Ample choice for buyers
By THE EDGE
The growing supply of new homes in Johor Baru is putting pressure on the values of houses on the secondary market. According to latest government data, as at end-2006, the existing supply of residential homes in Johor stood at 607,497 units (350,438 located in JB). In the same period, the state's incoming supply numbered 72,190 units (46,685 in JB) while planned supply totalled 133,316 units (91,710 in JB).
The secondary market for houses in JB has not been very exciting over the last year and this is reflected in the sampling for The Edge/KGV Lambert Smith Hampton JB Housing Property Monitor. The sampling shows that secondary housing property prices have not improved since 2001. In fact, in some of the areas sampled, values have dipped by as much as 26% in the last six years. Apart from houses on the Kempas Corridor, property prices elsewhere are rather flattish, observes Samuel Tan, director of KGV Lambert Smith Hampton JB.
He attributed this to the ample choice before buyers. The new houses are competitively priced, come with better designs and added freebies, says Tan when presenting The Edge/KGV Lambert Smith Hampton JB Housing Property Monitor for January–March 2007.
Sampling for the monitor shows prices for standard 1-storey terraced houses in Taman Daya have dropped by 24.3% and 26.5% in Taman Johor Jaya over the last six years. Meanwhile, 2-storey terraced homes in Taman Perling and Taman Daya dipped by 25% for the same period. Other areas that saw a significant drop in prices include 1-storey terraced houses in Taman Sutera (18.3%) and Bandar Baru Permas Jaya, which recorded a drop of 18.9% for 1-storey terraced houses and 19.2% for 2-storey terraced houses. The rental market also exhibited similar trends.
On the primary market, Tan says JB will be the place to watch over the next few years, with projects expected under the Ninth Malaysia Plan (9MP) and the Iskandar Development Region (IDR). He adds however that many quarters remain cautiously positive over the initiatives. He feels that any impact by the IDR and 9MP will only be gradually felt from the second quarter onwards.
Even though the secondary market is bound to be affected at first glance, Tan says the ready houses in older schemes may serve as an advantage as well. "JB city should see an increase in population, with people coming in to work in industries spurred by the IDR. Some of these people will be looking for ready housing. If homes in older schemes can find tenants, then they will become more tradable again," he offers.
Although the latest National Property Information Centre (Napic) Property Market Status Report (for 4Q2006) shows Johor having the highest number of surplus units in the country — 8,215 units or 32% of the nationwide market share — some developers remain upbeat about JB. Among them, notes Tan, are Scientex Bhd and SP Setia Bhd. The former has acquired about 250 acres in Sedenak, while the latter purchased 949 acres near Bandar Nusajaya. Scientex is planning a mixed housing development that will be launched early next year, while SP Setia has entered into a joint venture with Topasia Projects Sdn Bhd to develop an eco-themed township.
Based on Napic's report, the value of unsold units in Johor stands at RM1.43 billion, with the district of Johor Baru itself accounting for 77.5% (6,366 units) of the unsold units in the state. Most of these units (87.5%) had been on the market for more than 24 months. Two to 3-terraced and 1-storey terraced units formed the bulk of the overhang, with each type contributing 36% (2,957 units) and 16.5% (1,359 units), respectively.
Tan says developers are taking steps to avoid any overhang, by going for small launches with reasonable pricing. "Developers try to find their own niche market by targeting different segments that include upgraders, first-time house buyers or those looking for gated and guarded living."
He adds that in recent years, property development in JB has turned into a playground for the "bigger" developers. These are those who have the financial capacity to withstand slower sales and by default, enter into a "build-then-sell" arrangement.
So who's buying?
With so many new offerings, who and where are the buyers coming from? Tan observes that they are mostly buyers who appreciate contemporary designs and well-planned environments. "Many are Malaysians working in Singapore. The other group is made up of purchasers who want to improve their lifestyle by upgrading to a larger house," he notes.
The incentives and support packages (ISP) for investment in the IDR are expected to draw foreign investors into the state. A significant increase in interest from investors has been noted since the launching of the IDR last November, says Tan. The inflow of investment, especially in the industrial sector, will generate employment opportunities and in turn demand for housing. Tan says developers, especially those without any presence in the IDR, have shown interest in acquiring landbank to capitalise on the potential of this region.
On infrastructure, Tan points out that the government has approved the construction of the Eastern Dispersal Link. This highway will connect the present North-South Expressway (NSE) Interchange at Pandan to the new customs, immigration and quarantine complex (CIQ). It will run along Sungei Tebrau towards Kampung Bakar Batu and thereafter link to the CIQ along Jalan Pasir Pelangi. When completed, the highway will reduce travelling time from the NSE to the city centre, promoting the development potential of lands along the highway. Among the beneficiaries would be Tebrau Teguh Bhd and other land owners in the region.
"The 'feel-good' factor generated from the stock market will also trickle down to the property market. Since November last year, the stock market has been moving northwards. Many could have reaped profits and reinvested them in the property market," observes Tan.
New offerings
One of the more interesting launches in the JB market is Horizon Hills in Bandar Nusajaya, says Tan. The project was launched in March after months of publicity. A joint venture between UEM Land Sdn Bhd and Gamuda Bhd, the 1,200-acre freehold tract will offer mixed housing coupled with an 18-hole, 200-acre golf course. The design concept is based on clusters or precincts with 12 design themes that will incorporate lakes with islands and a 2km canal system.
Under its maiden launch, the developer offered for sale 250 units comprising 2-storey terraced homes, 2 and 2½-storey cluster homes and semidees. Built-ups start at 1,845 sq ft onwards, with tags starting from RM245,000 or an average of RM132 psf. Tan expects the project's marketability to be enhanced once the proposed western coastal highway linking Danga Bay to the new administrative centre is completed as this runs along the southern boundary of the project.
Travelling time to the city centre will then be shortened considerably.
Another new launch nearby is Taman Amyra located on a 35-acre site adjacent to Taman Perling. The gated project comprises 210 units of 2-storey semidees and 17 bungalows. Built-ups start from 2,850 sq ft and prices from RM403,800 for the semidees. For the bungalows with built-ups of 4,800 sq ft onwards, these are priced from RM798,000.
Over at the Kempas Corridor, Johor Land Bhd unveiled the 1,400-acre Bandar Dato' Onn. The initial launch in February saw several types of terraced houses launched. Built-ups start from 1,608 sq ft and these are priced from RM209,000. The construction of a link road connecting the Kempas Highway to the project has enhanced its accessibility. The opening of the link has also benefited other housing schemes such as Taman Sri Austin, Taman Adda Heights, Taman Daya and Taman Setia Indah. Tan says all the schemes reported better performance since the opening of the link.
In Taman Adda Heights, the developer reported a pick-up in sales, especially in March. At press time, only 11 out of 172 units of 2-storey cluster houses remain unsold. Prices range from RM278,000 to RM298,000 for the units with built-ups of between 2,048 and 2,200 sq ft. According to Tan, the developer is considering the build-then-sell concept for future launches.
Another scheme that reported good performance for the quarter under review was SP Setia's Taman Setia Tropika. A new interchange from the Kempas Highway costing RM18 million was completed during the period. The developer increased the prices for residential units by RM5,000 to RM7,000 per unit, while shopoffices by RM10,000 to RM30,000 each. The sale rate is about 80%, says Tan.
On Feb 14, SP Setia announced that Aeon will open its flagship shopping centre in Taman Bukit Indah. The mall, sitting on 37 acres of commercial land, is expected to be operational by end-2008. The convenience of shopping and entertainment brought by this mall will have a positive impact on demand for houses in the region. Apart from Taman Bukit Indah, the other schemes that will enjoy a spillover effect from this development are Taman Perling, Taman Nusa Bestari, Taman Nusa Indah and Taman Nusa Idaman, says Tan.
Over in Taman Nusa Idaman, 224 houses were launched with prices starting from RM149,000 for 1-storey terraced houses, RM239,000 for 2-storey terraced houses and RM397,000 onwards for semidees. In Taman Molek, the Berinda Group launched 26 units of super 2-storey semidees with a land area of 50ft by 100ft and built-up of 3,900 sq ft. Prices start from RM868,000. More than 30% of these units were reportedly sold since their launch in January. A stronger take-up rate was noted towards the end of March, says Tan.
Taman Austin Perdana by Mah Sing Group relaunched its 2-storey deluxe terraced houses priced at between RM277,556 and RM317,556. The developer has reported an average take-up rate of 70% since the initial launch in end-2004.
Saturday, June 30, 2007
Country View project to gain from IDR
Country View project to gain from IDR
By THE STAR
JOHOR BARU: Country View Bhd sees the Iskandar Development Region (IDR) creating a chain of economic opportunities for many businesses, including property developers.
Marketing manager Andrew Tan said the opportunities would come from the multi-billion ringgit development activities expected to take place up to 2025.
Tan said the property market would benefit from the IDR with demand for residential and commercial properties in the area likely to go up in the next few years.
The IDR covers 2,217 sq km from Senai-Kulai in the north, Gelang Patah-Pontian in the south-west and Pasir Gudang-Tanjung Langsat in the south-east of the state.
Andrew Tan
“Nusajaya is the key element in the IDR and in fact, in the last nine years developers had already started projects within the development circle despite the uncertainty over whether the IDR would take off,” Tan told StarBiz recently.
Tan said the company was currently developing its Nusa Indah property project in Nusajaya, comprising some 1,000 units of double-storey terrace houses and double-storey shop houses on 120 acres.
“The take-up rate for the project is good, including from Singaporeans due to its close proximity to the second link crossing,” he said.
Tan said visitors going to the State New Administrative Centre in Nusajaya would have to pass through Nusa Indah via a new linkroad, adding that the on-going housing projects by more than 10 developers in the area would further boost demand for properties there.
The company will be launching its 12 high-end bungalow houses on two acres in Jalan Straits View by the end of the year.
He said the project, billed as the last piece of residential development located on a prime land in Johor Baru, is about 3 km from the city centre and the causeway.
Tan said the company was also looking at the possibility of buying land for industrial development as demand for industrial properties within the IDR was expected to grow.
By THE STAR
JOHOR BARU: Country View Bhd sees the Iskandar Development Region (IDR) creating a chain of economic opportunities for many businesses, including property developers.
Marketing manager Andrew Tan said the opportunities would come from the multi-billion ringgit development activities expected to take place up to 2025.
Tan said the property market would benefit from the IDR with demand for residential and commercial properties in the area likely to go up in the next few years.
The IDR covers 2,217 sq km from Senai-Kulai in the north, Gelang Patah-Pontian in the south-west and Pasir Gudang-Tanjung Langsat in the south-east of the state.
Andrew Tan
“Nusajaya is the key element in the IDR and in fact, in the last nine years developers had already started projects within the development circle despite the uncertainty over whether the IDR would take off,” Tan told StarBiz recently.
Tan said the company was currently developing its Nusa Indah property project in Nusajaya, comprising some 1,000 units of double-storey terrace houses and double-storey shop houses on 120 acres.
“The take-up rate for the project is good, including from Singaporeans due to its close proximity to the second link crossing,” he said.
Tan said visitors going to the State New Administrative Centre in Nusajaya would have to pass through Nusa Indah via a new linkroad, adding that the on-going housing projects by more than 10 developers in the area would further boost demand for properties there.
The company will be launching its 12 high-end bungalow houses on two acres in Jalan Straits View by the end of the year.
He said the project, billed as the last piece of residential development located on a prime land in Johor Baru, is about 3 km from the city centre and the causeway.
Tan said the company was also looking at the possibility of buying land for industrial development as demand for industrial properties within the IDR was expected to grow.
Malaysian tycoons in talks to invest in Iskandar region
Malaysian tycoons in talks to invest in Iskandar region
By BUSINESS TIMES
A GROUP of local tycoons are in talks with Khazanah Nasional Bhd to develop a large piece of land in the Iskandar Development Region (IDR), a special economic zone in Johor.
Associated Chinese Chambers of Commerce and Industry Malaysia (ACCCIM) president, Tan Sri Williem Cheng, said a consortium has been formed to negotiate the development plan for a proposed project.
According to Cheng, Khazanah will allocate some 405 to 810 hectares of landbank to the consortium.
The group will then decide on the project, which may comprise service apartments and houses, shopping centres, hospitals, universities, schools, and a logistics hub.
"It will take six months to finalise the development plan and we expect the project to kick off early next year," Cheng told reporters after attending the Golden Bull Award 2007 ceremony in Petaling Jaya yesterday.
The IDR, an area almost three times the size of Singapore, is being promoted as a special economic zone in south Johor, and set to attract billions of ringgit in fresh investments.
Cheng said a group of investors from the Middle East and a consortium from Europe had been recently invited by the Government to invest in the IDR.
"Khazanah has allocated up to 810 hectares of landbank to each group to develop a project. They are currently negotiating the development plan," Cheng said.
He said the two groups are planning to build properties in the education, medical and logistics centre of the IDR and are expected to commence work early next year.
Cheng said the local consortium could buy the land from the State Government, or it may buy it from the private sector or the IDR's main developer.
The ACCCIM is also encouraging investors from Hong Kong, China, Taiwan and Singapore to participate in the development of the IDR.
Cheng said several groups of investors have expressed interest and may likely form a consortium soon to start negotiations with Khazanah.
By BUSINESS TIMES
A GROUP of local tycoons are in talks with Khazanah Nasional Bhd to develop a large piece of land in the Iskandar Development Region (IDR), a special economic zone in Johor.
Associated Chinese Chambers of Commerce and Industry Malaysia (ACCCIM) president, Tan Sri Williem Cheng, said a consortium has been formed to negotiate the development plan for a proposed project.
According to Cheng, Khazanah will allocate some 405 to 810 hectares of landbank to the consortium.
The group will then decide on the project, which may comprise service apartments and houses, shopping centres, hospitals, universities, schools, and a logistics hub.
"It will take six months to finalise the development plan and we expect the project to kick off early next year," Cheng told reporters after attending the Golden Bull Award 2007 ceremony in Petaling Jaya yesterday.
The IDR, an area almost three times the size of Singapore, is being promoted as a special economic zone in south Johor, and set to attract billions of ringgit in fresh investments.
Cheng said a group of investors from the Middle East and a consortium from Europe had been recently invited by the Government to invest in the IDR.
"Khazanah has allocated up to 810 hectares of landbank to each group to develop a project. They are currently negotiating the development plan," Cheng said.
He said the two groups are planning to build properties in the education, medical and logistics centre of the IDR and are expected to commence work early next year.
Cheng said the local consortium could buy the land from the State Government, or it may buy it from the private sector or the IDR's main developer.
The ACCCIM is also encouraging investors from Hong Kong, China, Taiwan and Singapore to participate in the development of the IDR.
Cheng said several groups of investors have expressed interest and may likely form a consortium soon to start negotiations with Khazanah.
Interest in IDR gaining momentum, says adviser
Interest in IDR gaining momentum, says adviser
By THE STAR
KUALA LUMPUR: Interest in the Iskandar Development Region (IDR) is gaining momentum among foreign investors, going by the rising number of visits to the region and talks being held with potential investors.
IDR adviser Tun Musa Hitam told reporters yesterday after the AGM of British Malaysian Chamber of Commerce (BMCC), of which he is co-patron, that talks on investment opportunities were currently being held with “certain Chinese parties”.
Investors from different countries, including 200 potential investors from Singapore, had visited the site, he said, but declined to give specific names.
Musa said various investors had also expressed interest in different aspects of the IDR.
BMCC chairman Peter Wentworth said British companies had a very positive view of the IDR as well.
“It’s a very natural extension of what Singapore and Malaysia could be doing.
“And most companies, particularly those in construction, would be interested to have a part in that region,” he told a press conference later.
Two-way trade between Malaysia and Britain hit RM2.5bil this year. Wentworth believes there is still an upside to this in the near future. The country is the third largest foreign investor in Malaysia.
By THE STAR
KUALA LUMPUR: Interest in the Iskandar Development Region (IDR) is gaining momentum among foreign investors, going by the rising number of visits to the region and talks being held with potential investors.
IDR adviser Tun Musa Hitam told reporters yesterday after the AGM of British Malaysian Chamber of Commerce (BMCC), of which he is co-patron, that talks on investment opportunities were currently being held with “certain Chinese parties”.
Investors from different countries, including 200 potential investors from Singapore, had visited the site, he said, but declined to give specific names.
Musa said various investors had also expressed interest in different aspects of the IDR.
BMCC chairman Peter Wentworth said British companies had a very positive view of the IDR as well.
“It’s a very natural extension of what Singapore and Malaysia could be doing.
“And most companies, particularly those in construction, would be interested to have a part in that region,” he told a press conference later.
Two-way trade between Malaysia and Britain hit RM2.5bil this year. Wentworth believes there is still an upside to this in the near future. The country is the third largest foreign investor in Malaysia.
Sculpting Horizon Hills' star attraction
Sculpting Horizon Hills' star attraction
By THE EDGE
Golf courses are akin to fine red wine — they improve with age. A great golf course flows, challenges, teases and rewards. It will not hesitate to punish too.
Ross Watson would concur. Ross Watson who? Think golf course design. Closer to home, he is behind the design of the award-winning Kota Permai Golf & Country Resort in Shah Alam, the A' Formosa Golf Resort in Melaka, Petaling Jaya's Tropicana Golf & Country Club and Valencia Golf Club in Selangor, to name a few.
Watson has been designing golf courses the last 25 years and he is back in Malaysia to sculpture what is one of the star attractions of Horizon Hills, a resort lifestyle development located within Nusajaya, which is the country's latest integrated hub within the highly publicised 2,217 sq km Iskandar Development Region in Johor.
It is full steam ahead for his team and him as they work relentlessly to have the 18-hole golf course playable by April next year, as promised to the prime minister.
Gamuda Land's managing director Chow Chee Wah says when fully developed, the course would appear as if it were carved out of a forest. The lakes and ponds, he says, have drainage and other site functions. These are strategically integrated into the layout of the course to provide challenge. Still, there are adequate bail-out areas for the average player.
What goes on behind the scenes to, for instance, put in place dog-leg fairways and bunkers? I decided to check it out.
What greets me at the unfinished Horizon Hills golf course one blistering afternoon is an undulating sea of brown, dotted with men wearing Phua Chu Kang-type of boots; these are in black though. My untrained eyes cannot make any sense of what they are labouring at except that each seems to be working independently. In reality, as I am told later, they are working very much in sync, putting together simultaneously and from all corners the pieces of a very big puzzle called the golf course.
As the Aussie designer explains, the challenge was to get the right team, one that could transfer idea to reality. Clad in long sleeves and a hat — just before entering the work site, Watson whips out his sun block and smears on the stuff to protect himself from the blazing sun — he draws my attention to mounds that seem nothing more than heaps of red soil. "A golf course is an art form. There must be a natural balance about it; the vegetation; the land form..." he offers.
Watson started his own golf course architecture business back in 1979. His earliest commissioned jobs were the Clifton Golf Course near Toowoomba and the Gold Coast Burleigh Golf Course. His design philosophy is to create unique courses using the existing environment and natural terrain to stimulate design. To him, a golf course is only deemed great if it can "sing" to him.
"Not only that, when I stand there, it has to sit properly…" he says, nodding for emphasis.
His view is that no two holes should offer a similar playing experience. Each must be remembered for its uniqueness, he says, pointing to the 200-acre championship course coming up in Horizon Hills. It is going to be big and bold yet subtle. A lot of strategic thought is required, given the terrain of the course and the wind. It is going to be more challenging than Kota Permai, a course that has received rave reviews, Watson promises.
Lest the social golfer feels intimidated, Watson gives the assurance that there will be "plenty of room" for the average golfer in Horizon Hills. "Some may wish to take the easy way to the hole. However, those who take risks and succeed will be rewarded," he says.
In short, Watson is applying the "risk reward" design principle to the layout, which preserves the natural terrain of the land and is accompanied by lots of waterways. Do expect many "heroic" holes, featuring dramatic changes in elevation from tee to green. Watch out for Hole 17 with its green perched on an island.
The unique features of the golf course will include classical bunkering with sweeping sand faces. The valley floor follows natural waterways including ponds, stony creeks and cascading waterfalls.
Working alongside turf superintendent Mark Ecott and key shaper-cum-construction manager Gary Cox, Watson is raising a series of bunkers to give the land a charismatic profile. "I want each hole to be remembered for itself," he says.
Watch out for its opening, along with a 150,000 sq ft clubhouse designed by Argentine Ernesto Bedmar of Singapore-based interior design firm Bedmar & Shi Designers.
By THE EDGE
Golf courses are akin to fine red wine — they improve with age. A great golf course flows, challenges, teases and rewards. It will not hesitate to punish too.
Ross Watson would concur. Ross Watson who? Think golf course design. Closer to home, he is behind the design of the award-winning Kota Permai Golf & Country Resort in Shah Alam, the A' Formosa Golf Resort in Melaka, Petaling Jaya's Tropicana Golf & Country Club and Valencia Golf Club in Selangor, to name a few.
Watson has been designing golf courses the last 25 years and he is back in Malaysia to sculpture what is one of the star attractions of Horizon Hills, a resort lifestyle development located within Nusajaya, which is the country's latest integrated hub within the highly publicised 2,217 sq km Iskandar Development Region in Johor.
It is full steam ahead for his team and him as they work relentlessly to have the 18-hole golf course playable by April next year, as promised to the prime minister.
Gamuda Land's managing director Chow Chee Wah says when fully developed, the course would appear as if it were carved out of a forest. The lakes and ponds, he says, have drainage and other site functions. These are strategically integrated into the layout of the course to provide challenge. Still, there are adequate bail-out areas for the average player.
What goes on behind the scenes to, for instance, put in place dog-leg fairways and bunkers? I decided to check it out.
What greets me at the unfinished Horizon Hills golf course one blistering afternoon is an undulating sea of brown, dotted with men wearing Phua Chu Kang-type of boots; these are in black though. My untrained eyes cannot make any sense of what they are labouring at except that each seems to be working independently. In reality, as I am told later, they are working very much in sync, putting together simultaneously and from all corners the pieces of a very big puzzle called the golf course.
As the Aussie designer explains, the challenge was to get the right team, one that could transfer idea to reality. Clad in long sleeves and a hat — just before entering the work site, Watson whips out his sun block and smears on the stuff to protect himself from the blazing sun — he draws my attention to mounds that seem nothing more than heaps of red soil. "A golf course is an art form. There must be a natural balance about it; the vegetation; the land form..." he offers.
Watson started his own golf course architecture business back in 1979. His earliest commissioned jobs were the Clifton Golf Course near Toowoomba and the Gold Coast Burleigh Golf Course. His design philosophy is to create unique courses using the existing environment and natural terrain to stimulate design. To him, a golf course is only deemed great if it can "sing" to him.
"Not only that, when I stand there, it has to sit properly…" he says, nodding for emphasis.
His view is that no two holes should offer a similar playing experience. Each must be remembered for its uniqueness, he says, pointing to the 200-acre championship course coming up in Horizon Hills. It is going to be big and bold yet subtle. A lot of strategic thought is required, given the terrain of the course and the wind. It is going to be more challenging than Kota Permai, a course that has received rave reviews, Watson promises.
Lest the social golfer feels intimidated, Watson gives the assurance that there will be "plenty of room" for the average golfer in Horizon Hills. "Some may wish to take the easy way to the hole. However, those who take risks and succeed will be rewarded," he says.
In short, Watson is applying the "risk reward" design principle to the layout, which preserves the natural terrain of the land and is accompanied by lots of waterways. Do expect many "heroic" holes, featuring dramatic changes in elevation from tee to green. Watch out for Hole 17 with its green perched on an island.
The unique features of the golf course will include classical bunkering with sweeping sand faces. The valley floor follows natural waterways including ponds, stony creeks and cascading waterfalls.
Working alongside turf superintendent Mark Ecott and key shaper-cum-construction manager Gary Cox, Watson is raising a series of bunkers to give the land a charismatic profile. "I want each hole to be remembered for itself," he says.
Watch out for its opening, along with a 150,000 sq ft clubhouse designed by Argentine Ernesto Bedmar of Singapore-based interior design firm Bedmar & Shi Designers.
KSL replicates Mid Valley concept
KSL replicates Mid Valley concept
By THE EDGE
KSL Holdings Bhd is developing a hotel and shopping centre project in Johor Bahru that replicates the Mid Valley Megamall concept and will have a gross development value (GDV) of RM180 million.
The project, called KSL City, is expected to contribute up to 30% to KSL's annual revenue upon completion in 2010, executive director Ku Tien Sek said.
The Johor-based property is at present identifying suitable operators to manage the proposed 600-room hotel and anchor tenants for the five-storey shopping centre.
Speaking to analysts and fund managers here last Friday, Ku said the company was confident the development would draw tourists visiting Singapore's integrated resort and theme park as it offered a much more affordable hotel stay and shopping experience.
"Hotel rates in Singapore in 2010 could be in the region of S$400 to S$500 (RM898 to RM1,123) per night. Our two-block hotel, on the other hand, is divided into three-star and budget rooms, priced around RM150 and RM100 per night respectively.
"We will also offer shuttle services for our guests who wish to travel to the island resort and theme park in Singapore, which makes the stay at our hotel worthwhile for budget travellers and families," he said.
Ku said the company expected to cater to foreign and domestic tourists with its reasonably priced hotel rooms and the convenience of shopping at the mall, based on the successful Mid Valley business model.
On KSL's property development business, Ku said it would continue to launch commercial and residential properties this year and in 2008, and was targeting a 10% growth in net profit from property sales this year.
He said the company was targeting some RM110 million in net profit this year, including RM40 million from the extraordinary gains from the compensation for the compulsory government acquisition of part of its Taman Bestari Indah project for the Senai-Desaru Highway.
"We are also targeting a 10% growth in net profit from sales in 2008, meaning a 10% improvement from RM70 million this year," Ku said.
The government acquired 28ha from KSL for the highway, and the total compensation of RM77.4 million covers lost sales and construction cost.
KSL now has three flagship projects, namely, Taman Nusa Bestari in Skudai, and Taman Bestari Indah and Taman Kempas Indah, both in Tebrau, with a combined GDV of RM3 billion.
It is launching its Pandan Commercial Centre which has a GDV of RM31 million in the fourth quarter of this year, and will hand over the Giant Hypermarket situated at Pusat Perdagangan Muar (PPM) to the hypermart operator on a 15-year RM60 million lease next month.
"We bought the land at PPM at around RM3 per sq ft (psf), and the current market value (including the building) is around RM100psf. It makes more sense to lease out the building as over 15 years it translates into higher rental value," he said, adding that the PPM project launched earlier this year had a remaining GDV of RM390 million.
Going forward, KSL is banking on the potential of the Iskandar Development Region (IDR) where it has about 405ha, which is about half of its total landbank in Johor.
Ku said the company was also optimistic that sales for its residential and commercial properties would pick up this year after a sluggish 2006, especially with the buzz over the IDR and the waiver of real property gains tax that took effect in April this year.
For the financial year ended Dec 31, 2006, KSL posted a lower net profit of RM67.75 million compared with RM76.23 million the previous year due to lower sales. Ku said sales have started picking since early this.
While KSL's 1Q2007 net profit surged almost 200% year-on-year to RM54.9 million on the back of RM103.3 million revenue, this included the RM58 million compensation received from the government.
By THE EDGE
KSL Holdings Bhd is developing a hotel and shopping centre project in Johor Bahru that replicates the Mid Valley Megamall concept and will have a gross development value (GDV) of RM180 million.
The project, called KSL City, is expected to contribute up to 30% to KSL's annual revenue upon completion in 2010, executive director Ku Tien Sek said.
The Johor-based property is at present identifying suitable operators to manage the proposed 600-room hotel and anchor tenants for the five-storey shopping centre.
Speaking to analysts and fund managers here last Friday, Ku said the company was confident the development would draw tourists visiting Singapore's integrated resort and theme park as it offered a much more affordable hotel stay and shopping experience.
"Hotel rates in Singapore in 2010 could be in the region of S$400 to S$500 (RM898 to RM1,123) per night. Our two-block hotel, on the other hand, is divided into three-star and budget rooms, priced around RM150 and RM100 per night respectively.
"We will also offer shuttle services for our guests who wish to travel to the island resort and theme park in Singapore, which makes the stay at our hotel worthwhile for budget travellers and families," he said.
Ku said the company expected to cater to foreign and domestic tourists with its reasonably priced hotel rooms and the convenience of shopping at the mall, based on the successful Mid Valley business model.
On KSL's property development business, Ku said it would continue to launch commercial and residential properties this year and in 2008, and was targeting a 10% growth in net profit from property sales this year.
He said the company was targeting some RM110 million in net profit this year, including RM40 million from the extraordinary gains from the compensation for the compulsory government acquisition of part of its Taman Bestari Indah project for the Senai-Desaru Highway.
"We are also targeting a 10% growth in net profit from sales in 2008, meaning a 10% improvement from RM70 million this year," Ku said.
The government acquired 28ha from KSL for the highway, and the total compensation of RM77.4 million covers lost sales and construction cost.
KSL now has three flagship projects, namely, Taman Nusa Bestari in Skudai, and Taman Bestari Indah and Taman Kempas Indah, both in Tebrau, with a combined GDV of RM3 billion.
It is launching its Pandan Commercial Centre which has a GDV of RM31 million in the fourth quarter of this year, and will hand over the Giant Hypermarket situated at Pusat Perdagangan Muar (PPM) to the hypermart operator on a 15-year RM60 million lease next month.
"We bought the land at PPM at around RM3 per sq ft (psf), and the current market value (including the building) is around RM100psf. It makes more sense to lease out the building as over 15 years it translates into higher rental value," he said, adding that the PPM project launched earlier this year had a remaining GDV of RM390 million.
Going forward, KSL is banking on the potential of the Iskandar Development Region (IDR) where it has about 405ha, which is about half of its total landbank in Johor.
Ku said the company was also optimistic that sales for its residential and commercial properties would pick up this year after a sluggish 2006, especially with the buzz over the IDR and the waiver of real property gains tax that took effect in April this year.
For the financial year ended Dec 31, 2006, KSL posted a lower net profit of RM67.75 million compared with RM76.23 million the previous year due to lower sales. Ku said sales have started picking since early this.
While KSL's 1Q2007 net profit surged almost 200% year-on-year to RM54.9 million on the back of RM103.3 million revenue, this included the RM58 million compensation received from the government.
IJM Prop eyes 50pc of Larut Leisure
IJM Prop eyes 50pc of Larut Leisure
By BUSINESS TIMES
IJM Corp Bhd's subsidiary, IJM Properties Sdn Bhd (IJMP), plans to buy a 50 per cent stake in Larut Leisure Enterprise (Hong Kong) Ltd (LLE) from Talam Group for HK$1 (HK$100 = RM44.40). The deal will also see IJMP assuming a loan of RM25.63 million from the Talam group to LLE. LLE owns a 60 per cent interest in Jilin Dingtai Enterprise Development Co Ltd, which owns a partially completed "Yin Hai Complex" in Jilin Province, China. The gross sales value of the proposed 35-storey commercial cum residential complex is estimated at RM340 million. LLE is a wholly-owned subsidiary of Larut Overseas Ventures Sdn Bhd, which is a wholly-owned subsidiary of Talam.
By BUSINESS TIMES
IJM Corp Bhd's subsidiary, IJM Properties Sdn Bhd (IJMP), plans to buy a 50 per cent stake in Larut Leisure Enterprise (Hong Kong) Ltd (LLE) from Talam Group for HK$1 (HK$100 = RM44.40). The deal will also see IJMP assuming a loan of RM25.63 million from the Talam group to LLE. LLE owns a 60 per cent interest in Jilin Dingtai Enterprise Development Co Ltd, which owns a partially completed "Yin Hai Complex" in Jilin Province, China. The gross sales value of the proposed 35-storey commercial cum residential complex is estimated at RM340 million. LLE is a wholly-owned subsidiary of Larut Overseas Ventures Sdn Bhd, which is a wholly-owned subsidiary of Talam.
Buying properties abroad helps hedge investments
Buying properties abroad helps hedge investments
By THE STAR
MOST Malaysian property buyers are a discerning and sophisticated lot nowadays, with the more affluent ones casting their sights on properties overseas.
S.K. Brothers Realty chief executive officer Charlie Chan sees Australia, Singapore and Britain as popular countries for Malaysians investing in properties overseas.
Elvin Fernandez
“With the growing affluence of Malaysians, investing in properties overseas is one way to hedge their investments. They want to put their eggs in different baskets,” he said.
Chan said those who had invested in properties in Britain years ago would be enjoying capital appreciation and foreign exchange gains, thus encouraging them to invest further.
Australia is also a favourite place – especially Melbourne, Sydney, Perth and Gold Coast – for Malaysians to buy property as many have children who are studying there.
“I don't see these investments affecting our local property market. People are still buying properties here to stay and invest in.
“We are also attracting foreign buyers into our market, especially after the recently introduced policies such as the abolition of the real property gains tax,” Chan said.
He believes these cross-border property investments are good for the country.
“People are looking for security and good returns on their investments,” he said.
Charlie Chan
General manager Chan Ai Cheng said investors were always on the lookout for new opportunities.
“Land investment in Britain is also something worth considering. Investors can expect a return of 300% to 700% over a five to 10-year period,” she said.
Strategic land investment involves buying land with agricultural status or brownfield land which would be converted into residential, commercial or industrial land in future.
The strategy is simple – buy an undeveloped piece of land, wait until its price goes up (with planning permission) and then sell.
When the land is sold, a capital gain is made, but since the British government only taxes people who live or work in Britain, Malaysians will not pay this tax.
“We have clinched a deal worth over RM500,000 from a single investor before,” Ai Cheng said.
Khong & Jaafar Sdn Bhd managing director Elvin Fernandez noted that one of the hottest sectors in the property market in Asean was the high-end luxurious condominium in Singapore.
“That market has been hot for the past one year. International buyers including Malaysians – high net worth individuals – are buying into the sector for capital appreciation and rental income,” he said.
Some high-end luxury condos are said to be selling at about S$3,000 per sq ft.
Elvin pointed out the need for good rental returns for a well-supported luxury high-end condo market.
“We will need a strong expatriate market to push up rental income for Malaysia so that the local luxury high-end condo can benefit from the spillover effect from Singapore,” he said.
He added that there could be more foreign workers in the country with projects from the Ninth Malaysia Plan rolling in and this would strengthen the luxury high-end condo market, as they would be looking to rent the condos.
Colliers International Property Consultants Sdn Bhd deputy managing director Lee Vun-Tsir reckoned the prices of luxury high-end condos in Singapore had doubled in the last eight months.
Lee expects a bigger expat workforce in Singapore, especially with the construction of Genting Inter- national's Sentosa integrated resort, which will have the region's first Universal Studios theme park and a casino.
He said this would help boost the property market there and make it even more attractive for foreign investors.
“Indonesia, especially Bali, is also one of the places Malaysians invest in – cash-rich individuals looking to buy resort developments, private villas and other such properties.
“Bali's resort developments are a favourite as they are relatively cheaper compared with the other resorts in the region – for example, it is one third the price of resort properties in Phuket. We also speak a similar language,” he said.
Lee said the company was not aggressively moving into the overseas property market but rather catered to a niche market with resort properties such as the Angsana Resort and Spa in Bali.
By THE STAR
MOST Malaysian property buyers are a discerning and sophisticated lot nowadays, with the more affluent ones casting their sights on properties overseas.
S.K. Brothers Realty chief executive officer Charlie Chan sees Australia, Singapore and Britain as popular countries for Malaysians investing in properties overseas.
Elvin Fernandez
“With the growing affluence of Malaysians, investing in properties overseas is one way to hedge their investments. They want to put their eggs in different baskets,” he said.
Chan said those who had invested in properties in Britain years ago would be enjoying capital appreciation and foreign exchange gains, thus encouraging them to invest further.
Australia is also a favourite place – especially Melbourne, Sydney, Perth and Gold Coast – for Malaysians to buy property as many have children who are studying there.
“I don't see these investments affecting our local property market. People are still buying properties here to stay and invest in.
“We are also attracting foreign buyers into our market, especially after the recently introduced policies such as the abolition of the real property gains tax,” Chan said.
He believes these cross-border property investments are good for the country.
“People are looking for security and good returns on their investments,” he said.
Charlie Chan
General manager Chan Ai Cheng said investors were always on the lookout for new opportunities.
“Land investment in Britain is also something worth considering. Investors can expect a return of 300% to 700% over a five to 10-year period,” she said.
Strategic land investment involves buying land with agricultural status or brownfield land which would be converted into residential, commercial or industrial land in future.
The strategy is simple – buy an undeveloped piece of land, wait until its price goes up (with planning permission) and then sell.
When the land is sold, a capital gain is made, but since the British government only taxes people who live or work in Britain, Malaysians will not pay this tax.
“We have clinched a deal worth over RM500,000 from a single investor before,” Ai Cheng said.
Khong & Jaafar Sdn Bhd managing director Elvin Fernandez noted that one of the hottest sectors in the property market in Asean was the high-end luxurious condominium in Singapore.
“That market has been hot for the past one year. International buyers including Malaysians – high net worth individuals – are buying into the sector for capital appreciation and rental income,” he said.
Some high-end luxury condos are said to be selling at about S$3,000 per sq ft.
Elvin pointed out the need for good rental returns for a well-supported luxury high-end condo market.
“We will need a strong expatriate market to push up rental income for Malaysia so that the local luxury high-end condo can benefit from the spillover effect from Singapore,” he said.
He added that there could be more foreign workers in the country with projects from the Ninth Malaysia Plan rolling in and this would strengthen the luxury high-end condo market, as they would be looking to rent the condos.
Colliers International Property Consultants Sdn Bhd deputy managing director Lee Vun-Tsir reckoned the prices of luxury high-end condos in Singapore had doubled in the last eight months.
Lee expects a bigger expat workforce in Singapore, especially with the construction of Genting Inter- national's Sentosa integrated resort, which will have the region's first Universal Studios theme park and a casino.
He said this would help boost the property market there and make it even more attractive for foreign investors.
“Indonesia, especially Bali, is also one of the places Malaysians invest in – cash-rich individuals looking to buy resort developments, private villas and other such properties.
“Bali's resort developments are a favourite as they are relatively cheaper compared with the other resorts in the region – for example, it is one third the price of resort properties in Phuket. We also speak a similar language,” he said.
Lee said the company was not aggressively moving into the overseas property market but rather catered to a niche market with resort properties such as the Angsana Resort and Spa in Bali.
Be cautious and selective, companies advised
Be cautious and selective, companies advised
By THE STAR
WHILE pursuing the many opportunities in the offshore property market has many advantages, developers have been cautioned to do the necessary homework and check the project's viability carefully before taking the plunge. They must be careful to balance the risks and rewards.
Sunway City Bhd (SunCity) senior managing director Datuk C.K. Wong advised Malaysian companies to remain cautious and selective because of the volatile nature of overseas property markets.
“Avoid mega residential and commercial developments initially. Residential developments should be the starting point, and only later the opportunities to develop mixed and commercial projects,” he added.
Wong said a strong equity partnership with an established and reputable local partner was advisable.
“SunCity requires a higher rate of return from its overseas property developments to manage and mitigate the additional risks.”
Mah Sing Group Bhd president and group chief executive Datuk Leong Hoy Kum concurred on the need to be cautious.
Having been approached by some foreign parties to pursue developments overseas, Mah Sing is currently conducting in-depth studies on several opportunities and evaluating the risks and returns.
“We are not in a hurry as there are still a lot of opportunities in Malaysia. Being a prudent developer, we are careful in ensuring that we face minimum risk by putting out minimum capital outlay.
“We also need to do a thorough research on the demand before embarking on any of the projects,” Leong said.
Should the company decide to venture overseas, it is likely to do it via a joint venture with an established local party so that it needs minimum capital payout.
“We need to take into account a whole range of factors and among the most important criteria we are looking for is that our joint-venture partner should be a reputable local party with extensive knowledge of the local market,” he said.
“If we can have that in place, we can concentrate on what we do best and introduce our lifestyle concepts and our branding in their market.”
By THE STAR
WHILE pursuing the many opportunities in the offshore property market has many advantages, developers have been cautioned to do the necessary homework and check the project's viability carefully before taking the plunge. They must be careful to balance the risks and rewards.
Sunway City Bhd (SunCity) senior managing director Datuk C.K. Wong advised Malaysian companies to remain cautious and selective because of the volatile nature of overseas property markets.
“Avoid mega residential and commercial developments initially. Residential developments should be the starting point, and only later the opportunities to develop mixed and commercial projects,” he added.
Wong said a strong equity partnership with an established and reputable local partner was advisable.
“SunCity requires a higher rate of return from its overseas property developments to manage and mitigate the additional risks.”
Mah Sing Group Bhd president and group chief executive Datuk Leong Hoy Kum concurred on the need to be cautious.
