Thereafter, the rate reverts to Sibor plus 1.2 per cent for the remaining tenure of the home loan. HSBC said that to enjoy its new home loan, customers must have an average annual balance of $100,000 or more. It added that there was no lock-in period for the loan.
- The Straits Times, B26
(Also see, The Business Times, P3 “HSBC Home loan rewards loyalty”) Big demand for new flats
Champions Court, a BTO project, closed yesterday with 3,239 applications for just 815 units. The 224 studio apartments - offered for the first time in Woodlands - drew 632 applications, while 422 potential buyers chased the 182 three-room flats. Studios are priced indicatively from $57,000 to $80,000, with the three-roomers at $118,000 to $142,000. The 224 four-room flats - from $194,000 to $227,000 - attracted 1,239 applications. The 185 five-roomers, which will cost about $247,000 to $296,000, received 946 bids. The overall median cash-over-valuation for a resale flat in Woodlands was $15,000 in the fourth quarter of last year.
- The Straits Times, B3 Singapore remains the best place for Asian expats
Singapore is still the best place for Asian expatriates to live in, a global human resources consultancy said yesterday. Edging out Sydney and Kobe, which were ranked second and third, Singapore defended its top spot for a 10th year in ECA International's latest annual survey. Good infrastructure and healthcare facilities, low crime and health risks and decent air quality' are why Singapore topped the quality-of-life charts for Asian assignees. Poor air quality is a key reason why Hong Kong, despite rising up the charts with improved facilities for visitors, came in 11th, below other Asian cities such as Yokohama and Tokyo. In its study, Singapore was also ranked the most liveable Asian location for European expatriates, out of 49 Asian locations rated. Worldwide, Copenhagen offered the best quality of life to Europeans, followed by Antwerp and Brussels. Worldwide, Singapore was ranked 54th.
- The Business Times, P8 Mohamed Sultan Road building sold for $35.8m
A company owned by a member of the family that developed International Plaza has bought the freehold Le Mercier House in Mohamed Sultan Road for $35.8 million.The buyer of 65 Mohamed Sultan Road, Ka$h International Pte Ltd, also owns the property next door. The company is controlled by Cheong Keng Hooi, the group that developed International Plaza in Tanjong Pagar.The sale of 65 Mohamed Sultan Road was a private treaty deal brokered by Isabel Redrup Agency Pte Ltd.Although the building sits on about 14,200 sq ft of land currently, with 52,000 sq ft of built-up area, it has a plot ratio of 2.8, so rebuilding it will not allow for more than 39,000 sq ft of GFA in the future.'Plot ratio is the ratio of maximum permissible gross floor area to land area.If the authorities were to allow the existing 52,000 sq ft GFA to be retained in a new development on the site, the unit land price would be lower at about $688 psf per plot ratio.
- The Business Times, P28
(Also see, The Straits Times, B26) New Orchard malls short of tenants
Between March and October last year, Mandarin Gallery secured tenants for 60 per cent of its net lettable area. But in the four months since, occupancy has increased only marginally with the makeover due to be completed in June. Signing up of new tenants has also slowed to a crawl at Far East Organization's Orchard Central, next to the Somerset MRT Station. Its occupancy has risen to just 65 per cent in the past four months. Ion Orchard - the other mall being built from scratch on Orchard Turn - said it was 50 per cent leased last September, at prices of up to $80 psf. On Monday, it declined to comment on its leasing progress, although it is slated to open in the third quarter of this year. Lend Lease Retail, which is building 313@Somerset, said in May last year that it expects to fully lease all its units by around the middle of this year. The malls are forging ahead to open as scheduled, even as visitor arrivals this year may drop by 6 per cent to 11 per cent and tourism spending is estimated to fall 15 per cent to 16 per cent.
- The Straits Times, B28 Malaysian property will consolidate in '09: DTZ
Malaysia’s property market will consolidate over the next six months after ending last year with a whimper. Despite the slump, DTZ does not anticipate immediate fire sales, but expects opportunities to emerge at attractive prices as investors demand higher yields.Investors from Singapore, Indonesia and the Middle East will still be keen to invest in Malaysian property because prices are lower than in other regional markets, DTZ believes. After two years of strong increases in rents and capital values, DTZ expects the office market to see 'some consolidation' - a situation it says will be healthy, as there is significant supply in the pipeline.
- The Business Times, P28 Interest rate cuts fail to lift UK property sector
As banks still refuse to lend to prospective home buyers, the rate cuts have 'done nothing to improve fluidity in the housing market', despite assisting home owners by lowering mortgage payments. The statement comes as the Royal Institution of Chartered Surveyors released data showing a continued slide in housing sales, with the number of transactions sinking to the lowest level since 1978. The average house in Britain is now worth £160,327 (S$342,503). Meanwhile, the number of new homes being built in England in 2009-10 is expected to drop to the lowest level in almost 90 years, according to the National Housing Federation.
- The Business Times, P27 Australian home loans rise on rate cuts, grants
Australian home loan approvals rose in January as government handouts and interest rate cuts spurred record demand among first-time property buyers. The number of loans granted to build or buy homes and apartments climbed 3.5 per cent to 55,628 from December, when they advanced a revised 6.7 per cent, the statistics bureau said in Sydney yesterday. The rate reductions have saved borrowers with an average A$250,000 home loan about A$600 a month. Around 90 per cent of property buyers in Australia have variable rate mortgages. An index measuring construction fell 4.6 points in February to 29.5, the 12th consecutive month of shrinking building work, the Australian Industry Group said last week.
- The Business Times, P27 Mixed reactions to RM60b second stimulus
Analysts held mixed views yesterday about Malaysia's RM60 billion (S$24.9 billion) second stimulus package with the most bearish veering towards full blown recession this year (minus 5 per cent) while others cautiously agreed with Kuala Lumpur's forecast (between one and -1 per cent). The main disappointments for analysts and, indeed, the general public were the absence of measures that would have cut the costs of doing business in Malaysia. The package, which amounted to 8-9 per cent of GDP, comprised: RM15 billion fiscal spending; RM25 billion guaranteed funds; RM10 billion through projects through Khazanah Holdings; RM7 billion private finance initiatives (PFI), and RM3 billion in tax initiatives. The RM15 billion spending package is likely to be channelled to small infrastructure projects - refurbishment, maintenance, new rural roads, etc - including RM2 billion for the construction of a new low cost carrier terminal at the international airport.
- The Business Times, P10 China expands yuan trade with Asian, African nations
China is expanding trading in yuan with some Asian and African countries after a pilot programme involving a few provinces.It is just about 10 weeks since China announced plans to allow two provinces, Yunnan province and the Guangxi Zhuang autonomous region, to trade payments in yuan with 'neighbouring trade partners' in South-east Asia. It was meant to be a test drive before unveiling a full-scale programme on turning the yuan currency into an international one.The government expects some of the aid money to result in higher exports. A related development is the series of currency swap agreements that China has signed in the past few months, the latest one being with Malaysia. Similar deals have been inked with Japan, South Korea, Vietnam and the Hong Kong special administrative region.
- The Business Times, P11 Yudhoyono calls for lower interest rates
Susilo Bambang Yudhoyono has asked the banking industry to drastically cut interest rates for lending, so as to ease business costs, spur loan demand from consumers, and push forward economic growth, the Jakarta Post reported yesterday. He said that although banks have to follow the 'prudential' principle, they should start looking outward to help the business sector sustain the global crisis. Statistics from the central bank show that the banks' average lending rates slid from 14.2 per cent in the last week of December 2008 to 13.93 per cent by the second week of March, while deposit rates declined from 8.75 per cent to 8.32 per cent.
- The Business Times, P10
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Developers head into crisis with more cash
'On average, the net debt-equity ratio had come down from 0.52 times in Q2 to 0.49 times in Q3. And the improvement was generally attributable to a stronger equity base, paring of borrowings and an increase in cash held from divestments. 'CapitaLand, City Developments and GuocoLand all cut their debt-to-equity ratios in Q3, OCBC's data shows. At end-2001, CapitaLand had $1.9 billion of cash and a gearing of 0.87 times. Now, it has $4.2 billion in cash and a gearing ratio of 0.51 times. City- Dev has increased its cash holding from $701.8 million to $813.3 million and cut its gearing from 0.8 times to 0.46 times. KepLand has also increased its cash holding, from $120.9 million to $663.4 million, and cut its gearing from 1.33 times to 0.54 times. Downward revaluations of investment properties are still expected in Q4 2008 when developers do their yearly valuations.
