Two Singapore office blocks sold for $40m
Two small office blocks have been sold for a total of about $40 million or $1,300-plus psf of existing net lettable area (NLA). Both buildings have 999-year leasehold tenure. A Hong Kong investor is believed to have bought Wisma Sugnomal at 75 High Street for $23.5 million or $1,349 psf based on existing NLA of 17,414 sq ft. The property is believed to have been sold by mortgagee bank DBS. The seven-storey office block, which has shops at street level, is about 12 years old and has existing gross floor area of about 25,500 sq ft. Fragrance group has bought 33 Middle Road, which is next to a Hotel 81, for $16.8 million or $1,324 psf of existing NLA in the five-storey building. Market watchers expect Fragrance to convert the property into a budget hotel. Colliers International is believed to have brokered both deals.
- The Business Times, P300
Condo land falling below building costs
Construction costs for some 99-year condo sites are now higher than their land costs, against the backdrop of soaring construction prices and a weak outlook for the prices at which private homes can be sold. Some industry watchers expect this trend for entry-level private housing to continue - which suggests that the government may have to be prepared to accept declining land bids at state tenders. Construction cost consultancy Rider Levett Bucknall (RLB) said that construction prices for medium-quality condominiums range from $260 psf to $320 psf of GFA in Q1 2008, and prices have risen to $280 to $350 psf of GFA for Q2 2008. As for the mid-market and high-end residential sectors, land values would still be above their construction costs. Developers have been focusing more on suburban sites suitable for being developed into mass-market private homes, as this is the sector where end-unit demand is relatively more resilient. Price escalation trends are set to continue for this year and may increase 15-20%, RLB said.
- The Business Times, P1 (see attached "List of residential land bids")
Asking price for collective sale site slashed by 40%
The owners of Robin Court (off Bukit Timah Road) are trying again for a collective sale - but after slashing the original price by nearly 40%. They want $58 million to $60 million for Robin Court, a walk-up block of 15 flats, and No. 1 Robin Drive, a detached house that hosts a preschool. The new price tag for the 40,518 sq ft parcel works out to $964-$996 psf of the total potential floor area of about 62,400 sq ft. This is almost 40% below the $1,500-$1,600 psf they sought during their first sale attempt last year when the property market was buzzing. A new development on the site could accommodate a residential project with a GFA of about 62,398 sq ft and can be configured into 30 apartments with an average size of 2,000 sq ft each, Credo Real Estate said. The developer should be able to break even at about $1,470-$1,500 psf, the firm added. Meanwhile, buyers are being sought for 2 blocks of apartments at Gallop Gables off Farrer Road. Knight Frank is inviting expressions of interest for the 38 tenanted apartments which are owned by Straits Trading. The indicative price is $1,500 psf - about $4.5 million for each apartment, or $171 million in total.
-The Straits Times, H17 (also see The Business Times, P31)
SWFs expected to treble investments in next 5 years
Sovereign wealth funds, which own about US$3 trillion in assets, may almost triple their investments in the next five years, said State Street Corp, the world's biggest money manager for institutions. Sovereign funds may invest an additional US$5 trillion in the next five years. Sovereign wealth funds and state-sponsored pools from governments invested US$58 billion in the first quarter, more than they spent from 2000 to 2005.
- The Business Times, P16
S'pore getting more expensive for expats: Mercer survey
Singapore is now the 5th most expensive Asian city for expatriates. For the 3rd year running, Moscow retained its top spot, while Tokyo climbed two spots to 2nd, with London in 3rd place. Singapore, which was number 6 in Asia last year, edged one spot higher in global rankings this year, coming in at 13th. Mercer-Asean sited the reasons for Singapore’s rise in rankings are the appreciation of Singapore dollar and its continued strength as a hub for the region. Rents have increased significantly here. According to Mercer, rents for a 'luxury' two-bedroom unfurnished apartment have increased about 20% from 2007. The findings also showed that for fast-developing Asian cities such as Singapore, the cost-of-living increase can be attributed to the higher quality of life. Despite rising living costs, Singapore remains competitive compared to its Asian neighbours and other global financial centres. Mercer's survey, which covers 143 cities, measures and compares the costs of over 200 expats’ essential items.
-The Straits Times, H17 (also see The Business Times, P10)
Newton Suites shortlisted for International Highrise Award
UOL's Newton Suites has been selected as one of the five contenders for the International Highrise Award. Newton Suites is designed by award-winning Singapore architectural firm, WOHA. On Newton Suites, the Jury citation reads: ‘In this residential tower, the feeling of living in the tropics both indoors and outdoors is transferred to a vertical dimension. It represents a development for life in the vertical in densely developed metropolises.’ Newton Suites is a 36-storey apartment building, clad in metal mesh sunshading. It features cantilevered skygardens and a 30-storey wall of creepers.
- The Business Times, P29
Numonyx sets up distribution hub here
Numonyx, one of the world's major suppliers of non-volatile memory chips, announced that it has made Singapore its global finished goods distribution hub. The Swiss-based semiconductor firm has signed a deal with DHL International GmbH to use the latter's 18,000 sq ft facilities at Bedok North to conduct its inbound and outbound goods distribution tasks.
- The Business Times, P22
CPI hits 7.5% but it may have peaked
Singapore's consumer price index (CPI) rose 7.5% year-on-year in June on the back of higher food and housing costs, according to the Department of Statistics. The CPI for the first six months of 2008 was 7.1% higher than in the corresponding period last year. Compared with May 2008, the CPI for June dipped 0.3%.
- The Business Times, P4
Indonesian central bank official sees stronger rupiah
Bank Indonesia has been selling US dollars to prop up the rupiah out of concern that currency weakness could fuel imported inflation, which rose in June to more than 11%. The rupiah eased to 9,143 per US dollar on Tuesday but the currency has gained 2% since late May. Higher domestic interest rates have boosted the attractiveness of Indonesian assets and supported the rupiah. The Indonesian central bank has raised interest rates three times since early May, taking its benchmark borrowing cost to 8.75%, among the highest in Asia.
- The Business Times, P12