Having been approached by some foreign parties to pursue developments overseas, Mah Sing is currently conducting in-depth studies on several opportunities and evaluating the risks and returns.
“We are not in a hurry as there are still a lot of opportunities in Malaysia. Being a prudent developer, we are careful in ensuring that we face minimum risk by putting out minimum capital outlay.
“We also need to do a thorough research on the demand before embarking on any of the projects,” Leong said.
Should the company decide to venture overseas, it is likely to do it via a joint venture with an established local party so that it needs minimum capital payout.
“We need to take into account a whole range of factors and among the most important criteria we are looking for is that our joint-venture partner should be a reputable local party with extensive knowledge of the local market,” he said.
“If we can have that in place, we can concentrate on what we do best and introduce our lifestyle concepts and our branding in their market.”
MALAYSIAN Resources Corp Bhd (MRCB) plans to launch a billion-ringgit real estate investment trust (REIT) made up of commercial properties at KL Sentr
MALAYSIAN Resources Corp Bhd (MRCB) plans to launch a billion-ringgit real estate investment trust (REIT) made up of commercial properties at KL Sentral in five years.
"A REIT will happen when our properties mature. It takes about three years for the buildings to come up and rentals to roll in," MRCB group managing director Shahril Ridza Ridzuan told Business Times after the company's annual and extraordinary general meetings in Kuala Lumpur yesterday.
Assets that may be injected into the REIT include Plaza Sentral 1 & 2 and office towers.
Shahril said the RM8.3 billion KL Sentral is expected to contribute some 50 per cent to the group's revenue this year.
The company is on track to achieving net profit of RM60 million and revenue of more than RM800 million for its financial year ending December 31 2007, up 83 per cent and 51 per cent respectively over last year's.
The results will represent MRCB's third straight year of more than 50 per cent growth following the rollout of the Ninth Malaysia Plan (9MP) and rising demand for its high-end property developments.
"Our overseas operations in Dubai and Bangladesh will contribute less than 10 per cent to revenue as most of the projects commenced only this year," he said.
On the Penang monorail project, Shahril said MRCB is waiting for the Government to finalise the specifications, routing and alignment before finalising the project cost.
"We have put in our papers and started work. The cost will be decided when the structure is finalised," he said.
Shahril told reporters earlier that MRCB was eyeing new markets in the Middle East to replicate its Malaysian businesses like building urban transportation hubs and working on engineering and infrastructure projects.
He said the group's next venture overseas will be in Saudi Arabia where it has begun talks with the locals to provide solutions in its area of expertise.
"We are also bidding for power transmission jobs, transportation hub development and toll highway concessions in Malaysia and overseas to expand our current order book of RM2.5 billion," he added.
Shahril also said that MRCB is still waiting for a final decision by the Government to provide a transmission solution for power to be generated at the Bakun Dam.
He, however, declined to comment if MRCB would take a 70 per cent stake in Peninsular Metroworks Sdn Bhd, which has the concession for the Penang Outer Ring Road project.
"On our side, we are not willing to comment about details on any particular projects. We do view Penang as a big area for our involvement, and we are always looking for opportunities to expand our businesses. Hopefully, in the near future, we will see some of our strategies coming into action," Shahril said.
"A REIT will happen when our properties mature. It takes about three years for the buildings to come up and rentals to roll in," MRCB group managing director Shahril Ridza Ridzuan told Business Times after the company's annual and extraordinary general meetings in Kuala Lumpur yesterday.
Assets that may be injected into the REIT include Plaza Sentral 1 & 2 and office towers.
Shahril said the RM8.3 billion KL Sentral is expected to contribute some 50 per cent to the group's revenue this year.
The company is on track to achieving net profit of RM60 million and revenue of more than RM800 million for its financial year ending December 31 2007, up 83 per cent and 51 per cent respectively over last year's.
The results will represent MRCB's third straight year of more than 50 per cent growth following the rollout of the Ninth Malaysia Plan (9MP) and rising demand for its high-end property developments.
"Our overseas operations in Dubai and Bangladesh will contribute less than 10 per cent to revenue as most of the projects commenced only this year," he said.
On the Penang monorail project, Shahril said MRCB is waiting for the Government to finalise the specifications, routing and alignment before finalising the project cost.
"We have put in our papers and started work. The cost will be decided when the structure is finalised," he said.
Shahril told reporters earlier that MRCB was eyeing new markets in the Middle East to replicate its Malaysian businesses like building urban transportation hubs and working on engineering and infrastructure projects.
He said the group's next venture overseas will be in Saudi Arabia where it has begun talks with the locals to provide solutions in its area of expertise.
"We are also bidding for power transmission jobs, transportation hub development and toll highway concessions in Malaysia and overseas to expand our current order book of RM2.5 billion," he added.
Shahril also said that MRCB is still waiting for a final decision by the Government to provide a transmission solution for power to be generated at the Bakun Dam.
He, however, declined to comment if MRCB would take a 70 per cent stake in Peninsular Metroworks Sdn Bhd, which has the concession for the Penang Outer Ring Road project.
"On our side, we are not willing to comment about details on any particular projects. We do view Penang as a big area for our involvement, and we are always looking for opportunities to expand our businesses. Hopefully, in the near future, we will see some of our strategies coming into action," Shahril said.
TA plans RM1.2bil REIT on SGX
TA plans RM1.2bil REIT on SGX
By THE STAR
TA Enterprise Bhd will list its real estate investment trust (REIT) in Singapore by year-end with an initial fund size of around RM1.2bil.
Executive chairman Datin Alicia Tiah said the group was currently working on the listing of its REIT on Singapore Exchange Ltd (SGX).
“We have been talking with our merchant banks and relevant parties for the listing exercise. Hopefully we will be able list our REIT by year-end. It is just a matter of timing,” Tiah said in an interview.
She said this would be a very good time to go for a listing with the current bull market. She added that REIT would be a good way for the company to unlock its property value.
“We believe Singapore is the best location for our listing exercise as the Singaporean market provides better valuations. The REITs listed on the SGX are doing very well, and the approval period from the regulators is shorter,” she explained.
Tiah said more properties could be injected into its REIT, but TA Enterprise would begin with three properties.
The REIT would include The Radisson Hotel in Sydney, its commercial building in downtown Vancouver in Canada as well as Menara TA One in Kuala Lumpur.
“We will have a good combination of REIT because we will have a hotel as well as commercial buildings. I think investors will like it,” Tiah said.
She said the cash raised through the REIT would go towards the funding of its ongoing development projects as well as upcoming projects.
TA Enterprise expects to unlock more than RM500mil and would use the money generated to buy more properties in China and Vietnam or enlarge its landbank locally.
On its overseas expansion, Tiah said TA Enterprise was currently conducting feasibility studies for ventures into Vietnam and China.
“Vietnam and China will offer good opportunities. We have been discussing with some potential partners in Vietnam, but it is still at the preliminary stage,” she said.
She added that TA Enterprise would like to tap the stock broking and property market in Vietnam.
TA Enterprise is expected to use Hong Kong, in which it already has a presence, a stepping stone to penetrate the huge Chinese market.
“We will venture into the property market in China for the moment before deciding to tap into the Chinese stockbroking industry.
“We will take it one step at a time. We'd rather be safe than lose any money,” Tiah said.
TA Enterprise plans to introduce new services in Malaysia in the second half of 2007 and is currently waiting for licences from the local authorities.
The stockbroking company will introduce services such as corporate advisory work and issue-structured products such as call warrants and exchange-traded funds, as well as go into venture capital lending.
According to Tiah, the company is currently preparing for the launch of Idaman Bintang, a residential and commercial development.
The project, which has a gross development value of RM1bil, sits on a three-acre freehold site at the intersection of Jalan Imbi and Jalan Bukit Bintang.
“Idaman Bintang will have three towers. We will be selling two towers and keep one to generate recurring income,” she said.
However, she did not specify other details like the built-up areas and timing of the project.
“The project (Idaman Bintang) has attracted a lot of interest even before the plan is approved,” Tiah said, adding that she believed that TA had a competitive advantage.
She said the company was also planning to build another two towers - TA Three (60 storeys) and TA Four (35 storeys) – on the land adjacent to the existing Menara TA One at Jalan P. Ramlee, Kuala Lumpur.
The towers are just across the road from Kuala Lumpur City Centre.
Tiah said the project would consist of about 300 units of 6-star hotel service apartments, offices and retail spaces.
On the company's financial performance, Tiah said she expected all its business segments to turn in a better performance for the current financial year ending Jan 31, 2008.
“Barring unforeseen circumstances, the company is expected to perform better this year due to the positive sentiment of the stock market as well as the property sector,” she said.
“Although we have not announced our first quarter results, I can assure you that they'll be very commendable results.”
Tiah added that TA Enterprise would also adopt its first ever dividend policy to pay its shareholders consistent yearly dividends of between 40% and 60% of the group's net profit.
For the financial year (FY) ended Jan 31, 2007, TA Enterprise posted a net profit of RM133.7mil on revenue of RM354.5mil, compared with RM80.7mil and RM312.8mil respectively in FY06.
To a question, Tiah said it did think about privatising the company when its share price was trading way below its net tangible assets (NTA) level.
“TA Enterprise was trading at 88 sen early of the year and the thought of privatisation came because the trading price then was not attractive,” she said, adding that its share price was still trading below its NTA level.
Tiah said she might consider a privatisation if the share price go below its “intrinsic value”.
TA Enterprise's share price has gained over 110% from a low of 77.5 sen on Jan 11, closing at RM1.63 last Friday. The counter was the most heavily traded counter that day with 29.3 million shares changing hands.
By THE STAR
TA Enterprise Bhd will list its real estate investment trust (REIT) in Singapore by year-end with an initial fund size of around RM1.2bil.
Executive chairman Datin Alicia Tiah said the group was currently working on the listing of its REIT on Singapore Exchange Ltd (SGX).
“We have been talking with our merchant banks and relevant parties for the listing exercise. Hopefully we will be able list our REIT by year-end. It is just a matter of timing,” Tiah said in an interview.
She said this would be a very good time to go for a listing with the current bull market. She added that REIT would be a good way for the company to unlock its property value.
“We believe Singapore is the best location for our listing exercise as the Singaporean market provides better valuations. The REITs listed on the SGX are doing very well, and the approval period from the regulators is shorter,” she explained.
Tiah said more properties could be injected into its REIT, but TA Enterprise would begin with three properties.
The REIT would include The Radisson Hotel in Sydney, its commercial building in downtown Vancouver in Canada as well as Menara TA One in Kuala Lumpur.
“We will have a good combination of REIT because we will have a hotel as well as commercial buildings. I think investors will like it,” Tiah said.
She said the cash raised through the REIT would go towards the funding of its ongoing development projects as well as upcoming projects.
TA Enterprise expects to unlock more than RM500mil and would use the money generated to buy more properties in China and Vietnam or enlarge its landbank locally.
On its overseas expansion, Tiah said TA Enterprise was currently conducting feasibility studies for ventures into Vietnam and China.
“Vietnam and China will offer good opportunities. We have been discussing with some potential partners in Vietnam, but it is still at the preliminary stage,” she said.
She added that TA Enterprise would like to tap the stock broking and property market in Vietnam.
TA Enterprise is expected to use Hong Kong, in which it already has a presence, a stepping stone to penetrate the huge Chinese market.
“We will venture into the property market in China for the moment before deciding to tap into the Chinese stockbroking industry.
“We will take it one step at a time. We'd rather be safe than lose any money,” Tiah said.
TA Enterprise plans to introduce new services in Malaysia in the second half of 2007 and is currently waiting for licences from the local authorities.
The stockbroking company will introduce services such as corporate advisory work and issue-structured products such as call warrants and exchange-traded funds, as well as go into venture capital lending.
According to Tiah, the company is currently preparing for the launch of Idaman Bintang, a residential and commercial development.
The project, which has a gross development value of RM1bil, sits on a three-acre freehold site at the intersection of Jalan Imbi and Jalan Bukit Bintang.
“Idaman Bintang will have three towers. We will be selling two towers and keep one to generate recurring income,” she said.
However, she did not specify other details like the built-up areas and timing of the project.
“The project (Idaman Bintang) has attracted a lot of interest even before the plan is approved,” Tiah said, adding that she believed that TA had a competitive advantage.
She said the company was also planning to build another two towers - TA Three (60 storeys) and TA Four (35 storeys) – on the land adjacent to the existing Menara TA One at Jalan P. Ramlee, Kuala Lumpur.
The towers are just across the road from Kuala Lumpur City Centre.
Tiah said the project would consist of about 300 units of 6-star hotel service apartments, offices and retail spaces.
On the company's financial performance, Tiah said she expected all its business segments to turn in a better performance for the current financial year ending Jan 31, 2008.
“Barring unforeseen circumstances, the company is expected to perform better this year due to the positive sentiment of the stock market as well as the property sector,” she said.
“Although we have not announced our first quarter results, I can assure you that they'll be very commendable results.”
Tiah added that TA Enterprise would also adopt its first ever dividend policy to pay its shareholders consistent yearly dividends of between 40% and 60% of the group's net profit.
For the financial year (FY) ended Jan 31, 2007, TA Enterprise posted a net profit of RM133.7mil on revenue of RM354.5mil, compared with RM80.7mil and RM312.8mil respectively in FY06.
To a question, Tiah said it did think about privatising the company when its share price was trading way below its net tangible assets (NTA) level.
“TA Enterprise was trading at 88 sen early of the year and the thought of privatisation came because the trading price then was not attractive,” she said, adding that its share price was still trading below its NTA level.
Tiah said she might consider a privatisation if the share price go below its “intrinsic value”.
TA Enterprise's share price has gained over 110% from a low of 77.5 sen on Jan 11, closing at RM1.63 last Friday. The counter was the most heavily traded counter that day with 29.3 million shares changing hands.
MAAKL REIT to focus on Asia-Pacific
MAAKL REIT to focus on Asia-Pacific
By BUSINESS TIMES
MAAKL Mutual has launched its first real estate investment trust (REIT) fund, focusing on REITs and infrastructure funds/trusts listed in Asia Pacific markets.
The MAAKL Asia Pacific REIT Fund (MAPREIT), a fund-of-funds investment, will focus on 13 countries - India, China, Hong Kong, Indonesia, South Korea, the Philippines, Singapore, Taiwan, Thailand, Australia, Japan, New Zealand and Malaysia.
Some 200 million units priced at 25 sen per unit will be offered beginning yesterday to June 27 2007. The minimum initial investment is RM1,000 while the minimum additional investment is RM100.
"Beside REITs, MAPREIT will also invest in infrastructure funds/trusts, focusing primarily on utilities, transportation or logistics and communication," MAAKL Mutual chief executive officer Wong Boon Choy said in a statement.
MAPREIT will invest up to a maximum of 98 per cent of its net asset value in Asia Pacific REIT's and infrastructure funds/ trusts. A minimum of 50 per cent must be invested in Asia Pacific REITs at all times while the balance can be invested in infrastructure funds/ trusts.
By BUSINESS TIMES
MAAKL Mutual has launched its first real estate investment trust (REIT) fund, focusing on REITs and infrastructure funds/trusts listed in Asia Pacific markets.
The MAAKL Asia Pacific REIT Fund (MAPREIT), a fund-of-funds investment, will focus on 13 countries - India, China, Hong Kong, Indonesia, South Korea, the Philippines, Singapore, Taiwan, Thailand, Australia, Japan, New Zealand and Malaysia.
Some 200 million units priced at 25 sen per unit will be offered beginning yesterday to June 27 2007. The minimum initial investment is RM1,000 while the minimum additional investment is RM100.
"Beside REITs, MAPREIT will also invest in infrastructure funds/trusts, focusing primarily on utilities, transportation or logistics and communication," MAAKL Mutual chief executive officer Wong Boon Choy said in a statement.
MAPREIT will invest up to a maximum of 98 per cent of its net asset value in Asia Pacific REIT's and infrastructure funds/ trusts. A minimum of 50 per cent must be invested in Asia Pacific REITs at all times while the balance can be invested in infrastructure funds/ trusts.
Quill Capital to buy Wisma Technip, Plaza Mont' Kiara
Quill Capital to buy Wisma Technip, Plaza Mont' Kiara
By BUSINESS TIMES
QUILL Capital Management Sdn Bhd (QCM), the manager of Quill Capital Trust (QCT), plans to buy Wisma Technip and Plaza Mont' Kiara for RM215 million.
The company will buy Wisma Technip from Aragorn ABS Bhd for RM125 million, and Plaza Mont' Kiara commercial shops and car park lots from Sunrise Bhd for RM90 million.
Mayban Trustees Bhd, as trustee of QCT, yesterday signed separate conditional agreements with the respective parties.
The acquisitions are expected to be completed by the fourth quarter of this year.
"Within six months from listing, we are adding to our portfolio two yield-accretive assets with high occupancy and long term tenancies. QCT will also achieve better geographical diversification with this latest foothold in the Klang Valley," QCM chief executive officer Chan Say Yeong said in a statement yesterday.
He said the acquisition is in line with the group's strategy to doubling QCT's asset size to RM560 million by end-2007.
QCT currently holds four buildings in Cyberjaya.
Wisma Technip is a fully occupied office building with a net lettable area of 233,021 sq ft while Plaza Mont' Kiara has a a net lettable area of 73,408 sq ft and is 94.9 per cent occupied.
QCM has also announced a proposed placement of new units in QCT to raise gross proceeds of up to RM377.2 million to finance the proposed acquisitions and other requirements.
The proposed placement of not exceeding 251.4 million units will be to institutional and other investors as well as to the two substantial unitholders.
Capital Commercial Trust (CCT) and the Quill Group may subscribe for new units such that their proportionate unitholdings of 30 per cent in QCT is maintained.
The proposed placement will increase QCT's fund size to up to 490.1 million units from 238.7 million units.
HwangDBS Investment Bank Bhd and Aseambankers Malaysia Bhd are joint placement agents for the exercise.
By BUSINESS TIMES
QUILL Capital Management Sdn Bhd (QCM), the manager of Quill Capital Trust (QCT), plans to buy Wisma Technip and Plaza Mont' Kiara for RM215 million.
The company will buy Wisma Technip from Aragorn ABS Bhd for RM125 million, and Plaza Mont' Kiara commercial shops and car park lots from Sunrise Bhd for RM90 million.
Mayban Trustees Bhd, as trustee of QCT, yesterday signed separate conditional agreements with the respective parties.
The acquisitions are expected to be completed by the fourth quarter of this year.
"Within six months from listing, we are adding to our portfolio two yield-accretive assets with high occupancy and long term tenancies. QCT will also achieve better geographical diversification with this latest foothold in the Klang Valley," QCM chief executive officer Chan Say Yeong said in a statement yesterday.
He said the acquisition is in line with the group's strategy to doubling QCT's asset size to RM560 million by end-2007.
QCT currently holds four buildings in Cyberjaya.
Wisma Technip is a fully occupied office building with a net lettable area of 233,021 sq ft while Plaza Mont' Kiara has a a net lettable area of 73,408 sq ft and is 94.9 per cent occupied.
QCM has also announced a proposed placement of new units in QCT to raise gross proceeds of up to RM377.2 million to finance the proposed acquisitions and other requirements.
The proposed placement of not exceeding 251.4 million units will be to institutional and other investors as well as to the two substantial unitholders.
Capital Commercial Trust (CCT) and the Quill Group may subscribe for new units such that their proportionate unitholdings of 30 per cent in QCT is maintained.
The proposed placement will increase QCT's fund size to up to 490.1 million units from 238.7 million units.
HwangDBS Investment Bank Bhd and Aseambankers Malaysia Bhd are joint placement agents for the exercise.
Bandar Raya plans RM1b REIT
Bandar Raya plans RM1b REIT
By BUSINESS TIMES
BANDAR Raya Developments Bhd (BRDB) may set up a property trust with assets worth more than RM1 billion in three years.
The real estate investment trust (REIT) will feature commercial properties in Kuala Lumpur and Johor, chief executive officer Datuk Jaganath Sabapathy said.
"The REIT will enable us to unlock the value of our assets. By 2009, we will have a million sq ft of prime commercial space. If we decide to launch a REIT, it would be in 2010," he told Business Times after a media briefing on the development of CapSquare in Kuala Lumpur yesterday.
Jaganath said the REIT will include assets such as the Bangsar Shopping Centre (BSC), properties at CapSquare, commercial components in The Troika and Permas Jaya Mall in Johor.
He also said that BRDB expects to post better earnings this year, driven by sales at CapSquare, The Troika and One Menerung. The latter two are luxury condominiums in Kuala Lumpur.
CapSquare, sprawled over 6ha, comprises two 40-storey office towers; two high-rise condominium blocks; four signature office buildings and a four-storey retail centre; two eight-storey office towers; and an entertainment, fitness and food village, known as e.centre.
The estimated gross development value (GDV) of the project is around RM2 billion, and it is expected to be completed by 2010.
Jaganath said the gross development cost of the project is expected to be around RM1.5 billion due to an eight-year delay to finish the job.
CapSquare was stalled in 1997 because of the financial crisis and other issues.
It was relaunched in 2005. BRDB has a 70 per cent stake in the project, with the rest held by UDA Holdings Bhd.
"We plan to build a hotel in CapSquare in five years. Next year, we will launch two luxury condominium projects in Bangsar with an expected GDV of RM1.2 billion," Jaganath said.
By BUSINESS TIMES
BANDAR Raya Developments Bhd (BRDB) may set up a property trust with assets worth more than RM1 billion in three years.
The real estate investment trust (REIT) will feature commercial properties in Kuala Lumpur and Johor, chief executive officer Datuk Jaganath Sabapathy said.
"The REIT will enable us to unlock the value of our assets. By 2009, we will have a million sq ft of prime commercial space. If we decide to launch a REIT, it would be in 2010," he told Business Times after a media briefing on the development of CapSquare in Kuala Lumpur yesterday.
Jaganath said the REIT will include assets such as the Bangsar Shopping Centre (BSC), properties at CapSquare, commercial components in The Troika and Permas Jaya Mall in Johor.
He also said that BRDB expects to post better earnings this year, driven by sales at CapSquare, The Troika and One Menerung. The latter two are luxury condominiums in Kuala Lumpur.
CapSquare, sprawled over 6ha, comprises two 40-storey office towers; two high-rise condominium blocks; four signature office buildings and a four-storey retail centre; two eight-storey office towers; and an entertainment, fitness and food village, known as e.centre.
The estimated gross development value (GDV) of the project is around RM2 billion, and it is expected to be completed by 2010.
Jaganath said the gross development cost of the project is expected to be around RM1.5 billion due to an eight-year delay to finish the job.
CapSquare was stalled in 1997 because of the financial crisis and other issues.
It was relaunched in 2005. BRDB has a 70 per cent stake in the project, with the rest held by UDA Holdings Bhd.
"We plan to build a hotel in CapSquare in five years. Next year, we will launch two luxury condominium projects in Bangsar with an expected GDV of RM1.2 billion," Jaganath said.
Homebuyers in Malaysia
Homebuyers in Malaysia
Traditionally overseas homebuyers in Malaysia have originated from the US, China and Japan. Today, however, as competition amongst other emerging property markets gathers steam, Malaysia is making sure it does not miss the boat and today actively encourages all forms of foreign investment to its shores.
As a result of a successful growth in economy and a competitive foreign exchange status, Malaysia attracts an exciting new influx of foreign investment in industry and real estate. Residential and holiday home purchasers are confidently buying into the very beginnings of a property boom in Malaysia, safe in the knowledge that prices are relatively low and growth figures remain high.
Malaysia is an attractive destination for high net worth foreigners looking to set up home. Now that the government has introduced changes in the Foreign Investment Committee (FIC) guidelines for foreign property purchase and restrictions have been lifted regarding the usage and number of units that can be purchased by foreigners, real estate in Malaysia has become far more accessible.
Malaysia Property Hotspots
As is often the case in emerging markets, city centre property investment can yield some high returns and Kuala Lumpur is no exception. With an ever increasing expatriate worker presence, a requirement has emerged for commercial premises, top-end accommodation, off-plan properties and buy-to-let options which are particularly attractive to investors. Alternatively, due to a sharp increase in tourist figures in Malaysia, property purchasers are finding some excellent opportunities in coastal areas such as Port Dickson, namely the sea-front Legend Water Chalets and the Banyun Curve Water Chalets, which are proving highly popular amongst many discerning property buyers.
Traditionally overseas homebuyers in Malaysia have originated from the US, China and Japan. Today, however, as competition amongst other emerging property markets gathers steam, Malaysia is making sure it does not miss the boat and today actively encourages all forms of foreign investment to its shores.
As a result of a successful growth in economy and a competitive foreign exchange status, Malaysia attracts an exciting new influx of foreign investment in industry and real estate. Residential and holiday home purchasers are confidently buying into the very beginnings of a property boom in Malaysia, safe in the knowledge that prices are relatively low and growth figures remain high.
Malaysia is an attractive destination for high net worth foreigners looking to set up home. Now that the government has introduced changes in the Foreign Investment Committee (FIC) guidelines for foreign property purchase and restrictions have been lifted regarding the usage and number of units that can be purchased by foreigners, real estate in Malaysia has become far more accessible.
Malaysia Property Hotspots
As is often the case in emerging markets, city centre property investment can yield some high returns and Kuala Lumpur is no exception. With an ever increasing expatriate worker presence, a requirement has emerged for commercial premises, top-end accommodation, off-plan properties and buy-to-let options which are particularly attractive to investors. Alternatively, due to a sharp increase in tourist figures in Malaysia, property purchasers are finding some excellent opportunities in coastal areas such as Port Dickson, namely the sea-front Legend Water Chalets and the Banyun Curve Water Chalets, which are proving highly popular amongst many discerning property buyers.
Malaysia Property Investment
Malaysia Property Investment
Property investors in Malaysia are profiting from some lucrative off-plan investments in and around the capital city as well as within the coastal tourist resorts and both markets are experiencing high growth rates. Residential property prices have generally risen by between 15 and 30% over the past five years and rental yields in Kuala Lumpur stand at a respectable 7.4 to 8.7%, while corresponding figures remain just a little lower within the tourist resorts. Holiday rentals are big business, particularly in areas in and around Port Dickson, as is the holiday home market which continues to attract visitors to this interesting and exotic holiday destination.
While property investment in Malaysia remains a firm favourite amongst Asian and US investors, we are witnessing a current European trend for worldwide property investment and Malaysia is now catching the eye of all discerning property investors with worldwide vision for a shrewd investment.
Malaysian property prices remain low by international standards and the local currency, the Malaysian ringgit (RM) is very cheap versus the sterling, making investment in carefully selected Malaysian property a highly lucrative option.
Reasons why property in Malaysia is a good investment
Government legislation is actively encouraging foreign property investment through a number of tax incentives and the relaxation of laws governing real estate purchase by foreigners.
Through its Ninth Plan, the government of Malaysia aims to improve the infrastructure and general economic development of the country. Analysts believe this will have a positive impact on the Malaysian real estate market.
Malaysia boasts a stable economy and government. It already has a world-class infrastructure, industry and support, along with a modern and cosmopolitan lifestyle.
English is widely spoken by a multi-lingual, experienced and qualified workforce.
The value of the local currency, the ringgit, is far below the euro, dollar and pound sterling, allowing foreign investors to buy a lot more for their money in Malaysia.
Property prices per square metre in all major Malaysian towns and cities are a fraction of the cost of similar investments in London and New York.
There is high demand for quality new real estate is high from an affluent expatriate market.
Malaysia is also among the top three countries for the greatest number of tourist arrivals among the 53 Commonwealth countries, according to the World Tourism Organisation.
Tourist arrivals in Malaysia rose by more than 160% between 2000 and 2005 - an astonishing achievement for tourism.
Malaysia is located near the Equator, hence its year-round tropical climate, ideal for tourism.
Malaysia does not suffer from any natural disasters such as earthquakes, volcanoes or tornados.
Extensive white sandy beaches continue to draw holidaymakers. Port Dickson resorts which have long been a favourite amongst visitors from Kuala Lumpur and other neighbouring towns who seek an escape from hectic life.
Buying costs are very low in Malaysia at between 3.4 to 6.75% of the property value, including 2.75% agent’s commission (for first MYR 500,000).
IPIN (International Property Investment Network) assists investors of all levels to find the best and most current investment opportunities. The network carefully vets all recommended investment locations, therefore maximising members´ chances of achieving the best return on investment from their property purchases in Malaysia.
Property investors in Malaysia are profiting from some lucrative off-plan investments in and around the capital city as well as within the coastal tourist resorts and both markets are experiencing high growth rates. Residential property prices have generally risen by between 15 and 30% over the past five years and rental yields in Kuala Lumpur stand at a respectable 7.4 to 8.7%, while corresponding figures remain just a little lower within the tourist resorts. Holiday rentals are big business, particularly in areas in and around Port Dickson, as is the holiday home market which continues to attract visitors to this interesting and exotic holiday destination.
While property investment in Malaysia remains a firm favourite amongst Asian and US investors, we are witnessing a current European trend for worldwide property investment and Malaysia is now catching the eye of all discerning property investors with worldwide vision for a shrewd investment.
Malaysian property prices remain low by international standards and the local currency, the Malaysian ringgit (RM) is very cheap versus the sterling, making investment in carefully selected Malaysian property a highly lucrative option.
Reasons why property in Malaysia is a good investment
Government legislation is actively encouraging foreign property investment through a number of tax incentives and the relaxation of laws governing real estate purchase by foreigners.
Through its Ninth Plan, the government of Malaysia aims to improve the infrastructure and general economic development of the country. Analysts believe this will have a positive impact on the Malaysian real estate market.
Malaysia boasts a stable economy and government. It already has a world-class infrastructure, industry and support, along with a modern and cosmopolitan lifestyle.
English is widely spoken by a multi-lingual, experienced and qualified workforce.
The value of the local currency, the ringgit, is far below the euro, dollar and pound sterling, allowing foreign investors to buy a lot more for their money in Malaysia.
Property prices per square metre in all major Malaysian towns and cities are a fraction of the cost of similar investments in London and New York.
There is high demand for quality new real estate is high from an affluent expatriate market.
Malaysia is also among the top three countries for the greatest number of tourist arrivals among the 53 Commonwealth countries, according to the World Tourism Organisation.
Tourist arrivals in Malaysia rose by more than 160% between 2000 and 2005 - an astonishing achievement for tourism.
Malaysia is located near the Equator, hence its year-round tropical climate, ideal for tourism.
Malaysia does not suffer from any natural disasters such as earthquakes, volcanoes or tornados.
Extensive white sandy beaches continue to draw holidaymakers. Port Dickson resorts which have long been a favourite amongst visitors from Kuala Lumpur and other neighbouring towns who seek an escape from hectic life.
Buying costs are very low in Malaysia at between 3.4 to 6.75% of the property value, including 2.75% agent’s commission (for first MYR 500,000).
IPIN (International Property Investment Network) assists investors of all levels to find the best and most current investment opportunities. The network carefully vets all recommended investment locations, therefore maximising members´ chances of achieving the best return on investment from their property purchases in Malaysia.
Malaysian Property Market Overview
Malaysian Property Market Overview
Current trends in property purchase in Malaysia are characterized by investment either in the capital city of Kuala Lumpur or within the new coastal resorts. City investment is growing in line with increased direct foreign investment from China, the US and Japan. A surge in economic activity (predicted increase in worker numbers of 27.9% by 2013 over 10 years) has brought with it a high demand for quality commercial and residential real estate lettings to serve an ever growing expatriate community employed in and around the city. Off-plan properties are being sold to international property developers with impressive guaranteed rental yields of between six and ten percent.
Meanwhile, growth in the tourism sector has prompted the birth of new resorts, particularly in coastal areas just south of Kuala Lumpur around Port Dickson. Boosted by a strong tourist industry, property purchasers are experiencing impressive returns on their buy-to-let and off-plan investments. These holiday resorts also offer great potential for second home buyers seeking an exotic overseas home in the sun.
The Malaysian government has recently relaxed home ownership rules for foreigners and introduced tax incentives which contribute to make this property market an easier and more beneficial option for foreign ownership. Further details are available on www.imi.gov.my.
Current trends in property purchase in Malaysia are characterized by investment either in the capital city of Kuala Lumpur or within the new coastal resorts. City investment is growing in line with increased direct foreign investment from China, the US and Japan. A surge in economic activity (predicted increase in worker numbers of 27.9% by 2013 over 10 years) has brought with it a high demand for quality commercial and residential real estate lettings to serve an ever growing expatriate community employed in and around the city. Off-plan properties are being sold to international property developers with impressive guaranteed rental yields of between six and ten percent.
Meanwhile, growth in the tourism sector has prompted the birth of new resorts, particularly in coastal areas just south of Kuala Lumpur around Port Dickson. Boosted by a strong tourist industry, property purchasers are experiencing impressive returns on their buy-to-let and off-plan investments. These holiday resorts also offer great potential for second home buyers seeking an exotic overseas home in the sun.
The Malaysian government has recently relaxed home ownership rules for foreigners and introduced tax incentives which contribute to make this property market an easier and more beneficial option for foreign ownership. Further details are available on www.imi.gov.my.
Singapore exchange launches Reits in Malaysian property
Singapore exchange launches Reits in Malaysian property
The Singapore exchange is believed to be seeking real estate investment trust (Reits) listings for products that could include Malaysian properties.
According to the Times, the Singapore Reit market has grown to be worth approximately £7 billion in recent years....
International Property Forum
The Singapore exchange is believed to be seeking real estate investment trust (Reits) listings for products that could include Malaysian properties.
According to the Times, the Singapore Reit market has grown to be worth approximately £7 billion in recent years.
Alastair Gillespie, co-head of Asian real estate research at UBS, told the newspaper that the "liquidity" within the country's Reits market could see Singapore become an important investment centre.
"It could quite quickly begin to attract Reits where the underlying assets are based in India, Indonesia, Vietnam, Malaysia and China," he said.
In related news, Christopher Boyd, executive chairman of Regroup Associates, recently said that Malaysia's rapid economic growth would be able to sustain its property market, the Edge Daily reports.
Additionally, the government removed capital gains tax earlier in the year, a move which could attract a greater number of foreign property investors.
The Singapore exchange is believed to be seeking real estate investment trust (Reits) listings for products that could include Malaysian properties.
According to the Times, the Singapore Reit market has grown to be worth approximately £7 billion in recent years....
International Property Forum
The Singapore exchange is believed to be seeking real estate investment trust (Reits) listings for products that could include Malaysian properties.
According to the Times, the Singapore Reit market has grown to be worth approximately £7 billion in recent years.
Alastair Gillespie, co-head of Asian real estate research at UBS, told the newspaper that the "liquidity" within the country's Reits market could see Singapore become an important investment centre.
"It could quite quickly begin to attract Reits where the underlying assets are based in India, Indonesia, Vietnam, Malaysia and China," he said.
In related news, Christopher Boyd, executive chairman of Regroup Associates, recently said that Malaysia's rapid economic growth would be able to sustain its property market, the Edge Daily reports.
Additionally, the government removed capital gains tax earlier in the year, a move which could attract a greater number of foreign property investors.
Services Sector To Do Better This Year
Services Sector To Do Better This Year
KUALA LUMPUR, June 29 (Bernama) -- The deficit in the country's services trade is expected to see further improvement this year with increased focus on services development and enhanced domestic capacity, the Ministry of International Trade and Industry (MITI) says.
"The Visit Malaysia Year 2007, greater outsourcing opportunities, increasing port throughput and higher revenue from Islamic financial services expansion would enhance exports of services," MITI said in the Malaysia International Trade and Industry Report 2006 released here Friday.
Under the Third Industrial Master Plan (IMP3) two national councils -- Malaysian Services Development Council and the Malaysian Logistics Council have been established to coordinate the promotion and development of the targeted services sector.
Enhance domestic capacity would reduce import growth to some extent, it said.
The services sector account for the largest share of Malaysia's Gross Domestic Product (GDP) with 51.8 percent contribution last year, with a growth rate of 7.2 percent.
It was estimated that about 5.7 million workers or 51.3 percent of the workforce were employed in the services sector. Non-government services were estimated to account for 44.7 percent of GDP and 41.8 percent of the total employment last year.
Last year, the finance, insurance, real estate and business services maintained their position as the leading sub-sectors, contributing an estimated 14.8 percent or RM70.2 billion to GDP.
This was followed by wholesale and retail trade, hotels and restaurants with RM65.2 billion or 13.7 percent, and transport, storage and communications RM34.8 billion or 7.3 percent.
-- BERNAMA
KUALA LUMPUR, June 29 (Bernama) -- The deficit in the country's services trade is expected to see further improvement this year with increased focus on services development and enhanced domestic capacity, the Ministry of International Trade and Industry (MITI) says.
"The Visit Malaysia Year 2007, greater outsourcing opportunities, increasing port throughput and higher revenue from Islamic financial services expansion would enhance exports of services," MITI said in the Malaysia International Trade and Industry Report 2006 released here Friday.
Under the Third Industrial Master Plan (IMP3) two national councils -- Malaysian Services Development Council and the Malaysian Logistics Council have been established to coordinate the promotion and development of the targeted services sector.
Enhance domestic capacity would reduce import growth to some extent, it said.
The services sector account for the largest share of Malaysia's Gross Domestic Product (GDP) with 51.8 percent contribution last year, with a growth rate of 7.2 percent.
It was estimated that about 5.7 million workers or 51.3 percent of the workforce were employed in the services sector. Non-government services were estimated to account for 44.7 percent of GDP and 41.8 percent of the total employment last year.
Last year, the finance, insurance, real estate and business services maintained their position as the leading sub-sectors, contributing an estimated 14.8 percent or RM70.2 billion to GDP.
This was followed by wholesale and retail trade, hotels and restaurants with RM65.2 billion or 13.7 percent, and transport, storage and communications RM34.8 billion or 7.3 percent.