- The Business Times, P1 |
Life after DPS won't be crippling for developers
A new report from DBS Research, which looks at the potential impact if buyers who bought homes under the deferred payment scheme (DPS) choose to walk away from their deals, concludes that developers are not likely to be too badly hit even under a 20 per cent default scenario. But among the developers, the smaller players would be more impacted in terms of proportional decline in earnings and interest cover. In addition, the recent property upcycle also saw active participation by foreign buyers, which adds an additional unknown to the equation: whether these buyers will follow through on their payments upon TOP. The research note concluded that while a 20 per cent default is not likely to hurt developers too much, the effect of DPS defaults is just one of a few challenges facing the developers in 2009.
- The Business Times, P5 |
Faster, cheaper for firms to get reclaimed land
In a joint initiative of the Singapore Land Authority (SLA) and JTC Corp to streamline the building of shore protection. Cutting edge analysis of wave erosion patterns will mean up to $16 million in savings for every kilometre of reclaimed shoreline. Currently, rock embankments costing $12.5 million per km are erected on the shoreline of newly-reclaimed land to prevent soil erosion, SLA said. The wait for the land could be cut by up to eight months. JTC reclaims land for industrial purposes and then leases it to industrial firms. Waterfront industrial sites, for example, are highly sought after by shipbuilding and marine-related industries.
- The Straits Times, B20 |
Thakral signs MOU with Aussie developer
As part of its bid to reposition itself as a pan-Asian property player, consumer electronics distributor Thakral Corporation has signed a memorandum of understanding (MOU) with an Australian developer for investments totalling up to A$117.5 million (S$115 million). The proposed transactions with Australian-listed Payce Consolidated came after Hong Leong Asia (HLA) failed in its bid against the MOU. Board representatives from HLA's indirect subsidiaries had opposed the MOU resolution but were outvoted. Of the proposed investments of up to A$117.5 million, some 13 per cent or A$15.73 million will be funded in cash; 63 per cent or A$73.55 million in debt; and 24 per cent or A$28.22 million through the issuance of new shares and share options to Payce, possibly making it a strategic shareholder.
- The Business Times, P7 |
Margaret Drive to get foreign worker dorm
The authorities have identified 10 more sites for temporary foreign worker dormitories, with the Queenstown Polyclinic site in Margaret Drive being the closest to residential areas. The building is across the road from three blocks of HDB flats, a hawker centre and the Queenstown library. The 10 sites will hold up to 20,000 foreign workers and tenures will range from three to six years. The majority of the sites are in remote areas like Mandai, Seletar West and Choa Chu Kang, which house industrial estates, farms and army camps. Three sites, two of which are situated in Changi and a third in Hougang Avenue 3, are near residential areas but are at least a 10-minute walk away. The MND said the 10 sites will help meet Singapore's construction needs over the next five to six years.
- The Straits Times, A3
(Also see, The Business Times, P9, “Govt releases 10 new sites for foreign worker dorms”) |
Developers in China scramble to raise cash
Suffering from a slumping housing market, Chinese developers are scrambling to find new ways to keep the cash flowing in and creditors at bay, with anything from factories to timeshares in their sights. An oversupply of new apartments in an economic downturn, and the lingering effects of government steps to stamp out rampant property speculation have sent home sales and prices tumbling. Shanghai-listed developer Vantone Estate aims to spend three billion yuan (S$667.2 million) on industrial property in the next couple of years, according to Wu Dongwei, general manager at the unit responsible for the venture. Holding investment properties usually produces much lower returns on assets than building homes because equity is tied up for much longer.
- The Business Times, P29 |
China SWF chief's blow to bailout hopes
The head of China's sovereign wealth fund said yesterday that he had lost the confidence to invest in foreign financial firms because of unclear and inconsistent government policy abroad which also fails to sufficiently protect investors. The comments by Mr Lou Jiwei, chairman and chief executive of the US$200billion China Investment Corp (CIC) will deal a fresh blow to embattled banks around the world hoping for a Chinese bailout. Mr Lou's remarks also suggested that US Treasury Secretary Henry Paulson may not receive generous pledges of further investment when he meets Chinese officials in Beijing today and tomorrow.
- The Straits Times, B17 |
Bank of Thailand cuts key interest rate
The Bank of Thailand reduced its one-day bond repurchase rate by one percentage point to 2.75 per cent. The first rate reduction in 17 months follows six months of anti-government protests that culminated in the seizure of Bangkok's international airport and Tuesday's court ruling that forced Prime Minister Somchai Wongsawat to step down. Thailand's economic growth slowed to 4 per cent in the third quarter as exports cooled and the violent political protests damped domestic spending. Inflation eased to 2.2 per cent in November, the slowest pace in 14 months.Thailand may not expand next year, as the closure of Bangkok's two main airports hurts tourism and a global recession slows exports.
- The Business Times, P13 |
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YTL ups the ante to clinch PowerSeraya
In a stunning about-turn, Temasek Holdings has sold electricity generating firm PowerSeraya to Malaysia's YTL Power International for $3.8 billion just a week after it postponed the sale indefinitely due to poor market conditions. YTL Power will pay Singapore investment company Temasek $3.6 billion and assume $201 million of PowerSeraya's net debt. Francis Yeoh, MD of YTL Power & YTL Corp said that he was 'delighted' to acquire PowerSeraya, which will give YTL Power 'significant participation in the Singapore energy market'. PowerSeraya is the last of three power generating companies that Temasek put up for sale under its planned divestment of the gencos, first announced in July last year. The deal is subject to the approval of YTL Power's shareholders. If approved, the acquisition is expected to be completed by the end of February next year.
- The Business Times, P1
(See also, The Straits Times, B24, “Last of Temasek's power units sold for $3.8 billion to Malaysian company”) |
Ex-school site attracts healthy interest
The former Seh Chuan High School has received healthy responses under the Ideas Tender Scheme by the SLA. The highest bid of $90,058 came from Dimensions Commercial School. Other bidders were existing SLA tenants such as Etonhouse International Holdings and Chatsworth International School. The site has a gross floor area of 4,222 sq metres and will be used for educational purposes. It was offered for use as a commercial or foreign system school in October, on a three-year tenancy with an option to renew. The former Mee Toh School opens for tender under the Ideas Tender Scheme today.
- The Business Times, P12 |
S'pore inks trade deals with N. Korea
The Ministry of Trade and Industry (MTI) said Singapore signed an Investment Guarantee Agreement with the country yesterday. Under the agreement, investors will be accorded non-discriminatory treatment, compensation in the event of expropriation or nationalisation of their investments, and free transfer of capital and returns from investment. Separately, the Singapore Business Federation (SBF) also signed a Memorandum of Understanding with the North Korean Chamber of Commerce. The SBF said the MOU will facilitate business exchanges, cooperation, information sharing and exploration of business opportunities between local firms and their North Korean counterparts.
- The Straits Times, B17 |
S'pore among top 5 Stanchart markets
Standard Chartered's £1.8 billion (S$4.16 billion) rights issue prospectus says that Singapore is one of the bank's top five markets and a fast-growing area. Singapore accounted for US$100 million or more than 5 per cent of operating profit from wholesale banking. Hong Kong led, followed by India and Korea. The big question is whether the rights issue is enough to guard against future Asian losses and disciplinary measures. Stanchart's 6.1 per cent core Tier 1 ratio - when others had increased theirs to over 8 per cent - was an obvious cautionary signal. By raising £1.8 billion via a deeply-discounted rights issue, the bank moves to 7.4 per cent, which should soothe investor worries.
- The Business Times, P19 |
New ez-link cards out soon
The next generation of ez-link cards, set to be released later this month, will let commuters pay for Electronic Road Pricing tolls and parking charges, on top of the usual MRT and bus fares. Another feature of the new card is that there will be no travel deposit. Once the card market is liberalised in 2010, commuters are likely to have more than just the new ez-link card to choose from. Nets, which issues the CashCard, has already expressed its interest in entering the public transport domain.
- The Straits Times, B7 |
Property slump in China threatens global growth
House prices in Shanghai, Shenzhen and Guangzhou are plunging. Construction of homes, offices and factories fell at least 16.6 per cent in October after rising 32.5 per cent a year earlier, according to Macquarie Securities Ltd. Shanghai house prices fell 19.5 per cent in the third quarter from the previous three months, according to real estate broker Savills. Declines in apartment values are accelerating in Shenzhen and Guangzhou, two of the fastest growing cities in Guangdong province, which produces 30 per cent of China's exports. Construction will contract 30 per cent next year after expanding 9 per cent in the first three quarters of 2008, according to Macquarie Securities.