-- BERNAMA
Friday, June 29, 2007
Real EstatePhilippine Star Online - Within the next
Real EstatePhilippine Star Online - Within the next
Real Estate
Philippine Star Online - Within the next five years, over 9,000 residential condominium units spread in at least 28 high-rise buildings will become available in Bonifacio Global City indicating the status of the 240 hectare business district as a fast-rising urban center. In
Source: www.philstar.com
Denver commercial real estate market on solid ground
Rocky Mountain News - The booming Denver commercial real estate is "as good as it gets," Sherman Miller, head of Cushman & Wakefield's Denver office said today, before brokers discussed investment, industrial, office, apartment and california estate fresno real retail markets. The industrial market
Source: www.rockymountainnews.com
Singapore poised to take lead Reits role
Times Online - Singapore is positioning itself as a global centre for trading in real estate investment trusts (Reits), tapping the Asian appetite for property risk. In its attempts to outclass Tokyo and california estate fresno real Hong Kong, the Singapore exchange is expected to pursue
Source: business.timesonline.co.uk
Limited Ownership Opportunities Newly Available at Raffles St. Lucia
Forbes - ST. LUCIA, West Indies, June 28 /PRNewswire/ -- Globally renowned Raffles Hotels & Resorts has announced the introduction of a limited Founder's Program at its newest Caribbean resort: Raffles St. Lucia, West Indies. Elegantly appointed estate
Source: www.forbes.com
In Pictures: Most Resilient U.S. Real Estate Markets
Forbes - When it comes to real estate, the questions on everyone's lips are: How low is low, and california estate fresno real when's the perfect time to buy back in? Of the largest metros still experiencing a slowdown, these are projections of when and california estate fresno real how those areas will recover. Data
Source: www.forbes.com
Free Mortgage Pre-Approval Letter For Victorville Real Estate Buyers
PR Inside - 2007-06-28 16:17:58 - Your search for Victorville CA real estate should start by obtaining a free mortgage loan pre-approval letter. California realtors treat you as a qualified buyer and california estate fresno real you know your maximum home loan amount Your Victorville CA
Source: www.pr-inside.com
Fitch Rates Resource Real Estate Funding CDO 2007-1, Ltd./LLC
Forbes - Fitch assigns the following ratings to Resource Real Estate Funding CDO 2007-1, Ltd. and california estate fresno real Resource Real Estate Funding CDO 2007-1, LLC (collectively, the co-issuers): --$180,000,000 class A-1 floating-rate secured notes due 2046 'AAA'; --$50,000,000
Source: www.forbes.com
BIZ WIZ'S $1.6M IN UNREAL ESTATE
New York Post - She promised to flip them a house. Instead, Manhattan prosecutors say, she flipped them the bird. Jennifer Wilkov, a former financial adviser for American Express, pleaded not guilty yesterday to allegedly tricking some two dozen New York-area
Source: www.nypost.com
L. Merion estate to be kept intact
Philadelphia Inquirer - Under its current zoning, Glenmede could have been the site of as many as 13 houses. The seller, Bryn Mawr College, has been using the site for student housing, but it's too far from campus. Fast action by the conservation community has spared a Main
Source: www.philly.com
Real Estate
Philippine Star Online - Within the next five years, over 9,000 residential condominium units spread in at least 28 high-rise buildings will become available in Bonifacio Global City indicating the status of the 240 hectare business district as a fast-rising urban center. In
Source: www.philstar.com
Denver commercial real estate market on solid ground
Rocky Mountain News - The booming Denver commercial real estate is "as good as it gets," Sherman Miller, head of Cushman & Wakefield's Denver office said today, before brokers discussed investment, industrial, office, apartment and california estate fresno real retail markets. The industrial market
Source: www.rockymountainnews.com
Singapore poised to take lead Reits role
Times Online - Singapore is positioning itself as a global centre for trading in real estate investment trusts (Reits), tapping the Asian appetite for property risk. In its attempts to outclass Tokyo and california estate fresno real Hong Kong, the Singapore exchange is expected to pursue
Source: business.timesonline.co.uk
Limited Ownership Opportunities Newly Available at Raffles St. Lucia
Forbes - ST. LUCIA, West Indies, June 28 /PRNewswire/ -- Globally renowned Raffles Hotels & Resorts has announced the introduction of a limited Founder's Program at its newest Caribbean resort: Raffles St. Lucia, West Indies. Elegantly appointed estate
Source: www.forbes.com
In Pictures: Most Resilient U.S. Real Estate Markets
Forbes - When it comes to real estate, the questions on everyone's lips are: How low is low, and california estate fresno real when's the perfect time to buy back in? Of the largest metros still experiencing a slowdown, these are projections of when and california estate fresno real how those areas will recover. Data
Source: www.forbes.com
Free Mortgage Pre-Approval Letter For Victorville Real Estate Buyers
PR Inside - 2007-06-28 16:17:58 - Your search for Victorville CA real estate should start by obtaining a free mortgage loan pre-approval letter. California realtors treat you as a qualified buyer and california estate fresno real you know your maximum home loan amount Your Victorville CA
Source: www.pr-inside.com
Fitch Rates Resource Real Estate Funding CDO 2007-1, Ltd./LLC
Forbes - Fitch assigns the following ratings to Resource Real Estate Funding CDO 2007-1, Ltd. and california estate fresno real Resource Real Estate Funding CDO 2007-1, LLC (collectively, the co-issuers): --$180,000,000 class A-1 floating-rate secured notes due 2046 'AAA'; --$50,000,000
Source: www.forbes.com
BIZ WIZ'S $1.6M IN UNREAL ESTATE
New York Post - She promised to flip them a house. Instead, Manhattan prosecutors say, she flipped them the bird. Jennifer Wilkov, a former financial adviser for American Express, pleaded not guilty yesterday to allegedly tricking some two dozen New York-area
Source: www.nypost.com
L. Merion estate to be kept intact
Philadelphia Inquirer - Under its current zoning, Glenmede could have been the site of as many as 13 houses. The seller, Bryn Mawr College, has been using the site for student housing, but it's too far from campus. Fast action by the conservation community has spared a Main
Source: www.philly.com
China's Economy May Grow at Fastest Pace in 12 Years (Update6)
China's Economy May Grow at Fastest Pace in 12 Years (Update6)
By Josephine Lau
A Chinese flag flies over the People's Bank of China June 29 (Bloomberg) -- China's economy may expand at the fastest pace in 12 years in 2007 and inflation will exceed the central bank's target, according to a report by economists at the People's Bank of China research department.
Gross domestic product may grow 10.8 percent, said the report published in the Beijing-based China Securities Journal today. Consumer prices may rise 3.2 percent, the fastest pace since 2004 and more than the central bank's 3 percent cap.
Stocks fell as the report added to speculation China will raise interest rates for a third time this year. Premier Wen Jiabao called for ``moderate tightening'' this month after inflation jumped to a 27-month high, factory spending accelerated and the stock market drew warnings of a bubble.
``The Chinese economy's still firing on all cylinders,'' said Tai Hui, an economist at Standard Chartered Bank Plc in Hong Kong. ``These numbers suggest that real interest rates may be even lower than expected, highlighting the need for higher rates.''
The CSI 300 Index fell 2.5 percent and posted its first monthly decline in almost a year. The benchmark has soared 84 percent this year after more than doubling in 2006.
Two interest-rate increases this year have failed to slow the economy's expansion. The benchmark one-year lending rate stands at 6.57 percent and the deposit rate is 3.06 percent.
Overtaking Germany?
China's economy is drawing closer to replacing Germany as the world's third-largest after expanding by at least 10 percent for each of the past four years. China last year reported gross domestic product of 20.9 trillion yuan ($2.6 trillion). That compared with Germany's $2.9 trillion, Japan's $4.5 trillion, and the U.S.'s $13.3 trillion.
The World Bank and the Organization for Economic Co- operation and Development expect China's economy to grow 10.4 percent in 2007. The International Monetary Fund and the Asian Development Bank forecast a 10 percent expansion.
Inflation has outpaced returns on bank deposits, encouraging households to shift money into shares. China's legislature today passed a law allowing the cabinet to scrap or reduce a 20 percent tax on interest income to try to cool the stock market, state news agency Xinhua reported.
Prices face ``potential pressure,'' the central bank said today in a separate statement on financial stability.
China's economy grew 11.1 percent in the first quarter and the government is due to report second-quarter figures in mid- July. Officials are concerned that an investment boom in stocks, factories and real estate could end in an abrupt economic slump.
Credit Growth
Record trade surpluses are spurring the expansion and pumping cash into the financial system, fueling growth in investment. The central bank has ordered lenders to set aside larger reserves five times this year to restrain credit.
The China Banking Regulatory Commission today urged small and medium-sized banks to adhere to a government policy of curbing loans to industries that have too much investment.
Wen signaled on June 14 that the central bank needed to raise interest rates or further curb bank lending. Consumer prices rose 3.4 percent in May from a year earlier because of soaring food costs. Factory investment rose 25.9 percent in the first five months.
The government in February announced an 8 percent growth target for 2007.
That was ``only a signal by the government that it didn't want further acceleration in investment and economic growth,'' said Huang Yiping, an economist with Citigroup Inc. in Hong Kong. ``Everybody knew it would be higher than that.''
China's economy expanded 10.7 percent in 2006 while consumer prices rose 1.5 percent. Gross domestic product grew by 10.9 percent in 1995.
To contact the reporters on this story: Josephine Lau in Beijing at jlau22@bloomberg.net
By Josephine Lau
A Chinese flag flies over the People's Bank of China June 29 (Bloomberg) -- China's economy may expand at the fastest pace in 12 years in 2007 and inflation will exceed the central bank's target, according to a report by economists at the People's Bank of China research department.
Gross domestic product may grow 10.8 percent, said the report published in the Beijing-based China Securities Journal today. Consumer prices may rise 3.2 percent, the fastest pace since 2004 and more than the central bank's 3 percent cap.
Stocks fell as the report added to speculation China will raise interest rates for a third time this year. Premier Wen Jiabao called for ``moderate tightening'' this month after inflation jumped to a 27-month high, factory spending accelerated and the stock market drew warnings of a bubble.
``The Chinese economy's still firing on all cylinders,'' said Tai Hui, an economist at Standard Chartered Bank Plc in Hong Kong. ``These numbers suggest that real interest rates may be even lower than expected, highlighting the need for higher rates.''
The CSI 300 Index fell 2.5 percent and posted its first monthly decline in almost a year. The benchmark has soared 84 percent this year after more than doubling in 2006.
Two interest-rate increases this year have failed to slow the economy's expansion. The benchmark one-year lending rate stands at 6.57 percent and the deposit rate is 3.06 percent.
Overtaking Germany?
China's economy is drawing closer to replacing Germany as the world's third-largest after expanding by at least 10 percent for each of the past four years. China last year reported gross domestic product of 20.9 trillion yuan ($2.6 trillion). That compared with Germany's $2.9 trillion, Japan's $4.5 trillion, and the U.S.'s $13.3 trillion.
The World Bank and the Organization for Economic Co- operation and Development expect China's economy to grow 10.4 percent in 2007. The International Monetary Fund and the Asian Development Bank forecast a 10 percent expansion.
Inflation has outpaced returns on bank deposits, encouraging households to shift money into shares. China's legislature today passed a law allowing the cabinet to scrap or reduce a 20 percent tax on interest income to try to cool the stock market, state news agency Xinhua reported.
Prices face ``potential pressure,'' the central bank said today in a separate statement on financial stability.
China's economy grew 11.1 percent in the first quarter and the government is due to report second-quarter figures in mid- July. Officials are concerned that an investment boom in stocks, factories and real estate could end in an abrupt economic slump.
Credit Growth
Record trade surpluses are spurring the expansion and pumping cash into the financial system, fueling growth in investment. The central bank has ordered lenders to set aside larger reserves five times this year to restrain credit.
The China Banking Regulatory Commission today urged small and medium-sized banks to adhere to a government policy of curbing loans to industries that have too much investment.
Wen signaled on June 14 that the central bank needed to raise interest rates or further curb bank lending. Consumer prices rose 3.4 percent in May from a year earlier because of soaring food costs. Factory investment rose 25.9 percent in the first five months.
The government in February announced an 8 percent growth target for 2007.
That was ``only a signal by the government that it didn't want further acceleration in investment and economic growth,'' said Huang Yiping, an economist with Citigroup Inc. in Hong Kong. ``Everybody knew it would be higher than that.''
China's economy expanded 10.7 percent in 2006 while consumer prices rose 1.5 percent. Gross domestic product grew by 10.9 percent in 1995.
To contact the reporters on this story: Josephine Lau in Beijing at jlau22@bloomberg.net
Hong Kong's shopping spree surges on, and on
Hong Kong's shopping spree surges on, and on
by Claire Cozens
Send by e-mail Save Print Just west of Hong Kong's bustling Tsim Sha Tsui tourist district, bamboo scaffolding stretches like a web over a swathe of reclaimed land surrounded by tower blocks.
It's a seemingly unpromising piece of real estate, but by the end of this year should be home to a massive new complex devoted to Hong Kong's favourite obsession -- shopping.
A decade ago when Britain was handing the territory back to China, sceptics predicted an end to its decades-long shopping spree with a wealth exodus from communist Chinese rule.
It didn't happen. In fact, although its international reputation is often centred on global finance, Hong Kong's economy is actually driven by consumer spending.
Lots of it.
Last year, residents and tourists spent 219 billion Hong Kong dollars (28 billion US dollars) in the city's shops, principally on retail goods.
Consumer power pulled Hong Kong from a seven-year recession sparked by the Asian financial crisis, and the subsequent economic boom has combined with an influx of bargain-hunting tourists from the Chinese mainland to keep the tills ringing.
In an indication of the city's cachet, Louis Vuitton has opened six stores here since the handover, more than it has in Paris or New York.
MTR Corporation, the company running Hong Kong's underground rail network, is hoping to cash in on the boom with a giant shopping centre beside Tsim Sha Tsui, to be called Elements.
It will provide the retail portion of a sprawling new development that will also include the city's tallest building, the International Commerce Centre.
Elements was designed by the architects behind Britain's Bluewater shopping centre. All but two of the spaces have been let, principally to international retailers including high-end British brands Mulberry and Pringle.
It will also house a 12-screen cinema with VIP suites and a martini bar, a 700,000-square-foot (16-acre) roof-top garden and a branch of trendy New York restaurant Megu.
"Shopping is almost Hong Kong's national pastime," said Betty Leong, MTR's chief retail development manager, who is confident there is room for another mall despite concern that traditional market stalls are being squeezed out in the rush for bigger, better and glitzier outlets.
"Hong Kong people are very stressed out, they are time-poor but cash-rich," she told AFP.
"Hong Kong is so condensed, people live in very small spaces and there are not a lot of places to go. This is the third place, somewhere away from office and home where they can go to relax."
The centre is on a direct rail link to Hong Kong's busy airport, making it easily accessible to the hordes of tourists -- 28 million last year -- lured here every year by tax-free shopping.
"The main purpose of most visits is to shop and eat," said Paul Husband, a Hong Kong-based consultant who advises on retail opportunities.
Far from sceptics' forecasts of an end to the consumer high-life, Husband said its continued allure could be attributed partly to Beijing.
"China has made huge efforts to ensure Hong Kong remains successful, for example by ensuring Chinese can have individual visas to visit the city, and allowing Hong Kong companies access to the mainland, rather than trying to clamp down on the city's success," he said.
Around 13.5 million Chinese tourists visited last year spending 27 billion dollars -- more than the rest of the world combined.
The bulk went on clothes, jewellery, watches and cosmetics, and despite a scandal earlier this year over the sale of fake jewellery to mainland buyers, their enthusiasm appears undimmed.
During China's early May holiday week, railings had to be erected outside a Louis Vuitton store to control the queues.
According to Chanel, far from losing significance, Hong Kong is seen more and more by international luxury names as "the trend-setting city for the rest of China."
"The luxury market in Hong Kong is large and it is a window to the region, particularly China," said Boris de Vroomen, managing director of Moet Hennessy Diageo Hong Kong, whose brands include Moet et Chandon and Veuve Clicquot.
Proof of the central role of shopping in Hong Kong came when the visiting French president Jacques Chirac lent the city a huge Picasso, the first time the work had been shown in Asia.
Instead of being displayed in a gallery, the work was given pride of place in a downtown shopping mall.
by Claire Cozens
Send by e-mail Save Print Just west of Hong Kong's bustling Tsim Sha Tsui tourist district, bamboo scaffolding stretches like a web over a swathe of reclaimed land surrounded by tower blocks.
It's a seemingly unpromising piece of real estate, but by the end of this year should be home to a massive new complex devoted to Hong Kong's favourite obsession -- shopping.
A decade ago when Britain was handing the territory back to China, sceptics predicted an end to its decades-long shopping spree with a wealth exodus from communist Chinese rule.
It didn't happen. In fact, although its international reputation is often centred on global finance, Hong Kong's economy is actually driven by consumer spending.
Lots of it.
Last year, residents and tourists spent 219 billion Hong Kong dollars (28 billion US dollars) in the city's shops, principally on retail goods.
Consumer power pulled Hong Kong from a seven-year recession sparked by the Asian financial crisis, and the subsequent economic boom has combined with an influx of bargain-hunting tourists from the Chinese mainland to keep the tills ringing.
In an indication of the city's cachet, Louis Vuitton has opened six stores here since the handover, more than it has in Paris or New York.
MTR Corporation, the company running Hong Kong's underground rail network, is hoping to cash in on the boom with a giant shopping centre beside Tsim Sha Tsui, to be called Elements.
It will provide the retail portion of a sprawling new development that will also include the city's tallest building, the International Commerce Centre.
Elements was designed by the architects behind Britain's Bluewater shopping centre. All but two of the spaces have been let, principally to international retailers including high-end British brands Mulberry and Pringle.
It will also house a 12-screen cinema with VIP suites and a martini bar, a 700,000-square-foot (16-acre) roof-top garden and a branch of trendy New York restaurant Megu.
"Shopping is almost Hong Kong's national pastime," said Betty Leong, MTR's chief retail development manager, who is confident there is room for another mall despite concern that traditional market stalls are being squeezed out in the rush for bigger, better and glitzier outlets.
"Hong Kong people are very stressed out, they are time-poor but cash-rich," she told AFP.
"Hong Kong is so condensed, people live in very small spaces and there are not a lot of places to go. This is the third place, somewhere away from office and home where they can go to relax."
The centre is on a direct rail link to Hong Kong's busy airport, making it easily accessible to the hordes of tourists -- 28 million last year -- lured here every year by tax-free shopping.
"The main purpose of most visits is to shop and eat," said Paul Husband, a Hong Kong-based consultant who advises on retail opportunities.
Far from sceptics' forecasts of an end to the consumer high-life, Husband said its continued allure could be attributed partly to Beijing.
"China has made huge efforts to ensure Hong Kong remains successful, for example by ensuring Chinese can have individual visas to visit the city, and allowing Hong Kong companies access to the mainland, rather than trying to clamp down on the city's success," he said.
Around 13.5 million Chinese tourists visited last year spending 27 billion dollars -- more than the rest of the world combined.
The bulk went on clothes, jewellery, watches and cosmetics, and despite a scandal earlier this year over the sale of fake jewellery to mainland buyers, their enthusiasm appears undimmed.
During China's early May holiday week, railings had to be erected outside a Louis Vuitton store to control the queues.
According to Chanel, far from losing significance, Hong Kong is seen more and more by international luxury names as "the trend-setting city for the rest of China."
"The luxury market in Hong Kong is large and it is a window to the region, particularly China," said Boris de Vroomen, managing director of Moet Hennessy Diageo Hong Kong, whose brands include Moet et Chandon and Veuve Clicquot.
Proof of the central role of shopping in Hong Kong came when the visiting French president Jacques Chirac lent the city a huge Picasso, the first time the work had been shown in Asia.
Instead of being displayed in a gallery, the work was given pride of place in a downtown shopping mall.
Hong Kong changed us
Hong Kong changed us
Real Estate By Charlie Smith
Publish Date: June 28, 2007
Vancouver architect Ron Yuen will never forget those heady days following Expo 86 when he helped redesign the north side of False Creek. Yuen was part of a team hired by Concord Pacific to create a new neighbourhood of high-rise residential towers after Hong Kong billionaire Li Ka-shing’s purchase of the former Expo site.
“I can still remember how amazed I was when the first tower started to go up, and the lineups were around the block,” Yuen recalled in an interview with the Georgia Straight. “There were a lot of Chinese immigrants, Hong Kong immigrants mainly, because of Li Ka-shing and his name.”
Tens of thousands of people moved from Hong Kong to Vancouver in the late 1980s and early ’90s, concerned about the future of the then-British colony, which was going to be returned to China on July 1, 1997. In the late ’80s, there was also an investment boom from Hong Kong, triggered by concerns about what would become of the colony’s capitalist business culture after it reverted to China.
Yuen explained that the exodus from Hong Kong has had a big impact on the Vancouver real-estate industry, noting that prior to Expo 86 there were never lineups to buy property. He said the Hong Kong immigrants also brought with them a strong sense of the economic value of land, a sense that has since been developed by local residents who buy condo units before buildings are constructed. “The Chinese immigrants have said, ‘We keep real estate for the long term. We keep it for generations,’” Yuen remarked.
On June 26, the Chinese Canadian Historical Society of British Columbia organized a forum at UBC’s C.K. Choi Building for the Institute of Asian Research to commemorate the 10th anniversary of Hong Kong’s return to China. One of the speakers, Vancouver multicultural social planner Baldwin Wong, cited three factors that came together to transform Vancouver: the above-mentioned influx from Hong Kong in the late ’80s; the city’s interest in densifying the downtown core; and the combination of developers’ expertise and the injection of new capital into the market.
“Vancouver’s downtown waterfront area was forever changed, more so than any other North American city within such a short time,” Wong said, emphasizing that he was speaking personally and not as a city representative.
Wong, a Hong Kong native, moved to Vancouver in the middle of the 1970s. He explained that by the late ’90s, the Hong Kong style of preselling condos and living in high-rises had become a standard way of investing in real estate in this city. “The practice has now spread to many parts of the Lower Mainland,” he said.
Wong noted that between 1971 and 1986, the city of Vancouver’s Chinese population increased from 25,000 to 70,000. Between 1986 and 1996, it doubled again to 140,000, out of an overall population of 420,000. Much of this increase was fuelled by immigration from Hong Kong.
However, he said, after the British ceded control over its colony in 1997, immigration from Hong Kong fell off sharply. “Chinese immigration continues to grow, now from a different source [China],” Wong said. “One can say that the Hong Kong immigrants more or less have paved the way for other Chinese immigrants or have consolidated the reputation of Vancouver as being an immigrant- and possibly a Chinese-friendly place.”
According to Yuen, one indication of the importance of Hong Kong real-estate buyers has been the avoidance of using the number four when labelling the floors of many buildings. In Cantonese, that number sounds similar to the Cantonese word for death, and so someone from Hong Kong might have an aversion to living on the fourth floor, just as North Americans might not want to live on the 13th.
At the June 26 forum, UBC historian Henry Yu noted that the legacy of Vancouver’s 1907 race riots was that Chinese people were permitted to live only in specific parts of the city. For many years afterward, the only persons of Chinese origin allowed to reside in Shaughnessy and Kerrisdale were servants.
“Then the Hong Kong Chinese came with their money and the entitlement of thinking, ‘I can live anywhere I want,’” Yu said. “That is a major, major change in this city. We need to remember this and to think about it. It changed the city for the better. Chinese can now live anywhere.”
Real Estate By Charlie Smith
Publish Date: June 28, 2007
Vancouver architect Ron Yuen will never forget those heady days following Expo 86 when he helped redesign the north side of False Creek. Yuen was part of a team hired by Concord Pacific to create a new neighbourhood of high-rise residential towers after Hong Kong billionaire Li Ka-shing’s purchase of the former Expo site.
“I can still remember how amazed I was when the first tower started to go up, and the lineups were around the block,” Yuen recalled in an interview with the Georgia Straight. “There were a lot of Chinese immigrants, Hong Kong immigrants mainly, because of Li Ka-shing and his name.”
Tens of thousands of people moved from Hong Kong to Vancouver in the late 1980s and early ’90s, concerned about the future of the then-British colony, which was going to be returned to China on July 1, 1997. In the late ’80s, there was also an investment boom from Hong Kong, triggered by concerns about what would become of the colony’s capitalist business culture after it reverted to China.
Yuen explained that the exodus from Hong Kong has had a big impact on the Vancouver real-estate industry, noting that prior to Expo 86 there were never lineups to buy property. He said the Hong Kong immigrants also brought with them a strong sense of the economic value of land, a sense that has since been developed by local residents who buy condo units before buildings are constructed. “The Chinese immigrants have said, ‘We keep real estate for the long term. We keep it for generations,’” Yuen remarked.
On June 26, the Chinese Canadian Historical Society of British Columbia organized a forum at UBC’s C.K. Choi Building for the Institute of Asian Research to commemorate the 10th anniversary of Hong Kong’s return to China. One of the speakers, Vancouver multicultural social planner Baldwin Wong, cited three factors that came together to transform Vancouver: the above-mentioned influx from Hong Kong in the late ’80s; the city’s interest in densifying the downtown core; and the combination of developers’ expertise and the injection of new capital into the market.
“Vancouver’s downtown waterfront area was forever changed, more so than any other North American city within such a short time,” Wong said, emphasizing that he was speaking personally and not as a city representative.
Wong, a Hong Kong native, moved to Vancouver in the middle of the 1970s. He explained that by the late ’90s, the Hong Kong style of preselling condos and living in high-rises had become a standard way of investing in real estate in this city. “The practice has now spread to many parts of the Lower Mainland,” he said.
Wong noted that between 1971 and 1986, the city of Vancouver’s Chinese population increased from 25,000 to 70,000. Between 1986 and 1996, it doubled again to 140,000, out of an overall population of 420,000. Much of this increase was fuelled by immigration from Hong Kong.
However, he said, after the British ceded control over its colony in 1997, immigration from Hong Kong fell off sharply. “Chinese immigration continues to grow, now from a different source [China],” Wong said. “One can say that the Hong Kong immigrants more or less have paved the way for other Chinese immigrants or have consolidated the reputation of Vancouver as being an immigrant- and possibly a Chinese-friendly place.”
According to Yuen, one indication of the importance of Hong Kong real-estate buyers has been the avoidance of using the number four when labelling the floors of many buildings. In Cantonese, that number sounds similar to the Cantonese word for death, and so someone from Hong Kong might have an aversion to living on the fourth floor, just as North Americans might not want to live on the 13th.
At the June 26 forum, UBC historian Henry Yu noted that the legacy of Vancouver’s 1907 race riots was that Chinese people were permitted to live only in specific parts of the city. For many years afterward, the only persons of Chinese origin allowed to reside in Shaughnessy and Kerrisdale were servants.
“Then the Hong Kong Chinese came with their money and the entitlement of thinking, ‘I can live anywhere I want,’” Yu said. “That is a major, major change in this city. We need to remember this and to think about it. It changed the city for the better. Chinese can now live anywhere.”
Hu Avoids Talk of Democracy As Hong Kong Marks Handoff
Hu Avoids Talk of Democracy As Hong Kong Marks Handoff
Associated Press
Word Count: 642
HONG KONG -- Chinese leader Hu Jintao avoided the touchy issue of democracy Friday as he began his first presidential trip to Hong Kong to celebrate the 10th anniversary of the former British colony's return to China.
After stepping off the plane on a rain-soaked tarmac, Mr. Hu walked past a line of flag-waving children and told reporters he was happy with Hong Kong's progress in the last decade. "I'm even more confident about Hong Kong's future," he added in a brief speech.
Security was tight for Mr. Hu's three-day trip, with the leader expected to face protests from activists ...
Associated Press
Word Count: 642
HONG KONG -- Chinese leader Hu Jintao avoided the touchy issue of democracy Friday as he began his first presidential trip to Hong Kong to celebrate the 10th anniversary of the former British colony's return to China.
After stepping off the plane on a rain-soaked tarmac, Mr. Hu walked past a line of flag-waving children and told reporters he was happy with Hong Kong's progress in the last decade. "I'm even more confident about Hong Kong's future," he added in a brief speech.
Security was tight for Mr. Hu's three-day trip, with the leader expected to face protests from activists ...
Hong Kong's New Groove:
Hong Kong's New Groove:
Ferraris, Hot Chefs, IPOs
Ten years after the handover, the city is thriving -- even as mainland China looms
By PETER STEIN
June 29, 2007; Page P1
HONG KONG -- At the recent launch of a hip new Japanese restaurant here called Zuma, a cross-section of high society sampled pink cocktails and teriyaki beef hors d'oeuvres. American investment bankers mingled with the fashionable daughters of old Hong Kong money as well as new faces, including the granddaughter of the chairman of China's National People's Congress.
See a timeline of major events in Hong Kong since the takeover. Plus, take a look at Hong Kong, 10 years on.
The scene captured much of what makes Hong Kong thrive these days, nearly 10 years after Hong Kong's July 1, 1997, handover from British to Chinese sovereignty: a legacy of wealth and sophistication, an international character with links to the world of global trade and finance, and an infusion of new money, opportunity and human capital from the new China.
That combination of factors has never guaranteed Hong Kong's prospects under Chinese rule. Beijing agreed to preserve Hong Kong's autonomy and way of life when it signed a handover deal with London in 1984. However, China's desire for political control has sometimes crimped freedoms here, and Hong Kong's push for more democracy remains a point of friction. The growing development of Shanghai and Beijing still threatens to detract from Hong Kong's pull as a center for business and finance.
But Hong Kong's ability to defy skeptics, maintain a leading role in China's economic growth and prosper as one of the world's great cities says much about the former colony's resilience.
Much of the past decade has been a story of adversity here. Almost immediately after the 1997 handover, a financial crisis spread throughout Asia, sinking Hong Kong and its nearly seven million residents into a six-year deflationary spiral. Many businesses collapsed, and home prices fell by as much as 75%. Four years ago, an outbreak of the SARS virus killed nearly 300 people in the city, bringing life here to a near standstill.
Today, demand from wealthy mainland Chinese buyers is driving prices in Hong Kong's luxury-housing market to records. Last December, a piece of land on picturesque Victoria Peak sold at auction for the equivalent of about US$5,400 a square foot, making it some of the most expensive real estate in the world, property agents say.
Hong Kong's ability to bounce back also says something about the "stickiness" of its competitive advantages: a reliable legal system, sound business regulation and a sophistication in financial, retail and travel services that is so far unmatched elsewhere in China.
"Your water glass is never empty in a restaurant," says Jennifer Woo, who runs Lane Crawford, a Hong Kong-based luxury and fashion retailer.
These days, the economy is purring. Last year, gross domestic product grew 6.9%, and growth is expected to remain strong this year. Unemployment is at a nine-year low of 4.3%. Consumer spending is up -- and conspicuous consumption is, too. Last year, Hong Kongers bought 96 Ferraris, compared with 28 in 2003. Zuma is only the latest chichi restaurant to set up a base here: Celebrity chefs Nobu Matsuhisa, Joel Robuchon and Alain Ducasse have all opened Hong Kong restaurants in the past few years.
For much of the colony's long history since the British took possession of it in 1842, Hong Kong was a haven of stability and safety that contrasted with upheaval elsewhere in China. Many of its business leaders today are the children of refugees who fled here in search of a better life. Under British rule, those people turned Hong Kong first into a manufacturing and trading center, then a services and logistics hub with a growing role in global finance.
That role has made Hong Kong, not Shanghai, China's premier financial center today. Last year, thanks to share sales by two of China's biggest banks, Hong Kong's stock exchange raised $42.7 billion in initial public offerings -- more money than the stock exchanges in New York, London or Tokyo. Hong Kong is China's only exchange where foreigners can freely trade shares in the country's biggest listed companies.
The financial action and Hong Kong's quality of life are attracting an infusion of new talent from China, including people like Neil Shen. A 39-year-old entrepreneur from Shanghai, Mr. Shen co-founded one of China's biggest online travel companies and a Chinese hotel chain. He now runs a venture-capital firm and keeps his primary home here in Hong Kong, in the exclusive neighborhood atop Victoria Peak.
When he first worked in Hong Kong as an investment banker 10 years ago, mainland Chinese professionals like him were a rarity, and people from the North were sometimes looked down upon by Hong Kong Chinese. Speaking Mandarin, not the local Cantonese dialect, immediately set him apart. People knew: "You're not a Hongkie," he says.
Today, though, "I feel I'm part of Hong Kong -- Hong Kong is my home," he says. Mr. Shen's two daughters attend Hong Kong schools, and he is a local member of the Young Presidents Organization, a networking group for businesspeople. "This is a place for people who are open-minded, willing to learn, willing to mingle," he says. "It's easy. And it's sophisticated, compared to Shanghai and Beijing."
For Allan Bu, an investment banker with Canadian Imperial Bank of Commerce in Hong Kong and native of northern China's Shandong province, Hong Kong is a happy middle ground between China and the West. Working for a Chinese investment bank, he spent several weeks in New York once, but knew that life there wasn't for him. Here, he says, "you have an overseas flavor, but you're part of China." One catch: He laments that the high cost of housing makes it difficult to live in a decent-size apartment, "unless you're super-rich."
In the decade since the Chinese handover, Hong Kong has seen massive protests against a planned antitreason law, top, and the 2003 SARS crisis, above, which killed nearly 300 people there.
China's super-rich appear to like Hong Kong, too. A number have bought homes in some of the city's most elite neighborhoods. Li Ning, a former Olympic gymnast who now runs China's biggest domestic sportswear brand, last year bought a 540-square-meter villa on the south side of Hong Kong Island for about US$19 million. One of his neighbors, the head of a mainland Chinese tobacco and liquor empire, paid about US$21.5 million for his home.
Hong Kong hit what many feel was its rock-bottom moment in 2003, during the outbreak of severe acute respiratory syndrome.
"SARS was the turning point," says Allan Zeman, a Canadian-born entrepreneur and longtime Hong Kong resident whose early investments in bars and restaurants helped establish one of the city's main nightlife districts, Lan Kwai Fong. "Hong Kong was really on its knees. Somebody needed to light the match to get the confidence burning."
It was also a time of huge political unease in Hong Kong. That summer, half a million people marched in the streets to protest then chief-executive Tung Chee Hwa's government and its policies, including plans to enact an unpopular antitreason law. (The law wasn't enacted.)
So China intervened to help Hong Kong's economy. It signed a trade pact with Hong Kong that gave the city's businesses certain investment privileges in China. And it loosened restrictions on individual travelers to Hong Kong from the rest of the country, goosing both the travel and retail industries.
Suddenly, those businesses began catering to the flood of mainlanders. Mr. Zeman recalls how restaurants in Lan Kwai Fong, a magnet for many expatriates, for the first time began printing their menus in the simplified Chinese characters used by China, rather than Hong Kong's traditional script.
Today, Mr. Zeman runs a successful aquatic theme park that pulls in more than five million visitors a year, just under half from mainland China. On July 1, he will be on hand to celebrate the park's newest attractions, Le Le and Ying Ying -- two baby pandas donated by China's central government to help celebrate the handover anniversary.
"It just shows how important Hong Kong is to China, and how important China is to Hong Kong," says Mr. Zeman of the pandas.
Visitors from China like Charlotte Zhao are now the key clientele for many of Hong Kong's swankiest boutiques. "Of course Hong Kong is the best place to go shopping," says Ms. Zhao, a 23-year old from Beijing whose fingernails are each painted with a different color of polish. She has just bought a watch at the Christian Dior boutique in a Hong Kong shopping mall. "I come to Hong Kong all the time whenever I'm bored at shopping in Beijing," she says.
Not everyone here feels the wealth effect. Many Hong Kong people still live in cramped homes stacked in densely packed housing estates. Some workers struggle to get by, and haven't adapted to the service economy that now dominates after low-cost Chinese labor north of border siphoned off most manufacturing work here.
Nor is Hong Kong out of the danger zone. Its stock market faces new challenges amid efforts by Chinese regulators to build up the Shanghai exchange after a long moratorium on domestic IPOs ended last year. The city's closer ties to the rest of China also mean any economic problems there will reverberate here as well.
And despite those closer ties, politics remains a sticking point. Ten years ago, China took over Hong Kong only after undoing Britain's last-minute attempts to expand the vote and dividing many people here on the subject of democracy. Seven years later, the unpopular Mr. Tung stepped down after more street protests at which democracy was a rallying cry.
Today, his more popular successor, Donald Tsang, a former civil servant under British rule, runs the city amid a calmer political climate. But the political system remains undemocratic -- he was chosen by a group of about 800 electors, not the wider Hong Kong electorate, and Beijing's support made his selection a mostly foregone conclusion. Mr. Tsang's toughest challenge may be mapping out a road toward a more open system, as he has promised to do.
Still, differing political views and the willingness to vent them are a good sign, says Eden Woon, a senior executive with Starbucks Corp. in China who used to run Hong Kong's chamber of commerce.
"The diversity is still there," he says. "There's still people complaining."
--Juying Qin contributed to this article.
Write to Peter Stein at peter.stein@wsj.com
Ferraris, Hot Chefs, IPOs
Ten years after the handover, the city is thriving -- even as mainland China looms
By PETER STEIN
June 29, 2007; Page P1
HONG KONG -- At the recent launch of a hip new Japanese restaurant here called Zuma, a cross-section of high society sampled pink cocktails and teriyaki beef hors d'oeuvres. American investment bankers mingled with the fashionable daughters of old Hong Kong money as well as new faces, including the granddaughter of the chairman of China's National People's Congress.
See a timeline of major events in Hong Kong since the takeover. Plus, take a look at Hong Kong, 10 years on.
The scene captured much of what makes Hong Kong thrive these days, nearly 10 years after Hong Kong's July 1, 1997, handover from British to Chinese sovereignty: a legacy of wealth and sophistication, an international character with links to the world of global trade and finance, and an infusion of new money, opportunity and human capital from the new China.
That combination of factors has never guaranteed Hong Kong's prospects under Chinese rule. Beijing agreed to preserve Hong Kong's autonomy and way of life when it signed a handover deal with London in 1984. However, China's desire for political control has sometimes crimped freedoms here, and Hong Kong's push for more democracy remains a point of friction. The growing development of Shanghai and Beijing still threatens to detract from Hong Kong's pull as a center for business and finance.
But Hong Kong's ability to defy skeptics, maintain a leading role in China's economic growth and prosper as one of the world's great cities says much about the former colony's resilience.
Much of the past decade has been a story of adversity here. Almost immediately after the 1997 handover, a financial crisis spread throughout Asia, sinking Hong Kong and its nearly seven million residents into a six-year deflationary spiral. Many businesses collapsed, and home prices fell by as much as 75%. Four years ago, an outbreak of the SARS virus killed nearly 300 people in the city, bringing life here to a near standstill.
Today, demand from wealthy mainland Chinese buyers is driving prices in Hong Kong's luxury-housing market to records. Last December, a piece of land on picturesque Victoria Peak sold at auction for the equivalent of about US$5,400 a square foot, making it some of the most expensive real estate in the world, property agents say.
Hong Kong's ability to bounce back also says something about the "stickiness" of its competitive advantages: a reliable legal system, sound business regulation and a sophistication in financial, retail and travel services that is so far unmatched elsewhere in China.
"Your water glass is never empty in a restaurant," says Jennifer Woo, who runs Lane Crawford, a Hong Kong-based luxury and fashion retailer.
These days, the economy is purring. Last year, gross domestic product grew 6.9%, and growth is expected to remain strong this year. Unemployment is at a nine-year low of 4.3%. Consumer spending is up -- and conspicuous consumption is, too. Last year, Hong Kongers bought 96 Ferraris, compared with 28 in 2003. Zuma is only the latest chichi restaurant to set up a base here: Celebrity chefs Nobu Matsuhisa, Joel Robuchon and Alain Ducasse have all opened Hong Kong restaurants in the past few years.
For much of the colony's long history since the British took possession of it in 1842, Hong Kong was a haven of stability and safety that contrasted with upheaval elsewhere in China. Many of its business leaders today are the children of refugees who fled here in search of a better life. Under British rule, those people turned Hong Kong first into a manufacturing and trading center, then a services and logistics hub with a growing role in global finance.
That role has made Hong Kong, not Shanghai, China's premier financial center today. Last year, thanks to share sales by two of China's biggest banks, Hong Kong's stock exchange raised $42.7 billion in initial public offerings -- more money than the stock exchanges in New York, London or Tokyo. Hong Kong is China's only exchange where foreigners can freely trade shares in the country's biggest listed companies.
The financial action and Hong Kong's quality of life are attracting an infusion of new talent from China, including people like Neil Shen. A 39-year-old entrepreneur from Shanghai, Mr. Shen co-founded one of China's biggest online travel companies and a Chinese hotel chain. He now runs a venture-capital firm and keeps his primary home here in Hong Kong, in the exclusive neighborhood atop Victoria Peak.
When he first worked in Hong Kong as an investment banker 10 years ago, mainland Chinese professionals like him were a rarity, and people from the North were sometimes looked down upon by Hong Kong Chinese. Speaking Mandarin, not the local Cantonese dialect, immediately set him apart. People knew: "You're not a Hongkie," he says.
Today, though, "I feel I'm part of Hong Kong -- Hong Kong is my home," he says. Mr. Shen's two daughters attend Hong Kong schools, and he is a local member of the Young Presidents Organization, a networking group for businesspeople. "This is a place for people who are open-minded, willing to learn, willing to mingle," he says. "It's easy. And it's sophisticated, compared to Shanghai and Beijing."
For Allan Bu, an investment banker with Canadian Imperial Bank of Commerce in Hong Kong and native of northern China's Shandong province, Hong Kong is a happy middle ground between China and the West. Working for a Chinese investment bank, he spent several weeks in New York once, but knew that life there wasn't for him. Here, he says, "you have an overseas flavor, but you're part of China." One catch: He laments that the high cost of housing makes it difficult to live in a decent-size apartment, "unless you're super-rich."
In the decade since the Chinese handover, Hong Kong has seen massive protests against a planned antitreason law, top, and the 2003 SARS crisis, above, which killed nearly 300 people there.
China's super-rich appear to like Hong Kong, too. A number have bought homes in some of the city's most elite neighborhoods. Li Ning, a former Olympic gymnast who now runs China's biggest domestic sportswear brand, last year bought a 540-square-meter villa on the south side of Hong Kong Island for about US$19 million. One of his neighbors, the head of a mainland Chinese tobacco and liquor empire, paid about US$21.5 million for his home.
Hong Kong hit what many feel was its rock-bottom moment in 2003, during the outbreak of severe acute respiratory syndrome.
"SARS was the turning point," says Allan Zeman, a Canadian-born entrepreneur and longtime Hong Kong resident whose early investments in bars and restaurants helped establish one of the city's main nightlife districts, Lan Kwai Fong. "Hong Kong was really on its knees. Somebody needed to light the match to get the confidence burning."
It was also a time of huge political unease in Hong Kong. That summer, half a million people marched in the streets to protest then chief-executive Tung Chee Hwa's government and its policies, including plans to enact an unpopular antitreason law. (The law wasn't enacted.)
So China intervened to help Hong Kong's economy. It signed a trade pact with Hong Kong that gave the city's businesses certain investment privileges in China. And it loosened restrictions on individual travelers to Hong Kong from the rest of the country, goosing both the travel and retail industries.
Suddenly, those businesses began catering to the flood of mainlanders. Mr. Zeman recalls how restaurants in Lan Kwai Fong, a magnet for many expatriates, for the first time began printing their menus in the simplified Chinese characters used by China, rather than Hong Kong's traditional script.
Today, Mr. Zeman runs a successful aquatic theme park that pulls in more than five million visitors a year, just under half from mainland China. On July 1, he will be on hand to celebrate the park's newest attractions, Le Le and Ying Ying -- two baby pandas donated by China's central government to help celebrate the handover anniversary.
"It just shows how important Hong Kong is to China, and how important China is to Hong Kong," says Mr. Zeman of the pandas.
Visitors from China like Charlotte Zhao are now the key clientele for many of Hong Kong's swankiest boutiques. "Of course Hong Kong is the best place to go shopping," says Ms. Zhao, a 23-year old from Beijing whose fingernails are each painted with a different color of polish. She has just bought a watch at the Christian Dior boutique in a Hong Kong shopping mall. "I come to Hong Kong all the time whenever I'm bored at shopping in Beijing," she says.
Not everyone here feels the wealth effect. Many Hong Kong people still live in cramped homes stacked in densely packed housing estates. Some workers struggle to get by, and haven't adapted to the service economy that now dominates after low-cost Chinese labor north of border siphoned off most manufacturing work here.
Nor is Hong Kong out of the danger zone. Its stock market faces new challenges amid efforts by Chinese regulators to build up the Shanghai exchange after a long moratorium on domestic IPOs ended last year. The city's closer ties to the rest of China also mean any economic problems there will reverberate here as well.
And despite those closer ties, politics remains a sticking point. Ten years ago, China took over Hong Kong only after undoing Britain's last-minute attempts to expand the vote and dividing many people here on the subject of democracy. Seven years later, the unpopular Mr. Tung stepped down after more street protests at which democracy was a rallying cry.
Today, his more popular successor, Donald Tsang, a former civil servant under British rule, runs the city amid a calmer political climate. But the political system remains undemocratic -- he was chosen by a group of about 800 electors, not the wider Hong Kong electorate, and Beijing's support made his selection a mostly foregone conclusion. Mr. Tsang's toughest challenge may be mapping out a road toward a more open system, as he has promised to do.
Still, differing political views and the willingness to vent them are a good sign, says Eden Woon, a senior executive with Starbucks Corp. in China who used to run Hong Kong's chamber of commerce.
"The diversity is still there," he says. "There's still people complaining."
--Juying Qin contributed to this article.
Write to Peter Stein at peter.stein@wsj.com
Asia grabs spotlight in global wealth
Asia grabs spotlight in global wealth
BS Reporter / Mumbai June 29, 2007
India sees second highest rise in high net worth individuals.
Strong economic growth has made Asia home to some of the fastest-growing markets in terms of high net worth individuals (HNWI), occupying five of the top 10 spots globally.
India, with a 20.5 per cent increase in the number of HNWIs to 100,015, recorded the second-highest growth rate in HNWIs globally, said the annual World Wealth Report by Merrill Lynch and Capgemini.
India trailed only Singapore, where the increase in HNWIs grew by 21.2 per cent. Indonesia saw its HNWI population rise 16.0 per cent while those of South Korea and Hong Kong rose 14.1 per cent and 12.2 per cent, respectively.
Double-digit growth was also recorded in Russia, the UAE, South Africa, Israel and the Czech Republic and together, these emerging economies made up the top 10 fastest-growing markets globally for HNWI population.
China, with a gross domestic product growth of 10.5 per cent in 2006, saw a 7.8 per cent increase in HNWIs.
Driven by a strong global economy, the wealth of the world’s HNWIs increased 11.4 per cent to $37.2 trillion in 2006. The number of HNWIs in the world increased by 8.3 per cent in 2006 to 9.5 million and the number of ultra high net worth individuals grew 11.3 per cent to 94,970.
In the Asia-Pacific, HNWIs increased to 2.6 million in 2006, an 8.6 per cent gain from the year before. These HNWIs’ combined wealth increased 10.5 per cent to $8.4 trillion.
In 2006, HNWIs’ investment portfolios also saw a shift to real estate. Globally, HNWIs shifted more money into real estate, at times liquidating some of their alternative investments for this.
This trend was most dramatic in the Asia Pacific, where 29 per cent of HNWI assets was held in real estate, up from 16 per cent in 2005. Globally, HNWIs held 24 per cent of their assets in real estate compared with 16 per cent in 2005.
Asia Pacific HNWIs also had the lowest exposure to fixed income securities, with only 15 per cent of assets in this category compared with 21 per cent for HNWIs globally. Equities made up 24 per cent of Asian HNWI investments, below the 31 per cent global average.
In 2006, Europe regained its position as the second most popular destination, after North America, for HNWI investments, accounting for 25 per cent of total HNWI assets. Asia accounted for 21 per cent of HNWI assets.
The report expects the growth rates of Asia and Latin America to ease as global demand slows. It says the combined global HNWI wealth is expected to grow 6.8 per cent annually between 2006 and 2011 to $51.6 trillion.
BS Reporter / Mumbai June 29, 2007
India sees second highest rise in high net worth individuals.
Strong economic growth has made Asia home to some of the fastest-growing markets in terms of high net worth individuals (HNWI), occupying five of the top 10 spots globally.
India, with a 20.5 per cent increase in the number of HNWIs to 100,015, recorded the second-highest growth rate in HNWIs globally, said the annual World Wealth Report by Merrill Lynch and Capgemini.
India trailed only Singapore, where the increase in HNWIs grew by 21.2 per cent. Indonesia saw its HNWI population rise 16.0 per cent while those of South Korea and Hong Kong rose 14.1 per cent and 12.2 per cent, respectively.
Double-digit growth was also recorded in Russia, the UAE, South Africa, Israel and the Czech Republic and together, these emerging economies made up the top 10 fastest-growing markets globally for HNWI population.
China, with a gross domestic product growth of 10.5 per cent in 2006, saw a 7.8 per cent increase in HNWIs.
Driven by a strong global economy, the wealth of the world’s HNWIs increased 11.4 per cent to $37.2 trillion in 2006. The number of HNWIs in the world increased by 8.3 per cent in 2006 to 9.5 million and the number of ultra high net worth individuals grew 11.3 per cent to 94,970.
In the Asia-Pacific, HNWIs increased to 2.6 million in 2006, an 8.6 per cent gain from the year before. These HNWIs’ combined wealth increased 10.5 per cent to $8.4 trillion.
In 2006, HNWIs’ investment portfolios also saw a shift to real estate. Globally, HNWIs shifted more money into real estate, at times liquidating some of their alternative investments for this.
This trend was most dramatic in the Asia Pacific, where 29 per cent of HNWI assets was held in real estate, up from 16 per cent in 2005. Globally, HNWIs held 24 per cent of their assets in real estate compared with 16 per cent in 2005.
Asia Pacific HNWIs also had the lowest exposure to fixed income securities, with only 15 per cent of assets in this category compared with 21 per cent for HNWIs globally. Equities made up 24 per cent of Asian HNWI investments, below the 31 per cent global average.
In 2006, Europe regained its position as the second most popular destination, after North America, for HNWI investments, accounting for 25 per cent of total HNWI assets. Asia accounted for 21 per cent of HNWI assets.
The report expects the growth rates of Asia and Latin America to ease as global demand slows. It says the combined global HNWI wealth is expected to grow 6.8 per cent annually between 2006 and 2011 to $51.6 trillion.
Cool savings
Cool savings
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PANASONIC is introducing its latest range of refrigerators incorporating the Intelligent Inverter or i-INVERTER technology developed specifically to lower the running cost, thus giving consumers savings of up to 20% in terms of power consumption.
The NR-B402V model is priced at RM2349
This latest range of refrigerators comes in four new models with two, four and six doors to cater to every household needs and is also equipped with multi-hygienic functions that eliminate unpleasant odour and inactivate moulds and bacteria.
“At Panasonic, we are concerned with the rising power cost and environmental damages associated with power producing methods. Hence, our i-INVERTER technology is the result of dedicated R&D and Panasonic is the first company in the world to develop and market an inverter-controlled refrigerator,” says Panasonic Malaysia Sdn Bhd managing director Hiroshi Nakamura.
“Our i-INVERTER technology has an intelligent sensor that can cleverly detect the changes in temperature due to the door opening and closing or the amount of food stored by simply adjusting the temperature inside the fridge to a more efficient and stable level which saves energy.
“The 20% energy consumption savings is certainly a major amount considering that the refrigerator is ranked second behind an air-conditioner in terms of power consumption among all household appliances.
“It too represents a small but significant step towards reducing global warming, thereby creating a healthier and sustainable ecological environment,” added Nakamura.
The i-INVERTER series of refrigerators is available at all authorised Panasonic dealers nationwide at an affordable price from RM2,049 to RM6,999.
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PANASONIC is introducing its latest range of refrigerators incorporating the Intelligent Inverter or i-INVERTER technology developed specifically to lower the running cost, thus giving consumers savings of up to 20% in terms of power consumption.
The NR-B402V model is priced at RM2349
This latest range of refrigerators comes in four new models with two, four and six doors to cater to every household needs and is also equipped with multi-hygienic functions that eliminate unpleasant odour and inactivate moulds and bacteria.
“At Panasonic, we are concerned with the rising power cost and environmental damages associated with power producing methods. Hence, our i-INVERTER technology is the result of dedicated R&D and Panasonic is the first company in the world to develop and market an inverter-controlled refrigerator,” says Panasonic Malaysia Sdn Bhd managing director Hiroshi Nakamura.
“Our i-INVERTER technology has an intelligent sensor that can cleverly detect the changes in temperature due to the door opening and closing or the amount of food stored by simply adjusting the temperature inside the fridge to a more efficient and stable level which saves energy.
“The 20% energy consumption savings is certainly a major amount considering that the refrigerator is ranked second behind an air-conditioner in terms of power consumption among all household appliances.
“It too represents a small but significant step towards reducing global warming, thereby creating a healthier and sustainable ecological environment,” added Nakamura.
The i-INVERTER series of refrigerators is available at all authorised Panasonic dealers nationwide at an affordable price from RM2,049 to RM6,999.
A good choice in flooring
A good choice in flooring
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Made from European technologies and raw material from Asia, Floor Depot has a stable structure
HOME improvement is fast catching on in our country. Promising a traditional yet natural appeal, wood flooring is an all-time favourite, when it comes to renovation or home décor.
Wood is a floor furnishing material that is soft to the touch, elegant in appeal and comfortable too.
Different kinds of living areas demand different types of flooring.
All wooden flooring from Floor Depot is designed with the aim of meeting the same fundamental requirements, which are the perfect combination of beautiful styling, textures and colours that meet every individual’s expectation.
Made from European technologies and raw material from Asia, it has a stable structure that can withstand extreme/local weather conditions.
Through the wide variety of wood flooring, Floor Depot can meet all requirements – from simpler options to floors with unique qualities in terms of appearance and advanced technology.
Couple that with the choices of wood flooring, Floor Depot offers a comprehensive range of accessories with 100% perfectly matched colour skirting and moulding to address the specific needs of every home.
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Made from European technologies and raw material from Asia, Floor Depot has a stable structure
HOME improvement is fast catching on in our country. Promising a traditional yet natural appeal, wood flooring is an all-time favourite, when it comes to renovation or home décor.
Wood is a floor furnishing material that is soft to the touch, elegant in appeal and comfortable too.
Different kinds of living areas demand different types of flooring.
All wooden flooring from Floor Depot is designed with the aim of meeting the same fundamental requirements, which are the perfect combination of beautiful styling, textures and colours that meet every individual’s expectation.
Made from European technologies and raw material from Asia, it has a stable structure that can withstand extreme/local weather conditions.
Through the wide variety of wood flooring, Floor Depot can meet all requirements – from simpler options to floors with unique qualities in terms of appearance and advanced technology.
Couple that with the choices of wood flooring, Floor Depot offers a comprehensive range of accessories with 100% perfectly matched colour skirting and moulding to address the specific needs of every home.
Three suitors for TA Enterprise REIT
Three suitors for TA Enterprise REIT
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KUALA LUMPUR: TA Enterprise Bhd, which is aiming to list its real estate investment trust (REIT) by early next year, is being courted by three stock exchanges, executive chairman Datin Alicia Tan Kuay Fong said.
The properties to be injected into the REITs are Terasen Centre in Vancouver, Canada, Radisson Plaza Hotel in Sydney and Menara TA One in Malaysia.
Together, the properties have a market value of RM1.2bil.
Tan said TA Enterprise had been approached by the stock exchanges of Malaysia, Singapore and Australia to list the REITs on their boards.
Currently, the Singapore Stock Exchange seems more attractive compared with the other two stock markets for products like REITs, she said.
But nothing had been finalised yet, and advisors for the REITs were also yet to be appointed, she said after the company AGM yesterday. – Bernama
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KUALA LUMPUR: TA Enterprise Bhd, which is aiming to list its real estate investment trust (REIT) by early next year, is being courted by three stock exchanges, executive chairman Datin Alicia Tan Kuay Fong said.
The properties to be injected into the REITs are Terasen Centre in Vancouver, Canada, Radisson Plaza Hotel in Sydney and Menara TA One in Malaysia.
Together, the properties have a market value of RM1.2bil.
Tan said TA Enterprise had been approached by the stock exchanges of Malaysia, Singapore and Australia to list the REITs on their boards.
Currently, the Singapore Stock Exchange seems more attractive compared with the other two stock markets for products like REITs, she said.
But nothing had been finalised yet, and advisors for the REITs were also yet to be appointed, she said after the company AGM yesterday. – Bernama
Majuperak plans project in Penang
Majuperak plans project in Penang
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KUALA LUMPUR: Perak state-owned Majuperak Holdings Bhd plans to launch a 17.9-acre commercial development in Seberang Prai, Penang, by early next year.
Majuperak, which yesterday began trading on the main board after taking over from United Chemical Industries Bhd (UCI) of the second board, has submitted the application to the Penang Government.
The application includes conversion of the land, on which UCI's factories are sited, to commercial use from industrial.
Chairman Datuk Seri Megat Najmuddin Megat Khas told a press conference that Majuperak, which has 4,000 acres, planned to develop 1,000 acres in Perak.
“We are looking at a township model, while our other smaller parcels mainly would be housing projects,” he said.
Datuk Seri Mohamad Tajol Rosli Ghazali signing the ceremonial plaque as Datuk Seri Megat Najmuddin Megat Khas looks on.
Planned in Simpang Pulai, the lake-fronting township would be targeted at buyers within and outside the state, he said.
Majuperak is currently also developing the 800-acre Bandar Tasek Idaman residential project in Batu Gajah, Perak. About 100 acres have been developed since the project was launched about three years ago.
On whether there were plans to list other state arms, Mentri Besar Datuk Seri Mohamad Tajol Rosli Ghazali said the State Government still had two such units – Perbadanan Pembangunan Pertanian Negeri Perak and the Perak Water Board – that were financially strong.
The Perak Water Board, which declared profits of RM54mil for 2005, is targeting annual profits of RM100mil by 2010. The board might be privatised, he said.
For the financial year ended Dec 31, 2006, Majuperak posted a net profit of RM12mil on revenue of RM37.9mil.
In its first-day trading, Majuperak opened at 80 sen but closed at 69 sen, down one sen from its issue price of 70 sen.
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KUALA LUMPUR: Perak state-owned Majuperak Holdings Bhd plans to launch a 17.9-acre commercial development in Seberang Prai, Penang, by early next year.
Majuperak, which yesterday began trading on the main board after taking over from United Chemical Industries Bhd (UCI) of the second board, has submitted the application to the Penang Government.
The application includes conversion of the land, on which UCI's factories are sited, to commercial use from industrial.
Chairman Datuk Seri Megat Najmuddin Megat Khas told a press conference that Majuperak, which has 4,000 acres, planned to develop 1,000 acres in Perak.
“We are looking at a township model, while our other smaller parcels mainly would be housing projects,” he said.
Datuk Seri Mohamad Tajol Rosli Ghazali signing the ceremonial plaque as Datuk Seri Megat Najmuddin Megat Khas looks on.
Planned in Simpang Pulai, the lake-fronting township would be targeted at buyers within and outside the state, he said.
Majuperak is currently also developing the 800-acre Bandar Tasek Idaman residential project in Batu Gajah, Perak. About 100 acres have been developed since the project was launched about three years ago.
On whether there were plans to list other state arms, Mentri Besar Datuk Seri Mohamad Tajol Rosli Ghazali said the State Government still had two such units – Perbadanan Pembangunan Pertanian Negeri Perak and the Perak Water Board – that were financially strong.
The Perak Water Board, which declared profits of RM54mil for 2005, is targeting annual profits of RM100mil by 2010. The board might be privatised, he said.
For the financial year ended Dec 31, 2006, Majuperak posted a net profit of RM12mil on revenue of RM37.9mil.
In its first-day trading, Majuperak opened at 80 sen but closed at 69 sen, down one sen from its issue price of 70 sen.
YNH joint venture with CapitaLand called off
YNH joint venture with CapitaLand called off
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By ANGIE NG
PETALING JAYA: YNH Property Bhd's share price has fallen 50 sen over the past three days on reports that a proposed joint-venture agreement with Singapore's CapitaLand Ltd has lapsed, which was confirmed by the latter yesterday.
However, YNH is confident the development of Menara YNH in Jalan Sultan Ismail, Kuala Lumpur, will proceed as scheduled despite the exit of CapitaLand.
According to YNH chief financial officer Y.M. Chan, the company will launch the project this year and expects it to be completed in 2011.
The approvals from the authorities are expected in the next two to three months.
Last December, YNH's wholly-owned unit Kar Sin Bhd entered into a memorandum of understanding (MoU) with CapitaLand Commercial and Integrated Development Ltd to jointly develop the commercial project beside the Shangri-La Hotel.
YNH was to have a 60% stake in the joint venture.
In a joint statement on the deal, the two companies had said further details would follow approval from the authorities.
But, in a statement yesterday, CapitaLand said the joint development with YNH had been called off. It said the MoU to build an office tower in the Golden Triangle of Kuala Lumpur “has lapsed due to non-fulfilment of the conditions precedent”.
In an announcement to Bursa Malaysia, YNH said the deal was off and it would develop the project on its own.
It is understood the dispute was over the value of the 133,000-sq-ft land of the project.
According to Chan, a few other potential partners had shown interest in the project and that the company would consider their proposals.
“Based on our strong cash position, and with the support of financial institutions, we may decide to undertake the project on our own,” he said.
He said a number of global real estate and private equity funds had shown interest in buying the building en bloc.
“Going by the strong interest and the high expected yield of 7% per annum, we have raised the price of the building to RM1.5bil from RM1bil,” Chan said.
The office tower with a net lettable space of 1.1 million sq ft – of which 10% is retail space – will cost RM500mil and provide an expected gross margin of 38% to YNH.
To ensure top quality and premium value, Chan said a reputable contractor, preferably from Japan, would be engaged to work alongside YNH's in-house construction arm to undertake the project.
YNH shares ended yesterday 15 sen lower at RM2.80.
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By ANGIE NG
PETALING JAYA: YNH Property Bhd's share price has fallen 50 sen over the past three days on reports that a proposed joint-venture agreement with Singapore's CapitaLand Ltd has lapsed, which was confirmed by the latter yesterday.
However, YNH is confident the development of Menara YNH in Jalan Sultan Ismail, Kuala Lumpur, will proceed as scheduled despite the exit of CapitaLand.
According to YNH chief financial officer Y.M. Chan, the company will launch the project this year and expects it to be completed in 2011.
The approvals from the authorities are expected in the next two to three months.
Last December, YNH's wholly-owned unit Kar Sin Bhd entered into a memorandum of understanding (MoU) with CapitaLand Commercial and Integrated Development Ltd to jointly develop the commercial project beside the Shangri-La Hotel.
YNH was to have a 60% stake in the joint venture.
In a joint statement on the deal, the two companies had said further details would follow approval from the authorities.
But, in a statement yesterday, CapitaLand said the joint development with YNH had been called off. It said the MoU to build an office tower in the Golden Triangle of Kuala Lumpur “has lapsed due to non-fulfilment of the conditions precedent”.
In an announcement to Bursa Malaysia, YNH said the deal was off and it would develop the project on its own.
It is understood the dispute was over the value of the 133,000-sq-ft land of the project.
According to Chan, a few other potential partners had shown interest in the project and that the company would consider their proposals.
“Based on our strong cash position, and with the support of financial institutions, we may decide to undertake the project on our own,” he said.
He said a number of global real estate and private equity funds had shown interest in buying the building en bloc.
“Going by the strong interest and the high expected yield of 7% per annum, we have raised the price of the building to RM1.5bil from RM1bil,” Chan said.
The office tower with a net lettable space of 1.1 million sq ft – of which 10% is retail space – will cost RM500mil and provide an expected gross margin of 38% to YNH.
To ensure top quality and premium value, Chan said a reputable contractor, preferably from Japan, would be engaged to work alongside YNH's in-house construction arm to undertake the project.
YNH shares ended yesterday 15 sen lower at RM2.80.
Landmarks to sell assets
Landmarks to sell assets
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KUALA LUMPUR: Landmarks Bhd is finalising plans which may involve disposing of certain non-core assets and signing joint-venture agreements.
Chairman Oh Teik Tatt declined to furnish details at the company AGM yesterday but said everything was going as planned, and announcements to Bursa Malaysia would be made accordingly.
“We expect to finalise the masterplan on Bintan (Treasure Bay), our project in Indonesia, around the fourth quarter. We will talk about it when everything is ready,” he said.
He said Landmarks' focus was to hive off certain non-strategic assets and de-gear its balance sheet.
This was to place the company in a better footing for opportunities that might crop up in its mainstay – resorts, hospitality and wellness business, he added.
Among the assets which may be divested are its 20% stake in Teknologi Tenaga Perlis Consortium Sdn Bhd, an independent power producer undertaking the development and operation of a 650MW power plant in Perlis, and a 26.6% stake in Shangri-La Hotels (M) Bhd.
Oh added that Landmarks was exploring several possibilities and would make a firm decision after considering all avenues.
The company recently concluded the sale of wholly-owned unit Sungei Wang Plaza Sdn Bhd for RM284.8mil.
Much of Landmarks' plans are focused on developing a RM4bil resort on Bintan Island, via the acquisition of 64.5% in Bintan Treasure Bay Pte Ltd from Bold Impact Enterprises Ltd and Complete Win Group Ltd for some RM355mil.
This project is expected to start contributing to Landmarks' bottomline as early as next year.
“It will be developed over seven to eight years and expected to be funded through various means, including joint ventures, turnkey contracts, pre-selling of some plots and internal funds,” Oh said.
Landmarks' board believed this investment would be the main catalyst for its next phase of growth.
The company posted a net profit of RM15.9mil on RM36.4mil in sales for the first three months ended March, down 23% and 22% respectively from the previous corresponding period.
For the period under review, the company has RM245.4mil long-term liabilities while its shareholders' fund stood at about RM500mil.
Landmarks' shares closed at RM1.95 yesterday.
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KUALA LUMPUR: Landmarks Bhd is finalising plans which may involve disposing of certain non-core assets and signing joint-venture agreements.
Chairman Oh Teik Tatt declined to furnish details at the company AGM yesterday but said everything was going as planned, and announcements to Bursa Malaysia would be made accordingly.
“We expect to finalise the masterplan on Bintan (Treasure Bay), our project in Indonesia, around the fourth quarter. We will talk about it when everything is ready,” he said.
He said Landmarks' focus was to hive off certain non-strategic assets and de-gear its balance sheet.
This was to place the company in a better footing for opportunities that might crop up in its mainstay – resorts, hospitality and wellness business, he added.
Among the assets which may be divested are its 20% stake in Teknologi Tenaga Perlis Consortium Sdn Bhd, an independent power producer undertaking the development and operation of a 650MW power plant in Perlis, and a 26.6% stake in Shangri-La Hotels (M) Bhd.
Oh added that Landmarks was exploring several possibilities and would make a firm decision after considering all avenues.
The company recently concluded the sale of wholly-owned unit Sungei Wang Plaza Sdn Bhd for RM284.8mil.
Much of Landmarks' plans are focused on developing a RM4bil resort on Bintan Island, via the acquisition of 64.5% in Bintan Treasure Bay Pte Ltd from Bold Impact Enterprises Ltd and Complete Win Group Ltd for some RM355mil.
This project is expected to start contributing to Landmarks' bottomline as early as next year.
“It will be developed over seven to eight years and expected to be funded through various means, including joint ventures, turnkey contracts, pre-selling of some plots and internal funds,” Oh said.
Landmarks' board believed this investment would be the main catalyst for its next phase of growth.
The company posted a net profit of RM15.9mil on RM36.4mil in sales for the first three months ended March, down 23% and 22% respectively from the previous corresponding period.
For the period under review, the company has RM245.4mil long-term liabilities while its shareholders' fund stood at about RM500mil.
Landmarks' shares closed at RM1.95 yesterday.
Sime UEP to launch USJ Heights
Sime UEP to launch USJ Heights
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By LOONG TSE MIN
PETALING JAYA: Sime UEP Properties Bhd plans to launch the first two phases of its mixed residential development, USJ Heights, next month.
“The development is a gated and guarded concept blended in six distinct precincts.
“Each precinct is held together with a themed garden,” Sime UEP managing director Jauhari Hamidi told StarBiz.
The six precincts will be themed Malay, Balinese, Zen, English, Mediterranean and Highland gardens.
Artist's impression of some of the properties to be developed at USJ Heights
The two phases – USH2A and USH2B – in the Kayangan precinct will consist of units with land areas of 26ft by 80ft and 24ft by 80ft respectively.
The total gross development value (GDV) of the two phases is estimated at RM157mil.
The entire project, comprising 750 residential units in the Subang Jaya conurbation, has a GDV of about RM616mil.
USJ Heights is expected to have generally low to medium density of 5.5 grounded units per acre
“The development is highly accessible and serviced by planned major roads and transport system,” Jauhari said.
It also forms part of the highly marketable housing zone of the Klang Valley and is “exclusively isolated”.
At present, the site has direct access to the west of USJ and the north of the Federal Highway.
Physical concept of the development included “selective land use and intensity” with residential units having dominant land use, Jauhari said.
The USJ Heights development is expected to have generally low to medium density of 5.5 grounded units per acre.
Special consideration has also been given to orientation, location and distribution of the units.
The designs of the properties were modern contemporary with decorated facade and oversized windows to maximise natural lighting as well as spaciousness with large built-up areas, Jauhari said.
Future phases of the development will include bungalows and more designer homes.
The full development of USJ Heights is expected in 2010
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By LOONG TSE MIN
PETALING JAYA: Sime UEP Properties Bhd plans to launch the first two phases of its mixed residential development, USJ Heights, next month.
“The development is a gated and guarded concept blended in six distinct precincts.
“Each precinct is held together with a themed garden,” Sime UEP managing director Jauhari Hamidi told StarBiz.
The six precincts will be themed Malay, Balinese, Zen, English, Mediterranean and Highland gardens.
Artist's impression of some of the properties to be developed at USJ Heights
The two phases – USH2A and USH2B – in the Kayangan precinct will consist of units with land areas of 26ft by 80ft and 24ft by 80ft respectively.
The total gross development value (GDV) of the two phases is estimated at RM157mil.
The entire project, comprising 750 residential units in the Subang Jaya conurbation, has a GDV of about RM616mil.
USJ Heights is expected to have generally low to medium density of 5.5 grounded units per acre
“The development is highly accessible and serviced by planned major roads and transport system,” Jauhari said.
It also forms part of the highly marketable housing zone of the Klang Valley and is “exclusively isolated”.
At present, the site has direct access to the west of USJ and the north of the Federal Highway.
Physical concept of the development included “selective land use and intensity” with residential units having dominant land use, Jauhari said.
The USJ Heights development is expected to have generally low to medium density of 5.5 grounded units per acre.
Special consideration has also been given to orientation, location and distribution of the units.
The designs of the properties were modern contemporary with decorated facade and oversized windows to maximise natural lighting as well as spaciousness with large built-up areas, Jauhari said.
Future phases of the development will include bungalows and more designer homes.
The full development of USJ Heights is expected in 2010
IJM agress to buy 50% of Leisure
IJM agress to buy 50% of Leisure
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PETALING JAYA: IJM Corp Bhd unit IJM Properties Sdn Bhd has agreed to buy a 50% stake in Larut Leisure Enterprise (HK) Ltd, which owns a partially completed commercial and residential complex in Changchun, north-east China.
IJM told Bursa Malaysia that IJM Properties would buy 1.52 million shares in Larut Leisure from Larut Overseas Ventures Sdn Bhd. Larut Overseas is a subsidiary of Talam Corp Bhd.
For the deal, IJM Properties will pay HK$1 and assume RM25.63mil of loans from the Talam group to Larut Leisure.
Larut Leisure has a 60% stake in Jilin Dingtai Enterprise Development Co Ltd, which owns the Yin Hai Complex.
IJM said the gross sales value of the 35-storey complex was estimated at 745 million yuan (RM340mil).
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PETALING JAYA: IJM Corp Bhd unit IJM Properties Sdn Bhd has agreed to buy a 50% stake in Larut Leisure Enterprise (HK) Ltd, which owns a partially completed commercial and residential complex in Changchun, north-east China.
IJM told Bursa Malaysia that IJM Properties would buy 1.52 million shares in Larut Leisure from Larut Overseas Ventures Sdn Bhd. Larut Overseas is a subsidiary of Talam Corp Bhd.
For the deal, IJM Properties will pay HK$1 and assume RM25.63mil of loans from the Talam group to Larut Leisure.
Larut Leisure has a 60% stake in Jilin Dingtai Enterprise Development Co Ltd, which owns the Yin Hai Complex.
IJM said the gross sales value of the 35-storey complex was estimated at 745 million yuan (RM340mil).
The bond that lasts
The bond that lasts
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KRISTALBOND is the latest in solar protection technology that allows high levels of light transmission. It can be applied seamlessly to existing windows of all sizes and shapes.
And if you’re worried that it can’t be applied to curved glass, you can throw that worry out the window now!
The technological advancement of KristalBond combines breakthrough ultra-low temperature Sol-Gel technology and Nanotechnology to produce a liquid that bonds permanently to glass.
The clear, non-reflective KristalBond liquid bonds seamlessly onto glass
After application of the KristalBond liquid onto the glass, it will dry and cure in about 45 minutes, depending on the surface area and the environmental conditions.
KristalBond retains the original specifications of glass and more importantly, it does not distort or colour the original glass specification. The coating in its standard form is clear, non-reflective and colourless.
KristalBond is a high-tech and affordable-cost solution to conserve energy by reducing excessive heat penetration into building and alleviating heat build-up; reduce fading to building interior including furniture and furnishing; and shield occupants from health risks associated with sun rays.
KristalBond also solves common problems faced by film tints as it does not require adhesive, nor contain high amounts of metallic substance. For building glass applications, KristalBond provides a 10-year warranty against peeling, bubbling and delaminating.
KristalBond is also suitable for automobile glass applications as it is 100% JPJ (Malaysian Road & Transport Department) compliant.
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KRISTALBOND is the latest in solar protection technology that allows high levels of light transmission. It can be applied seamlessly to existing windows of all sizes and shapes.
And if you’re worried that it can’t be applied to curved glass, you can throw that worry out the window now!
The technological advancement of KristalBond combines breakthrough ultra-low temperature Sol-Gel technology and Nanotechnology to produce a liquid that bonds permanently to glass.
The clear, non-reflective KristalBond liquid bonds seamlessly onto glass
After application of the KristalBond liquid onto the glass, it will dry and cure in about 45 minutes, depending on the surface area and the environmental conditions.
KristalBond retains the original specifications of glass and more importantly, it does not distort or colour the original glass specification. The coating in its standard form is clear, non-reflective and colourless.
KristalBond is a high-tech and affordable-cost solution to conserve energy by reducing excessive heat penetration into building and alleviating heat build-up; reduce fading to building interior including furniture and furnishing; and shield occupants from health risks associated with sun rays.
KristalBond also solves common problems faced by film tints as it does not require adhesive, nor contain high amounts of metallic substance. For building glass applications, KristalBond provides a 10-year warranty against peeling, bubbling and delaminating.
KristalBond is also suitable for automobile glass applications as it is 100% JPJ (Malaysian Road & Transport Department) compliant.
Mah Sing proposes sea villas for Southbay project
Mah Sing proposes sea villas for Southbay project
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KUALA LUMPUR: Mah Sing Group Bhd has proposed to build sea villas as an added attraction in its Southbay Penang project.
Managing director Datuk Leong Hoy Kum said Mah Sing was in the process of submitting its application to develop these villas.
Speaking after the company AGM yesterday, he said should it be given approval, it would be a first in Penang.
He also said Southbay’s current gross development value (GDV) of RM1.28bil did not include the proposed sea villas, which would be built on the seabed.
“Southbay’s target market includes local and foreign investors who are keen to invest in high-value commercial properties,” he said.
Southbay’s residential developments, Legenda@Southbay Penang and Residence@Southbay Penang, are set to be launched in the first half of 2008, to be followed by commercial properties.
Also included in its target market for Southbay were participants in the Malaysia My Second Home programme, Leong said.
The foreign investors interested in Mah Sing’s properties were from South Korea, Japan, the Middle East, Hong Kong, the US, Singapore and Europe, he said.
Leong also said the group was keen to lure institutional investors, as Malaysia’s property sector was attractive due to its prices being among the lowest in the region.
On overseas markets, Leong said Mah Sing was discussing with some parties in Vietnam to venture into residential and condominium development within Ho Chi Minh City, and also exploring opportunities in Doha.
“But, we are in no hurry to venture overseas. We are evaluating opportunities and, if we do go abroad, we want to ensure minimal capital outlay,” he added.
On the Icon development in Jalan Tun Razak, Kuala Lumpur, Leong said Mah Sing was keen to retain one of its blocks to ensure recurring income.
Mah Sing would capitalise on the low supply of semi-detached houses and bungalows in the Klang Valley, he said.
He added that of the total residential supply (in the Klang Valley), only 5% consisted of these types of residences.
Also, Leong said, Mah Sing was keen to further boost its commercial and office property sector due to its high growth potential.
Based on studies from Regroup Associates, it is estimated that buyers outnumber sellers by as much 15:1 in certain (commercial) developments.
With this high demand, it had set a target price of about RM900 per sq ft for Grade A offices in Kuala Lumpur within two years.
To date, Mah Sing has 13 developments and, with unbilled sales of RM430mil as at March 31, bringing its total GDV to RM3.9bil.
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KUALA LUMPUR: Mah Sing Group Bhd has proposed to build sea villas as an added attraction in its Southbay Penang project.
Managing director Datuk Leong Hoy Kum said Mah Sing was in the process of submitting its application to develop these villas.
Speaking after the company AGM yesterday, he said should it be given approval, it would be a first in Penang.
He also said Southbay’s current gross development value (GDV) of RM1.28bil did not include the proposed sea villas, which would be built on the seabed.
“Southbay’s target market includes local and foreign investors who are keen to invest in high-value commercial properties,” he said.
Southbay’s residential developments, Legenda@Southbay Penang and Residence@Southbay Penang, are set to be launched in the first half of 2008, to be followed by commercial properties.
Also included in its target market for Southbay were participants in the Malaysia My Second Home programme, Leong said.
The foreign investors interested in Mah Sing’s properties were from South Korea, Japan, the Middle East, Hong Kong, the US, Singapore and Europe, he said.
Leong also said the group was keen to lure institutional investors, as Malaysia’s property sector was attractive due to its prices being among the lowest in the region.
On overseas markets, Leong said Mah Sing was discussing with some parties in Vietnam to venture into residential and condominium development within Ho Chi Minh City, and also exploring opportunities in Doha.
“But, we are in no hurry to venture overseas. We are evaluating opportunities and, if we do go abroad, we want to ensure minimal capital outlay,” he added.
On the Icon development in Jalan Tun Razak, Kuala Lumpur, Leong said Mah Sing was keen to retain one of its blocks to ensure recurring income.
Mah Sing would capitalise on the low supply of semi-detached houses and bungalows in the Klang Valley, he said.
He added that of the total residential supply (in the Klang Valley), only 5% consisted of these types of residences.
Also, Leong said, Mah Sing was keen to further boost its commercial and office property sector due to its high growth potential.
Based on studies from Regroup Associates, it is estimated that buyers outnumber sellers by as much 15:1 in certain (commercial) developments.
With this high demand, it had set a target price of about RM900 per sq ft for Grade A offices in Kuala Lumpur within two years.
To date, Mah Sing has 13 developments and, with unbilled sales of RM430mil as at March 31, bringing its total GDV to RM3.9bil.
Dubai funds first direct offering in Malaysia
Saturday June 30, 2007
Dubai funds first direct offering in Malaysia
KUALA LUMPUR: Islamic funds distributed by Dubai's financial centre will be the first foreign funds to be offered directly to Malaysians under new rules that take effect on July 1.
Investors currently had to go through a feeder fund in Malaysia to gain exposure to foreign funds, the Securities Commission said. But the new guidelines, designed to ease marketing and distribution of foreign funds, will change that.
Malaysian and Dubai authorities signed a pact on March 27 to allow approved Islamic funds to be sold in their respective jurisdictions.
Foreign funds included, among others, retail unit trust funds or mutual funds, real estate investment trusts or private funds, whether unlisted or listed on an exchange, the regulator said.
The Dubai International Financial Centre, set up by the government of the Gulf Arab emirate to build a financial services hub there, was the first foreign jurisdiction recognised by Malaysia, the SC said in a statement.
“The list of recognised jurisdictions is set to expand with the signing of future mutual recognition agreements,” it added, but gave no details.
The pacts would also allow Malaysian manufactured funds to be offered and distributed in recognised jurisdictions, it said. – Reuters
Dubai funds first direct offering in Malaysia
KUALA LUMPUR: Islamic funds distributed by Dubai's financial centre will be the first foreign funds to be offered directly to Malaysians under new rules that take effect on July 1.
Investors currently had to go through a feeder fund in Malaysia to gain exposure to foreign funds, the Securities Commission said. But the new guidelines, designed to ease marketing and distribution of foreign funds, will change that.
Malaysian and Dubai authorities signed a pact on March 27 to allow approved Islamic funds to be sold in their respective jurisdictions.
Foreign funds included, among others, retail unit trust funds or mutual funds, real estate investment trusts or private funds, whether unlisted or listed on an exchange, the regulator said.
The Dubai International Financial Centre, set up by the government of the Gulf Arab emirate to build a financial services hub there, was the first foreign jurisdiction recognised by Malaysia, the SC said in a statement.
“The list of recognised jurisdictions is set to expand with the signing of future mutual recognition agreements,” it added, but gave no details.
The pacts would also allow Malaysian manufactured funds to be offered and distributed in recognised jurisdictions, it said. – Reuters
MRCB’s Penang monorail bid gets a boost
MRCB’s Penang monorail bid gets a boost
By DAVID TAN
PENANG: Malaysian Resources Corp Bhd (MRCB) is now on a firmer footing to bid for the monorail project on the island, with Penang Port Sdn Bhd (PPSB) joining its consortium.
With PPSB teaming up with MRCB, the latter’s chances of clinching the monorail contract had definitely increased, a source in the infrastructure industry said.
“PPSB was co-opted into the consortium because MRCB realised that a substantial portion of the land on which the monorail would be constructed belonged to PPSB,” the source told StarBiz.
Moreover, since PPSB has a better understanding of the traffic problems in Penang, it could help MRCB come up with a suitable monorail system.
Last year, when PPSB bid for the project as a separate entity, managing director Datuk Ahmad Ibnihajar had said the company had a better chance than others because it was based in Penang and understood the needs of the people.
The source said MRCB could also plan the monorail system to dovetail with the routes of the Penang Outer Ring Road (PORR) project, which the company was keen on.
MRCB is believed to be negotiating a 70% stake in Peninsular Metro Works Sdn Bhd, the concessionaire of the PORR project.
The support from PPSB lends even more credence to MRCB’s portfolio as a competitor for the monorail project.
Other members of the MRCB consortium are MTrans Transportation Systems Sdn Bhd, which specialises in manufacture of urban buses and monorail transportation system, and Scomi Engineering Bhd, which owns a 51% stake in MTrans.
The rival bidders for the monorail project are MMC Metrail Sdn Bhd, Road Builder and Melewar group.
The Melewar group, with technical backing from Swiss and Russian partners, has submitted a RM1.6bil bid.
Phase one of the project is an 18km stretch from the Penang International Airport to the Raja Tun Uda Ferry Terminal. Phase two is from the ferry terminal to Paya Terubong, while the final phase is from Komtar to Tanjung Tokong.
By DAVID TAN
PENANG: Malaysian Resources Corp Bhd (MRCB) is now on a firmer footing to bid for the monorail project on the island, with Penang Port Sdn Bhd (PPSB) joining its consortium.
With PPSB teaming up with MRCB, the latter’s chances of clinching the monorail contract had definitely increased, a source in the infrastructure industry said.
“PPSB was co-opted into the consortium because MRCB realised that a substantial portion of the land on which the monorail would be constructed belonged to PPSB,” the source told StarBiz.
Moreover, since PPSB has a better understanding of the traffic problems in Penang, it could help MRCB come up with a suitable monorail system.