- The Business Times, P16 |
KL firms' weak Q3 earnings spark analyst downgrades
Analysts have slashed their earnings growth forecasts after corporate Malaysia turned in a third quarter performance that revealed earnings to be souring faster than expected. While one in four companies covered by stockbroker HwangDBS-Vickers proved to be a letdown for the second quarter, 34 per cent did not live up to expectations for the third. Transport, telco, banking, and construction were significant underperformers but a number of big caps across the board were off target: Maybank, Bumiputra-Commerce, TMI, MAS, MISC, Genting, and Tenaga. HwangDBS is more optimistic about this year's earnings growth, pegging it at 6.7 per cent, but has projected earnings to contract 8.8 per cent next year. Its downgrades included two blue chips - Sime Darby and Resorts World.
- The Business Times, P15 |
Weak Korean currency brings cheer to expats
Concerns over a global recession have prompted foreign investors to dump Korean stocks and convert their gains to the safer greenback. The won, which is the worst-performing currency in Asia, has depreciated by 40 per cent in value against the United States dollar since the start of the year.Real estate agencies in the expatriate areas of Hanam and Itaewon in Seoul reported several cases of American tenants upgrading their houses from apartments to landed properties. But for Seoul, the plummeting value of its currency is not all bad news: More tourists are flocking to South Korea, which has become more wallet-friendly.
- The Straits Times, A19 |
Australian central bank slashes rates
The Reserve Bank of Australia cited the perilous state of the global economy when it cut the benchmark cash rate by a full percentage point to 4.25 per cent, a bigger margin than most analysts had forecast. It left the door open to more cuts. Britain, the Euro zone and New Zealand will almost certainly cut interest rates later this week. In addition to more rate cuts, the Federal Reserve is weighing other responses with its benchmark rate nearing zero and the US economy now officially in recession. |
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URA releases reserve-list hotel site for application
URA yesterday released for application through the reserve list a plum hotel site at Bukit Chermin flanked by Keppel Club and the Reflections at Keppel Bay condo project. Despite the site's attractive location in hilly terrain along the coast, some market watchers do not expect takers to emerge until mid-2009 at the earliest, given the property investment climate. Any eventual bids for the 60-year-leasehold plot will be assessed under a dual-envelope system, taking into account concept and land price. The 3 ha plot is expected to yield about 50-70 hotel rooms/ villas. The plot was initially on the second-half 2008 confirmed list but was moved to the reserve list late last month.
- The Business Times, P8
(See also, The Straits Times, C28 – “Hotel site at Bukit Chermin up for grabs”) |
Lend Lease makes progress in leasing of Orchard mall
Lend Lease says it has found over 50 per cent of the retailers it needs for 313@Somerset Orchard Road. 313@Somerset, targeted at the mid-market segment, the mall has 294,000 sq ft of net lettable area with about 180 retail and F&B outlets. As a part of 313@Somerset's USP, Lend Lease will be focusing on service standards and will open a $1 million Retail Training and Employment Centre to provide retail training to the employees of its retailers.This was prompted by 'the retail industry's need for skilled workers geared towards service excellence'. Lend Lease says it will fund around 60 per cent of the training centre and expects to seek additional funding through various government agencies. The centre is expected to be fully operational by mid-2009.
- The Business Times, P8
(See also, The Straits Times, C4 – “Mall to train staff for free”) |
Hong Leong Asia makes bid for Tasek, valuing it at $290m
Hong Leong Asia (HLA) has made another attempt to acquire Tasek Corporation Berhad in an offer that values the Malaysian building material company at about $290 million. HLA said that it has agreed to buy a 13.5 per cent stake in Tasek. This raised the 32.23 per cent holding held by HLA and persons acting in concert to 45.73 per cent, triggering a conditional takeover offer for the remaining 54.3 per cent stake that it does not already own at RM3.80 per share. The offer is being made through HLA's wholly owned unit Hartwell Pte Ltd. HLA agreed to buy the 13.5 per cent stake from Calamus Pte Ltd for about $39.5 million - which represents 24.9 million shares at RM3.80 each.
- The Business Times, P5
(See also, The Straits Times, C27 – “Hong Leong Asia’s offer for Tasek”) |
With RM11b in hand, YTL eyes cheap assets
YTL Corp, is an enormous holding company with a market capitalisation of RM9.7 billion, and its six separate listed entities are involved in everything from construction, telecommunications and cement manufacturing to power generation and property. Mr Yeoh's growth strategy is overseas acquisition - power distribution in Australia, a water utility in Britain, a real estate investment trust in Singapore - using profits made in Malaysia to rebrand YTL as a global infrastructure company.
- The Business Times, P18 |
MI-Reit to refinance $201m of debt by Jan
Macarthurcook Industrial Reit (MI-Reit) said it aims to refinance some $201 million of debt due in April 2009 by the end of January next year. MI-Reit said yesterday it expects to finalise negotiations to refinance the bulk of its debt maturities by the end of January 2009. And as for the new acquisition, finance will be sought via negotiations with banks, MI-Reit told BT. The planned $91 million acquisition will lift the trust's gearing from around 39 per cent now to about 47 per cent.
- The Business Times, P7 |
Rednano Mobile kicks off next Thursday
Rednano Mobile, the mobile platform of local search and directory engine rednano.sg, is launching its free location-based service next week. To be introduced on Thursday, Rednano Locate offers a broad package of features, comprising directory listing, maps, traffic updates and promotions. It pin-points users' location and provides information based on where they are. The service will kick off with more than 100,000 vendors onboard, with some offering promotions and discounts. Based on a combination of location-based technologies, including Global Positioning System, it will be accessible both indoors and outdoors.
- The Business Times, P7
(See also, The Straits Times, C4 – “Rednano to launch free mobile service search”) |
3 local firms in running for multi-million $ PUB contract
Three Singapore-based firms are in the running for a multi-million dollar PUB contract that could be worth between $279.2 million and $335.2 million. The contract is for the building of waterworks and ancillary facilities at Lower Seletar. Major projects include the Marina Reservoir Recirculation Scheme (MRRS), ABC Waters Programme, Lower Seletar Waterworks and two membrane bioreactor plants. According to the government's e-procurement portal GeBIZ, the three firms competing for the multi-million dollar Lower Seletar Waterworks contract are Keppel Seghers Engineering Singapore, Sembawang Engineers and Constructors, and United Engineers. The tender closed in September but the contract has not been awarded yet.
- The Business Times, B7 |
Reits treading warily in market minefield
DMG & Partners Securities estimates that the sector has at least $4.5 billion up for refinancing in 2009 alone. With credit tightening and spreads widening, the market is watching closely for signs of trouble. According to a CIMB-GK report, borrowing spreads for Reits have risen from an average of 150 basis points (bps) to 200-300 bps for three-year loans in the last six months.Reits are also affected by asset devaluation as the slowing economy weighs down on rents and occupancies. Lower property values would raise gearing ratios.
- The Business Times, P1 |
Construction firms face 'collapse risk'
The local construction industry could already be in serious trouble heading into the economic downturn, new data from DP Information Group (DP Info) shows. They now face the risk of defaulting on repayments, should banks further tighten credit as times get tougher, the credit and business information firm said. This finding was based on an analysis of the audited financial results of more than 2,000 construction firms lodged this year. About three in four have an annual turnover of $10 million or less. The other 24 per cent are over $10 million. Overall, about 6,000 firms make up the construction industry here. The analysis of the data found that many companies face not just one but multiple financial problems. These include: high levels of debt, low levels of liquidity and weak profitability.
- The Straits Times, C32 |
China's forex reserves pushing US$2t
Trade surpluses helped to swell the reserves, the world's biggest, to US$1.9 trillion at the end of September, according to the central bank. Larger reserves would strengthen the nation's finances as the government boosts spending and cuts interest rates to counter the financial crisis. Premier Wen Jiabao is trying to prevent a deeper slowdown in the world's fourth-biggest economy as construction slumps and exports wane. China reported a record US$35.2 billion trade surplus last month. The reserves have increased 14 times in size in the past decade, according to government data. They topped US$1 trillion in 2006.
- The Business Times, P19
(See also, The Straits Times, B2 – “China warns of worse to come for its economy”) |
S'pore-Nanjing venture sets up US$100m fund
S’pore-based private equity firm, Tembusu Partners, is joining hands with the government in Nanjing, China, to set up a US$100 million fund. The Nanjing Growth Fund will invest in growing companies in the Yangtze Delta region, across industries such as infrastructure and engineering, water and pharmaceuticals. The Nanjing government is taking part in the venture through Nanjing Hi-Tech Venture Capital and will raise US$40 million for the fund. Tembusu and its co-partner, Venture Capital and Consulting, will each raise another US$30 million.
- The Business Times, P7 |
India's business heart in crosshairs
Shares of big companies listed here with Indian operations slumped, dragging the Straits Times Index (STI) lower. Analysts fear that the killings in Mumbai and the confrontation in Bangkok will hurt already fragile sentiment among investors worldwide, triggering a retreat from Indian and Thai investments. The Mumbai attacks 'will have a huge negative impact on the financial sector because they targeted not just foreigners but also the professional class', said Manu Bhaskaran, head of global economic research at US consulting firm Centennial, in Singapore.
- The Business Times, P1 |
S'pore-Israel R&D foundation invests US$6.1m in five projects
The five joint-venture projects are expected to generate cumulative revenues of US$260 million in their first three years of commercialisation. They employ 68 research scientists and engineers from Singapore and Israel. Local company 1-2-1 View Media Holdings and its Israeli research and development partner Outform Ltd are developing two new products that allow pedestrians to actively interact with digital signs. To date, SIIRD has approved 79 R&D projects with a total research investment of US$82.3 million. The organisation was jointly set up in 1997 by the Singapore Economic Development Board and Israel's Office of Chief Scientist to promote, facilitate and support joint industrial R&D projects between Singapore and Israeli high-tech companies.
- The Business Times, P8 |
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| Savills sees over 20% drop in luxury home prices
Savills is predicting price drops of more than 20 per cent in the next five quarters for high-end and super-luxury private homes. This would follow declines of 14.3 per cent and 12 per cent respectively for these two segments in the first nine months of 2008 from the peak in Q4 last year. The average capital value for high-end (non-landed) residential homes fell to $2,065 per square foot in Q3 2008 while in the super luxury league, the average capital value slipped to $3,240.40 psf in Q3. Savills expects mass- market home prices to fall 5 to 8 per cent in the next five quarters - arguing that a price drop in this segment will be cushioned by continued support from HDB upgraders and other buyers picking up private homes for their own occupation. Savills also said that 10,923 leasing deals were recorded for private homes (excluding ECs) in the July to September quarter this year, the highest Q3 figure since 2000. - The Business Times, P2
(Also see, The Straits Times, D16 “Private home rents may fall 15%”) |
| Office space returns seen in year ahead
Savills reckons that some 450,000 square feet of Grade A office space - or 3.5 per cent of existing space in this sector - could be returned by tenants in the next 12 months. The figure fell from a high of $15.10 per square foot (psf) in Q2 this year to $14.92 psf in Q3. The decline was on a 3.3 per cent drop in asking rent in Tanjong Pagar and a 0.91 per cent drop in the Orchard area. But asking rents held firm in Q3 for Raffles Place, City Hall/Marina Bay and Beach Road/Middle Road. And in Shenton Way, they actually rose 2.2 per cent. The average Grade A office capital value slid 4.3 per cent quarter-on-quarter to $2,680 psf in Q3.
- The Business Times, P2 |
| 3 S'pore firms ink deals in Shandong
’s fast-growing ties with Shandong, 's No.2 province in economic terms, got a fresh boost yesterday as three local firms signed agreements with businesses in the coastal province. Hyflux was one of the three companies to sign an MOU - with Linyi local government to cooperate in municipal water projects. The second agreement involved Singapore Cruise Centre working with the Qingdao City Construction Investment (QCCI) Group to explore possibilities to provide consultancy and management services for QCCI's cruise terminal operations and management project. Third, soya bean specialist Jollibean will team up with Soya to open Jollibean speciality stores in Shandong . The SSBC meeting also identified key areas of collaboration between Shandong and next year - namely, infrastructure and environmental services, and educational services with a focus on vocational and technical education
- The Straits Times, D14 |
| 's biggest employer still hiring
Amid the rounds of corporate layoffs, 's biggest employer - the civil service - is still hiring. The Ministry of Education (MOE), for instance, is looking for teachers and school counsellors, among others. Also recruiting is the Ministry of Home Affairs. 'Ministries are still recruiting talent to meet organisational needs,' the Public Service Division (PSD) said and its guidelines for managing excess employees include encouraging bosses to consider measures such as flexible work arrangements, temporary layoffs, a shorter work week, sending employees for training and upgrading courses, and adjusting salaries. Retrenchment is 'the last resort' in dealing with surplus manpower arising from restructuring or best-sourcing, the PSD said.
- The Straits Times, A16 |
| Aviation turmoil may delay S'pore Rolls-Royce plant
The timetable for the construction Rolls-Royce's $320 million Trent aero-engine plant at Seletar Aerospace Park may be a casualty of the dramatic downturn in the global aviation operating environment. Faced with the challenging operating environment, Rolls-Royce is moving quickly to slash capacity and jobs worldwide. Yesterday, it announced plans to cut up to 2,000 jobs next year in the face of slumping demand. UK-based Roll-Royce officials were tight-lipped when contacted yesterday, but alluded to the impact of announced programme delays by customers.
- The Business Times, P2 |
| Upside in property S-chips?
The price of Centra- Land shares at IPO is likely to have priced-in various poor economic data at the time. Even so, its IPO offer price of 50 cents has fallen only 4 per cent since, while share prices of most Singapore-based property developers are more likely to have fallen upwards of 60 per cent. Less exotic property S-chips like Yanlord, New Town Development (CNTD) and Sunshine Holdings are traded more heavily. Their share prices have also fallen dramatically, in line with market movements. But the paradox is that unlike (and much of the world) some markets in , where some of these S-chips have projects, are actually seeing property prices recovering. Each city appears to react to different micro-economic factors like land scarcity, high levels of speculation, or even the efficiency of local governments to implement policy changes.
- The Business Times, P5 |
| tackles massive risks posed by unemployment
is racing to avoid a massive unemployment crisis and deal with mounting social unrest across the country over jobs. Social security officials yesterday declared that stabilising employment was a top priority, as they revealed a recent spike in the number of jobless. The policies range from setting up a fast-track system to nip labour disputes in the bud, providing financial aid to firms to help them retain workers, improving job search services for rural workers and clearing a backlog of sensitive court cases. Unemployment was most severe in 's southern manufacturing and export hub where thousands of labour-intensive firms which employ migrant labour have collapsed due to weakening external demand - The Straits Times, A1
(Also see, The Business Times, P13 “New system to take edge off labour unrest”) |
| Johor unveils plans for education hub
Newcastle University will open a medical faculty in Iskandar by 2011, while Malaysian education group Cempaka Schools is to open an international boarding school for boys in the next few years, it was announced yesterday. Both institutions will be located in Iskandar's education hub, Educity, which is near the Second Link at Tuas. The development corridor is about three times the size of and is expected to be completed in 20 years. A major advantage for international students, officials say, is the lower cost of getting an education in . Educity plans to eventually house eight tertiary faculties on one campus. They will share facilities like a library, hostels and a sports complex. A major core of the Iskandar region is located near the Second Link, which aims to become an international metropolis, officials say. Apart from Educity, a marina for yachts, a theme park, hotels and residential villas are part of the blueprint.
- The Straits Times, B1 |
| rupiah hits decade low
The Indonesian rupiah tumbled yesterday to its weakest level since the Asian financial crisis a decade ago and trading almost ground to a halt as forward markets indicated the currency would slump further. Investors in the offshore non-deliverable forwards markets were pricing in a 12 per cent depreciation in the rupiah in one month and 25 per cent in a year. Yesterday, the Korean won slumped to its lowest close in nearly 11 years, reflecting investor concerns that a recession in the developed economies will hammer export demand while the Indian rupee dropped to a record low in opening trades as investors took fright at another sharp fall in global stock markets.
- The Straits Times, D11
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Sunset Way, Clementi - Announcing a rent/lease reduction on 137 Sunset Way, Singapore, a 2,000 sq. ft., 3 bath, 3 bdrm apartment "Free shuttle bus to Clementi MRT every 30 mins". Now $4,000 SGD Monthly - Fully Furnished, Quiet. Property information
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Diamond in Tranquil Area
• 1,464 sq. ft., 3 bath, 3 bdrm apartment - $2,050,000 SGD - Price Negotiable.. Holland , West Region - Address: 29, 31, 33 Mount Sinai Rise
Type of Development: Condominium
Tenure: Freehold
District: 10
No. of Units: 239
Year of Completion: 2005
Developer: Dariene Pte Ltd (OUB Centre Ltd)
Unit sizes:
2 bedrooms: 100 sq m
3 bedrooms: 127 – 254 sq m
3+1 bedrooms: 141 – 302 sq m
4 bedrooms: 165 - 313 sq m
Penthouse: 275 – 294 sq m
The Marbella consists of two high rise apartment blocks. All the units are facing south, you are assured of cool, gentle breezes from the South and shielded from the scorching sun. Both internally and externally, The Marbella speaks of modern elegance and design excellence. With its quality finishes and fittings, The Marbella is truly an investment that is specially reserved for the royals of your heart.