Last year, when PPSB bid for the project as a separate entity, managing director Datuk Ahmad Ibnihajar had said the company had a better chance than others because it was based in Penang and understood the needs of the people.
The source said MRCB could also plan the monorail system to dovetail with the routes of the Penang Outer Ring Road (PORR) project, which the company was keen on.
MRCB is believed to be negotiating a 70% stake in Peninsular Metro Works Sdn Bhd, the concessionaire of the PORR project.
The support from PPSB lends even more credence to MRCB’s portfolio as a competitor for the monorail project.
Other members of the MRCB consortium are MTrans Transportation Systems Sdn Bhd, which specialises in manufacture of urban buses and monorail transportation system, and Scomi Engineering Bhd, which owns a 51% stake in MTrans.
The rival bidders for the monorail project are MMC Metrail Sdn Bhd, Road Builder and Melewar group.
The Melewar group, with technical backing from Swiss and Russian partners, has submitted a RM1.6bil bid.
Phase one of the project is an 18km stretch from the Penang International Airport to the Raja Tun Uda Ferry Terminal. Phase two is from the ferry terminal to Paya Terubong, while the final phase is from Komtar to Tanjung Tokong.
Tokyo office rents expected to rise another 60per cent to a peak in 2010 because of shrinking vacancy rates, now at just 2.7 per cent,
Mikihisa Hirai, president of Atlas Partners Japan Ltd, should be giddy with excitement as European and Middle Eastern clients are due to almost double the size of his property funds to just over US$800 million. But Mr Hirai knows he has his work cut out for him.
With Tokyo office rents expected to rise another 60per cent to a peak in 2010 because of shrinking vacancy rates, now at just 2.7 per cent, Japan is a popular place for property investors.
But average prices for commercial buildings have already jumped 25 per cent in the last couple of years, and competition for assets between real estate investment trusts (Reits), private equity funds and institutional investors is hotting up, eating away at returns.
‘There are no simple and easy deals,’ Mr Hirai said. ‘I feel there are more deals where bid prices are ridiculously high.’
With rock-bottom interest rates despite an economic recovery, Japan drew 55per cent of the US$94 billion in property transactions in Asia last year, including an increasing amount of petrodollars from the Middle East.
But now, yield-hungry investors are having to scour the country for more complex deals.
For example, Australian listed property trusts are starting to buy Japanese buildings, but employ heavy borrowing and currency hedging to artificially lift a property yield of 5 per cent into a more attractive 7.7 per cent yield for investors back home. Four property trusts carrying Japanese assets have listed in Australia in the past two years, including Babcock & Brown Japan Property Trust and Galileo Japan Trust. Such ‘financial engineering’ gives Australian investors an incentive to buy in Japan, says Peter Barge, chief executive officer of Jones Lang LaSalle Asia.
Deals are also growing bigger, Mr Barge said, as foreign investors try to outrun their local rivals.
‘Japanese are becoming major competitors. So they go for deals worth at least half a billion dollars to get away from Japanese competitors,’ he said. ‘You have to be a big investor to find opportunities.’
Yesterday, Mitsubishi Fuso Truck and Bus Corp, the Japanese truck unit of DaimlerChrysler AG, said it had sold 180 real estate properties in Japan as part of its efforts to focus on its core businesses, in a deal valued at US$1.4 billion, according to a market source.
The properties, mainly of retail operations for its regional sales centres, would be leased back to the same operators.
Investors are also moving away from the staple diet of offices.
Australian real estate manager MacarthurCook Ltd is looking to buy Japanese logistics buildings which offer a yield of about 5 per cent, compared with yields for top-notch offices of as low as 2 per cent.
‘Not many logistics properties are included in Japanese Reits yet,’ said Craig Dunstan, managing director and chief investment officer for MacarthurCook. ‘It’s positive from the availability point of view.’
The MacarthurCook Industrial Real Estate Investment Trust SI, which listed in Singapore in April, expects Japan to account for about 20 per cent of its overall portfolio.
The Japanese government, worried about another asset bubble, will start monitoring private funds from September, a step likely to force some smaller players out of the market. Others warn that rising interest rates in global markets may depress foreign investor appetite for assets in Japan.
Higher borrowing costs, already higher than property yields in Europe and the United States, could turn property investors more insular, said Daisuke Fukushima, senior analyst Nomura Securities Co Ltd.
‘Negative spreads in some overseas investments are widening and this means that investment properties are incurring latent losses,’ he said. ‘It’s likely that foreign investors will become less aggressive on their global investments when they are not sure how much losses they have at home.’
Source: The Business Times, 28 June 2007
With Tokyo office rents expected to rise another 60per cent to a peak in 2010 because of shrinking vacancy rates, now at just 2.7 per cent, Japan is a popular place for property investors.
But average prices for commercial buildings have already jumped 25 per cent in the last couple of years, and competition for assets between real estate investment trusts (Reits), private equity funds and institutional investors is hotting up, eating away at returns.
‘There are no simple and easy deals,’ Mr Hirai said. ‘I feel there are more deals where bid prices are ridiculously high.’
With rock-bottom interest rates despite an economic recovery, Japan drew 55per cent of the US$94 billion in property transactions in Asia last year, including an increasing amount of petrodollars from the Middle East.
But now, yield-hungry investors are having to scour the country for more complex deals.
For example, Australian listed property trusts are starting to buy Japanese buildings, but employ heavy borrowing and currency hedging to artificially lift a property yield of 5 per cent into a more attractive 7.7 per cent yield for investors back home. Four property trusts carrying Japanese assets have listed in Australia in the past two years, including Babcock & Brown Japan Property Trust and Galileo Japan Trust. Such ‘financial engineering’ gives Australian investors an incentive to buy in Japan, says Peter Barge, chief executive officer of Jones Lang LaSalle Asia.
Deals are also growing bigger, Mr Barge said, as foreign investors try to outrun their local rivals.
‘Japanese are becoming major competitors. So they go for deals worth at least half a billion dollars to get away from Japanese competitors,’ he said. ‘You have to be a big investor to find opportunities.’
Yesterday, Mitsubishi Fuso Truck and Bus Corp, the Japanese truck unit of DaimlerChrysler AG, said it had sold 180 real estate properties in Japan as part of its efforts to focus on its core businesses, in a deal valued at US$1.4 billion, according to a market source.
The properties, mainly of retail operations for its regional sales centres, would be leased back to the same operators.
Investors are also moving away from the staple diet of offices.
Australian real estate manager MacarthurCook Ltd is looking to buy Japanese logistics buildings which offer a yield of about 5 per cent, compared with yields for top-notch offices of as low as 2 per cent.
‘Not many logistics properties are included in Japanese Reits yet,’ said Craig Dunstan, managing director and chief investment officer for MacarthurCook. ‘It’s positive from the availability point of view.’
The MacarthurCook Industrial Real Estate Investment Trust SI, which listed in Singapore in April, expects Japan to account for about 20 per cent of its overall portfolio.
The Japanese government, worried about another asset bubble, will start monitoring private funds from September, a step likely to force some smaller players out of the market. Others warn that rising interest rates in global markets may depress foreign investor appetite for assets in Japan.
Higher borrowing costs, already higher than property yields in Europe and the United States, could turn property investors more insular, said Daisuke Fukushima, senior analyst Nomura Securities Co Ltd.
‘Negative spreads in some overseas investments are widening and this means that investment properties are incurring latent losses,’ he said. ‘It’s likely that foreign investors will become less aggressive on their global investments when they are not sure how much losses they have at home.’
Source: The Business Times, 28 June 2007
Alexandra is emerging as a strong alternative to the central business district (CBD) as banks continue to be attracted to the business hub there.
Alexandra is emerging as a strong alternative to the central business district (CBD) as banks continue to be attracted to the business hub there.
Real estate company Mapletree, which developed Alexandra Business Hub, says that it is in ’serious negotiations’ to sign on up to five more banks, chief operating officer Tan Boon Leong told BT yesterday.
One of the banks is asking for 550,000 sq ft and another for 350,000 sq ft.
It recently signed up DBS, HSBC and an American bank looking to move some of their operations there. Mapletree says the average space banks are seeking is 100,000 to 150,000 sq ft.
Mr Tan says that while banks had earlier shifted operations to various neighbourhoods, Alexandra is a ‘true alternative’ to the CBD because of its location - 10 minutes from the CBD and its links to major roads leading to expressways.
Prime office rents in Raffles Place have hit record levels, forcing companies to reconsider their space requirements and manage costs, Mr Tan says. According to a CB Richard Ellis report last month, office rents in Singapore are the fifth fastest growing globally.
Office rent at its Alexandra hub is about ‘40 per cent lower’ than going rates in the CBD. While prime office space is said to be going for about $12 per sq ft, Mapletree is asking $7 psf for office space and $4-$4.50 psf for back room operations space.
While financial institutions have earlier shifted some operations to neighbourhoods such as Tampines and Changi, Mr Tan says that Alexandra is preferred because of its proximity to town.
Also, even though Alexandra used to be an industrial area, Mr Tan says there is no ‘image’ problem. ‘When banks see that other banks are coming, they take a second look,’ he said.
Based on demand so far, Mr Tan says he expects 50 to 60 per cent of the new leasable area of 1.6 million sq ft to be taken up by financial institutions. Oil and gas, telecoms and chemical companies may take up another 20 to 30 per cent, while the remaining space may be taken up by companies which offer support services such as IT.
Mapletree expects to have pre-commitment of 40 per cent of the new space by the first quarter next year.
Mr Tan says multinational companies need more space in Singapore to expand and consolidate their regional presence affordably, which is what Alexandra Hub offers. The complex, which cost Mapletree $405 million to build, includes amenities catering for expatriates such as childcare facilities, a gym with a swimming pool, coffee outlets, laundry and garden landscape.
Source: The Business Times, 28 June 2007
Real estate company Mapletree, which developed Alexandra Business Hub, says that it is in ’serious negotiations’ to sign on up to five more banks, chief operating officer Tan Boon Leong told BT yesterday.
One of the banks is asking for 550,000 sq ft and another for 350,000 sq ft.
It recently signed up DBS, HSBC and an American bank looking to move some of their operations there. Mapletree says the average space banks are seeking is 100,000 to 150,000 sq ft.
Mr Tan says that while banks had earlier shifted operations to various neighbourhoods, Alexandra is a ‘true alternative’ to the CBD because of its location - 10 minutes from the CBD and its links to major roads leading to expressways.
Prime office rents in Raffles Place have hit record levels, forcing companies to reconsider their space requirements and manage costs, Mr Tan says. According to a CB Richard Ellis report last month, office rents in Singapore are the fifth fastest growing globally.
Office rent at its Alexandra hub is about ‘40 per cent lower’ than going rates in the CBD. While prime office space is said to be going for about $12 per sq ft, Mapletree is asking $7 psf for office space and $4-$4.50 psf for back room operations space.
While financial institutions have earlier shifted some operations to neighbourhoods such as Tampines and Changi, Mr Tan says that Alexandra is preferred because of its proximity to town.
Also, even though Alexandra used to be an industrial area, Mr Tan says there is no ‘image’ problem. ‘When banks see that other banks are coming, they take a second look,’ he said.
Based on demand so far, Mr Tan says he expects 50 to 60 per cent of the new leasable area of 1.6 million sq ft to be taken up by financial institutions. Oil and gas, telecoms and chemical companies may take up another 20 to 30 per cent, while the remaining space may be taken up by companies which offer support services such as IT.
Mapletree expects to have pre-commitment of 40 per cent of the new space by the first quarter next year.
Mr Tan says multinational companies need more space in Singapore to expand and consolidate their regional presence affordably, which is what Alexandra Hub offers. The complex, which cost Mapletree $405 million to build, includes amenities catering for expatriates such as childcare facilities, a gym with a swimming pool, coffee outlets, laundry and garden landscape.
Source: The Business Times, 28 June 2007
Three more than the sites it put on the market for the first half of 2007.
The government yesterday said that nine sites are on offer under its industrial land sales programme for the second half of this year - three more than the sites it put on the market for the first half of 2007.
The nine sites will together give about 3.74 million square feet of industrial space, up from the 2.79 million sq ft offered in the first half of the year.
However, the increase in the space offered under the industrial land sales programme is not as great as that seen for residential space, market observers said. The number of residential sites on offer through the confirmed list increased from two to eight from the first half of 2007 to the second half.
‘This could indicate that the government may see that the industrial property market is fairly stable with sufficient supply in the short and medium term,’ said Nicholas Mak, Knight Frank’s head of consultancy and research.
As with the first half of the year, just two industrial sites - this time, a 5.1 ha site in Sin Ming Lane and a 2.1 ha site in Jalan Tepong - will be offered under the confirmed list. Both sites are expected to see strong interest.
The Sin Ming Lane plot has the potential to yield a large gross floor area of about 1.37 million sq ft. Potential bidders include car companies and/or workshops because of nearby vehicle inspection centres, said Li Hiaw Ho, executive director for research at CB Richard Ellis (CBRE). ‘The unit price for this plot might be lower as a result of the large land area,’ Mr Li said.
The Jalan Tepong site, on the other hand, is interesting because it has a lease of about 23 years, shorter than the usual tenure of 30 or 60 years. The tenure for the site is only until 2030 to dovetail with future developments in that area. The plot might also fetch a lower price because of the unusual tenure, Mr Li said. ‘Some fresh food companies might bid for the site as food manufacturing is permitted and the site is near to Jurong Port.’
The new reserve list has seven sites, three more than the previous reserve list. The seven sites can yield a total maximum gross floor area of 2.05 million sq ft, less than the 2.40 million sq ft that the four sites on the previous reserve list could yield.
Despite the smaller floor area, the reserve list for the second half seems to be offering a variety of locations, Mr Mak said.
The take-up for factory space was 7.64 million sq ft in 2006 and 1.39 million sq ft in the first quarter of 2007. The market should therefore be able to absorb the gross floor area that can potentially come from the sites on the current reserve list, observers said.
CBRE said average rents for all industrial space increased in the second quarter of 2007, with high-tech space rising the fastest.
Average rents for high-tech space rose 11.9 per cent from $2.10 per square foot (psf) in the first quarter to $2.35 psf in Q2 - the highest quarterly increase in the past five years.
‘The limited supply of office space coupled with rising rents encouraged many qualifying companies to look to high-tech properties to meet their needs,’ CBRE said. ‘Further rent increases for high-tech space during the second half of the year is expected as demand for offices is unlikely to let up while supply of office space will still remain tight.’
Source: The Business Times, 28 June 2007
The nine sites will together give about 3.74 million square feet of industrial space, up from the 2.79 million sq ft offered in the first half of the year.
However, the increase in the space offered under the industrial land sales programme is not as great as that seen for residential space, market observers said. The number of residential sites on offer through the confirmed list increased from two to eight from the first half of 2007 to the second half.
‘This could indicate that the government may see that the industrial property market is fairly stable with sufficient supply in the short and medium term,’ said Nicholas Mak, Knight Frank’s head of consultancy and research.
As with the first half of the year, just two industrial sites - this time, a 5.1 ha site in Sin Ming Lane and a 2.1 ha site in Jalan Tepong - will be offered under the confirmed list. Both sites are expected to see strong interest.
The Sin Ming Lane plot has the potential to yield a large gross floor area of about 1.37 million sq ft. Potential bidders include car companies and/or workshops because of nearby vehicle inspection centres, said Li Hiaw Ho, executive director for research at CB Richard Ellis (CBRE). ‘The unit price for this plot might be lower as a result of the large land area,’ Mr Li said.
The Jalan Tepong site, on the other hand, is interesting because it has a lease of about 23 years, shorter than the usual tenure of 30 or 60 years. The tenure for the site is only until 2030 to dovetail with future developments in that area. The plot might also fetch a lower price because of the unusual tenure, Mr Li said. ‘Some fresh food companies might bid for the site as food manufacturing is permitted and the site is near to Jurong Port.’
The new reserve list has seven sites, three more than the previous reserve list. The seven sites can yield a total maximum gross floor area of 2.05 million sq ft, less than the 2.40 million sq ft that the four sites on the previous reserve list could yield.
Despite the smaller floor area, the reserve list for the second half seems to be offering a variety of locations, Mr Mak said.
The take-up for factory space was 7.64 million sq ft in 2006 and 1.39 million sq ft in the first quarter of 2007. The market should therefore be able to absorb the gross floor area that can potentially come from the sites on the current reserve list, observers said.
CBRE said average rents for all industrial space increased in the second quarter of 2007, with high-tech space rising the fastest.
Average rents for high-tech space rose 11.9 per cent from $2.10 per square foot (psf) in the first quarter to $2.35 psf in Q2 - the highest quarterly increase in the past five years.
‘The limited supply of office space coupled with rising rents encouraged many qualifying companies to look to high-tech properties to meet their needs,’ CBRE said. ‘Further rent increases for high-tech space during the second half of the year is expected as demand for offices is unlikely to let up while supply of office space will still remain tight.’
Source: The Business Times, 28 June 2007
There has been disturbing talk in the media recently that the restrictions on foreigners buying landed homes in Singapore could be relaxed.
There has been disturbing talk in the media recently that the restrictions on foreigners buying landed homes in Singapore could be relaxed.
I hope the authorities would quickly nip this rumour in the bud before there is too much public disquiet.
Goldman Sachs (Singapore) is lobbying for the rescindment of the Residential Property Act, which has, since 1973, restricted foreigners and permanent residents from owning landed residential property without prior official approval.
Goldman Sachs argues that this change would serve as a catalyst for further foreign buying of private homes and boost the current residential property up-cycle. To further support this argument, it implies that Singaporeans already have a stake in the country by virtue of public housing catering to 80 per cent of us.
I doubt anyone in Singapore really feels that the property market requires more encouragement. If anything, the reverse is probably true and the authorities are probably contemplating measures to cool the red-hot market to bring it to a more sustainable level.
Goldman Sach’s reference to public housing also comes across as being a tad condescending to me.
Hence I agree fully with the industry’s opinion leaders, who were quoted to be mostly against this proposal.
Mr Charles Chong, chairman of the Government Parliamentary Committee (National Development and Environment), was quoted as saying: ‘Landed properties should not be priced out of Singaporeans’ reach (or) it could lead to disgruntled Singaporeans.’
Others said that the existing Act has the positive effect of ‘encouraging foreigners to commit to Singapore, to sink their roots here’ and that landed-property ownership is one of the ‘privileges of being Singaporean’.
In Pearl S. Buck’s The Good Earth, the protagonist Wang Lung chided his sons when he overheard them talking about selling the land which he had loved so much. He said: ‘…if you sell the land, it is the end.’
Dr Huang Shoou Chyuan
Source: The Straits Times, 28 June 2007
I hope the authorities would quickly nip this rumour in the bud before there is too much public disquiet.
Goldman Sachs (Singapore) is lobbying for the rescindment of the Residential Property Act, which has, since 1973, restricted foreigners and permanent residents from owning landed residential property without prior official approval.
Goldman Sachs argues that this change would serve as a catalyst for further foreign buying of private homes and boost the current residential property up-cycle. To further support this argument, it implies that Singaporeans already have a stake in the country by virtue of public housing catering to 80 per cent of us.
I doubt anyone in Singapore really feels that the property market requires more encouragement. If anything, the reverse is probably true and the authorities are probably contemplating measures to cool the red-hot market to bring it to a more sustainable level.
Goldman Sach’s reference to public housing also comes across as being a tad condescending to me.
Hence I agree fully with the industry’s opinion leaders, who were quoted to be mostly against this proposal.
Mr Charles Chong, chairman of the Government Parliamentary Committee (National Development and Environment), was quoted as saying: ‘Landed properties should not be priced out of Singaporeans’ reach (or) it could lead to disgruntled Singaporeans.’
Others said that the existing Act has the positive effect of ‘encouraging foreigners to commit to Singapore, to sink their roots here’ and that landed-property ownership is one of the ‘privileges of being Singaporean’.
In Pearl S. Buck’s The Good Earth, the protagonist Wang Lung chided his sons when he overheard them talking about selling the land which he had loved so much. He said: ‘…if you sell the land, it is the end.’
Dr Huang Shoou Chyuan
Source: The Straits Times, 28 June 2007
It is timely that our Government should rescind the strict ruling on foreigners buying landed properties in Singapore.
It is timely that our Government should rescind the strict ruling on foreigners buying landed properties in Singapore. It was imposed decades ago due to abuses and loose regulations then that affected citizens.
Over the years that I have witnessed the development of our property market, there has been no runaway prices seen in the 1960s.
I have been a supporter of conserving old landed properties and, having invested heavily in one, I found that for more than 10 years, I have yet to see any increase in my landed property which is a conservation terrace house, fully modernised at great cost, without expecting any subsidy from the Government.
Now that I have a need to dispose of my conservation property to reduce my costly bank borrowing, I face great hardship in trying to dispose of my conservation property for two main reasons.
I have foreigners keen to buy but they are put off by the need to apply for special permission which takes time. As a result, while condominium prices have gone up since last year, my conservation property of 3,000 sq ft remains stagnant in terms of price increases. Even if I could sell, the price is very low.
I appeal to the Government to rescind this ruling so that those of us who have maintained conservation properties for the good of the nation would not be penalised in this way.
Anna Su-Yin Wang (Ms)
Source: The Straits Times, 28 June 2007
Over the years that I have witnessed the development of our property market, there has been no runaway prices seen in the 1960s.
I have been a supporter of conserving old landed properties and, having invested heavily in one, I found that for more than 10 years, I have yet to see any increase in my landed property which is a conservation terrace house, fully modernised at great cost, without expecting any subsidy from the Government.
Now that I have a need to dispose of my conservation property to reduce my costly bank borrowing, I face great hardship in trying to dispose of my conservation property for two main reasons.
I have foreigners keen to buy but they are put off by the need to apply for special permission which takes time. As a result, while condominium prices have gone up since last year, my conservation property of 3,000 sq ft remains stagnant in terms of price increases. Even if I could sell, the price is very low.
I appeal to the Government to rescind this ruling so that those of us who have maintained conservation properties for the good of the nation would not be penalised in this way.
Anna Su-Yin Wang (Ms)
Source: The Straits Times, 28 June 2007
Six new industrial sites were put on the Government’s land sales list
Six new industrial sites were put on the Government’s land sales list yesterday.
The sites, with a total area of 11.7ha, will be released in the second half of this year.
Two of the plots are on the confirmed list, which means that they will be put up for sale on a pre-determined date.
The first, a 5.1ha site in Sin Ming Lane, will be released in August. Another 2.1ha site in Jalan Tepong will follow in September.
The remaining four sites will be made available on the reserve list. To trigger a public tender for them, a developer will have to submit an acceptable minimum bid to the Government.
The sites comprise a 0.8ha site in Toa Payoh at the former Playfair Primary School, a 1.5ha plot at Yishun Avenue 6, a 1.2ha parcel at Ubi Avenue 4, and a 1ha site at the junction of Pioneer Road and Tuas Avenue 11.
In general, these four plots ‘appear more attractive than the two confirmed sites’, said Ms Tay Huey Ying, director of research and consultancy at Colliers International.
This is because they are mostly smaller, more centrally located and more suitable for general business uses. All four sites on the reserve list can be partly used as substitutes for office space.
She added that the Toa Payoh and Ubi parcels are particularly appealing.
But she also said it is unlikely that these plots will help alleviate the current office shortage.
‘By the time they are sold and completed, they are likely to coincide with the completion of the Business and Financial Centre as well as all the other office redevelopments,’ she said.
‘By then, the office supply crunch would have ceased somewhat.’
Source: The Straits Times, 28 June 2007
The sites, with a total area of 11.7ha, will be released in the second half of this year.
Two of the plots are on the confirmed list, which means that they will be put up for sale on a pre-determined date.
The first, a 5.1ha site in Sin Ming Lane, will be released in August. Another 2.1ha site in Jalan Tepong will follow in September.
The remaining four sites will be made available on the reserve list. To trigger a public tender for them, a developer will have to submit an acceptable minimum bid to the Government.
The sites comprise a 0.8ha site in Toa Payoh at the former Playfair Primary School, a 1.5ha plot at Yishun Avenue 6, a 1.2ha parcel at Ubi Avenue 4, and a 1ha site at the junction of Pioneer Road and Tuas Avenue 11.
In general, these four plots ‘appear more attractive than the two confirmed sites’, said Ms Tay Huey Ying, director of research and consultancy at Colliers International.
This is because they are mostly smaller, more centrally located and more suitable for general business uses. All four sites on the reserve list can be partly used as substitutes for office space.
She added that the Toa Payoh and Ubi parcels are particularly appealing.
But she also said it is unlikely that these plots will help alleviate the current office shortage.
‘By the time they are sold and completed, they are likely to coincide with the completion of the Business and Financial Centre as well as all the other office redevelopments,’ she said.
‘By then, the office supply crunch would have ceased somewhat.’
Source: The Straits Times, 28 June 2007
20 per cent levy by Indonesia’s Karimun province on its granite bound for Singapore
The proposed 20 per cent levy by Indonesia’s Karimun province on its granite bound for Singapore may not come to pass, a senior Indonesian official told The Straits Times yesterday.
Mr Muhammad Lutfi, who chairs Indonesia’s Investment Coordinating Board, said he would meet Karimun’s governor and mayor next Monday specifically to thrash out with them the levy, which could amount to S$9.50 a tonne at the current price of S$60 a tonne here for granite.
He said: ‘Let me put it this way - we would like to give our investors good, smart policies.
‘We would also like to maintain the 3,000 workers working in the granite mines of Karimun.’
So, he stressed, it would not be smart if such a levy lost his country a vital market for the rock.
After all, he added, the whole point of Indonesia’s new pro-business drive, which he is steering, was to create jobs and lift at least 19 million Indonesians out of poverty by 2010.
Ironically, news of the levy came just a day after he told reporters at the World Economic Forum here that he was looking to ease Singapore’s importing of granite, perhaps even scrapping checks on Singapore-bound shipments.
Singaporean investors had queried him on the levy during a closed-door meeting at the Economic Development Board’s headquarters here yesterday morning.
Karimun’s planned levycame to light recently in a statement from building materials supplier Hong Leong Asia to the Singapore Stock Exchange.
Indonesia banned Singapore from buying its land sand in February and, in April, detained 12 of its granite-bearing barges on suspicion of sand-smuggling.
But on Monday, the Building and Construction Authority said all 12 barges had been released.
Source: The Straits Times, 28 June 2007
Mr Muhammad Lutfi, who chairs Indonesia’s Investment Coordinating Board, said he would meet Karimun’s governor and mayor next Monday specifically to thrash out with them the levy, which could amount to S$9.50 a tonne at the current price of S$60 a tonne here for granite.
He said: ‘Let me put it this way - we would like to give our investors good, smart policies.
‘We would also like to maintain the 3,000 workers working in the granite mines of Karimun.’
So, he stressed, it would not be smart if such a levy lost his country a vital market for the rock.
After all, he added, the whole point of Indonesia’s new pro-business drive, which he is steering, was to create jobs and lift at least 19 million Indonesians out of poverty by 2010.
Ironically, news of the levy came just a day after he told reporters at the World Economic Forum here that he was looking to ease Singapore’s importing of granite, perhaps even scrapping checks on Singapore-bound shipments.
Singaporean investors had queried him on the levy during a closed-door meeting at the Economic Development Board’s headquarters here yesterday morning.
Karimun’s planned levycame to light recently in a statement from building materials supplier Hong Leong Asia to the Singapore Stock Exchange.
Indonesia banned Singapore from buying its land sand in February and, in April, detained 12 of its granite-bearing barges on suspicion of sand-smuggling.
But on Monday, the Building and Construction Authority said all 12 barges had been released.
Source: The Straits Times, 28 June 2007
‘Condo residents hit by club lights”
Mr Madho Prasad Shroff’s letter, ‘Condo residents hit by club lights” (Online forum, June 26), raises the interesting issue of whether a swimming, golf or country club is liable for the tort of nuisance if the well-being of residents in an adjoining condo is adversely affected by excessive lights emanating from the club.
The Latin phrase, ’sic utera tuo ut alienam non laedas”, means that one must use one’s property in such a fashion so as not to disturb your neighbours.
Nuisance is divided into ‘public nuisance” and ‘private nuisance”, depending on the extent of the harm or annoyance.
If the harm is suffered by one or a particular group of people, it is a private nuisance. A public nuisance is one where citizens generally, or a substantial number of members of the public, are harmed or unreasonably inconvenienced.
Private nuisance is a tort where the defendant has unreasonably and substantially interfered with the plaintiff’s reasonable use and enjoyment of his land.
Such nuisance includes the malfunctioning of sewage systems, excessive noise, directing your CCTV at your neighbour’s gate or pointing your floodlights into your neighbour’s compound for an extended period of time .
A court would normally assess the reasonableness of any nuisance based on what would be found tolerable by the ordinary occupier of reasonable fortitude.
The standard is the ordinary man which means abnormal sensitivities may prevent a claim if the nuisance would not have otherwise unreasonably interfered with an ordinary occupier.
It is not necessary to prove fault on the part of the defendant. The court would weigh the inconvenience to the plaintiff against the usefulness of the defendant’s conduct under the prevailing circumstances.
In private nuisance, the interference must be substantial, not trivial. For example, the building of a hospital next to a person’s land was held not to be a nuisance. However, courts have found dust from a sawmill, noise from racing boats or even funeral parlours as nuisances to neighbours.
Nuisance is a tort of strict liability. This means that once the damages and causation have been proven, it is no defence to argue that you have taken all reasonable precautions. The remedy for a nuisance is either an injunction or monetary damages.
In our HDB estate, the lights at the basketball court are switched off at 10pm and all residents are expected to put up with the noise of bouncing balls which is deemed to be reasonable.
If the club in question has seriously interfered with the quiet enjoyment of the condo residents by the emanation of excessive lights that have gone past the boundaries of their property for an unreasonable length of time and the gravity of the harm (causing residents to suffer from insomnia) outweighs the utility of the conduct of the defendant, the plaintiff may make a claim in nuisance.
Heng Cho Choon
Source: The Straits Times, 28 June 2007
The Latin phrase, ’sic utera tuo ut alienam non laedas”, means that one must use one’s property in such a fashion so as not to disturb your neighbours.
Nuisance is divided into ‘public nuisance” and ‘private nuisance”, depending on the extent of the harm or annoyance.
If the harm is suffered by one or a particular group of people, it is a private nuisance. A public nuisance is one where citizens generally, or a substantial number of members of the public, are harmed or unreasonably inconvenienced.
Private nuisance is a tort where the defendant has unreasonably and substantially interfered with the plaintiff’s reasonable use and enjoyment of his land.
Such nuisance includes the malfunctioning of sewage systems, excessive noise, directing your CCTV at your neighbour’s gate or pointing your floodlights into your neighbour’s compound for an extended period of time .
A court would normally assess the reasonableness of any nuisance based on what would be found tolerable by the ordinary occupier of reasonable fortitude.
The standard is the ordinary man which means abnormal sensitivities may prevent a claim if the nuisance would not have otherwise unreasonably interfered with an ordinary occupier.
It is not necessary to prove fault on the part of the defendant. The court would weigh the inconvenience to the plaintiff against the usefulness of the defendant’s conduct under the prevailing circumstances.
In private nuisance, the interference must be substantial, not trivial. For example, the building of a hospital next to a person’s land was held not to be a nuisance. However, courts have found dust from a sawmill, noise from racing boats or even funeral parlours as nuisances to neighbours.
Nuisance is a tort of strict liability. This means that once the damages and causation have been proven, it is no defence to argue that you have taken all reasonable precautions. The remedy for a nuisance is either an injunction or monetary damages.
In our HDB estate, the lights at the basketball court are switched off at 10pm and all residents are expected to put up with the noise of bouncing balls which is deemed to be reasonable.
If the club in question has seriously interfered with the quiet enjoyment of the condo residents by the emanation of excessive lights that have gone past the boundaries of their property for an unreasonable length of time and the gravity of the harm (causing residents to suffer from insomnia) outweighs the utility of the conduct of the defendant, the plaintiff may make a claim in nuisance.
Heng Cho Choon
Source: The Straits Times, 28 June 2007
More comprehensive data on the property market will be available from next month, enabling the Government and the public to better gauge
More comprehensive data on the property market will be available from next month, enabling the Government and the public to better gauge the health of the sector, said Mr Mah Bow Tan.
There have been concerns that the recent increase in private home prices — more than 20 per cent in the last three years — is a bubble waiting to burst.
Even as more options such as executive condominiums (ECs) will be offered to keep private housing affordable, the Government has asked developers for more details about their sales, for a more complete picture of the market.
Said Mr Mah: “We look at the economy, we look at the various indicators. And it’s important for us to make sure that the data we get is accurate, is comprehensive, and is reaching us in a timely manner so that we can make those decisions.
“We will also push that data out into the market, to let the public know … then they will be able to make considered, rational, prudent decisions.”
The information will include pricing details and sales numbers for all new projects. Said Mr Mah: “The worst thing is for people to have incomplete information … create a panic, make people very anxious and they rush in.
“If we can provide the data — imminent supply, three-year supply, office space, residential — let this information go into the market so that people will know, ‘There’s this supply coming up, why are we rushing?’ — that’s what I hope for.”
By and large, property developers have been cooperative. He said: “We’ve explained to them that a transparent market is good for everybody. They understand that.”
And with the widening price gap between private and public housing, the Government will strive to provide more affordable options for young couples and HDB upgraders. These include ECs and Design, Build and Sell Scheme flats.
“I think 2005 was the last time we put up an EC site for sale. But now the gap is starting to widen, so it’s time for us to replenish the EC stock,” he said, referring to the recent release of a site in Punggol for that purpose.
Meanwhile, the Monetary Authority of Singapore said it is monitoring developments to ensure that banks not become overexposed to the property sector.
In response to queries from Thomson Financial, an MAS spokesperson said measures are in place, and added: “MAS is monitoring developments and has reminded banks to maintain prudent credit standards in their property-related loans.”
But analysts think it increasingly likely the central bank will step in to curb property developers’ practice of offering deferred payment schemes to property buyers, which shifts the financing burden to developers and construction companies.
Citigroup economist Chua Hak Bin said loans extended to building and construction companies surged 27 per cent year-on-year in April. In contrast, mortgage loans had risen just 5 per cent in April compared to the year before.
The Government last imposed curbs on the property sector in 1996, in the form of a capital gains tax, restrictions on CPF use and limits on property purchases by foreigners.
Source: Today, 29 June 2007
There have been concerns that the recent increase in private home prices — more than 20 per cent in the last three years — is a bubble waiting to burst.
Even as more options such as executive condominiums (ECs) will be offered to keep private housing affordable, the Government has asked developers for more details about their sales, for a more complete picture of the market.
Said Mr Mah: “We look at the economy, we look at the various indicators. And it’s important for us to make sure that the data we get is accurate, is comprehensive, and is reaching us in a timely manner so that we can make those decisions.
“We will also push that data out into the market, to let the public know … then they will be able to make considered, rational, prudent decisions.”
The information will include pricing details and sales numbers for all new projects. Said Mr Mah: “The worst thing is for people to have incomplete information … create a panic, make people very anxious and they rush in.
“If we can provide the data — imminent supply, three-year supply, office space, residential — let this information go into the market so that people will know, ‘There’s this supply coming up, why are we rushing?’ — that’s what I hope for.”
By and large, property developers have been cooperative. He said: “We’ve explained to them that a transparent market is good for everybody. They understand that.”
And with the widening price gap between private and public housing, the Government will strive to provide more affordable options for young couples and HDB upgraders. These include ECs and Design, Build and Sell Scheme flats.
“I think 2005 was the last time we put up an EC site for sale. But now the gap is starting to widen, so it’s time for us to replenish the EC stock,” he said, referring to the recent release of a site in Punggol for that purpose.
Meanwhile, the Monetary Authority of Singapore said it is monitoring developments to ensure that banks not become overexposed to the property sector.
In response to queries from Thomson Financial, an MAS spokesperson said measures are in place, and added: “MAS is monitoring developments and has reminded banks to maintain prudent credit standards in their property-related loans.”
But analysts think it increasingly likely the central bank will step in to curb property developers’ practice of offering deferred payment schemes to property buyers, which shifts the financing burden to developers and construction companies.
Citigroup economist Chua Hak Bin said loans extended to building and construction companies surged 27 per cent year-on-year in April. In contrast, mortgage loans had risen just 5 per cent in April compared to the year before.
The Government last imposed curbs on the property sector in 1996, in the form of a capital gains tax, restrictions on CPF use and limits on property purchases by foreigners.
Source: Today, 29 June 2007
More buzz will soon be added to Tanglin Village, the rustic bohemian hangout a short drive from the busy Orchard Road area.
More buzz will soon be added to Tanglin Village (picture), the rustic bohemian hangout a short drive from the busy Orchard Road area.
Yesterday, the Singapore Land Authority (SLA) awarded a total of 11 buildings — consisting of 40,135 sq m over two sites — to local construction company Country City Investment Pte Ltd.
Country City Investment is planning to turn the cluster into a “lifestyle destination area”.
For the Dempsey Hill area, the tenant is planning a mixture of food and beverage (F&B) establishments and recreational outlets, such as a children’s entertainment centre.
Over at the former Civil Service Club at 25 Dempsey Road, a mix of fine dining restaurants will form the sub-tenants.
Mr Nicholas Ng, Country City general manager, told Today the company has been “very selective”, considering factors such as concept and business proposal.
“Ultimately, we hope that with the F&B establishments and fine dining restaurants will be a new lifestyle destination that will attract locals, expatriates and travellers alike,” said Mr Ng.
The two new developments are expected to be operational in the later half of this year.
The tenancies at the two sites are for an initial term of three years and renewable up to 2015.
Since Tanglin Village’s launch last year, the SLA has managed to attract keen interest. For example, the former Civil Service Club received an overwhelming nine bids — ranging from $38,000 to $93,889, on a total site area of about 16,300 sq m.
With the award of the two sites, SLA said it is closer to fulfilling about 60 per cent of the site’s occupancy as an enclave of lifestyle, education and art interests.
In August, it will put up another property for public tender at Minden Road for similar lifestyle uses.
Source: Today, 29 June 2007
Yesterday, the Singapore Land Authority (SLA) awarded a total of 11 buildings — consisting of 40,135 sq m over two sites — to local construction company Country City Investment Pte Ltd.
Country City Investment is planning to turn the cluster into a “lifestyle destination area”.
For the Dempsey Hill area, the tenant is planning a mixture of food and beverage (F&B) establishments and recreational outlets, such as a children’s entertainment centre.
Over at the former Civil Service Club at 25 Dempsey Road, a mix of fine dining restaurants will form the sub-tenants.
Mr Nicholas Ng, Country City general manager, told Today the company has been “very selective”, considering factors such as concept and business proposal.
“Ultimately, we hope that with the F&B establishments and fine dining restaurants will be a new lifestyle destination that will attract locals, expatriates and travellers alike,” said Mr Ng.
The two new developments are expected to be operational in the later half of this year.
The tenancies at the two sites are for an initial term of three years and renewable up to 2015.
Since Tanglin Village’s launch last year, the SLA has managed to attract keen interest. For example, the former Civil Service Club received an overwhelming nine bids — ranging from $38,000 to $93,889, on a total site area of about 16,300 sq m.
With the award of the two sites, SLA said it is closer to fulfilling about 60 per cent of the site’s occupancy as an enclave of lifestyle, education and art interests.
In August, it will put up another property for public tender at Minden Road for similar lifestyle uses.
Source: Today, 29 June 2007
Jurong and Paya Lebar have been designated to become new business hubs, under the upcoming Master Plan review for 2008.
Jurong and Paya Lebar have been designated to become new business hubs, under the upcoming Master Plan review for 2008.
Giving a preview of the plans in a Channel NewsAsia interview, National Development Minister Mah Bow Tan said these would provide space for Singapore’s continued growth as a global business centre, and offer an alternative to the overcrowded CBD area.
The Master Plan guides Singapore’s medium-term land use, and is reviewed every five years.
The Government plans to release sites for new offices, shops, homes and entertainment outlets in Jurong and Paya Lebar, to grow them into new hubs for businesses.
According to the minister, the lower costs will be a key pull factor. Said Mr Mah: “I think the best incentive is that it will offer cheaper office space — cheaper than the CBD quite obviously. It will offer proximity to some of the nearby residences; as people want to live near their workplace, that would be an attraction.
“Of course, it’s going to be a very nice leisure, recreational area as well. In Jurong, for example, we can redevelop the areas around the Jurong Lake, which can provide very nice retail, and F&B outlets on the waterfront.”
The specific locations of the sites have yet to be determined, but they will be centred around the existing MRT stations. For Jurong, these would likely be the Lakeside, Boon Lay or Jurong East stations, while the Paya Lebar station is the likely candidate in the east.
Mr Mah added that he did not see the need for the land acquisition by the Government as there was ample empty sites in these areas.
The new hubs are seen as part of the long-term answer to the current office space crunch.
“I remember we took at least 10 years to fully develop Tampines as a Regional Centre. So I think, depending on the reaction of the market, it may take just as long (to build up Jurong and Paya Lebar).”
As for speculation about drastic increases in plot ratios for land around the island to cope with an anticipated rise in population, Mr Mah said there was no need for any such move yet. He explained that the figure of 6.5 million was a very long-term parameter to guide land-use planning, spanning up to 50 years.
As such, he said: “There’s really no urgent need for us to drastically change all our plot ratios, or up the intensity of all the various parcels of land that we have. We’ve been doing this gradually over many years … It’s not something that we need to do across the board at this point in time, based on the reviews that we have done.”
The Master Plan will also include new details of living options, leisure facilities, and ways to encourage rootedness in Singapore. It will be put up for public feedback by mid next year.
Source: Today, 29 June 2007
Giving a preview of the plans in a Channel NewsAsia interview, National Development Minister Mah Bow Tan said these would provide space for Singapore’s continued growth as a global business centre, and offer an alternative to the overcrowded CBD area.
The Master Plan guides Singapore’s medium-term land use, and is reviewed every five years.
The Government plans to release sites for new offices, shops, homes and entertainment outlets in Jurong and Paya Lebar, to grow them into new hubs for businesses.
According to the minister, the lower costs will be a key pull factor. Said Mr Mah: “I think the best incentive is that it will offer cheaper office space — cheaper than the CBD quite obviously. It will offer proximity to some of the nearby residences; as people want to live near their workplace, that would be an attraction.
“Of course, it’s going to be a very nice leisure, recreational area as well. In Jurong, for example, we can redevelop the areas around the Jurong Lake, which can provide very nice retail, and F&B outlets on the waterfront.”
The specific locations of the sites have yet to be determined, but they will be centred around the existing MRT stations. For Jurong, these would likely be the Lakeside, Boon Lay or Jurong East stations, while the Paya Lebar station is the likely candidate in the east.
Mr Mah added that he did not see the need for the land acquisition by the Government as there was ample empty sites in these areas.
The new hubs are seen as part of the long-term answer to the current office space crunch.
“I remember we took at least 10 years to fully develop Tampines as a Regional Centre. So I think, depending on the reaction of the market, it may take just as long (to build up Jurong and Paya Lebar).”
As for speculation about drastic increases in plot ratios for land around the island to cope with an anticipated rise in population, Mr Mah said there was no need for any such move yet. He explained that the figure of 6.5 million was a very long-term parameter to guide land-use planning, spanning up to 50 years.
As such, he said: “There’s really no urgent need for us to drastically change all our plot ratios, or up the intensity of all the various parcels of land that we have. We’ve been doing this gradually over many years … It’s not something that we need to do across the board at this point in time, based on the reviews that we have done.”
The Master Plan will also include new details of living options, leisure facilities, and ways to encourage rootedness in Singapore. It will be put up for public feedback by mid next year.
Source: Today, 29 June 2007
The landlords are laughing but their tenants in Orchard most likely are not.
The landlords are laughing but their tenants in Orchard most likely are not.
Rents in the shopping belt are inches away from the peaks of 1996, the year before a financial crisis shocked the region.
According to a report issued yesterday by CB Richard Ellis (CBRE), this year’s second quarter saw prime Orchard Road rents average $34.40 per square foot (psf) per month, veering close to the levels of $35.10 psf per month about 11 years ago.
“The tides have turned in recent years with the strong rebound of the Singapore economy. Efforts to rejuvenate Orchard Road with a lot more vibrancy are beginning to pay off,” said CBRE’s executive director for retail services Mavis Seow. Malls have become more attractive, as boutiques have been retrofitted while new brands have joined the fashion scene, she explained.
Unfortunately, shop owners are also starting to see red over higher rents. Ms Seow acknowledged she had heard complaints “every now and then”. But the hikes are “not a sharp rise. It’s a gradual increase”.
Back when Orchard Road prime retail rents hit rock bottom in 1998 at $23.40 psf per month, shops were not smiling, either. They were struggling to make ends meet during the initial years after 1997.
Looking ahead, Ms Seow expects prime Orchard retail rentals to grow by 4 to 7 per cent for the full year. This is faster than it did last year, when the pace was between 3 and 6 per cent, she said.
Meanwhile, some firms are feeling the heat of rising rents — especially downtown.
Banking giant HSBC has been moving parts of its operations out of Atrium@Orchard into Eunos and Alexandra premises, insiders told Today. A source said the bank was moving out because rents in Alexandra, reportedly drawing a growing number of financial institutions, are about a third cheaper than at its current office at Atrium.
But the Atrium space is unlikely to stay vacant for long, as other big-name banks are said to have their eye on it.
Source: Today, 29 June 2007
Rents in the shopping belt are inches away from the peaks of 1996, the year before a financial crisis shocked the region.
According to a report issued yesterday by CB Richard Ellis (CBRE), this year’s second quarter saw prime Orchard Road rents average $34.40 per square foot (psf) per month, veering close to the levels of $35.10 psf per month about 11 years ago.
“The tides have turned in recent years with the strong rebound of the Singapore economy. Efforts to rejuvenate Orchard Road with a lot more vibrancy are beginning to pay off,” said CBRE’s executive director for retail services Mavis Seow. Malls have become more attractive, as boutiques have been retrofitted while new brands have joined the fashion scene, she explained.
Unfortunately, shop owners are also starting to see red over higher rents. Ms Seow acknowledged she had heard complaints “every now and then”. But the hikes are “not a sharp rise. It’s a gradual increase”.
Back when Orchard Road prime retail rents hit rock bottom in 1998 at $23.40 psf per month, shops were not smiling, either. They were struggling to make ends meet during the initial years after 1997.
Looking ahead, Ms Seow expects prime Orchard retail rentals to grow by 4 to 7 per cent for the full year. This is faster than it did last year, when the pace was between 3 and 6 per cent, she said.
Meanwhile, some firms are feeling the heat of rising rents — especially downtown.
Banking giant HSBC has been moving parts of its operations out of Atrium@Orchard into Eunos and Alexandra premises, insiders told Today. A source said the bank was moving out because rents in Alexandra, reportedly drawing a growing number of financial institutions, are about a third cheaper than at its current office at Atrium.
But the Atrium space is unlikely to stay vacant for long, as other big-name banks are said to have their eye on it.
Source: Today, 29 June 2007
Goldman Sachs (Singapore) is lobbying for the rescindment of the Residential Property Act which has, since 1973, restricted foreigners and PR
Recently, there have been reports in the media pushing for the restrictions on the sale of landed homes here to foreigners to be relaxed. I hope the authorities quickly nip this in the bud before too much public disquiet arises.
Goldman Sachs (Singapore) is lobbying for the rescindment of the Residential Property Act which has, since 1973, restricted foreigners and Permanent Residents from owning landed residential property without prior official approval.
The investment firm argues that this change would serve as a catalyst for further foreign purchasing of private homes as well as boost the current residential property up-cycle. To further support this argument, it implies that Singaporeans already have a stake in the country by virtue of the public housing catering to 80 per cent of us.
I doubt anyone in Singapore really feels that the property market requires any more encouragement. If anything, the reverse is true — in fact, the authorities are probably contemplating measures to cool the red-hot market and bring it down to a more sustainable level.
Goldman Sachs’ reference to public housing also comes across as being slightly condescending to me.
I agree with the industry’s opinion leaders, who were quoted to be mostly against this proposal. Government Parliamentary Committee for National Development and Environment chairman Charles Chong was quoted as saying: “Landed properties should not be priced out of Singaporeans’ reach (or) it could lead to disgruntled Singaporeans.”
Others, meanwhile, said that the existing Act has the positive effect of “encouraging foreigners to commit to Singapore, to sink their roots here” and that landed property ownership is one of the “privileges of being Singaporean”.
In American author Pearl S Buck’s The Good Earth, the protagonist Wang Lung chides his sons when he overhears them talking about selling the land which he loves so much. In his words: “If you sell the land, it is the end.”
Letter from Dr Huang Shoou Chyuan
Source: Today, 29 June 2007
Goldman Sachs (Singapore) is lobbying for the rescindment of the Residential Property Act which has, since 1973, restricted foreigners and Permanent Residents from owning landed residential property without prior official approval.
The investment firm argues that this change would serve as a catalyst for further foreign purchasing of private homes as well as boost the current residential property up-cycle. To further support this argument, it implies that Singaporeans already have a stake in the country by virtue of the public housing catering to 80 per cent of us.
I doubt anyone in Singapore really feels that the property market requires any more encouragement. If anything, the reverse is true — in fact, the authorities are probably contemplating measures to cool the red-hot market and bring it down to a more sustainable level.
Goldman Sachs’ reference to public housing also comes across as being slightly condescending to me.
I agree with the industry’s opinion leaders, who were quoted to be mostly against this proposal. Government Parliamentary Committee for National Development and Environment chairman Charles Chong was quoted as saying: “Landed properties should not be priced out of Singaporeans’ reach (or) it could lead to disgruntled Singaporeans.”
Others, meanwhile, said that the existing Act has the positive effect of “encouraging foreigners to commit to Singapore, to sink their roots here” and that landed property ownership is one of the “privileges of being Singaporean”.
In American author Pearl S Buck’s The Good Earth, the protagonist Wang Lung chides his sons when he overhears them talking about selling the land which he loves so much. In his words: “If you sell the land, it is the end.”
Letter from Dr Huang Shoou Chyuan
Source: Today, 29 June 2007
Property analysts had predicted that it was not likely to happen, but the local real estate market has just witnessed its first collective sale
Property analysts had predicted that it was not likely to happen, but the local real estate market has just witnessed its first collective sale to bust the billion-dollar mark.
CapitaLand yesterday got the nod to buy Farrer Court collectively for $1.3388 billion, and plans to transform the ageing HUDC estate into a luxurious condominium with the help of partners including Hotel Properties (HPL).
The transaction price is below the $1.5 billion that the 618 homeowners had asked for.
Still, each seller is in line to receive between $2.122 million and $2.238 million, based on their apartment sizes ranging from 1,453- to 1,615 sq ft.
The owners have also been given the first right of refusal to buy the new homes that CapitaLand plans to build. This means they will be invited to a preview launch of the new development slated to be launched in the first half of 2009.
CapitaLand’s grand plans for the 838,488-sq-ft site will include partners: HPL, Wachovia Development Corp and possibly a foreign fund, said Ms Patricia Chia, chief executive of CapitaLand Residential Singapore.
Together, hey will build a luxury 36-storey condominium with 1,500 units — more than doubling the number of apartments on the existing site located at the corner of Leedon Heights and Farrer Road.
The project promises to be “a unique landmark project” created by “world-renowned architects who have an international portfolio”, said CapitaLand Group chief Liew Mun Leong.
Each consortium member will own part of a joint venture named Morganite. HPL said its stake would be between 20 and 30 per cent.
The deal works out to $762 to $783 per square foot per plot ratio, after taking into account the differential premium of $450 million to $500 million to refresh the lease to a 99-year tenure and to maximise the plot ratio to 2.8.
With the approval of the Strata Titles Board, the transaction is expected to be completed by the second quarter of next year.
Source: Today, 29 June 2007
CapitaLand yesterday got the nod to buy Farrer Court collectively for $1.3388 billion, and plans to transform the ageing HUDC estate into a luxurious condominium with the help of partners including Hotel Properties (HPL).
The transaction price is below the $1.5 billion that the 618 homeowners had asked for.
Still, each seller is in line to receive between $2.122 million and $2.238 million, based on their apartment sizes ranging from 1,453- to 1,615 sq ft.
The owners have also been given the first right of refusal to buy the new homes that CapitaLand plans to build. This means they will be invited to a preview launch of the new development slated to be launched in the first half of 2009.
CapitaLand’s grand plans for the 838,488-sq-ft site will include partners: HPL, Wachovia Development Corp and possibly a foreign fund, said Ms Patricia Chia, chief executive of CapitaLand Residential Singapore.
Together, hey will build a luxury 36-storey condominium with 1,500 units — more than doubling the number of apartments on the existing site located at the corner of Leedon Heights and Farrer Road.
The project promises to be “a unique landmark project” created by “world-renowned architects who have an international portfolio”, said CapitaLand Group chief Liew Mun Leong.
Each consortium member will own part of a joint venture named Morganite. HPL said its stake would be between 20 and 30 per cent.
The deal works out to $762 to $783 per square foot per plot ratio, after taking into account the differential premium of $450 million to $500 million to refresh the lease to a 99-year tenure and to maximise the plot ratio to 2.8.
With the approval of the Strata Titles Board, the transaction is expected to be completed by the second quarter of next year.
Source: Today, 29 June 2007
There are no plans to liberalise the existing restrictions on foreigners buying landed properties in Singapore, the Law Ministry said yesterday.
There are no plans to liberalise the existing restrictions on foreigners buying landed properties in Singapore, the Law Ministry said yesterday.
‘In land scarce Singapore, landed properties have to be treated as a special category where purchases by foreigners are subject to special approval,’ a MinLaw spokesman said.
Earlier this week, BT reported on a paper by Goldman Sachs (Singapore), which argued a case for lifting restrictions on foreigners buying landed homes in Singapore. The Goldman Sachs paper said such a change would serve as a catalyst for further foreign buying of private homes and boost the current residential property upcycle.
Removing the restrictions would result in some positive spinoffs, and residential developers could gain from even greater foreign buying interest given the positive message such a move would send.
‘We think relaxing restrictions on foreigners buying landed property would accelerate Singapore’s efforts to attract foreign talent,’ the Goldman Sachs paper had said.
However, some BT readers take a different view. One, Singaporean Patrick Chia, managing director of Hospitality Associates, who is a landed property owner, said: ‘If foreigners are allowed to freely buy landed property, all the non-government owned landed property could theoretically and practically be bought up, because in this 21st Century, the world is flush with liquidity.‘
‘The current abundance of petro-dollars from the oil-rich Middle-East countries and Russia can easily buy up Singapore. So can the current American and European funds with their billions. Bankers and real estate agents can confirm that foreign funds are looking for Singapore property assets to buy.’
Mr Chia, who has nearly 30 years’ experience in the Singapore property business, also recapped the historical circumstances in the early 1970s that led to the government introducing the Residential Property Act in 1973. That law bars foreigners, including permanent residents, from buying landed property here without prior government approval.
‘Way back in 1973, with the first oil shock when oil prices sky-rocketed, then-rich neighbours, Indonesians and Malaysians, were able to freely buy Singapore landed property and much of the prime landed real estate were bought by them.
‘The government, realising the future implications of such a scenario if left unchecked, wisely instituted the current curbs to foreigner purchase of landed property,’ Mr Chia added.
And over the past 30 years, the government has continuously relaxed the curbs as needed, and pointed out that the Singapore government has been very accommodating in this regard compared with many other countries. In Singapore, foreigners have to be PRs before they can receive permission to buy landed homes on mainland Singapore, and Sentosa Cove is the only location where foreigners who are not PRs are allowed to purchase landed property. Even then, foreign would-be buyers must seek permission from the Land Dealings (Approval) Unit under the Singapore Land Authority.
Foreigners, including PRs, can at any one time own only one landed home in Singapore and must occupy it themselves rather than renting it out.
Among the criteria that the Minister for Law will consider when asked to approve foreigners/PRs buying a landed home in Singapore are the applicant’s qualifications and whether the applicant has made, or will be able to make, adequate economic contribution to Singapore.
Typically, it takes about four weeks for approval to be granted, but on Sentosa Cove, the time has been cut to less than 48 hours under a special fast-track approval scheme.
The landed properties that foreigners and PRs may be permitted to buy must have a land area of no more than 15,000 sq ft, although exceptions have been made, with some PRs buying Good Class Bungalows, which have a plot size of at least 1,400 square metres (about 15,070 sq ft).
Foreign buyers may acquire an unlimited number of non-landed private homes, that is, condominiums and apartments. The only foreigners who may buy HDB flats on the resale market are PRs.
Source: The Business Times, 28 June 2007
‘In land scarce Singapore, landed properties have to be treated as a special category where purchases by foreigners are subject to special approval,’ a MinLaw spokesman said.
Earlier this week, BT reported on a paper by Goldman Sachs (Singapore), which argued a case for lifting restrictions on foreigners buying landed homes in Singapore. The Goldman Sachs paper said such a change would serve as a catalyst for further foreign buying of private homes and boost the current residential property upcycle.
Removing the restrictions would result in some positive spinoffs, and residential developers could gain from even greater foreign buying interest given the positive message such a move would send.
‘We think relaxing restrictions on foreigners buying landed property would accelerate Singapore’s efforts to attract foreign talent,’ the Goldman Sachs paper had said.
However, some BT readers take a different view. One, Singaporean Patrick Chia, managing director of Hospitality Associates, who is a landed property owner, said: ‘If foreigners are allowed to freely buy landed property, all the non-government owned landed property could theoretically and practically be bought up, because in this 21st Century, the world is flush with liquidity.‘
‘The current abundance of petro-dollars from the oil-rich Middle-East countries and Russia can easily buy up Singapore. So can the current American and European funds with their billions. Bankers and real estate agents can confirm that foreign funds are looking for Singapore property assets to buy.’
Mr Chia, who has nearly 30 years’ experience in the Singapore property business, also recapped the historical circumstances in the early 1970s that led to the government introducing the Residential Property Act in 1973. That law bars foreigners, including permanent residents, from buying landed property here without prior government approval.
‘Way back in 1973, with the first oil shock when oil prices sky-rocketed, then-rich neighbours, Indonesians and Malaysians, were able to freely buy Singapore landed property and much of the prime landed real estate were bought by them.
‘The government, realising the future implications of such a scenario if left unchecked, wisely instituted the current curbs to foreigner purchase of landed property,’ Mr Chia added.
And over the past 30 years, the government has continuously relaxed the curbs as needed, and pointed out that the Singapore government has been very accommodating in this regard compared with many other countries. In Singapore, foreigners have to be PRs before they can receive permission to buy landed homes on mainland Singapore, and Sentosa Cove is the only location where foreigners who are not PRs are allowed to purchase landed property. Even then, foreign would-be buyers must seek permission from the Land Dealings (Approval) Unit under the Singapore Land Authority.
Foreigners, including PRs, can at any one time own only one landed home in Singapore and must occupy it themselves rather than renting it out.
Among the criteria that the Minister for Law will consider when asked to approve foreigners/PRs buying a landed home in Singapore are the applicant’s qualifications and whether the applicant has made, or will be able to make, adequate economic contribution to Singapore.
Typically, it takes about four weeks for approval to be granted, but on Sentosa Cove, the time has been cut to less than 48 hours under a special fast-track approval scheme.
The landed properties that foreigners and PRs may be permitted to buy must have a land area of no more than 15,000 sq ft, although exceptions have been made, with some PRs buying Good Class Bungalows, which have a plot size of at least 1,400 square metres (about 15,070 sq ft).
Foreign buyers may acquire an unlimited number of non-landed private homes, that is, condominiums and apartments. The only foreigners who may buy HDB flats on the resale market are PRs.
Source: The Business Times, 28 June 2007
It’s a decade since an asset bubble fed the Asian economic crisis and fears swirl over the US housing market and interest rates
It’s a decade since an asset bubble fed the Asian economic crisis and fears swirl over the US housing market and interest rates, but investors still believe the only way for Asia’s soaring property markets is up - at least for a couple of years.
Asian economies are booming, and property is once again the hot subject of dinner conversations from Tokyo to Mumbai, fuelled by cheap credit, cross-border investment and rising incomes.
Policy-makers fear a boom-and-bust cycle where rising real estate prices fuel inflation and force interest rates higher, leaving households and companies loaded with debt and dragging on economic activity.
But at the Reuters Real Estate Summit this week in Singapore, where some residents are seeing their rents jump 50 per cent overnight, property executives effused about India, despite a doubling in urban land prices since foreign property investment was ushered in two years ago.
Japan also appears to be still hugely popular, although average Tokyo office prices have leapt 25per cent in last two years.
And investors believe government cooling measures will bring order to China’s market, while failing to stem a hunger for homes among the expanding and increasingly affluent middle class.
Justin Chiu, executive director of Hong Kong property giant Cheung Kong (Holdings), said the prospect of ever higher prices was driving Asia’s notoriously sentiment-driven markets. ‘If there are no bubbles, you don’t drink beer. It’s just plain water and there’s no incentive to invest,’ he said. ‘Of course, if you see too many bubbles, you stop pouring.’
Cheung Kong expects mainland China to account for a third of its property earnings by 2010 from about 18 per cent now.
The Asian continent saw some US$94 billion of property investment in 2006, up 43 per cent on the previous year, but barely one-seventh of the global total. And investors show no sign they will stop the flow.
New flavours
Morgan Stanley said last week it had earmarked for 60per cent of a new US$8 billion fund for Asia and Goldman Sachs has raised about the same amount in a couple of funds, according to a source familiar with the matter.
ING Real Estate is raising two US$1 billion funds for Asia, and private equity firm Blackstone is raising US$10 billion to spend globally.
But some market watchers wonder where all the money will be spent, and if rising values will curb investment returns.
Asian commercial property is tightly held by families and private companies, so Peter Barge, Asia chief executive of property consultants Jones Lang LaSalle, believes many investors will have to take on risky development projects. ‘There’s a lot of money on the books, but people are scratching their heads about what to do with it,’ Mr Barge said.
Japan is a perennial favourite in Asia because its US$1.27 trillion of investment-grade property offers huge choice.
Kurt Roeloffs, Asia head for Deutsche Bank’s property unit RREEF, put it at the top of his list followed by China and India. RREEF, one of the world’s biggest property fund managers, plans to spend around 30 per cent of its future private equity funds in Asia, Mr Roeloffs said on Monday. China is drawing Hong Kong developers such as Cheung Kong as well as funds run by ING Real Estate, AETOS Capital and Invesco.
But the new flavours of the month are India and Vietnam, which both rank among the most opaque property markets in the world but promise internal rates of return of 25-30 per cent.
Forecasts that Indian property prices have surged too fast and could drop anywhere between 10 and 40 per cent are brushed aside on the grounds that an outsourcing boom is enriching a middle class couped up in crumbling homes built decades ago.
‘India has huge potential,’ said Seek Ngee Huat, head of the GIC Real Estate. An investment company of the Singapore government, and one of the world’s biggest property investors, GIC is eyeing developing markets including Russia and Turkey, while cautious about London offices because of steep price rises.
Mr Barge believes Asia has at least two or three years more to run on the upward swing of its property cycle, saying: ‘Mother gravity is always there.’
Mr Seek was wary that defaults on US subprime mortgages could infect the whole financial system.
‘There are certainly financial risks being built up,’ he said.
Meanwhile, Liew Mun Leong, chief executive of South-east Asia’s biggest developer, CapitaLand Ltd, which is launching funds for China and India this year, acknowledged that property investors may not have the best crystal balls.
‘It’s funny but we in the property industry can always predict when the market will turn up, but we can never say when it will turn down,’ he said.
Source: The Business Times, 28 June 2007
Asian economies are booming, and property is once again the hot subject of dinner conversations from Tokyo to Mumbai, fuelled by cheap credit, cross-border investment and rising incomes.
Policy-makers fear a boom-and-bust cycle where rising real estate prices fuel inflation and force interest rates higher, leaving households and companies loaded with debt and dragging on economic activity.
But at the Reuters Real Estate Summit this week in Singapore, where some residents are seeing their rents jump 50 per cent overnight, property executives effused about India, despite a doubling in urban land prices since foreign property investment was ushered in two years ago.
Japan also appears to be still hugely popular, although average Tokyo office prices have leapt 25per cent in last two years.
And investors believe government cooling measures will bring order to China’s market, while failing to stem a hunger for homes among the expanding and increasingly affluent middle class.
Justin Chiu, executive director of Hong Kong property giant Cheung Kong (Holdings), said the prospect of ever higher prices was driving Asia’s notoriously sentiment-driven markets. ‘If there are no bubbles, you don’t drink beer. It’s just plain water and there’s no incentive to invest,’ he said. ‘Of course, if you see too many bubbles, you stop pouring.’
Cheung Kong expects mainland China to account for a third of its property earnings by 2010 from about 18 per cent now.
The Asian continent saw some US$94 billion of property investment in 2006, up 43 per cent on the previous year, but barely one-seventh of the global total. And investors show no sign they will stop the flow.
New flavours
Morgan Stanley said last week it had earmarked for 60per cent of a new US$8 billion fund for Asia and Goldman Sachs has raised about the same amount in a couple of funds, according to a source familiar with the matter.
ING Real Estate is raising two US$1 billion funds for Asia, and private equity firm Blackstone is raising US$10 billion to spend globally.
But some market watchers wonder where all the money will be spent, and if rising values will curb investment returns.
Asian commercial property is tightly held by families and private companies, so Peter Barge, Asia chief executive of property consultants Jones Lang LaSalle, believes many investors will have to take on risky development projects. ‘There’s a lot of money on the books, but people are scratching their heads about what to do with it,’ Mr Barge said.
Japan is a perennial favourite in Asia because its US$1.27 trillion of investment-grade property offers huge choice.
Kurt Roeloffs, Asia head for Deutsche Bank’s property unit RREEF, put it at the top of his list followed by China and India. RREEF, one of the world’s biggest property fund managers, plans to spend around 30 per cent of its future private equity funds in Asia, Mr Roeloffs said on Monday. China is drawing Hong Kong developers such as Cheung Kong as well as funds run by ING Real Estate, AETOS Capital and Invesco.
But the new flavours of the month are India and Vietnam, which both rank among the most opaque property markets in the world but promise internal rates of return of 25-30 per cent.
Forecasts that Indian property prices have surged too fast and could drop anywhere between 10 and 40 per cent are brushed aside on the grounds that an outsourcing boom is enriching a middle class couped up in crumbling homes built decades ago.
‘India has huge potential,’ said Seek Ngee Huat, head of the GIC Real Estate. An investment company of the Singapore government, and one of the world’s biggest property investors, GIC is eyeing developing markets including Russia and Turkey, while cautious about London offices because of steep price rises.
Mr Barge believes Asia has at least two or three years more to run on the upward swing of its property cycle, saying: ‘Mother gravity is always there.’
Mr Seek was wary that defaults on US subprime mortgages could infect the whole financial system.
‘There are certainly financial risks being built up,’ he said.
Meanwhile, Liew Mun Leong, chief executive of South-east Asia’s biggest developer, CapitaLand Ltd, which is launching funds for China and India this year, acknowledged that property investors may not have the best crystal balls.
‘It’s funny but we in the property industry can always predict when the market will turn up, but we can never say when it will turn down,’ he said.
Source: The Business Times, 28 June 2007
Temasek Holdings’ Mapletree Investments has topped the billion-dollar mark in earnings for the year ended March 31, 2007, thanks to a huge $971.2 mill
Temasek Holdings’ Mapletree Investments has topped the billion-dollar mark in earnings for the year ended March 31, 2007, thanks to a huge $971.2 million net revaluation gain.
The Singapore investment company’s subsidiary also revealed in its latest annual report plans to launch more real estate investment trusts (Reits) on the Singapore Exchange (SGX) this year.
Mapletree - a Singapore real estate company with an Asian focus - reported a profit after tax and minority interests of $1.07 billion, up from the previous year’s net profit of $144.54 million. But without the $971.2 million net revaluation gain, operating profit was still up $31.8 million or 41 per cent at $109 million, with the boost coming from the positive market outlook in Singapore.
The group’s $971.2 million net revaluation gain was a quantum leap from the previous year’s $1.04 million. This increase was mainly contributed by VivoCity, which was completed in October 2006, as well as the increase in value of Mapletree’s other commercial properties, mostly offices.
The Reits that Mapletree plans to launch on SGX include Mapletree Commercial Trust with the VivoCity mall as the anchor asset and with revenue streams from office, retail and entertainment properties in Singapore. The group, which aims to be a leading real estate capital management company, is also in discussion with Indonesia’s Lippo Group to co-manage an Indonesia-focused shopping mall Reit, Mapletree Investments’ chairman Edmund Cheng said, without elaborating, in his annual report message.
Market watchers reckon that VivoCity itself, with about one million square feet net lettable area, could be worth more than $1.6 billion and that the group could also inject into the proposed Mapletree Commercial Trust its other nearby properties such as St James Power Station, HarbourFront Centre (formerly World Trade Centre), Mapletree’s stakes in HarbourFront Towers One and Two office blocks, PSA Building and PSA Vista. The combined value of the entire portfolio, including VivoCity, could be around $3 billion, say industry observers.
As for the Indonesia-focused mall Reit venture with Lippo, market watchers note Lippo controls 40 malls through its various units. An industry player says it makes sense for Lippo to partner a proven name in the Singapore Reit business if it wants to list a shopping centre Reit in Singapore.
The group’s commercial property portfolio includes HarbourFront Centre, HarbourFront Towers One and Two (Mapletree owns 61 per cent of the two buildings), Keppel Bay Tower (30 per cent), SPI Building, St James Power Station, PSA Building and PSA Vista. Mapletree’s industrial property portfolio includes Tanjong Pagar and Pasir Panjang distriparks and Alexandra Distripark (including The Comtech, a high-tech industrial building).
In all, the group’s investment’s properties were valued at $3.72 billion as at March 31, 2007, up from $1.83 billion a year earlier. However, properties under development fell from $569.7 million to $157.7 million due to the re-classification of VivoCity property from ‘properties under development’ to ‘investment properties’ at market valuation upon its completion late last year.
Mapletree’s operating profit rose from $77.2 million for financial year ended March 2006 to almost $109 million in FY March 2007 on the back of a 34.7 per cent jump in revenue to $216.6 million. The higher revenue was due mainly to the opening of VivoCity, as well as improved occupancy and rental rates achieved by the group’s other properties. This was partly offset by loss of revenue from properties that were injected into Mapletree Logistics Trust (MLT). The group’s revenue was also boosted from higher fee income, contributed mainly by the SGX-listed MLT. The group also received a new fee income stream from one of its new funds - the privately held Mapletree Industrial Fund. Fee income accounted for 9 per cent of the group’s revenue for FY March 2007, up from a 5 per cent share for FY March 2006, reflecting Mapletree Investments’ expansion into the capital management business.
In line with the improved performance, Mapletree Investments’ return on equity rose from 6 per cent in FY March 2006 to 37 per cent in FY March 2007. Return on total assets also increased from 6 per cent to 30 per cent over the same period.
Source: The Business Times, 28 June 2007
The Singapore investment company’s subsidiary also revealed in its latest annual report plans to launch more real estate investment trusts (Reits) on the Singapore Exchange (SGX) this year.
Mapletree - a Singapore real estate company with an Asian focus - reported a profit after tax and minority interests of $1.07 billion, up from the previous year’s net profit of $144.54 million. But without the $971.2 million net revaluation gain, operating profit was still up $31.8 million or 41 per cent at $109 million, with the boost coming from the positive market outlook in Singapore.
The group’s $971.2 million net revaluation gain was a quantum leap from the previous year’s $1.04 million. This increase was mainly contributed by VivoCity, which was completed in October 2006, as well as the increase in value of Mapletree’s other commercial properties, mostly offices.
The Reits that Mapletree plans to launch on SGX include Mapletree Commercial Trust with the VivoCity mall as the anchor asset and with revenue streams from office, retail and entertainment properties in Singapore. The group, which aims to be a leading real estate capital management company, is also in discussion with Indonesia’s Lippo Group to co-manage an Indonesia-focused shopping mall Reit, Mapletree Investments’ chairman Edmund Cheng said, without elaborating, in his annual report message.
Market watchers reckon that VivoCity itself, with about one million square feet net lettable area, could be worth more than $1.6 billion and that the group could also inject into the proposed Mapletree Commercial Trust its other nearby properties such as St James Power Station, HarbourFront Centre (formerly World Trade Centre), Mapletree’s stakes in HarbourFront Towers One and Two office blocks, PSA Building and PSA Vista. The combined value of the entire portfolio, including VivoCity, could be around $3 billion, say industry observers.
As for the Indonesia-focused mall Reit venture with Lippo, market watchers note Lippo controls 40 malls through its various units. An industry player says it makes sense for Lippo to partner a proven name in the Singapore Reit business if it wants to list a shopping centre Reit in Singapore.
The group’s commercial property portfolio includes HarbourFront Centre, HarbourFront Towers One and Two (Mapletree owns 61 per cent of the two buildings), Keppel Bay Tower (30 per cent), SPI Building, St James Power Station, PSA Building and PSA Vista. Mapletree’s industrial property portfolio includes Tanjong Pagar and Pasir Panjang distriparks and Alexandra Distripark (including The Comtech, a high-tech industrial building).
In all, the group’s investment’s properties were valued at $3.72 billion as at March 31, 2007, up from $1.83 billion a year earlier. However, properties under development fell from $569.7 million to $157.7 million due to the re-classification of VivoCity property from ‘properties under development’ to ‘investment properties’ at market valuation upon its completion late last year.
Mapletree’s operating profit rose from $77.2 million for financial year ended March 2006 to almost $109 million in FY March 2007 on the back of a 34.7 per cent jump in revenue to $216.6 million. The higher revenue was due mainly to the opening of VivoCity, as well as improved occupancy and rental rates achieved by the group’s other properties. This was partly offset by loss of revenue from properties that were injected into Mapletree Logistics Trust (MLT). The group’s revenue was also boosted from higher fee income, contributed mainly by the SGX-listed MLT. The group also received a new fee income stream from one of its new funds - the privately held Mapletree Industrial Fund. Fee income accounted for 9 per cent of the group’s revenue for FY March 2007, up from a 5 per cent share for FY March 2006, reflecting Mapletree Investments’ expansion into the capital management business.
In line with the improved performance, Mapletree Investments’ return on equity rose from 6 per cent in FY March 2006 to 37 per cent in FY March 2007. Return on total assets also increased from 6 per cent to 30 per cent over the same period.
Source: The Business Times, 28 June 2007
Shun Tak Holdings Ltd, run by the family of casino tycoon Stanley Ho, will buy a 75 per cent stake in a Macau property project from Mr Ho
Shun Tak Holdings Ltd, run by the family of casino tycoon Stanley Ho, will buy a 75 per cent stake in a Macau property project from Mr Ho’s private company and billionaire Gordon Wu for HK$6.87 billion (S$1.4 billion).
Shun Tak will pay Mr Wu’s Hopewell Holdings Ltd HK$4.58 billion for a 50 per cent stake in the Nova City/Nova Taipa Gardens project in Macau, Hopewell said in a statement on Tuesday.
It will pay Mr Ho’s Sociedade de Turismo e Diversoes de Macau HK$2.29 billion for its 25 per cent stake, Shun Tak spokeswoman Catherine Szeto said.
The purchase will give Shun Tak full ownership of the project, up from 25 per cent.
Property prices in Macau, the only city in China where casinos are legal, are climbing as soaring gaming revenue and rising tourism boost the economy.
‘We have a leadership role in the property market in Macau,’ Ms Szeto said in a phone interview.
The company has sufficient cash and existing financing to pay for the purchase, she added.
Shares in Hopewell rose 5.1 per cent to HK$32.75 as of 10:21am in Hong Kong, heading for their biggest gain in more than a year.
Hong Kong-based Shun Tak is buying the shops at Nova Taipa Gardens and Nova City, the uncompleted residential phases four and five of Nova City and all cash and receivables from units sold in the first three phases, the company said in a faxed statement late on Tuesday.
Real estate in Macau last year sold at an average 1,519 patacas (S$290.3) per square foot, more than doubling from 2002, according to Midland Realty Ltd, a Hong Kong-based property agency.
Macau’s economy may grow 16.5 per cent this year and next according to Enoch Fung, a Hong Kong-based economist at Goldman Sachs Group Inc.
The economy grew 16.6 per cent last year, more than twice as fast as its 6.9 per cent expansion in 2005.
Last year, Shun Tak and Hongkong Land Ltd sold all 800 apartments at One Central Residence, a luxury real estate project in Macau at an average price of about HK$5,000 per square foot.
The apartments are scheduled to be finished in 2009.
In addition to developing real estate, Shun Tak also operates the main ferry service linking Hong Kong to Macau and manages hotels.
Hong Kong-based Hopewell develops real estate, runs hotels and owns stakes in toll roads in China.
Source: The Business Times, 28 June 2007
Shun Tak will pay Mr Wu’s Hopewell Holdings Ltd HK$4.58 billion for a 50 per cent stake in the Nova City/Nova Taipa Gardens project in Macau, Hopewell said in a statement on Tuesday.
It will pay Mr Ho’s Sociedade de Turismo e Diversoes de Macau HK$2.29 billion for its 25 per cent stake, Shun Tak spokeswoman Catherine Szeto said.
The purchase will give Shun Tak full ownership of the project, up from 25 per cent.
Property prices in Macau, the only city in China where casinos are legal, are climbing as soaring gaming revenue and rising tourism boost the economy.
‘We have a leadership role in the property market in Macau,’ Ms Szeto said in a phone interview.
The company has sufficient cash and existing financing to pay for the purchase, she added.
Shares in Hopewell rose 5.1 per cent to HK$32.75 as of 10:21am in Hong Kong, heading for their biggest gain in more than a year.
Hong Kong-based Shun Tak is buying the shops at Nova Taipa Gardens and Nova City, the uncompleted residential phases four and five of Nova City and all cash and receivables from units sold in the first three phases, the company said in a faxed statement late on Tuesday.
Real estate in Macau last year sold at an average 1,519 patacas (S$290.3) per square foot, more than doubling from 2002, according to Midland Realty Ltd, a Hong Kong-based property agency.
Macau’s economy may grow 16.5 per cent this year and next according to Enoch Fung, a Hong Kong-based economist at Goldman Sachs Group Inc.
The economy grew 16.6 per cent last year, more than twice as fast as its 6.9 per cent expansion in 2005.
Last year, Shun Tak and Hongkong Land Ltd sold all 800 apartments at One Central Residence, a luxury real estate project in Macau at an average price of about HK$5,000 per square foot.
The apartments are scheduled to be finished in 2009.
In addition to developing real estate, Shun Tak also operates the main ferry service linking Hong Kong to Macau and manages hotels.
Hong Kong-based Hopewell develops real estate, runs hotels and owns stakes in toll roads in China.
Source: The Business Times, 28 June 2007
A whopping $1.3388 billion.
A whopping $1.3388 billion.
That’s the price that a consortium - comprising CapitaLand, Hotel Properties, US-based Wachovia Development Corporation and possibly a foreign fund - is paying to buy Farrer Court.
According to Credo Real Estate, which brokered the sale, the sum is the highest ever fetched for a collective sale to date, and is possibly also the biggest ever residential land transaction in Singapore.
The unit land cost to the developers for the leasehold District 10 site works out to $762 to $783 psf of potential gross floor area. This is inclusive of two payments the buyers will have to make to the state - an estimated $275 million differential premium for enhancing the intensity of the site’s use to a 2.8 plot ratio, and a further sum of about $175 million to $225 million for topping up the site’s lease from a remaining term of about 69 years to 99 years.
The privatised HUDC estate has 618 existing apartments of two sizes - 1,615 sq ft and 1,453 sq ft. Their owners will get respective sums of $2.238 million and $2.122 million per unit. Based on the apartments’ existing strata areas, the proceeds to owners work out to $1,386 psf and $1,460 psf respectively. Before work on a collective sale at Farrer Court began in Q2 last year, the apartments were changing hands at about $500,000 to $600,000 each. The sums that the owners will receive are about 11.5 per cent higher than the sums they would have received based on the $1.2 billion reserve price in the collective sale agreement (CSA).
The deal is subject to approval from the Strata Titles Board. Owners with about 81 per cent of share values have signed the CSA so far. Rodyk & Davidson is representing the majority owners.
Industry players reckoned the construction costs, fees, interest and holdings costs for the developers could amount to a further $1 billion to $1.1 billion - resulting in an all-in investment of about $2.8 billion to $2.9 billion for the buyers.
Market watchers said the breakeven cost for a new condo on the site may be about $1,200 to $1,300 psf. At 838,488 sq ft, Farrer Court also has the biggest land area for a collective sale site transacted.
CapitaLand will lead the consortium buying Farrer Court, with a 35 to 40 per cent stake. HPL said its stake is expected to be 20 to 30 per cent.
CapitaLand said the plan is to redevelop the site into a new 36-storey condo with about 1,500 generously-sized apartments. The project will be ready for launch in first-half 2009. CapitaLand is the lead development manager.
‘Existing owners will be given the first right of refusal to purchase units in the new development, similar to what was extended to former owners of Char Yong Gardens and the site for The Seafront on Meyer,’ CapitaLand Group president and CEO Liew Mun Leong said yesterday. ‘The Farrer Court site is a large-sized property that will give us the opportunity to work with world renowned architects who have an international portfolio, to create a unique landmark project.’
The transaction is expected to be completed by Q2 2008.