The Marbella is situated at Mount Sinai Rise, surrounded by lush and peaceful gardens, The Marbella is the perfect retreat from today's competitive environment. It is near to Holland Road and Ulu Pandan Road which is about 3 minutes drive to Holland Village and a 7 minutes drive to Orchard Road.
The apartments in The Marbella are appealing to the expats because they have large balconies, which is rare for new condominiums. In addition, all the apartments are unblocked and have North-South orientation. Property information
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More PRs snapping up private homes
The proportion of permanent residents (PRs) in the pool of foreign buyers of private homes here has been rising, according to DTZ's analysis of caveats data from URA. PRs made up 54% of the total number of 913 private-home purchases by foreigners in Q2 this year - up from a 51% share in Q1. Non-PR foreigners have seen their share of this pool decline from 54% in Q3 2007 to 46% in Q2 this year. DTZ expects the trend to continue in the coming months. Foreigners (including PRs) bought a total 913 private homes here in Q2, up 3% from Q1. Malaysians overtook Indonesians as the top foreign buyers of private homes in Singapore in Q2. Malaysians accounted for 19% of the purchases by foreigners (including PRs), followed by a 17% share for Indonesians. China and India citizens each accounted for 11% of foreign buyers while UK buyers had a 9% share. Projects which received more foreign interest in Q2 include The Lakeshore, Vutton at Akyab Road and Nassim Park Residences. Foreigners (including PRs) made up 44% of the 55 units sold at The Lakeshore. The Indonesians favour prime districts 9 and 10. District 15 is popular with all the five major nationalities because it offers sea views, easy access to the airport and city, and is a popular residential area even with the locals. The Chinese, Malaysians and Brits also buy into the west.
- The Business Times, P32
Ease of doing business: Singapore is still No. 1
Singapore is tops for the third straight year globally in the ease of doing business, thanks to continual regulatory reforms, a survey by the World Bank and International Finance Corporation (IFC) shows. Singapore has undertaken reforms in starting a business and dealing with construction permits. It simplified the online process for business start-ups, cutting the time required by a day, and fast-tracked the process for giving out construction permits from 102 days to 38. The survey ranks 181 economies based on 10 indicators of business regulation that track the time and cost to start and operate a business, trade across borders, pay taxes and close a business.
- The Business Times, P9
TID wins URA condo-site tender with $84m bid
URA awarded a 99-year leasehold condo site next to Tanah Merah MRT Station to top bidder TID. TID's $84 million winning bid reflects a land price of about $282 psf of potential gross floor area, within the $250-$300 psf ppr range market watchers predicted for the confirmed list site when it was launched in mid-July. TID is a joint venture between Hong Leong Group and Japan's Mitsui Fudosan. The tender drew 7 bids.
- The Business Times, P32
Abu Dhabi bank putting 1b dirhams in property unit
Abu Dhabi Islamic Bank plans an aggressive real estate expansion outside its home base into Africa, Europe and Asia by putting one billion dirhams (S$390 million) into its Burooj Properties unit. The bank also aims to float a majority of Burooj shares in 2010 as cash profit at the division, which excludes revaluation of assets. Burooj said these markets look attractive and stable for investments to be done where the fundamentals are good with strong demand. Burooj is setting up branches in Egypt, Algeria and Syria, and will examine commercial and residential property development.
- The Business Times, P30
Over 65% of Phase 1 leased out
The first phase of Marina Bay Financial Centre is 65.6% pre-leased, almost two years ahead of its completion in Q2 2010. Two big names from Australia, BHP Billiton and Macquarie Group, are among the latest tenants. BHP Billiton will lease 142,000 sq ft of MBFC's Tower 2 under the project's first phase, while Macquarie will take more than 74,000 sq ft of the same tower. Murex Southeast Asia has leased about 25,000 sq ft at Tower 2 under a six-year tenancy agreement. With the latest signings, the total 2.92 million sq ft of Grade A office space in the MBFC development is 61% pre-committed. CBRE said that the latest signings at MBFC are a good indicator that demand for quality office space remains in positive territory and that there is underlying confidence in Singapore's relative position.
- The Business Times, P3
Exec search firm sets up global HQ here
The growing interest of American and European companies in expanding their operations in Asia and hiring more senior staff is one factor prompting international search company Whitehead Mann to set up its second global headquarters in Singapore. Whitehead Mann, which is also based in London, focuses primarily on helping companies to search for directors, chief executive officers (CEOs) and other top management staff. The firm, whose clients include 90 of Europe's top 200 companies, will hire about 50 staff.
- The Straits Times, B18
Barratt posts 13% profit fall, cancels dividend
A slide in Britain's housing market led builder Barratt Developments plc to cancel its final dividend after underlying annual profit fell 13% and it warned that the market remained difficult. Latest monthly data from HBOS, Britain's biggest mortgage lender, showed house prices fell for the seventh month running in August to stand 12.7% lower than a year earlier. More than £25,000 (S$62,900) have been wiped off the value of the average British home in the past year. Barratt unveiled a new package of measures to stimulate flagging sales, including stamp duty holiday on purchases up to £500,000 and a price guarantee to protect buyers from short-term falls in prices. Under its Price Promise scheme, if a buyer sells a house at a loss within three years, Barratt will refund the difference, up to a maximum of 15%.
- The Business Times, P31
NZ house sales slump to 26-year low
The number of homes sold dropped 34% to 4,220 last month from 6,394 a year earlier. The median house price dropped 5.7%. Slowing consumer spending and a plunge in the housing market tipped New Zealand's economy into a recession in the first half of this year, prompting interest rate cuts. The underlying fundamentals for housing demand remains weak, with mortgage rates still at high levels and over-supply of houses in the market will weigh on prices, said an economist at ASB Bank Ltd in Auckland.
- The Business Times, P30
As £ plunges, S'pore firms get pounded
The free-falling British pound is hurting exporters and Singapore companies with investments and operations in the UK. The pound is down 3% against the Singapore dollar since the beginning of the month and has slumped about 12% so far this year. Firms that have not hedged against depreciation in the pound are finding that their export receivables from the UK have deteriorated in value once converted to the local currency. For UK companies heading here, there has been no indication of any concern over the slide in the currency, said the British Chamber of Commerce.
- The Business Times, P1
Wholesale licence for QNB
Qatar National Bank has received a wholesale banking licence, making it the second bank from the Middle East to be able to offer a full range of services here. National Bank of Kuwait was the first Middle Eastern bank to get a wholesale banking licence here, while Arab Bank plc operates with a lesser offshore licence. From today, QNB, which opened a representative office here in April last year, will provide a full range of services and products. Located in Millenia Tower, QNB will have about 20 staff.
- The Business Times, P10
Sybase may move regional HQ to Singapore
Enterprise software provider Sybase could add to its sizeable local operations by relocating its Asia-Pacific headquarters from Hong Kong to Singapore. Although its regional HQ is in Hong Kong, Singapore has been the bigger beneficiary of Sybase's regional investments. The firm opened a new wireless research facility in 2007 and a wireless solution centre and a software development facility here in 1998. Government agencies have been in discussions with Sybase on the possibility of relocation in the last few years and dialogue is still continuing.
- The Business Times, P29
Big pay rises for top UK execs despite tough times
A survey by Deloitte has found that executves at FTSE 350 companies are still bagging pay rises which are also outstripping inflation. The financial services sector was particularly rewarding, with directors in this sector notching up pay increases of 8.5% last year. Overall, there was a 6.2% rise in salaries for directors of the FTSE 350. Pay packages at larger UK companies are overtaking those at other FTSE 100 firms. The annual bonus at the leading companies also increased last year.
- The Business Times, P13
China Aug CPI hits 14-month low of 4.9%
China's consumer inflation fell last month to a 14-month low of 4.9%. Goldman Sachs expects consumer inflation to fall to 3-4% in the coming quarters. Gross domestic product expanded 10.1% in the second quarter from a year earlier, down from 11.9% in all of last year.
- The Business Times, P16
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HDB upgraders come out to play in quiet market
HDB upgraders' share of private home purchases rose to 34% in Q2 2008 from just 28% in Q1, according to DTZ's analysis of data from URA Realis system. No. of private homes bought by those with HDB addresses increased 35% quarter-on-quarter to 1,199. HDB upgraders picked up the most number of units (36) in The Verve in the Balestier area, followed by 32units at Stadia at Yio Chu Kang. The Quartz was the most popular with 86% of its buyers being upgraders. DTZ said that developers are targeting this segment with realistic prices and offering attractive mortgage schemes for buyers with banks. Buyers of 97 of the 169 primary market transactions of private apartments/condos below 1,000 sq ft and costing at most $1,000 psf in Q2 had HDB addresses. The subsale market increased 52% Q-on-Q to 152 deals in Q2 2008, with median price declining 8% to $871psf. Subsales for non-landed private homes rose 25% quarter-on-quarter to 493, making up about 17% share of transactions of non-landed private homes. DTZ commented that the subsale activity in Q2 seems to have been fuelled by those who'd bought units in the past few years unloading their investments as their units reach or near completion. The median subsale price fall by 5% to $1,052 psf in Q2 after sliding 8% in Q1 and 4% in Q4 2007. This was due to fewer high-end units being transacted in the subsale market as well as slight price corrections. Median subsale prices of Citylights was $1,100psf (down by 2%) and The Sail @ Marina Bay were $1,810 psf (down by 14%) from Q1.Meanwhile, the number of private homes acquired by foreigners (including PR) rose 3% to 913. Foreigners bought 26% of total private homes, down slightly from a 28% share in Q1. DTZ observed that when private property prices are high, there are more foreigners as they are attracted by the growth story. When private property prices are low, there are more buyers with HDB addresses as it's a good opportunity to upgrade at more affordable levels.
- The Business Times, P1 Home prices have peaked ‘but won’t crash’
High-end home prices have dropped by about 15% to 20% and will 'stabilise at this level', said Wing Tai Holdings. Transactions here in the first half of the year have dropped by about 77% from the same period last year. He said that many developers have strong balance sheets and acquired properties before the property boom last year, so they are sitting on profits and 'will not be forced to sell below what they believe is the right price'. Property sales in Singapore will see a more 'normal pace', with decent-sized projects taking six months to a year to sell out. Home prices have 'peaked for now', but they will not crash as long as developers and home sellers hold on to their properties. Chinese developer Hang Lung Properties said China's real estate market had been affected more by domestic economic conditions than the US crisis. Gale International, a New York-based property developer, said the US sub-prime crisis was a banking crisis, 'not a real estate one'. He added that the office market, especially in the Central Business District, has held on very well.
- The Straits Times, B21 Hong Fok launches Concourse skyline
Hong Fok Corporation launched the 1st phase of Concourse Skyline at Beach Road. Comprising two towers and a podium complex, the 99-year leasehold development will house 360 units when completed in 2013. Units consist of one to four-bedroom apartments and penthouses, with one-bedroom apartments making up some 40%. 90 units will be released in the 1st phase, average sale prices could range from $1,500 to $1,800 per sq ft (psf) for the apartments. One-bedroom units can go up to 893 sq ft. Sea-facing units will cost $300 psf more than those facing the city. The penthouses will not be released for now. DTZ and CB Richard Ellis are marketing the property. Depending on take-up for the first phase, Hong Fok could release another 30 units in the next phase. Hong Fok also announced that it is developing a 68-unit serviced apartment project in Hong Kong and through its subsidiary, Winfoong International. That is slated for completion in early 2010.
- The Business Times, P6 Choice Tanah Merah condo site receives seven bids
99-year leasehold condo site next to Tanah Merah MRT station drew 7 bids. The top bid of $84 million or $282 per sq ft per plot ratio (psf ppr) came from TID - a joint venture between Singapore's Hong Leong Group and Japan's Mitsui Fudosan. The top bid was within the $250-300 psf ppr range predicted for the plot. But it is 11% shy of the $318.50 achieved for a neighbouring site - farther from the MRT station - in April 2006, when sentiment was more buoyant. That site is now being developed as the Casa Merah condo. CBRE estimates that based on TID's bid price, the breakeven cost for a new condo is likely to be $700-750 psf, translating to possible sale prices ranging from $800-850 psf. The 106,299 sq ft plot can be developed into a condo with 240-250 units averaging 1,200 sq ft. CBRE said the future project on the site will be attractive to HDB upgraders around the neighourhood and expats looking to rent homes along transport nodes.
- The Business Times, P12 S’pore moves up in world of global business hubs
According to the latest Worldwide Centres of Commerce Index published by MasterCard, Singapore has been ranked the 4th best centre of commerce worldwide, just behind Tokyo, It was also considered the best city for ease of doing business. London, New York, and Tokyo retained the top three spots respectively, but Singapore moved up two rungs, overtaking Chicago at No 5 and Hong Kong. Singapore ranked second only to Stockholm for its legal and political framework, and ahead of more established financial centres such as New York and London. The cities ranked top for economic stability were all in Western Europe - Vienna in first place, and Barcelona and Madrid tied in second place.
- The Business Times, P4 (Also see The Straits Times, A17) Qatar bank opens full branch here
Qatar National Bank (QNB) has upgraded its Singapore operations from representative office to a branch offering a range of commercial banking services and products. QNB opened its representative office in April last year and has been keen to expand its operations here. The new branch will be a valuable asset to both economies as emerging opportunities will boost the business trade between Qatar, Singapore, and other Asian countries. QNB is Qatar's biggest bank with total assets of 95.4 billion Qatari riyals (S$37.5 billion) and is 50 per cent cent owned by the Qatar government.
- The Straits Times, B16 Singapore a model for Sony worldwide
Singapore has been a haven of strength for Sony, with its electronics operations here chalking up double digit growth over the past two years. Despite the global economy uncertainities, the pan-Asian region is doing very well for Sony, according to Sony. More broadly, Singapore has the right environment for a multi-dimensional organisation like Sony's to thrive. Lauding the wide range of talent here, Sony noted that this was ideal for them, which also owns major movie and music businesses.
- The Business Times, P13 Singapore wealth story continues
Wealth in Asia Pacific ex-Japan registered the fastest growth of 13.6% in 2007, according to the latest wealth report by the Boston Consulting Group. Singapore has emerged as the market with the greatest concentration of 'millionaire' households, 0.6% of households - with AUM of at least US$1 million. BCG says that wealthy households globally have been shifting their allocations from equities into more conservative instruments since early 2008. BCG expects the Asia Pacific ex-Japan region to expand at the fastest clip over the next five years, growing its share of global AUM from 12% in 2007 to 16% in 2012. In terms of asset allocation, the proportion invested in equities among Asia ex-Japan clients has risen from 26 to 35% between 2002 and 2007. Conservative products such as cash and deposits remain popular, although low interest rates have prompted a shift to other assets.
- The Business Times, P32 New banking hubs like S’pore on radar screen
Traditional offshore banking centres face a number of challenges as tighter tax codes and the emergence of new banking hubs like Singapore prompt the wealthy to re-think their banking arrangements. Singapore's offshore AUM is estimated at US$500 billion, and Hong Kong's at US$200 billion. BCG said some high net worth individuals may consider relocating to foreign offshore centres as 'a roundabout way of complying with domestic tax regulations'. They are more likely to relocate to places with a high quality of life and large business communities such as Switzerland and Singapore. Investors from China, Taiwan and Hong Kong are gravitating towards Singapore, said BCG.
- The Business Times, P32 UOB launches credit card with Japanese focus
UOB is wooing the Japanese in Singapore as well as Singaporeans who travel often to Japan with the launch of a credit card that offers over 1,000 dining, shopping, beauty and travel privileges at merchants in Singapore and Japan. UOB is working together with JCB International Co Ltd on this UOB JCB Platinum Card. In addition to exclusive privileges at Japanese restaurants and beauty brands, both UOB and JCBI have also partnered Japan Airlines (JAL) and popular Japanese shopping mall Liang Court. In Japan, card members get dining privileges at over 800 restaurants, cafes and nightspots from Hokkaido to Okinawa.
- The Business Times, P8
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Size up home supply again
Last year, the Government announced the huge number of new homes in the supply pipline, to help keep soaring home prices in check. However the property market now is not as feverish as it was last year. Developers have adjusted to the cooling market sentiment by putting off sales. The Government should also adapt its calculation of supply figures to reflect these new conditions. The massive supply figure is now acting as a drag on the negative sentiment. A more accurate reflection of impending supply is to focus on units that have already begun to be built, as opposed to those still on the drawing board. Given the construction crunch and delayed launches, that would more than halve the supply figure. According to URA in July, the total supply of homes in the pipeline has jumped to 67,569. But a closer look at the data shows that construction has started on only 31,176 of these units. Figures under construction tend to stay more stable from quarter to quarter, unlike the total supply number. Apart from this, URA should also divulge how many units have had their scheduled completion dates pushed back, and to which years. This would throw light on the extent of delays in project completions, something the overall supply figure alone cannot communicate. Another useful measure would be to break down expected supply by location, completion year and construction status. The URA only provides the number of unsold units in each of three broad districts: the core central region, city-fringe areas and suburban locations. CBRE has already flagged a possible glut in the prime districts and in the East Coast, which have turned into major building sites after developers snapped up land there in the last two years. The problem is that CBRE's supply figures do not gel with the URA's. But unless the Government releases more relevant information - and property developers cooperate to boost transparency - the question of supply overhang will continue to hang over the market for some time.