CapitaLand said its latest acquisition of Farrer Court will increase the size of the residential landbank the group is managing in Singapore to about 5.5 million sq ft of potential gross floor area.
The tender for Farrer Court, which closed on Wednesday afternoon, attracted one other bidder - believed to be GuocoLand, which earlier this year bought the nearby freehold Leedon Heights site for $835 million or $1,062 psf per plot ratio.
Farrer Court is the only private residential site in the Farrer Road and Holland Road area accorded a high plot ratio of 2.8 and a maximum height of 36 storeys. Most of the surrounding sites are designated for either landed housing or low or medium-rise developments.
When signing of the collective sale agreement began in late September last year, the initial proposed reserve price was $700 million. By January this year, this had been revised upwards to $840 million, with a final revision to $1.2 billion in March.
Source: The Business Times, 29 June 2007
That’s the price that a consortium - comprising CapitaLand, Hotel Properties, US-based Wachovia Development Corporation and possibly a foreign fund - is paying to buy Farrer Court.
According to Credo Real Estate, which brokered the sale, the sum is the highest ever fetched for a collective sale to date, and is possibly also the biggest ever residential land transaction in Singapore.
The unit land cost to the developers for the leasehold District 10 site works out to $762 to $783 psf of potential gross floor area. This is inclusive of two payments the buyers will have to make to the state - an estimated $275 million differential premium for enhancing the intensity of the site’s use to a 2.8 plot ratio, and a further sum of about $175 million to $225 million for topping up the site’s lease from a remaining term of about 69 years to 99 years.
The privatised HUDC estate has 618 existing apartments of two sizes - 1,615 sq ft and 1,453 sq ft. Their owners will get respective sums of $2.238 million and $2.122 million per unit. Based on the apartments’ existing strata areas, the proceeds to owners work out to $1,386 psf and $1,460 psf respectively. Before work on a collective sale at Farrer Court began in Q2 last year, the apartments were changing hands at about $500,000 to $600,000 each. The sums that the owners will receive are about 11.5 per cent higher than the sums they would have received based on the $1.2 billion reserve price in the collective sale agreement (CSA).
The deal is subject to approval from the Strata Titles Board. Owners with about 81 per cent of share values have signed the CSA so far. Rodyk & Davidson is representing the majority owners.
Industry players reckoned the construction costs, fees, interest and holdings costs for the developers could amount to a further $1 billion to $1.1 billion - resulting in an all-in investment of about $2.8 billion to $2.9 billion for the buyers.
Market watchers said the breakeven cost for a new condo on the site may be about $1,200 to $1,300 psf. At 838,488 sq ft, Farrer Court also has the biggest land area for a collective sale site transacted.
CapitaLand will lead the consortium buying Farrer Court, with a 35 to 40 per cent stake. HPL said its stake is expected to be 20 to 30 per cent.
CapitaLand said the plan is to redevelop the site into a new 36-storey condo with about 1,500 generously-sized apartments. The project will be ready for launch in first-half 2009. CapitaLand is the lead development manager.
‘Existing owners will be given the first right of refusal to purchase units in the new development, similar to what was extended to former owners of Char Yong Gardens and the site for The Seafront on Meyer,’ CapitaLand Group president and CEO Liew Mun Leong said yesterday. ‘The Farrer Court site is a large-sized property that will give us the opportunity to work with world renowned architects who have an international portfolio, to create a unique landmark project.’
The transaction is expected to be completed by Q2 2008.
CapitaLand said its latest acquisition of Farrer Court will increase the size of the residential landbank the group is managing in Singapore to about 5.5 million sq ft of potential gross floor area.
The tender for Farrer Court, which closed on Wednesday afternoon, attracted one other bidder - believed to be GuocoLand, which earlier this year bought the nearby freehold Leedon Heights site for $835 million or $1,062 psf per plot ratio.
Farrer Court is the only private residential site in the Farrer Road and Holland Road area accorded a high plot ratio of 2.8 and a maximum height of 36 storeys. Most of the surrounding sites are designated for either landed housing or low or medium-rise developments.
When signing of the collective sale agreement began in late September last year, the initial proposed reserve price was $700 million. By January this year, this had been revised upwards to $840 million, with a final revision to $1.2 billion in March.
Source: The Business Times, 29 June 2007
The Government has no plans for a major exercise to raise plot ratios anytime soon.
The Government has no plans for a major exercise to raise plot ratios anytime soon.
In the lead-up to next year’s announcement of the Master Plan for Singapore’s physical development, National Development Minister Mah Bow Tan quashed expectations in some quarters that plot ratios are headed upwards, to make room for a future population of 6.5 million.
The plot ratio of a site decides how much total floor area it can support, in other words, whether its buildings can be high-rise or low-rise. It is also known as a site’s development intensity.
In an interview this week, Mr Mah said there was no need for a massive across-the-board change in development intensity, as the land available today is more than enough to meet needs over the next 10 to 15 years.
That is the time-frame for the upcoming Master Plan 2008, to be unveiled around the middle of next year.
The statutory document regulates the permissible use and density for land parcels across the island. It is reviewed every five years.
Putting into context the 6.5 million figure, Mr Mah said it was the ‘upper bound’ for Singapore’s population over the long term of 40 to 50 years.
The figure is calculated based on current demographic trends.
It would have little impact on shorter-term, land-use plans.
‘There is more than sufficient land for accommodating our population quite comfortably in the next 10, 15 years, which is the time-frame for this Master Plan.
‘There does not appear to be any need for a massive across-the-board kind of intensification…some of the land that we have is not built up to full intensity under today’s intensity,’ he said.
Mr Mah added that his ministry’s strategy of intensifying land use gradually had worked well.
Coming in the midst of collective property sale frenzy, Mr Mah’s announcement is likely to have the strongest impact on the sentiments of these sellers.
Dr Ong Seow Eng, deputy head of research at the National University of Singapore’s department of real estate, said homeowners who have committed to sell their properties will have fewer reasons to be unhappy, while those planning to sell will have less incentive to hold out for higher prices, in anticipation of higher plot ratios.
He said the Government’s strategy of gradual intensification made sense as a sudden change could put undue stress on road and MRT networks.
Mr Lui Seng Fatt, regional director at Jones Lang LaSalle, a global real estate consultant, agreed that the minister’s statement would result in more ‘realistic’ expectations among property owners.
The director of research at property firm Knight Frank, Mr Nicholas Mak, said the Government might have wanted to avoid another round of collective sales as that would again reduce the stock of rental units and cause rents to rise further.
During the interview, Mr Mah also debunked some analysts’ reports of a short-term shortfall in private homes.
Some 42,200 new private homes are slated for completion from the second half of this year to 2010, he said, as compared with a historical demand of between 8,000 and 10,000 units a year.
To help buyers and sellers in their decision-making amid a very buoyant property market, he said the Urban Redevelopment Authority would release more information on supply, demand and transaction prices.
‘There’s nothing like total transparency to help people make clear decisions, rather than to make decisions based on panic or try to influence the market on the basis of selective information,’ he said.
Source: The Straits Times, 29 June 2007
In the lead-up to next year’s announcement of the Master Plan for Singapore’s physical development, National Development Minister Mah Bow Tan quashed expectations in some quarters that plot ratios are headed upwards, to make room for a future population of 6.5 million.
The plot ratio of a site decides how much total floor area it can support, in other words, whether its buildings can be high-rise or low-rise. It is also known as a site’s development intensity.
In an interview this week, Mr Mah said there was no need for a massive across-the-board change in development intensity, as the land available today is more than enough to meet needs over the next 10 to 15 years.
That is the time-frame for the upcoming Master Plan 2008, to be unveiled around the middle of next year.
The statutory document regulates the permissible use and density for land parcels across the island. It is reviewed every five years.
Putting into context the 6.5 million figure, Mr Mah said it was the ‘upper bound’ for Singapore’s population over the long term of 40 to 50 years.
The figure is calculated based on current demographic trends.
It would have little impact on shorter-term, land-use plans.
‘There is more than sufficient land for accommodating our population quite comfortably in the next 10, 15 years, which is the time-frame for this Master Plan.
‘There does not appear to be any need for a massive across-the-board kind of intensification…some of the land that we have is not built up to full intensity under today’s intensity,’ he said.
Mr Mah added that his ministry’s strategy of intensifying land use gradually had worked well.
Coming in the midst of collective property sale frenzy, Mr Mah’s announcement is likely to have the strongest impact on the sentiments of these sellers.
Dr Ong Seow Eng, deputy head of research at the National University of Singapore’s department of real estate, said homeowners who have committed to sell their properties will have fewer reasons to be unhappy, while those planning to sell will have less incentive to hold out for higher prices, in anticipation of higher plot ratios.
He said the Government’s strategy of gradual intensification made sense as a sudden change could put undue stress on road and MRT networks.
Mr Lui Seng Fatt, regional director at Jones Lang LaSalle, a global real estate consultant, agreed that the minister’s statement would result in more ‘realistic’ expectations among property owners.
The director of research at property firm Knight Frank, Mr Nicholas Mak, said the Government might have wanted to avoid another round of collective sales as that would again reduce the stock of rental units and cause rents to rise further.
During the interview, Mr Mah also debunked some analysts’ reports of a short-term shortfall in private homes.
Some 42,200 new private homes are slated for completion from the second half of this year to 2010, he said, as compared with a historical demand of between 8,000 and 10,000 units a year.
To help buyers and sellers in their decision-making amid a very buoyant property market, he said the Urban Redevelopment Authority would release more information on supply, demand and transaction prices.
‘There’s nothing like total transparency to help people make clear decisions, rather than to make decisions based on panic or try to influence the market on the basis of selective information,’ he said.
Source: The Straits Times, 29 June 2007
The ongoing property boom, coupled with indications of growing foreign interest in Singapore, prompted Goldman Sachs
The ongoing property boom, coupled with indications of growing foreign interest in Singapore, prompted Goldman Sachs to call for the removal of controls on foreign ownership of landed property - and speculate that such a policy change is likely on the cards.
In a report released on Sunday, the investment bank argues that relaxing the curbs, set in 1973, that require foreigners to seek official approval before buying a landed home would spur further foreign buying - which saw a surge last year - and close the price gap between bungalows and luxury apartments, and just overall give the already-buoyant property market a fillip.
The Law Ministry has since come out to quash any such hopes (that developers, in particular, might have harboured), saying that ‘landed properties have to be treated as a special category’ in land-scarce Singapore, and there are no plans to liberalise foreign buying restrictions. Be that as it may, the matter strikes - beyond the property market - also at issues of hearth and home for Singaporeans, and debate on it will no doubt surface again from time to time. And, in making its case, Goldman Sachs made some notable points.
It suggests, for instance, that free and full access to landed housing would attract more foreigners to town. That’s highly arguable, not only because what usually moves executives and professionals to relocate halfway around the world are, first and foremost, career and business opportunities, not quite housing options, especially where there is no serious lack of choice in a well-developed city. Particularly for the rich and super rich - or at least those who would go for landed homes - there is a good enough range of luxury apartments here, and many rent.
In any case, the landed property curbs, to begin with, are not exactly highly onerous : Foreigners are not absolutely barred from buying; they can buy, subject to approval, which is usually granted. They are just obliged to stay in the house for at least three years, not rent it out or sell too soon, and they may not own more than one landed property at a time.
It is easy to see how a full relaxation of the curbs could inject a strong speculative element to this segment of the housing market - given all the wealth out there - and how it would easily be priced out of the reach of even upper-income Singaporeans, particularly during an upswing. As it turned out, foreign ownership of prime-district houses (in districts 9, 10 and 11) grew 67 per cent last year to an 11-year high - and this excludes, of course, Sentosa Cove, which foreigners can freely buy. It would be quite a different matter if land is plentiful and abundant in Singapore as it is in the US or Australia.
But here on this island nation of barely 700 sq km, that is actually highly anxious to get its share of foreign talent, being slightly possessive about landed property ownership is nothing xenophobic at all. Most foreigners would understand that.
Source: The Business Times, 29 June 2007
In a report released on Sunday, the investment bank argues that relaxing the curbs, set in 1973, that require foreigners to seek official approval before buying a landed home would spur further foreign buying - which saw a surge last year - and close the price gap between bungalows and luxury apartments, and just overall give the already-buoyant property market a fillip.
The Law Ministry has since come out to quash any such hopes (that developers, in particular, might have harboured), saying that ‘landed properties have to be treated as a special category’ in land-scarce Singapore, and there are no plans to liberalise foreign buying restrictions. Be that as it may, the matter strikes - beyond the property market - also at issues of hearth and home for Singaporeans, and debate on it will no doubt surface again from time to time. And, in making its case, Goldman Sachs made some notable points.
It suggests, for instance, that free and full access to landed housing would attract more foreigners to town. That’s highly arguable, not only because what usually moves executives and professionals to relocate halfway around the world are, first and foremost, career and business opportunities, not quite housing options, especially where there is no serious lack of choice in a well-developed city. Particularly for the rich and super rich - or at least those who would go for landed homes - there is a good enough range of luxury apartments here, and many rent.
In any case, the landed property curbs, to begin with, are not exactly highly onerous : Foreigners are not absolutely barred from buying; they can buy, subject to approval, which is usually granted. They are just obliged to stay in the house for at least three years, not rent it out or sell too soon, and they may not own more than one landed property at a time.
It is easy to see how a full relaxation of the curbs could inject a strong speculative element to this segment of the housing market - given all the wealth out there - and how it would easily be priced out of the reach of even upper-income Singaporeans, particularly during an upswing. As it turned out, foreign ownership of prime-district houses (in districts 9, 10 and 11) grew 67 per cent last year to an 11-year high - and this excludes, of course, Sentosa Cove, which foreigners can freely buy. It would be quite a different matter if land is plentiful and abundant in Singapore as it is in the US or Australia.
But here on this island nation of barely 700 sq km, that is actually highly anxious to get its share of foreign talent, being slightly possessive about landed property ownership is nothing xenophobic at all. Most foreigners would understand that.
Source: The Business Times, 29 June 2007
Singapore was ranked among the world’s 20 most liveable cities recently by a European lifestyle magazine. National Development Minister Mah Bow Tan
Singapore was ranked among the world’s 20 most liveable cities recently by a European lifestyle magazine. National Development Minister Mah Bow Tan speaks to LYDIA LIM about what the new Master Plan has in store, and holds out the prospect that life here will get only better even as the population grows
As he marks his eighth year as National Development Minister, Mr Mah Bow Tan knows to expect shock and horror each time he announces that planners are gearing up to house a bigger projected population.
This time, the figure is 6.5 million, up from the 5.5 million figure set out in the last Master Plan review in 2003.
The Master Plan is the statutory land use plan which guides Singapore’s development in the medium term of 10 to 15 years. It is reviewed every five years.
Worries about being squeezed like sardines, of not having green spaces to retreat to on weekends, and sky-rocketing property prices that put homes out of reach of locals are among the top fear factors.
Mr Mah wants to quash these worries.
The island is not about to be overrun by a population of 6.5 million overnight, he says.
The figure is a planning parameter, the ‘upper bound’ that Singapore’s population could hit over the long term of 40 to 50 years, based on current demographic trends.
Planners need to have in place such scenarios in order to work out if and how the island can accommodate a population of that size, he says.
And there is no doubt, at least in his mind, that the answer is yes - and comfortably too.
‘If we look ahead as far as the eye can see, based on the technologies that we know today - building up, building down - based on the land bank that we have; based on putting all these jigsaw puzzle pieces together, schools, roads, MRT, reservoir, Mindef, office, everything you can think of, sewerage plant, gardens.
‘We’re not compromising, you know. We are keeping to our standards for parks and gardens, our greenery spaces. We are keeping all those standards. We’re not compromising our quality of life. And yet, can we fit this number of people in? The answer is yes.’
He explains that it is only when the issue of physical space has been resolved that the population planners can re-look migration policies, taking into account other factors such as job supply and whether newcomers can assimilate.
The trade-offs to having a larger population are inevitable, but he assures Singaporeans these ‘are not unbearable’.
Future population increases notwithstanding, the Government will continue to provide public housing that is affordable.
‘We will have, we must,’ stresses Mr Mah on this non-negotiable commitment.
Despite the current red-hot property market, he declares that he is ‘comfortable’ with the steady, sustainable rate at which public housing prices have been appreciating.
HDB resale prices have in general risen by between 3 and 4 per cent recently, he says, compared to 30 to 40 per cent for private housing in the Core Central Region, the island’s most prime location.
Such steady growth is to be welcomed, as property is after all ‘a very major store of wealth for Singaporeans’.
He is eager to assuage people’s fears about the future as his ministry starts the one-year countdown to the unveiling of Master Plan 2008, which he hopes Singaporeans will look to not with trepidation, but anticipation.
More choices, not fewer
EUROPEAN lifestyle magazine Monocle recently ranked Singapore 17th on its list of the world’s 20 most liveable cities.
Mr Mah highlights the fact that Monocle is not just any magazine but the brainchild of Mr Tyler Brule, International Herald Tribune columnist and founder of design magazine Wallpaper.
‘Wallpaper is the type of very chic lifestyle magazine read by the arty types.
‘For people like that to start to take notice of what’s happening here, I think it’s quite significant,’ he says.
The focus of the survey was not on the fun quotient of cities but on a combination of all the things that make life in a city better, so Mr Brule had explained.
Monocle described Singapore as ’still conservative’ but said the city had in the last decade enjoyed a flowering in its arts and architectural scene.
It also praised Singapore’s ‘First World standard of living’ which was extremely affordable, save for exorbitant prices of cars and land.
The city’s communication, health, public housing and transportation systems were ‘first-rate’, it added.
Interpreting the results, Mr Mah says: ‘What they’re saying is that in Singapore, there are many little things that make a difference, not the big things.
‘We don’t have the biggest building or the most lavish; we’re not Dubai, but the small things matter and collectively they make a difference: connectivity, airports, transport, safety, schools, health care, housing, roads.’
Such reports, and the recent Time magazine cover story entitled ‘Singapore Soars’, are encouraging, Mr Mah says, but they describe the start, not the end, of the transformation.
‘They haven’t seen anything yet because there are still going to be changes, more developments, more exciting things happening.’
Master Plan 2008 is what will tie all these various new elements into a coherent whole.
In housing, for example, the next generation of HDB flats to be built in Dawson Road in Queenstown will be the first of its kind - high-rise homes in a park.
Based on what he has seen of the designs, Mr Mah is confident these flats will bring the evolution of public housing ‘to another level’.
‘We have to keep pace with people’s expectations and lifestyle changes because we want public housing to remain an attractive option for young Singaporeans,’’ he adds.
The public will get to view the design at an exhibition in September.
At the luxury end of the residential market, buyers can look forward to yet more city living options, complete with spectacular water views, when land around the Gardens on the Bay is released for new housing.
For businesses, there will be two new regional centres in Jurong and Paya Lebar coming up over the next five to 10 years, offering high-quality office and retail space outside the Central Business District.
Leisure options will also multiply. The southern HarbourFront, where VivoCity is located, has been earmarked as a new rest and relaxation hub.
One highlight will be a new running path linking the island’s southern ridges, from Mount Faber to Kent Ridge.
Even as development gathers pace, conservation remains a priority, Mr Mah says, because all these efforts aim to build an ‘endearing home’ for Singaporeans.
Many may not be aware that over the last decade, the Urban Redevelopment Authority (URA) has conserved close to 6,500 buildings.
The URA does not decide on its own which buildings to preserve but consults independent experts who sit on the Conservation Advisory Panel. Decisions are reached through an exercise of ‘collective wisdom’, he says.
Members of the public will get a close-up look at the new housing, business, leisure and conservation plans when Master Plan 2008 is exhibited in the middle of next year.
Changes may follow a period of public consultation, after which the plan will be gazetted.
Planning makes perfect
JOB satisfaction for Mr Mah, 58, a political office holder since 1988, comes from watching carefully laid plans for Singapore’s physical development take shape.
He cites the Marina Bay area as a prime example.
Reclamation began in the 1960s and went on until about 1990.
By 2000, the URA started developing the area and then selling off sites for what would become the NTUC Centre, 1 Raffles Quay, The Sail, the Business and Financial Centre and, finally, the integrated resort.
While architects may chafe at a lack of flexibility because of strict guidelines, Mr Mah remains convinced that good planning is the key to Singapore’s successful transformation.
He believes it will give the country a good shot at becoming one of the few cities in the world not to suffer a drop in living standards, even as its population swells.
‘If any country can make it, Singapore can, because we have the planning parameters, we have the process in place.’
Source: The Straits Times, 29 June 2007
As he marks his eighth year as National Development Minister, Mr Mah Bow Tan knows to expect shock and horror each time he announces that planners are gearing up to house a bigger projected population.
This time, the figure is 6.5 million, up from the 5.5 million figure set out in the last Master Plan review in 2003.
The Master Plan is the statutory land use plan which guides Singapore’s development in the medium term of 10 to 15 years. It is reviewed every five years.
Worries about being squeezed like sardines, of not having green spaces to retreat to on weekends, and sky-rocketing property prices that put homes out of reach of locals are among the top fear factors.
Mr Mah wants to quash these worries.
The island is not about to be overrun by a population of 6.5 million overnight, he says.
The figure is a planning parameter, the ‘upper bound’ that Singapore’s population could hit over the long term of 40 to 50 years, based on current demographic trends.
Planners need to have in place such scenarios in order to work out if and how the island can accommodate a population of that size, he says.
And there is no doubt, at least in his mind, that the answer is yes - and comfortably too.
‘If we look ahead as far as the eye can see, based on the technologies that we know today - building up, building down - based on the land bank that we have; based on putting all these jigsaw puzzle pieces together, schools, roads, MRT, reservoir, Mindef, office, everything you can think of, sewerage plant, gardens.
‘We’re not compromising, you know. We are keeping to our standards for parks and gardens, our greenery spaces. We are keeping all those standards. We’re not compromising our quality of life. And yet, can we fit this number of people in? The answer is yes.’
He explains that it is only when the issue of physical space has been resolved that the population planners can re-look migration policies, taking into account other factors such as job supply and whether newcomers can assimilate.
The trade-offs to having a larger population are inevitable, but he assures Singaporeans these ‘are not unbearable’.
Future population increases notwithstanding, the Government will continue to provide public housing that is affordable.
‘We will have, we must,’ stresses Mr Mah on this non-negotiable commitment.
Despite the current red-hot property market, he declares that he is ‘comfortable’ with the steady, sustainable rate at which public housing prices have been appreciating.
HDB resale prices have in general risen by between 3 and 4 per cent recently, he says, compared to 30 to 40 per cent for private housing in the Core Central Region, the island’s most prime location.
Such steady growth is to be welcomed, as property is after all ‘a very major store of wealth for Singaporeans’.
He is eager to assuage people’s fears about the future as his ministry starts the one-year countdown to the unveiling of Master Plan 2008, which he hopes Singaporeans will look to not with trepidation, but anticipation.
More choices, not fewer
EUROPEAN lifestyle magazine Monocle recently ranked Singapore 17th on its list of the world’s 20 most liveable cities.
Mr Mah highlights the fact that Monocle is not just any magazine but the brainchild of Mr Tyler Brule, International Herald Tribune columnist and founder of design magazine Wallpaper.
‘Wallpaper is the type of very chic lifestyle magazine read by the arty types.
‘For people like that to start to take notice of what’s happening here, I think it’s quite significant,’ he says.
The focus of the survey was not on the fun quotient of cities but on a combination of all the things that make life in a city better, so Mr Brule had explained.
Monocle described Singapore as ’still conservative’ but said the city had in the last decade enjoyed a flowering in its arts and architectural scene.
It also praised Singapore’s ‘First World standard of living’ which was extremely affordable, save for exorbitant prices of cars and land.
The city’s communication, health, public housing and transportation systems were ‘first-rate’, it added.
Interpreting the results, Mr Mah says: ‘What they’re saying is that in Singapore, there are many little things that make a difference, not the big things.
‘We don’t have the biggest building or the most lavish; we’re not Dubai, but the small things matter and collectively they make a difference: connectivity, airports, transport, safety, schools, health care, housing, roads.’
Such reports, and the recent Time magazine cover story entitled ‘Singapore Soars’, are encouraging, Mr Mah says, but they describe the start, not the end, of the transformation.
‘They haven’t seen anything yet because there are still going to be changes, more developments, more exciting things happening.’
Master Plan 2008 is what will tie all these various new elements into a coherent whole.
In housing, for example, the next generation of HDB flats to be built in Dawson Road in Queenstown will be the first of its kind - high-rise homes in a park.
Based on what he has seen of the designs, Mr Mah is confident these flats will bring the evolution of public housing ‘to another level’.
‘We have to keep pace with people’s expectations and lifestyle changes because we want public housing to remain an attractive option for young Singaporeans,’’ he adds.
The public will get to view the design at an exhibition in September.
At the luxury end of the residential market, buyers can look forward to yet more city living options, complete with spectacular water views, when land around the Gardens on the Bay is released for new housing.
For businesses, there will be two new regional centres in Jurong and Paya Lebar coming up over the next five to 10 years, offering high-quality office and retail space outside the Central Business District.
Leisure options will also multiply. The southern HarbourFront, where VivoCity is located, has been earmarked as a new rest and relaxation hub.
One highlight will be a new running path linking the island’s southern ridges, from Mount Faber to Kent Ridge.
Even as development gathers pace, conservation remains a priority, Mr Mah says, because all these efforts aim to build an ‘endearing home’ for Singaporeans.
Many may not be aware that over the last decade, the Urban Redevelopment Authority (URA) has conserved close to 6,500 buildings.
The URA does not decide on its own which buildings to preserve but consults independent experts who sit on the Conservation Advisory Panel. Decisions are reached through an exercise of ‘collective wisdom’, he says.
Members of the public will get a close-up look at the new housing, business, leisure and conservation plans when Master Plan 2008 is exhibited in the middle of next year.
Changes may follow a period of public consultation, after which the plan will be gazetted.
Planning makes perfect
JOB satisfaction for Mr Mah, 58, a political office holder since 1988, comes from watching carefully laid plans for Singapore’s physical development take shape.
He cites the Marina Bay area as a prime example.
Reclamation began in the 1960s and went on until about 1990.
By 2000, the URA started developing the area and then selling off sites for what would become the NTUC Centre, 1 Raffles Quay, The Sail, the Business and Financial Centre and, finally, the integrated resort.
While architects may chafe at a lack of flexibility because of strict guidelines, Mr Mah remains convinced that good planning is the key to Singapore’s successful transformation.
He believes it will give the country a good shot at becoming one of the few cities in the world not to suffer a drop in living standards, even as its population swells.
‘If any country can make it, Singapore can, because we have the planning parameters, we have the process in place.’
Source: The Straits Times, 29 June 2007
Rents of malls along Orchard Road are almost back to their pre-Asian financial crisis levels, according to a new study by CB Richard Ellis (CBRE).
Rents of malls along Orchard Road are almost back to their pre-Asian financial crisis levels, according to a new study by CB Richard Ellis (CBRE).
It showed that retail rents in Singapore’s prime shopping district hit an average of $34.40 per sq ft (psf) per month in the April-to-June period.
This is just 2 per cent shy of the property market peak in 1996, when retail rents in Orchard Road reached a monthly average of $35.10 psf, said Ms Mavis Seow, executive director of retail services at CBRE.
Rents in Orchard Road have been rising because of a renewed focus on the area.
A state-initiated rejuvenation has led to a flurry of building development and refurbishment activities along the shopping corridor.
Interest in the Singapore retail scene has also grown, as the economy strengthens and retailers bring in new foreign brands, said Ms Seow.
‘The second quarter of this year saw more new brands from Europe, the United States and Australia setting up shop here,’ she said.
‘Home-grown retailers are also rebranding, with department stores such as Robinsons expanding their fashion range.’
For the whole of this year, Ms Seow expects Orchard Road mall rents to rise between 4 per cent and 7 per cent. This would take them to a 10-year high, surpassing 1996 levels, she added.
The City Hall and Marina Centre belt, another major shopping area, is also benefiting from the upturn.
With several malls in the area being revamped, such as Raffles City and Suntec City, higher rentals for these spaces have pushed up average prime rents.
They rose to $25.90 psf per month - 4.4 per cent higher than a year ago, said CBRE.
Source: The Straits Times, 29 June 2007
It showed that retail rents in Singapore’s prime shopping district hit an average of $34.40 per sq ft (psf) per month in the April-to-June period.
This is just 2 per cent shy of the property market peak in 1996, when retail rents in Orchard Road reached a monthly average of $35.10 psf, said Ms Mavis Seow, executive director of retail services at CBRE.
Rents in Orchard Road have been rising because of a renewed focus on the area.
A state-initiated rejuvenation has led to a flurry of building development and refurbishment activities along the shopping corridor.
Interest in the Singapore retail scene has also grown, as the economy strengthens and retailers bring in new foreign brands, said Ms Seow.
‘The second quarter of this year saw more new brands from Europe, the United States and Australia setting up shop here,’ she said.
‘Home-grown retailers are also rebranding, with department stores such as Robinsons expanding their fashion range.’
For the whole of this year, Ms Seow expects Orchard Road mall rents to rise between 4 per cent and 7 per cent. This would take them to a 10-year high, surpassing 1996 levels, she added.
The City Hall and Marina Centre belt, another major shopping area, is also benefiting from the upturn.
With several malls in the area being revamped, such as Raffles City and Suntec City, higher rentals for these spaces have pushed up average prime rents.
They rose to $25.90 psf per month - 4.4 per cent higher than a year ago, said CBRE.
Source: The Straits Times, 29 June 2007
An art gallery and recreational outlets including an indoor children’s entertainment centre are adding to the buzz at Tanglin Village.
An art gallery and recreational outlets including an indoor children’s entertainment centre are adding to the buzz at Tanglin Village.
The Singapore Land Authority (SLA) announced yesterday it has awarded two more sites with an area of 40,135 sq m, consisting of 11 blocks, to construction company Country City Investment.
Both sites are on a three-year lease, with an option to renew up to 2015.
Some of the new additions of fine-dining restaurants, recreational and retail outlets are already open for business on one of the sites at 8 Dempsey Hill, which has seven blocks.
The 16 new outlets on the site include cafe Dome, ice-cream parlour Ben & Jerry’s, and Harry’s Bar.
Other outlets on the site, like art gallery Red Sea Gallery and Go-Go Bambini, a children’s entertainment playground, opened recently.
Country City will seek sub-tenants to open outlets on its second site at 25 Dempsey Road, formerly occupied by the Civil Service Club (CSC).
The SLA said it received a good response from bidders with nine bids ranging from $38,000 to $94,000 for the 16,300 sq m site, which has four blocks.
Country City’s first sub-tenant at Tanglin Village is established food haunt Samy’s Curry Restaurant. It had remained on site on a temporary licence when the CSC moved out last year.
General manager of Country City, Mr Nicholas Ng, said he hopes the new outlets and fine-dining restaurants will ‘be a new lifestyle destination’ for Singaporeans, expatriates and tourists.
The SLA said another property at 45 Minden Road will be put up for public tender in August.
Source: The Straits Times, 29 June 2007
The Singapore Land Authority (SLA) announced yesterday it has awarded two more sites with an area of 40,135 sq m, consisting of 11 blocks, to construction company Country City Investment.
Both sites are on a three-year lease, with an option to renew up to 2015.
Some of the new additions of fine-dining restaurants, recreational and retail outlets are already open for business on one of the sites at 8 Dempsey Hill, which has seven blocks.
The 16 new outlets on the site include cafe Dome, ice-cream parlour Ben & Jerry’s, and Harry’s Bar.
Other outlets on the site, like art gallery Red Sea Gallery and Go-Go Bambini, a children’s entertainment playground, opened recently.
Country City will seek sub-tenants to open outlets on its second site at 25 Dempsey Road, formerly occupied by the Civil Service Club (CSC).
The SLA said it received a good response from bidders with nine bids ranging from $38,000 to $94,000 for the 16,300 sq m site, which has four blocks.
Country City’s first sub-tenant at Tanglin Village is established food haunt Samy’s Curry Restaurant. It had remained on site on a temporary licence when the CSC moved out last year.
General manager of Country City, Mr Nicholas Ng, said he hopes the new outlets and fine-dining restaurants will ‘be a new lifestyle destination’ for Singaporeans, expatriates and tourists.
The SLA said another property at 45 Minden Road will be put up for public tender in August.
Source: The Straits Times, 29 June 2007
Property giant CapitaLand is paying $1.3388 billion for the sprawling Farrer Court estate - the biggest lump sum ever shelled out for residential
Property giant CapitaLand is paying $1.3388 billion for the sprawling Farrer Court estate - the biggest lump sum ever shelled out for a residential site in Singapore.
Owners at the 618-unit estate will get about $2.15 million each, depending on the size of their flats, which range from 1,453 sq ft to 1,615 sq ft.
The bumper price for the former HUDC estate beat the reserve price of $1.2 billion but fell short of the owners’ asking price of $1.5 billion.
It also signals how high and how fast prices have risen this year. Farrer Court owners had revised their reserve price from $700 million to $840 million at the start of the year, only to push it up to $1.2 billion in March.
Credo Real Estate, which brokered the deal, said the sale is also the largest one in terms of land area, number of units and buildable gross floor area.
Farrer Court, which is 30 years into a 99-year lease, sits on 838,488 sq ft of land near the junction of Farrer Road and Holland Road. It is also close to the upcoming Farrer MRT Station.
It is the only site on Farrer Road with the potential to be built up to 36 storeys.
CapitaLand said it plans to build a ‘luxurious’ 36-storey condominium with about 1,500 ‘generously-sized’ flats on the site, which will be ready for launch in early 2009.
Existing Farrer Court owners will have the first right of refusal to buy units at the new development, it said.
CapitaLand president and chief executive Liew Mun Leong said the deal would further boost its residential land bank, allowing it to benefit from Singapore’s ‘growth story’.
The site also gives the developer the chance to work with world-renowned architects to create a unique landmark project, he added.
The Farrer Court tender closed on Wednesday and attracted two bids, both above the reserve price.
Credo Real Estate declined to comment on the second bid, but sources said it came from GuocoLand, which had paid a then-
record $835 million for the freehold Leedon Heights site in Holland Road in April.
CapitaLand’s price for Farrer Court works out to about $762 to $783 per sq ft (psf) of potential gross floor area.
This psf price includes about $450 million to $500 million to maximise the use of the land and to top up the lease to a fresh 99-year tenure.
The deal is subject to the approval of the Strata Titles Board and should be completed by the second quarter of next year.
CapitaLand intends to share its risks with partners but will be the lead development manager for the project.
It said yesterday that Hotel Properties (HPL), US-based Wachovia Development Corp and possibly a foreign fund will join it in the venture.
CapitaLand is likely to hold 35 to 40 per cent of the joint venture while HPL expects to take a 20 to 30 per cent interest.
HPL took a stake in an earlier CapitaLand purchase of another former HUDC estate, Gillman Heights, in Alexandra Road, which cost $548 million, or $363 psf of potential gross floor area.
The sale of Farrer Court leaves the 290-unit Pacific Mansions in River Valley Close as the only estate up for sale at more than $1 billion.
Owners of Pacific Mansions are asking for $1.18 billion or about $2,400 psf of potential gross floor area.
Source: The Straits Times, 29 June 2007
Owners at the 618-unit estate will get about $2.15 million each, depending on the size of their flats, which range from 1,453 sq ft to 1,615 sq ft.
The bumper price for the former HUDC estate beat the reserve price of $1.2 billion but fell short of the owners’ asking price of $1.5 billion.
It also signals how high and how fast prices have risen this year. Farrer Court owners had revised their reserve price from $700 million to $840 million at the start of the year, only to push it up to $1.2 billion in March.
Credo Real Estate, which brokered the deal, said the sale is also the largest one in terms of land area, number of units and buildable gross floor area.
Farrer Court, which is 30 years into a 99-year lease, sits on 838,488 sq ft of land near the junction of Farrer Road and Holland Road. It is also close to the upcoming Farrer MRT Station.
It is the only site on Farrer Road with the potential to be built up to 36 storeys.
CapitaLand said it plans to build a ‘luxurious’ 36-storey condominium with about 1,500 ‘generously-sized’ flats on the site, which will be ready for launch in early 2009.
Existing Farrer Court owners will have the first right of refusal to buy units at the new development, it said.
CapitaLand president and chief executive Liew Mun Leong said the deal would further boost its residential land bank, allowing it to benefit from Singapore’s ‘growth story’.
The site also gives the developer the chance to work with world-renowned architects to create a unique landmark project, he added.
The Farrer Court tender closed on Wednesday and attracted two bids, both above the reserve price.
Credo Real Estate declined to comment on the second bid, but sources said it came from GuocoLand, which had paid a then-
record $835 million for the freehold Leedon Heights site in Holland Road in April.
CapitaLand’s price for Farrer Court works out to about $762 to $783 per sq ft (psf) of potential gross floor area.
This psf price includes about $450 million to $500 million to maximise the use of the land and to top up the lease to a fresh 99-year tenure.
The deal is subject to the approval of the Strata Titles Board and should be completed by the second quarter of next year.
CapitaLand intends to share its risks with partners but will be the lead development manager for the project.
It said yesterday that Hotel Properties (HPL), US-based Wachovia Development Corp and possibly a foreign fund will join it in the venture.
CapitaLand is likely to hold 35 to 40 per cent of the joint venture while HPL expects to take a 20 to 30 per cent interest.
HPL took a stake in an earlier CapitaLand purchase of another former HUDC estate, Gillman Heights, in Alexandra Road, which cost $548 million, or $363 psf of potential gross floor area.
The sale of Farrer Court leaves the 290-unit Pacific Mansions in River Valley Close as the only estate up for sale at more than $1 billion.
Owners of Pacific Mansions are asking for $1.18 billion or about $2,400 psf of potential gross floor area.
Source: The Straits Times, 29 June 2007
The price of a condominium unit in Singapore has crossed the $5,000 per sq ft (psf) mark for the first time.
The all-time high was set by at least one apartment in The Marq on Paterson Hill, the latest project by luxury developer SC Global.
This 6,195 sq ft unit fetched $5,100 psf, or a total of about $31 million - also believed to be the highest price ever paid for a single condominium unit, said SC Global.
All the 21 units released at The Marq been taken up, just a week after SC Global said it would offer them at an invitation-only preview.
The apartments sold at the 66-unit development achieved an average price of $4,137 psf, SC Global said in a statement.
Each unit was priced at between $11 million and $31 million.
Prices of luxury condominiums have soared to new heights since the beginning of the year.
In March, they crossed the $4,000 psf mark at CapitaLand’s The Orchard in Orchard Turn and two weeks ago, an apartment in St Regis Residences in Cuscaden Road, developed by City Developments, fetched a record $4,635.50 psf.
Even The Marq’s record may not last for long, say property experts.
As Singapore’s property developers start catering more to ‘ultra-high net worth individuals’ from around the world, condominiums are likely to get more expensive, said Mr Ku Swee Yong, director of marketing and business development at Savills Singapore.
‘We will continue seeing more and more opulent types of developments coming into the market, which will support continued growth in capital values,’ he added.
Despite the roaring market, average prices of Singapore’s most luxurious condominiums are still below those in major cities.
In Tokyo and Hong Kong, for instance, the average price of the most prime apartments is more than $3,000 psf, Mr Ku said.
In New York, it is $4,000 psf, and in London, it can go up to $9,000 psf. The average price of luxury condominiums in Singapore is about $2,000 psf.
The record-setting apartment at The Marq was one of eight sold in the development’s Signature Tower, which boasts a 15m private lap pool in every unit. Each unit takes up an entire floor.
Although SC Global would not disclose the nationality of the buyer who forked out $31 million, it said that 65 per cent of The Marq’s buyers so far have been foreigners.
They hail from Indonesia, Malaysia, Britain, China and India, the developer added.
SC Global also said it has not yet finalised a date for the release of the other units at The Marq.
Source: The Straits Times, 29 June 2007
The all-time high was set by at least one apartment in The Marq on Paterson Hill, the latest project by luxury developer SC Global.
This 6,195 sq ft unit fetched $5,100 psf, or a total of about $31 million - also believed to be the highest price ever paid for a single condominium unit, said SC Global.
All the 21 units released at The Marq been taken up, just a week after SC Global said it would offer them at an invitation-only preview.
The apartments sold at the 66-unit development achieved an average price of $4,137 psf, SC Global said in a statement.
Each unit was priced at between $11 million and $31 million.
Prices of luxury condominiums have soared to new heights since the beginning of the year.
In March, they crossed the $4,000 psf mark at CapitaLand’s The Orchard in Orchard Turn and two weeks ago, an apartment in St Regis Residences in Cuscaden Road, developed by City Developments, fetched a record $4,635.50 psf.
Even The Marq’s record may not last for long, say property experts.