- The Straits Times, P2 30 units sold at Martin No. 38
All 30 private preview units at SC Global's Martin No. 38 have been sold at better-than-expected prices. The company had said it was expecting around $2,000psf for the project but sales came in at $1,881 psf to $2,494 psf, or an average of $2,130 psf. That would make the flats around $2 million to $3.8 million. The developer sold about a third of the total 91 units, with about 60% to overseas buyers. The developer says there is no need for an official launch as it has sold out its preview units and has yet to decide on the launch of the second phase. A market watcher said there has been little change in prices of some other developments in the area, with a few even falling. Deals in the Robertson Quay area have been done at $1,130 to $1,840 psf this year although some Rivergate units sold for over $2,000 psf last year. A market watcher noted that high pricing works in a bullish market but in the weak market prevailing now, sales are likely to slow after the first 20 or 30 per cent is sold.
- The Straits Times, B19 OG buys Orchard serviced apartments from Ascott
OG has bought a block of serviced residences (88 units) that form part of its Orchard Point store for $100 million in cash from The Ascott Group. Ascott will continue to manage the residences for 15 years, with an option to renew the contract for another 10 years. The deal yields Ascott a gross gain of $43 million and works out to a price of about $1,530psf for the property, which has about 74 years left on its lease. Generally, property experts viewed the purchase favourably for OG. Serviced apartments are zoned for residential use, not hotel use, which could make it easier to convert.
- The Straits Times, B19 New UWC campus in Tampines hit by delay
Only part of the new UWC campus at Tampines is slated to open in 2010 as contractors would not be able to complete them on time as there are too many projects on hand. So the plan to take in 1,150 students from K1 through to Grade 11 on its 5.5ha Tampines Street 73 campus by August 2010 has been shelved. The campus will open in phases. Only the infant school for pupils from K1 to Grade 1, where the demand is greatest, will open in August 2010. Until then, the school's week-old interim campus in Ang Mo Kio will continue operating. Despite offering over 500 more places in both its campuses this year, UWC's waiting list has grown by 300 students since last year to 2,300. Recognising the increase in demand for places in international schools, the Government has stepped in to offer more land sites for up to four schools.
- The Straits Times, A8 Still hiring, but with far more caution
According to latest poll by US-nased Manpower (employment services firm), Singapore's job market in the final three months of the year is tipped to soften somewhat as the outlook for the economy grows dimmer. But compared with 32 other countries, Singapore - along with India and Taiwan - still offers job seekers the best employment prospects. India polled the highest net employment outlook for Q4: 43%. Singapore has the second highest (25%), followed by Taiwan (23 per cent). With the exception of the transportation & utilities sector, all other sectors in Singapore expect to increase headcount in Q4.
- The Business Times, P2 Asia toasts Fannie Mae, Freddie Mac bailout
Stock markets around the world rallied yesterday, following the US government's weekend bailout of Fannie Mae and Freddie Mac. Across most of Asia, stocks surged at the start of trading. In Singapore, the Straits Times Index jumped 4.8% - the biggest percentage gain since Aug 20, 2007. Stocks outside the financial sector were also boasted, including major exporters. Investors speculated that the latest bailout would help the broader US economy, supporting demand for commodities and imports.
- The Business Times, P1 50% of retail space leased at Fusionpolis
More than 50% of retail space at Fusionpolis has been taken up. The upcoming research and development (R&D) hotspot, comprising two towers and a podium in phase one, has around 183,000 sq ft of retail space. Tenants included Cold Storage and Fitness First. Rents for the retail space range from $4.50 to $12 psf, depending on how the units are used. Larger units also enjoy a lower psf rent. Frasers Hospitality will also be launching its brand of serviced apartments in Fusionopolis, comprising 50 work loft units. Phases 2A and 2B of the Fusionopolis are likely to be completed by 2010.
- The Business Times, P30 Singapore office occupancy costs 7th highest worldwide : survey
Grade A office space in Singapore was the 7th most expensive in the world, according to study by Colliers International. The average annual Grade A office gross rent here was US$125.06 ( SGD$179.297). Cities that were dearer included Hong Kong (US$213.68), London's West End (US$207.42) and Moscow (US$167.29). Singapore was the third most expensive location in the Asia-Pacific region, after Hong Kong and Tokyo. In terms of vacancy rates, Singapore at 7.5% in June 2008 ranked 13th in the Asia-Pacific, below the likes of Perth (0.3 per cent), Seoul (0.7 per cent) and Brisbane (1.2 per cent). Office investment held up in the Asia-Pacific but was down in Europe and North America.
- The Business Times, P30 Ramp-up warehouses offer more in rental returns
According to Colliers International, ramp-up warehouse facilities offer better investment returns as rents in Penjuru and Changi go for $1.30-$1.50 and $1.70-$1.80 psf per month respectively. Multi-storey warehouse facilities with cargo lifts (upper floors) in the same vicinity go for $1.00-$1.20 and $1.40-$1.60 respectively. Direct vehicular access to every floor in a ramp-up warehouse development effectively makes every floor comparable to a ground floor level unit. In a conventional multi- storey warehouse, upper- floor units command lower rents than ground-floor units because users have to load and unload by cargo lift. The rent differential can range from $0.20 to $0.50 psf per month depending on location.
- The Business Times, B30 Surge in Japan real estate companies filing for bankruptcy
The number of Japanese real estate companies filing for bankruptcy protection surged 23.5% in August from last year as banks choke off loans to the industry. The number of developers filing for bankruptcy protection reached 42 last month. Liabilities at failed real estate companies more than doubled from July to 438.97 billion yen (S$5.8 billion). Banks cut lending as growth in Japan's property market slowed and the collapse of the sub-prime market in the US kept potential buyers from making acquisitions. Japanese developers are also being squeezed by higher prices for steel and other raw materials used in construction, and by the government's revisions to building-approval regulations last June.
- The Business Times, P30
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Looking for your first home
Now may be a good time for genuine home buyers to take advantage of the slowdown and scour the market for bargains. Besides budget, location and space needed in a home, there are other considerations when buying a home for the first time. Mortgage consultancy portal HousingLoanSG.com recommends shopping for a home loan before shopping for the home. Obtaining an in-principle loan approval from a bank allows you to calculate the exact loan amount you can get based on your income and repayment ability. In the initial browsing stage, it is important to research through sources such as Classified Ads, online property listings, and recent transactions to have a gauge on market prices. Other considerations include legal fees for a valuation of the property and mortgage insurance.
- The Sunday Times, 7th Sep 2008
Investing in land overseas
Land banking firms typically buy rural land with the intent to re-zone it into commercial or residential use, or both. These firms in turn invite investors to buy parcels of land. Chesterton cautioned that investors may make some money from buying land, but probably not much more than from other high-yielding investments which are probably less risky. IPP Financial Advisers' investment director advised investors to consider land banking as an asset class only if they have a medium to long time horizon and have already set aside sufficient savings to for liquidity needs. There is typically an administration fee and a broking fee of, say, 15 per cent of the resale price for the transaction. Land banking is highly dependent on government policies or directives. There is always a risk of the land not being approved for development. The holding period for land banking projects can turn out to be long. The projects are typically subject to tax by the respective countries upon exit. Consumers are also subject to foreign exchange risk as most projects are denominated in the local currency where the raw land is.
- The Sunday Times, 7th Sep 2008
You got a home..does your car?
A Straits Times survey of 26 condominiums launched or built after 2005 showed carparks are getting smaller, with some even falling below a government standard of at least one lot per unit. About 50% of the condominiums surveyed will have just one lot for each unit - plus not more than 5% of extra lots - when completed. The situation is more pronounced in the city. At least three new developments - The Sail @ Marina Bay, Marina Bay Residences and Icon - have between 20% and 40% fewer lots than units. The Sail @ Marina Bay will have 700 lots for its 1,111 units. A survey of about 10 condos built between 1980 and 2000 showed they were more generous, with over 50% of them giving at least 15% more leeway for lots. A handful of retailers at Icon - a retail-***-residential development - said a few customers have complained it can be hard to find a lot during the peak hours. Reasons for this trend include the sheer cost of land and construction, the smaller plots of land for sale these days and the higher construction costs of basement carparks. The exception is usually super deluxe condos, which sell for about $3,000 or more psf. For example, the upcoming Boulevard Vue will provide up to four lots for each penthouse unit.
- The Straits Times, B6 (See attached “9Sep_CondoCarparkCrunch.jpg”)
Exec search firm sets up HQ
Singapore’s attractiveness as a business location and a springboard to the region has drawn Whitehead Mann Partnership, to set up a second headquarters here. The international search firm specialises in the search for directors and C-level executives (such as CEOs and chief financial officers). Besides these services, Whitehead Mann also offers due diligence and referencing services, talent management advice and human capital research. Whitehead Mann has plans to expand into India in the coming year, and is exploring entry into China.
- The Business Times, P10
6 Indians among Asia's 15 youngest billionaires
Forbes has now included 6 young (below 40) Indian men in its list of 15 youngest Asian billionaires. The Indian billionaires' list includes brothers Malvinder Singh and Shivinder Singh, who command a net worth of US$2.5 billion. The siblings control generic drug manufacturer Ranbaxy Laboratories, founded by their ancestors, which was sold earlier this year to Japan's Daiichi. Despite the sellout, Mr Malvinder Singh remains CEO of Ranbaxy, while Mr Shivinder Singh straddles the Indian hospital chain Fortis Healthcare, which went public in 2007. Forbes has noted that India has maintained its pace in the money race and its 'millionaires jumped 23% last year while the billionaire count soared to 53 from 36 the previous year'. India boasts a competitive demographic advantage in a young population, observed Forbes, and its 6 under-40 billionaires represent a cumulative worth of US$8.3 billion. In another compilation 10 Indian companies - led by the state-run conglomerate Bharat Heavy Electricals Limited (BHEL), telecom major Bharti Airtel and Mukesh Ambani-led Reliance Industries Ltd (RIL) - have made it to the magazine's list of 50 best companies in the Asia-Pacific region.
- The Business Times, P19
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Transitional office sites seek niche as market cools
URA rolled out another 15-year leasehold transitional office sites in Mohamed Sultan Road. This is the seventh transitional office site URA has launched since July last year, and one of two transitional office plots for release in second half 2008. The other, at Mountbatten Road, will be launched next month. CBRE expects few bidders for the site and predicts bids of about $80 to $100 psf ppr. The site's location may appeal to businesses that don't require a CBD location. Knight Frank projects a slightly higher price range of $100-$130 psf ppr for the site. It reckons the plot may receive cautious or a few opportunistic bids, citing that the completion time of the project on the plot could be close to 2010, when a large supply of office space is also slated for completion. Morgan Stanley said that it expects Singapore office rents to peak earlier by end-2008, due to expectations for office demand being lower than upcoming office supply (including business parks). CBRE data shows that about 10.1 million sq ft of new office space will be completed between Q3 2008 and 2012, inclusive of 645,000 sq ft of the transitional offices. Separately, URA said it has accepted applications for the release of two 60-year leasehold industrial sites at Kallang Pudding Road and Ubi Avenue 4 in the reserve list. The minimum prices that the successful applicants have committed to bid are $69.88 psf ppr for the Kallang Pudding plot and $69.85 psf ppr for the Ubi site.
- The Business Times, P2 – also see The Straits Times, B25 “Few bids for Mohd Sultan site?”
More land, buildings for foreign schools
Four more state buildings and three land parcels have been identified for use as Foreign System Schools (FSS). The buildings are the former Upper Serangoon Secondary School in Upper Serangoon Road, Nan Chiau High School in Kim Yam Road, Fuchun Primary School in Woodlands Centre Road and Jurong Town Primary School in Hu Ching Road. Except for the Upper Serangoon Road property, the buildings will be leased for three years, with the option to renew for two further three-year terms. The land parcels - at Yishun Avenue 1, Hougang Avenue 1 and Bukit Batok Road - have lease periods of 30 years. Currently, 19 international schools use state property. EDB said that more schools will be attracted to the island in line with market demand from expats.
- The Business Times, P8
Hoi Hup-led group top bidder for DBSS site in Toa Payoh
A consortium led by Hoi Hup Realty is the top bidder for a HDB Design, Build and Sell Scheme (DBSS) site at Lorong 1A Toa Payoh. Its bid of about $198.82 million works out to about $160 psf ppr. Market watchers estimate that the breakeven cost could be around $430-500 psf of saleable area. The breakeven cost will depend on construction costs and whether Hoi Hup succeeds in making its application to URA to secure provisional permission before Oct 7. After that date, bay windows and planter boxes will no longer be exempt from Gross Floor Area calculations and Hoi Hup’s breakeven cost for the project will be higher. The DBSS site, which is being offered on a 103-year leasehold tenure, can accommodate about 1,200 HDB flats comprising a mix of three-, four- and five-room flats. ERA reckons the selling price for the HDB flats on the site may be around $550 psf of saleable area. Currently, in the HDB resale market, four-room flats (969 sq ft) are selling for about $540 psf while five-room flats (1,184 sq ft) are selling for about $530 psf in the location. ERA also said that the threshold for HDB buyers in Toa Payoh should not exceed $650,000 for five-room flats and $550,000 for four-room flats. ERA also commented that the top bid by Hoi Hup was bullish. The tender attracted two other bids - from TP Development Pte Ltd and Sim Lian Land. More than 80% of the 714 units at City View @ Boon Keng DBSS flats, also developed by Hoi Hup, have been sold so far.
- The Business Times, P9
4% growth next year: Economists
Singapore’s economy is likely to grow at about 4% next year - the same rate as this year or even lower, according to a poll of private sector economists. They expect the slowdown to continue well into next year. Weak external demand has dragged down exports, but the fear is that this may spill over to other parts of the economy, which have so far proved resilient, said a Citigroup's economist. A Barclays economist expects a multi-year price correction in residential property. But he also said that the economy is more buffered from an export slowdown by Singapore’s exportable services engines, the building boom and the diverse range of manufacturing. Another positive sign is that inflation has peaked, said DBS. DBS also sees new investments coming in, particularly in pharmaceuticals
- The Straits Times, B26
Lenders face tougher times after strong H1
China's state banks are poised to report strong profit growth for the first half in 2008, thanks to wider margins and strong fee income, but funding costs are expected to rise in the second half, eroding growth. Chinese lenders are likely to face a harder time for the rest of the year and beyond as customers lock up funds in time deposits and move away from more profitable demand deposits. Asset quality is expected to deteriorate as property firms are hit by Beijing's clampdown on borrowing. Robust loan growth is slowing as Beijing took steps to stave off economic overheating.
- The Business Times, P12
Billionaire denies buying world's costliest home
Russian billionaire Mikhail Prokhorov denied French media reports he had bought the world's most expensive home. Newspapers said Mr Prokhorov paid 496 million euros (S$1 billion) for a property in southern France called Villa Leopolda, built in 1902 for Belgian King Leopold II. Mr Prokhorov, Russia's fifth richest man, made his estimated US$22 billion fortune during the economic free-for-all in Russia in the 1990s.
- The Business Times, H16
Echoes of lost decade haunt Japan again
Japan faces fears of prolonged stagnation as Bank of Japan (BOJ) warns of sluggish growth and high prices. Fears were heightened by news last week that Japanese banks are facing new problems with bad loans, especially to the property sector. The BOJ also predicted that inflation in Japan, which has soared to its highest level in more than a decade, will accelerate in coming months. The nation's economy contracted at its fastest pace in seven years during the second quarter of this year, with gross domestic product registering a 2.4% annualised decline. Corporate sentiment and capital expenditure plans in Japan have declined. The Bank of Japan's quarterly survey of business prospects for June showed sentiment to be at its lowest level in five years across a wide spectrum of businesses.
- The Business Times, P1
Why he just leaps when she hesitates
A survey of American households carried out by Iowa State University and presented to the NASD Investor Education Foundation found that in relationships in which couples didn't make investment decisions together, the men took control. Women reported finding investing more stressful, less exciting and more difficult than men did. Men tolerate more risk than women, which means that over time, women's returns could be less. Colorado State University researchers found that single women held 43% of their wealth in risky assets while single men held 51%. As their wealth increased, women devoted less money to risky assets than men did. Women largely exhibit more self-control and rational behaviour than men do when it comes to investment decisions.
- The Business Times, P30
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