As Singapore’s property developers start catering more to ‘ultra-high net worth individuals’ from around the world, condominiums are likely to get more expensive, said Mr Ku Swee Yong, director of marketing and business development at Savills Singapore.
‘We will continue seeing more and more opulent types of developments coming into the market, which will support continued growth in capital values,’ he added.
Despite the roaring market, average prices of Singapore’s most luxurious condominiums are still below those in major cities.
In Tokyo and Hong Kong, for instance, the average price of the most prime apartments is more than $3,000 psf, Mr Ku said.
In New York, it is $4,000 psf, and in London, it can go up to $9,000 psf. The average price of luxury condominiums in Singapore is about $2,000 psf.
The record-setting apartment at The Marq was one of eight sold in the development’s Signature Tower, which boasts a 15m private lap pool in every unit. Each unit takes up an entire floor.
Although SC Global would not disclose the nationality of the buyer who forked out $31 million, it said that 65 per cent of The Marq’s buyers so far have been foreigners.
They hail from Indonesia, Malaysia, Britain, China and India, the developer added.
SC Global also said it has not yet finalised a date for the release of the other units at The Marq.
Source: The Straits Times, 29 June 2007
Jurong and Paya Lebar have been designated as new business hubs so as to provide space for Singapore’s continued growth as a global business centre
Jurong and Paya Lebar have been designated as new business hubs so as to provide space for Singapore’s continued growth as a global business centre, National Development Minister Mah Bow Tan said yesterday.
In the interview with Channel NewsAsia, Mr Tan also commented on speculation about the possibility of sharp increases in plot ratios for land to cope with an anticipated rise in population. He said there is no need for such a move at this point as the figure of a 6.5 million population is a very long-term guide spanning up to 50 years.
On the new business hubs, he said the move would offer an alternative to the crowded Central Business District area.
To grow those areas into new hubs for businesses, the government plans to release sites for new offices, shops, homes and entertainment outlets in those areas.
Mr Tan was giving a preview of the upcoming Master Plan 2008 in his interview with CNA. The plan will go out for public feedback by mid-2008.
Source: The Business Times, 29 June 2007
In the interview with Channel NewsAsia, Mr Tan also commented on speculation about the possibility of sharp increases in plot ratios for land to cope with an anticipated rise in population. He said there is no need for such a move at this point as the figure of a 6.5 million population is a very long-term guide spanning up to 50 years.
On the new business hubs, he said the move would offer an alternative to the crowded Central Business District area.
To grow those areas into new hubs for businesses, the government plans to release sites for new offices, shops, homes and entertainment outlets in those areas.
Mr Tan was giving a preview of the upcoming Master Plan 2008 in his interview with CNA. The plan will go out for public feedback by mid-2008.
Source: The Business Times, 29 June 2007
A new record for home prices in Singapore has been set, once again. A unit in SC Global’s freehold The Marq On Paterson Hill has been sold for $5,100
A new record for home prices in Singapore has been set, once again. A unit in SC Global’s freehold The Marq On Paterson Hill has been sold for $5,100 per square foot (psf), the developer said yesterday.
SC Global, a developer of exclusive luxury residences, said it has sold all 21 apartments it released in the first phase of its 66-unit luxury development at an average selling price of $4,137 psf. The project started previewing last week.
The previous record for home prices was held by Parkview Eclat, where developer Chyau Fwu Group said it sold a four-bedroom apartment for ‘almost $4,200 psf’.
At The Marq, absolute prices for apartments ranged from about $11 million to $31 million, SC Global said.
Another luxury property - in the Bukit Timah area this time round rather than Orchard - has similarly seen hot demand. About 70 per cent of the UOL Group’s 120-unit Duchess Residences has been sold with prices crossing the $2,000 psf mark for several apartments, the company said. Sources said that the highest price fetched was in the region of $2,100 psf.
Duchess Residences started previewing on Monday, but most of the units were snapped up over four hours yesterday, BT understands. The project will be officially launched tomorrow, UOL said.
‘This (the high prices) confirms that the Bukit Timah area is seeing a lot of pent-up demand, and people are looking to buy,’ said Ku Swee Yong, director of marketing and business development at Savills Singapore.
Savills is marketing Duchess Residences together with DTZ Debenham Tie Leung.
Bukit Timah, which made waves during the last property boom, is expected to make a comeback this year. Other than Duchess Residences, at least five other developments will be launched there in the coming months, with prices expected to cross the $2,000 psf mark - a level not seen for the past 10 years.
SC Global shares traded unchanged at $6.40 yesterday before a late afternoon trading halt ahead of the announcement. UOL’s stock closed 15 cents higher at $5.80.
Source: The Business Times, 29 June 2007
SC Global, a developer of exclusive luxury residences, said it has sold all 21 apartments it released in the first phase of its 66-unit luxury development at an average selling price of $4,137 psf. The project started previewing last week.
The previous record for home prices was held by Parkview Eclat, where developer Chyau Fwu Group said it sold a four-bedroom apartment for ‘almost $4,200 psf’.
At The Marq, absolute prices for apartments ranged from about $11 million to $31 million, SC Global said.
Another luxury property - in the Bukit Timah area this time round rather than Orchard - has similarly seen hot demand. About 70 per cent of the UOL Group’s 120-unit Duchess Residences has been sold with prices crossing the $2,000 psf mark for several apartments, the company said. Sources said that the highest price fetched was in the region of $2,100 psf.
Duchess Residences started previewing on Monday, but most of the units were snapped up over four hours yesterday, BT understands. The project will be officially launched tomorrow, UOL said.
‘This (the high prices) confirms that the Bukit Timah area is seeing a lot of pent-up demand, and people are looking to buy,’ said Ku Swee Yong, director of marketing and business development at Savills Singapore.
Savills is marketing Duchess Residences together with DTZ Debenham Tie Leung.
Bukit Timah, which made waves during the last property boom, is expected to make a comeback this year. Other than Duchess Residences, at least five other developments will be launched there in the coming months, with prices expected to cross the $2,000 psf mark - a level not seen for the past 10 years.
SC Global shares traded unchanged at $6.40 yesterday before a late afternoon trading halt ahead of the announcement. UOL’s stock closed 15 cents higher at $5.80.
Source: The Business Times, 29 June 2007
Fitch Affirms Sorin Real Estate CDO I, Ltd.
Fitch Affirms Sorin Real Estate CDO I, Ltd.
NEW DELHI & SINGAPORE--(BUSINESS WIRE)--Fitch has affirmed seven classes of notes issued by Sorin Real Estate CDO I, Ltd. These affirmations are the result of Fitch's review process and are effective immediately:
--$302,000,000 class A1 floating rate senior notes affirmed at 'AAA';
--$27,600,000 class A2 floating rate senior notes affirmed at 'AAA';
--$20,000,000 class B floating rate senior notes affirmed at 'AA';
--$12,100,000 class C floating rate subordinated notes affirmed at 'A';
--$13,802,422 class D floating rate subordinated notes affirmed at 'BBB';
--$3,915,578 class E floating rate subordinated notes affirmed at 'BBB-';
--$4,000,000 class F fixed rate subordinated notes affirmed at 'BB'.
Sorin Real Estate CDO I is a revolving collateralized debt obligation (CDO) that closed July 21, 2005. Sorin Real Estate CDO I is managed by Sorin Capital Management, LLC (Sorin). The portfolio is currently composed of commercial mortgage-backed securities (52.3%), residential mortgage-backed securities (32.9%), commercial real estate loans (10.5%), and bank loans to real estate operating companies (4.4%). Sorin Real Estate CDO I will end its reinvestment period in September 2010.
The affirmations are the result of stable portfolio performance measures, such as overcollateralization (OC) ratios and weighted average rating factor (WARF). As of the most recent trustee report dated May 31, 2007 all OC and interest coverage ratios have remained stable and continue to pass their covenants. Since Fitch's last review, the WARF on the collateral has improved to 6.74 ('BBB/BBB-') from 7.07 ('BBB/BBB-'). The collateral has a maximum Fitch WARF of 7.26 ('BBB-'). There are no defaulted assets in the portfolio.
While Sorin Real Estate CDO I has some exposure to subprime RMBS (27.1%), currently all the subprime RMBS assets are of investment-grade ratings. 95% (25.7% of total collateral) of the total subprime RMBS exposure is rated 'AA-' or better. None of the subprime RMBS assets are of the 2006 vintage. The current exposure to 2004 and 2005 subprime RMBS vintages is 9% and 91%, respectively. Fitch will continue to monitor this transaction as the CDO is currently in its revolving period in which new collateral may be purchased to replace existing collateral, subject to re-investment criteria.
Fitch conducted cash flow modeling utilizing various default timing and interest rate scenarios to measure the breakeven default rates going forward relative to the minimum cumulative default rates required for the rated liabilities.
The ratings of the class A1, A2 and B notes address the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the stated balance of principal by the legal final maturity date. The ratings of the class C, D, E and F notes address the likelihood that investors will receive ultimate and compensating interest payments, as per the governing documents, as well as the stated balance of principal by the legal final maturity date.
Fitch will continue to monitor and review this transaction for future rating adjustments. Additional deal information and historical data are available on the Derivative Fitch web site at www.derivativefitch.com. For more information on the Fitch VECTOR Model, see 'Global Rating Criteria for Collateralised Debt Obligations,' dated Oct. 4, 2006 and also available at www.derivativefitch.com.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.derivativefitch.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site. Fitch means Fitch, Inc., Fitch Ratings, Ltd. and their subsidiaries including Derivative Fitch, Inc. and Derivative Fitch Ltd. and any successor or successors thereto.
NEW DELHI & SINGAPORE--(BUSINESS WIRE)--Fitch has affirmed seven classes of notes issued by Sorin Real Estate CDO I, Ltd. These affirmations are the result of Fitch's review process and are effective immediately:
--$302,000,000 class A1 floating rate senior notes affirmed at 'AAA';
--$27,600,000 class A2 floating rate senior notes affirmed at 'AAA';
--$20,000,000 class B floating rate senior notes affirmed at 'AA';
--$12,100,000 class C floating rate subordinated notes affirmed at 'A';
--$13,802,422 class D floating rate subordinated notes affirmed at 'BBB';
--$3,915,578 class E floating rate subordinated notes affirmed at 'BBB-';
--$4,000,000 class F fixed rate subordinated notes affirmed at 'BB'.
Sorin Real Estate CDO I is a revolving collateralized debt obligation (CDO) that closed July 21, 2005. Sorin Real Estate CDO I is managed by Sorin Capital Management, LLC (Sorin). The portfolio is currently composed of commercial mortgage-backed securities (52.3%), residential mortgage-backed securities (32.9%), commercial real estate loans (10.5%), and bank loans to real estate operating companies (4.4%). Sorin Real Estate CDO I will end its reinvestment period in September 2010.
The affirmations are the result of stable portfolio performance measures, such as overcollateralization (OC) ratios and weighted average rating factor (WARF). As of the most recent trustee report dated May 31, 2007 all OC and interest coverage ratios have remained stable and continue to pass their covenants. Since Fitch's last review, the WARF on the collateral has improved to 6.74 ('BBB/BBB-') from 7.07 ('BBB/BBB-'). The collateral has a maximum Fitch WARF of 7.26 ('BBB-'). There are no defaulted assets in the portfolio.
While Sorin Real Estate CDO I has some exposure to subprime RMBS (27.1%), currently all the subprime RMBS assets are of investment-grade ratings. 95% (25.7% of total collateral) of the total subprime RMBS exposure is rated 'AA-' or better. None of the subprime RMBS assets are of the 2006 vintage. The current exposure to 2004 and 2005 subprime RMBS vintages is 9% and 91%, respectively. Fitch will continue to monitor this transaction as the CDO is currently in its revolving period in which new collateral may be purchased to replace existing collateral, subject to re-investment criteria.
Fitch conducted cash flow modeling utilizing various default timing and interest rate scenarios to measure the breakeven default rates going forward relative to the minimum cumulative default rates required for the rated liabilities.
The ratings of the class A1, A2 and B notes address the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the stated balance of principal by the legal final maturity date. The ratings of the class C, D, E and F notes address the likelihood that investors will receive ultimate and compensating interest payments, as per the governing documents, as well as the stated balance of principal by the legal final maturity date.
Fitch will continue to monitor and review this transaction for future rating adjustments. Additional deal information and historical data are available on the Derivative Fitch web site at www.derivativefitch.com. For more information on the Fitch VECTOR Model, see 'Global Rating Criteria for Collateralised Debt Obligations,' dated Oct. 4, 2006 and also available at www.derivativefitch.com.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.derivativefitch.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site. Fitch means Fitch, Inc., Fitch Ratings, Ltd. and their subsidiaries including Derivative Fitch, Inc. and Derivative Fitch Ltd. and any successor or successors thereto.
Thursday, June 28, 2007
The tender for Farrer Court, Singapore’s first billion-dollar collective sale, closed yesterday with strong bids, industry players reckon.
The tender for Farrer Court, Singapore’s first billion-dollar collective sale, closed yesterday with strong bids, industry players reckon.
Speculation was that CapitaLand was the front runner and was engaged in negotiations late last night. Credo Real Estate, which is handling Farrer Court’s collective sale, declined to comment.
GuocoLand is also believed to have taken part in the tender. It clinched the freehold Leedon Heights earlier this year at $835 million or $1,062 psf of potential gross floor area.
Farrer Court, however, has an even higher absolute reserve price, of $1.2 billion, which works out to slightly over $700 psf per plot ratio (psf ppr) for the 99-year leasehold site. Bids for Farrer Court are believed to have clearly surpassed that.
The official expected price when Farrer Court’s tender was launched last month was $1.5 billion, or around $850 psf ppr.
The District 10 site, a privatised HUDC estate, is unique in being the only private residential site in the Farrer Road and Holland Road vicinity that is accorded a high plot ratio of 2.8 and a maximum height of 36 storeys.
Most of the surrounding sites are designated for either landed housing or low or medium-rise developments of up to five or 12 storeys.
Farrer Court boasts not only the highest asking price in terms of the absolute dollar quantum for a collective sale, it also has the biggest land area at 838,488 sq ft, for an en bloc sale site.
The maximum potential gross floor area of almost 2.35 million sq ft for the site - or about 1,800 apartments averaging 1,250 sq ft - means that a new development on the site would be the biggest condo development yet to be undertaken in Singapore, based on comments when thesite was launched last month.
Source: The Business Times, 28 June 2007
Speculation was that CapitaLand was the front runner and was engaged in negotiations late last night. Credo Real Estate, which is handling Farrer Court’s collective sale, declined to comment.
GuocoLand is also believed to have taken part in the tender. It clinched the freehold Leedon Heights earlier this year at $835 million or $1,062 psf of potential gross floor area.
Farrer Court, however, has an even higher absolute reserve price, of $1.2 billion, which works out to slightly over $700 psf per plot ratio (psf ppr) for the 99-year leasehold site. Bids for Farrer Court are believed to have clearly surpassed that.
The official expected price when Farrer Court’s tender was launched last month was $1.5 billion, or around $850 psf ppr.
The District 10 site, a privatised HUDC estate, is unique in being the only private residential site in the Farrer Road and Holland Road vicinity that is accorded a high plot ratio of 2.8 and a maximum height of 36 storeys.
Most of the surrounding sites are designated for either landed housing or low or medium-rise developments of up to five or 12 storeys.
Farrer Court boasts not only the highest asking price in terms of the absolute dollar quantum for a collective sale, it also has the biggest land area at 838,488 sq ft, for an en bloc sale site.
The maximum potential gross floor area of almost 2.35 million sq ft for the site - or about 1,800 apartments averaging 1,250 sq ft - means that a new development on the site would be the biggest condo development yet to be undertaken in Singapore, based on comments when thesite was launched last month.
Source: The Business Times, 28 June 2007
Wednesday, June 27, 2007
HONG KONG (Reuters) - Developer Hang Lung Properties Ltd. (0101.HK: Quote, Profile, Research) is likely to finance its planned $5 billion of projects
HONG KONG (Reuters) - Developer Hang Lung Properties Ltd. (0101.HK: Quote, Profile, Research) is likely to finance its planned $5 billion of projects in mainland China with internal cash flow, rather than go to capital markets, Chairman Ronnie Chan said on Tuesday.
The 18 projects are also likely to generate investment returns of 18 to 20 percent per year upon completion, the same rate of return it is seeing from its finished projects in Shanghai, he said.
Its portfolio of China mainland properties should grow to account for 50 percent of Hang Lung's rental revenues in five years, up from just 30 percent now, Chan said in an interview on Tuesday for the Reuters Real Estate Summit.
The increased rental income, combined with the sales proceeds from its residential projects in Hong Kong, are likely to be enough to finance the expected US$5 billion, or roughly HK$40 billion, in project costs over the coming years.
"I can do all 18 projects with no borrowing, potentially I can do that. Of course, I don't know when I'm going to sell all my Hong Kong residential development projects," he told Reuters.
"If the market conditions are such that it makes sense for me to drag it out a little, then the cash inflow will be a bit slower. In which case I may borrow some, but it is unlikely."
Shares in Hang Lung have risen almost 37 percent this year, beating a 7 percent rise in Cheung Kong (Holdings) (0001.HK: Quote, Profile, Research), and a 5 percent gain by Sun Hung Kai Properties (0016.HK: Quote, Profile, Research), its larger rivals. The blue-chip Hang Seng Index (.HSI: Quote, Profile, Research) has risen about 9 percent.
CHINA EXPANSION
Hang Lung, Hong Kong's No.3 real estate firm by market value, currently has about half of the 18 projects it hopes to complete in China under way, with budgets for these projected at about HK$24 billion, Chan said.
The 18 projects are also likely to generate investment returns of 18 to 20 percent per year upon completion, the same rate of return it is seeing from its finished projects in Shanghai, he said.
Its portfolio of China mainland properties should grow to account for 50 percent of Hang Lung's rental revenues in five years, up from just 30 percent now, Chan said in an interview on Tuesday for the Reuters Real Estate Summit.
The increased rental income, combined with the sales proceeds from its residential projects in Hong Kong, are likely to be enough to finance the expected US$5 billion, or roughly HK$40 billion, in project costs over the coming years.
"I can do all 18 projects with no borrowing, potentially I can do that. Of course, I don't know when I'm going to sell all my Hong Kong residential development projects," he told Reuters.
"If the market conditions are such that it makes sense for me to drag it out a little, then the cash inflow will be a bit slower. In which case I may borrow some, but it is unlikely."
Shares in Hang Lung have risen almost 37 percent this year, beating a 7 percent rise in Cheung Kong (Holdings) (0001.HK: Quote, Profile, Research), and a 5 percent gain by Sun Hung Kai Properties (0016.HK: Quote, Profile, Research), its larger rivals. The blue-chip Hang Seng Index (.HSI: Quote, Profile, Research) has risen about 9 percent.
CHINA EXPANSION
Hang Lung, Hong Kong's No.3 real estate firm by market value, currently has about half of the 18 projects it hopes to complete in China under way, with budgets for these projected at about HK$24 billion, Chan said.
Property markets are on the rise across Asia
SINGAPORE (Reuters) - Property markets are on the rise across Asia, fuelled by cash-rich investors looking for higher returns, the booming economies of China and India and the emergence of Japan from over a decade of economic stagnation.
With global investors increasing allocations to property and diversifying geographically, investment in Asia jumped 43 percent to $94 billion in 2006, consultants Jones Lang LaSalle say.
The flow of capital into Asia shows no sign of abating. The property arm of Morgan Stanley (MS.N: Quote, Profile, Research), for example, has earmarked around 60 percent of a $8 billion fund it has just raised for Asia -- and Japan, China and India in particular.
Future trends will be a key theme for top executives from the world's property industry at the Reuters Real Estate Summit in London, New York and Singapore on June 25-27.
Here is a brief round-up of markets in the region.
JAPAN
-- As Japan's economy recovers, office buildings have become the most coveted asset, sending capital values soaring in Tokyo
-- Because of tight supply, analysts see Tokyo office rents rising another 60 to 70 percent to a cyclical peak around 2010
-- While the vacancy rates for top-notch buildings fell to 0.7 percent from 1.0 percent during 2006, average annual rents climbed 55 percent in the year
With global investors increasing allocations to property and diversifying geographically, investment in Asia jumped 43 percent to $94 billion in 2006, consultants Jones Lang LaSalle say.
The flow of capital into Asia shows no sign of abating. The property arm of Morgan Stanley (MS.N: Quote, Profile, Research), for example, has earmarked around 60 percent of a $8 billion fund it has just raised for Asia -- and Japan, China and India in particular.
Future trends will be a key theme for top executives from the world's property industry at the Reuters Real Estate Summit in London, New York and Singapore on June 25-27.
Here is a brief round-up of markets in the region.
JAPAN
-- As Japan's economy recovers, office buildings have become the most coveted asset, sending capital values soaring in Tokyo
-- Because of tight supply, analysts see Tokyo office rents rising another 60 to 70 percent to a cyclical peak around 2010
-- While the vacancy rates for top-notch buildings fell to 0.7 percent from 1.0 percent during 2006, average annual rents climbed 55 percent in the year
China is worried that a property bubble could destabilize its booming economy
BEIJING (Reuters) - China is worried that a property bubble could destabilize its booming economy and has announced a series of measures to cool its hot real estate sector.
The government initially focused on curbing land supply in mid-2003, but this only pushed up prices. So it then switched the focus to cooling demand.
Following are some of the steps taken to date to cool the economy and property sector.
June 18, 2007 - China's banking regulator says it has punished the branches of eight banks for extending loans that were illicitly used for property and stock market investments
June 11 - China's commerce ministry issues new rules making it harder for foreigners to invest in property, partly by making them obtain land use rights before developing projects.
Existing foreign-funded firms also need to seek additional approvals to launch new development schemes
May 18 - China's central bank says it will raise both interest rates and bank reserve requirements
April 29 - Central bank raises bank reserve requirements
April 5 - Central bank raises bank reserve requirements
March 23 - The construction ministry says it will check whether local governments are implementing measures aimed at cooling the market and errant officials will be held accountable
The government initially focused on curbing land supply in mid-2003, but this only pushed up prices. So it then switched the focus to cooling demand.
Following are some of the steps taken to date to cool the economy and property sector.
June 18, 2007 - China's banking regulator says it has punished the branches of eight banks for extending loans that were illicitly used for property and stock market investments
June 11 - China's commerce ministry issues new rules making it harder for foreigners to invest in property, partly by making them obtain land use rights before developing projects.
Existing foreign-funded firms also need to seek additional approvals to launch new development schemes
May 18 - China's central bank says it will raise both interest rates and bank reserve requirements
April 29 - Central bank raises bank reserve requirements
April 5 - Central bank raises bank reserve requirements
March 23 - The construction ministry says it will check whether local governments are implementing measures aimed at cooling the market and errant officials will be held accountable
SINGAPORE - The following are notable quotes about China's property market from executives attending the Reuters Real Estate Summit
SINGAPORE (Reuters) - The following are notable quotes about China's property market from executives attending the Reuters Real Estate Summit in Singapore, London and New York on June 25-27:
SEEK NGEE HUAT, PRESIDENT, GIC REAL ESTATE
"The Chinese government is clearly concerned about house prices running out of control so they want to rein in speculators. If they can get it corrected, it is good for the market in the long run."
LIEW MUN LEONG, PRESIDENT & CEO, CAPITALAND (CATL.SI: Quote, Profile, Research)
"It is a demand-driven market (in China). People are buying it with their own money, they are staying or buying for the purpose of rental yields. The government is not discouraging foreign investors per se but is seeking to ensure supply of real estate for urbanization. It also wants to stabilize prices so the common man can afford housing."
KURT ROELOFFS, ASIA PACIFIC CHIEF EXECUTIVE FOR RREEF, DEUTSCHE BANK'S (DBKGn.DE: Quote, Profile, Research) PROPERTY INVESTMENT ARM
"We have very high expectations of what we can accomplish in the long-term in China. There's lots of policy changes and bumps on the road a long the way, but in generally it's all headed in the right direction. So we see increasing scope for strategy.
"We're also seeing more and more investor interest around the global for different investment strategies. Before we saw U.S investors. Now we see Europeans, Middle Easterners, Australians.
"There's a real macro economic challenge there to try to keep balance in fixed investment. The government tries to communicate as best they can in advance policy changes. We've been able to adapt to it.
"I don't think they're being unfair. they've got a macro economic challenge they're doing reasonably well at managing.
SEEK NGEE HUAT, PRESIDENT, GIC REAL ESTATE
"The Chinese government is clearly concerned about house prices running out of control so they want to rein in speculators. If they can get it corrected, it is good for the market in the long run."
LIEW MUN LEONG, PRESIDENT & CEO, CAPITALAND (CATL.SI: Quote, Profile, Research)
"It is a demand-driven market (in China). People are buying it with their own money, they are staying or buying for the purpose of rental yields. The government is not discouraging foreign investors per se but is seeking to ensure supply of real estate for urbanization. It also wants to stabilize prices so the common man can afford housing."
KURT ROELOFFS, ASIA PACIFIC CHIEF EXECUTIVE FOR RREEF, DEUTSCHE BANK'S (DBKGn.DE: Quote, Profile, Research) PROPERTY INVESTMENT ARM
"We have very high expectations of what we can accomplish in the long-term in China. There's lots of policy changes and bumps on the road a long the way, but in generally it's all headed in the right direction. So we see increasing scope for strategy.
"We're also seeing more and more investor interest around the global for different investment strategies. Before we saw U.S investors. Now we see Europeans, Middle Easterners, Australians.
"There's a real macro economic challenge there to try to keep balance in fixed investment. The government tries to communicate as best they can in advance policy changes. We've been able to adapt to it.
"I don't think they're being unfair. they've got a macro economic challenge they're doing reasonably well at managing.
LONDON (Reuters) - This year's slide in European property stocks has yet to run its course and sentiment is unlikely to improve soon
LONDON (Reuters) - This year's slide in European property stocks has yet to run its course and sentiment is unlikely to improve soon, after a run of pulled initial public offerings (IPOs), a leading banker said on Tuesday.
"You know you're pushing water uphill, that sentiment is against you despite the strong fundamentals," Ian Marcus, chairman of European real estate investment banking at Credit Suisse said at the Reuters Real Estate Summit in London.
Marcus is also the incoming president of UK trade body the British Property Federation -- the first banker to hold this post in a further sign of real estate's shift into the investment mainstream.
He said the market was following a familiar pattern, citing a similar spring bout of property IPO indigestion in 2006 after a rush of deals in the first few months of the year.
UK hotel owner Vector Hospitality, Germany's Boetzelen Real Estate (BOEG.DE: Quote, Profile, Research), Dutch-owned Uni-Invest and Spain's Reyal Urbis and Tremon are among the property IPOs cancelled this month, against a backdrop of falling property shares.
The FTSE NAREIT/EPRA index of European property shares (.FTUPRA: Quote, Profile, Research) is down almost 15 percent since mid-April, unlike the broader FTSEurofirst stock market index (.FTEU: Quote, Profile, Research), which is up 2.6 percent in the period.
CHANGE IN SENTIMENT
Marcus gave no assurances that the property IPO market might reopen soon, while the volatility in the market persisted.
"You know you're pushing water uphill, that sentiment is against you despite the strong fundamentals," Ian Marcus, chairman of European real estate investment banking at Credit Suisse said at the Reuters Real Estate Summit in London.
Marcus is also the incoming president of UK trade body the British Property Federation -- the first banker to hold this post in a further sign of real estate's shift into the investment mainstream.
He said the market was following a familiar pattern, citing a similar spring bout of property IPO indigestion in 2006 after a rush of deals in the first few months of the year.
UK hotel owner Vector Hospitality, Germany's Boetzelen Real Estate (BOEG.DE: Quote, Profile, Research), Dutch-owned Uni-Invest and Spain's Reyal Urbis and Tremon are among the property IPOs cancelled this month, against a backdrop of falling property shares.
The FTSE NAREIT/EPRA index of European property shares (.FTUPRA: Quote, Profile, Research) is down almost 15 percent since mid-April, unlike the broader FTSEurofirst stock market index (.FTEU: Quote, Profile, Research), which is up 2.6 percent in the period.
CHANGE IN SENTIMENT
Marcus gave no assurances that the property IPO market might reopen soon, while the volatility in the market persisted.
GE "relatively optimistic" on U.S. real estate
NEW YORK (Reuters) - General Electric Co. (GE.N: Quote, Profile, Research) expects the U.S. commercial real estate market to remain relatively healthy over the next year to 18 months, a top GE executive said on Tuesday.
"We're relatively optimistic about the next 12 to 18 months from a U.S. basis," Joseph Parsons, president of North American equity, said at the Reuters Real Estate Summit. "There is still a tremendous amount of appetite for real estate assets, for real estate commercial lending assets."
Parsons said GE's real estate arm has not yet seen investors pulling capital out of the property market, even as rising energy prices have crimped consumer spending.
"We thought $70 (a gallon) oil prices were going to drive capital out of the market, we thought the U.S. consumer was going to have an impact, and it hasn't," Parsons said.
Still, he acknowledged that lenders have become more conservative in financing commercial real estate deals, which could slow price appreciation.
"There was a period when we didn't understand how some people could pay the prices," Parsons said. "You're seeing some moderation in that, I think you're seeing the market coming back a little bit to our valuation."
Alec Burger, senior vice president of North American lending at GE Real Estate, said that in the United States the company was most interested in increasing its presence in New York, Washington, Boston and Chicago, with Dallas and Houston also starting to look more appealing.
"We can afford at this point to be more focused on some of the bigger markets," Burger said.
"We're relatively optimistic about the next 12 to 18 months from a U.S. basis," Joseph Parsons, president of North American equity, said at the Reuters Real Estate Summit. "There is still a tremendous amount of appetite for real estate assets, for real estate commercial lending assets."
Parsons said GE's real estate arm has not yet seen investors pulling capital out of the property market, even as rising energy prices have crimped consumer spending.
"We thought $70 (a gallon) oil prices were going to drive capital out of the market, we thought the U.S. consumer was going to have an impact, and it hasn't," Parsons said.
Still, he acknowledged that lenders have become more conservative in financing commercial real estate deals, which could slow price appreciation.
"There was a period when we didn't understand how some people could pay the prices," Parsons said. "You're seeing some moderation in that, I think you're seeing the market coming back a little bit to our valuation."
Alec Burger, senior vice president of North American lending at GE Real Estate, said that in the United States the company was most interested in increasing its presence in New York, Washington, Boston and Chicago, with Dallas and Houston also starting to look more appealing.
"We can afford at this point to be more focused on some of the bigger markets," Burger said.
LONDON (Reuters) - More companies, including many manufacturers, are starting to consider ways of extracting value from the real estate they own
LONDON (Reuters) - More companies, including many manufacturers, are starting to consider ways of extracting value from the real estate they own in part to fend off becoming vulnerable to a private equity takeover, a leading property services firm said on Monday.
"We're getting quite a few organizations now saying, 'What do we do to protect ourselves?,'" John Wilson, senior director of corporate strategies at CB Richard Ellis (CBG.N: Quote, Profile, Research), told the Reuters Real Estate Summit in London.
"If they are extremely well run, it's less easy for (private equity) to see a turn on a business," he added. "If there is a better return and a better way to protect the business through the monetization of assets, then you would expect them" to do so.
Retailers, cinema chains and pub operators have become increasingly vulnerable to takeovers in recent years as private equity firms exploit the valuable real estate they own as a way to finance their leveraged buyouts.
Wilson said manufacturers across Europe, including pharmaceutical companies and other industries undergoing major transition because of mergers and other factors, were more actively reviewing their real estate.
"For organizations who want to go through change, it's a tidy way to pay for the change through real estate," he said.
"The other element is organizations that are pretty happy with what's going on ... but they'd like to take money out of the business and give it back to shareholders or protect themselves from (private equity firms)."
"We're getting quite a few organizations now saying, 'What do we do to protect ourselves?,'" John Wilson, senior director of corporate strategies at CB Richard Ellis (CBG.N: Quote, Profile, Research), told the Reuters Real Estate Summit in London.
"If they are extremely well run, it's less easy for (private equity) to see a turn on a business," he added. "If there is a better return and a better way to protect the business through the monetization of assets, then you would expect them" to do so.
Retailers, cinema chains and pub operators have become increasingly vulnerable to takeovers in recent years as private equity firms exploit the valuable real estate they own as a way to finance their leveraged buyouts.
Wilson said manufacturers across Europe, including pharmaceutical companies and other industries undergoing major transition because of mergers and other factors, were more actively reviewing their real estate.
"For organizations who want to go through change, it's a tidy way to pay for the change through real estate," he said.
"The other element is organizations that are pretty happy with what's going on ... but they'd like to take money out of the business and give it back to shareholders or protect themselves from (private equity firms)."
SINGAPORE (Reuters) - Hong Kong's Cheung Kong (Holdings) Ltd.
SINGAPORE (Reuters) - Hong Kong's Cheung Kong (Holdings) Ltd. (0001.HK: Quote, Profile, Research) expects mainland China to account for a third of its property earnings by 2010, with a company executive saying asset price bubbles are encouraging middle class homebuyers.
Executive Director Justin Chiu told Reuters on Tuesday that Hong Kong's biggest property firm had built up a land bank of 120-130 million square feet in China -- enough for five to seven years of development.
That would help lift income from China quickly from the current 18 percent of the company's property earnings.
"It will grow to around 30 percent in three years' time," Chiu said. "We all know that the next phase of growth is in China," he added, referring to Hong Kong developers.
In an interview during the Reuters Real Estate Summit in Singapore, Chiu said the firm's China projects were "very profitable" but declined to disclose average margins or investment figures.
Fast rising prices in many second-tier Chinese cities were encouraging homebuyers, Chiu said, and would not reach dangerous levels as long as the government continued to implement cooling measures moderately.
"If there are no bubbles, you don't want to drink the beer," Chiu said. "It's just plain water, and there's no incentive to invest."
Last year, Cheung Kong's property earnings from China jumped 69 percent to HK$1.18 billion (US$151 million) -- around 18 percent of total property earnings.
Executive Director Justin Chiu told Reuters on Tuesday that Hong Kong's biggest property firm had built up a land bank of 120-130 million square feet in China -- enough for five to seven years of development.
That would help lift income from China quickly from the current 18 percent of the company's property earnings.
"It will grow to around 30 percent in three years' time," Chiu said. "We all know that the next phase of growth is in China," he added, referring to Hong Kong developers.
In an interview during the Reuters Real Estate Summit in Singapore, Chiu said the firm's China projects were "very profitable" but declined to disclose average margins or investment figures.
Fast rising prices in many second-tier Chinese cities were encouraging homebuyers, Chiu said, and would not reach dangerous levels as long as the government continued to implement cooling measures moderately.
"If there are no bubbles, you don't want to drink the beer," Chiu said. "It's just plain water, and there's no incentive to invest."
Last year, Cheung Kong's property earnings from China jumped 69 percent to HK$1.18 billion (US$151 million) -- around 18 percent of total property earnings.
Jun. 27 - Toll Brother's Chairman and CEO says the ''earliest the housing market could see a turnaround is April of 2008.''
Jun. 27 - Toll Brother's Chairman and CEO says the ''earliest the housing market could see a turnaround is April of 2008.''
Robert Toll, speaking at the Reuters Real Estate Summit in New York on Wednesday, says "by that time we will have candidates selected for the presidential race" and that "could produce a return of confidence that is sorely lacking right now with the consumer."
Toll says he's certain his candidate will be a democratic but he hasn't yet chosen who it will be.
Speaker:
Robert Toll
CEO, Toll Brothers
Robert Toll, speaking at the Reuters Real Estate Summit in New York on Wednesday, says "by that time we will have candidates selected for the presidential race" and that "could produce a return of confidence that is sorely lacking right now with the consumer."
Toll says he's certain his candidate will be a democratic but he hasn't yet chosen who it will be.
Speaker:
Robert Toll
CEO, Toll Brothers
Toll sees no housing jump before April
NEW YORK (Reuters) - The sagging U.S. housing market probably will not rebound before next April, when the presidential race narrows down and national confidence improves as a result, the head of luxury home builder Toll Brothers Inc. (TOL.N: Quote, Profile, Research) said on Wednesday.
"I see no reason to expect a change in confidence until probably April '08, when the candidates will fairly well be settled for the presidential election and we'll start to listen to speeches about how we'll get better," Robert Toll, the company's chairman and chief executive, said at the Reuters Real Estate Summit.
Many home-building industry executives, including Toll, attribute the anemic housing market to low buyer confidence, despite a healthy economy, strong employment and relatively low mortgage rates, currently at about 6.7 percent.
"(My) personal view is that it will be a very quick and strong rebound" fueled by a release of pent-up demand for new homes, Toll said. "We're not into this recession in housing for a long period compared to the other downturns."
However, all bets are off if the U.S. economy retreats, he said.
Judging by typical U.S. home-buying patterns, home builders will have to wait about a month to get an indication of the direction of the market, he said.
Historically, one of the strongest home-buying seasons has been between the Super Bowl pro football championship, usually in early February, and Easter, although this year that strength failed to materialize.
Home buyers usually reemerge after the Independence Day holiday.
"The next serious indication you'll get of what the market looks like will come probably three weeks after July 4," Toll said. "I would look at the tea leaves then to see if there's any indication that the market is coming back."
Asked about his recent criticism of U.S. Treasury Secretary Henry Paulson's view of the housing market, Toll said: "I didn't criticize. I suggested that he was wrong."
"I see no reason to expect a change in confidence until probably April '08, when the candidates will fairly well be settled for the presidential election and we'll start to listen to speeches about how we'll get better," Robert Toll, the company's chairman and chief executive, said at the Reuters Real Estate Summit.
Many home-building industry executives, including Toll, attribute the anemic housing market to low buyer confidence, despite a healthy economy, strong employment and relatively low mortgage rates, currently at about 6.7 percent.
"(My) personal view is that it will be a very quick and strong rebound" fueled by a release of pent-up demand for new homes, Toll said. "We're not into this recession in housing for a long period compared to the other downturns."
However, all bets are off if the U.S. economy retreats, he said.
Judging by typical U.S. home-buying patterns, home builders will have to wait about a month to get an indication of the direction of the market, he said.
Historically, one of the strongest home-buying seasons has been between the Super Bowl pro football championship, usually in early February, and Easter, although this year that strength failed to materialize.
Home buyers usually reemerge after the Independence Day holiday.
"The next serious indication you'll get of what the market looks like will come probably three weeks after July 4," Toll said. "I would look at the tea leaves then to see if there's any indication that the market is coming back."
Asked about his recent criticism of U.S. Treasury Secretary Henry Paulson's view of the housing market, Toll said: "I didn't criticize. I suggested that he was wrong."
LONDON (Reuters) - Global real estate investment is still buoyant but a few cracks are starting to show as higher borrowing costs begin to bite
LONDON (Reuters) - Global real estate investment is still buoyant but a few cracks are starting to show as higher borrowing costs begin to bite, making 2007 a pivotal year after an extended bull run in property prices.
Future trends will be a key theme for top executives from the world's property industry at the Reuters Real Estate Summit, which is being held in London, New York and Singapore on June 25-27.
A bullish mix of surging rents, cross-border investment, capital values, and shrinking or stable yields remains intact in many parts of the world, where the amount of capital chasing investment opportunities still exceeds the amount of physical stock available.
But worries over U.S. subprime mortgage loans and Spanish housing, tighter Chinese regulations, cancelled property company flotations, and weak debuts by British real estate investment trusts (REITs) suggests the market is at a turning point.
"This year is the same as last year and the year before because people expect property returns to remain strong but to then fall off sharply in the following year," Peter Hobbs, global head of real estate research at RREEF, part of Deutsche Bank and one of the world's biggest property fund managers.
"However, there are now more and more signs of that eventual sell-off, and the recent spike in bond yields increases the risk that the slowdown in property performance starts to occur before the end of the year," he told Reuters in a telephone interview.
Soaring prices in some Asian hotspots, such as major Indian and Chinese cities, have provoked fears risky bubbles are forming and price corrections are on their way. In China, the government is trying to cool the market with a raft of measures to deter speculation, including taxes and interest rate rises.
But in India, an influx of foreign funds has helped double property prices in Mumbai and New Delhi over the last two years.
Funds are becoming much more cautious and are increasingly eyeing up investment opportunities in distressed assets.
Future trends will be a key theme for top executives from the world's property industry at the Reuters Real Estate Summit, which is being held in London, New York and Singapore on June 25-27.
A bullish mix of surging rents, cross-border investment, capital values, and shrinking or stable yields remains intact in many parts of the world, where the amount of capital chasing investment opportunities still exceeds the amount of physical stock available.
But worries over U.S. subprime mortgage loans and Spanish housing, tighter Chinese regulations, cancelled property company flotations, and weak debuts by British real estate investment trusts (REITs) suggests the market is at a turning point.
"This year is the same as last year and the year before because people expect property returns to remain strong but to then fall off sharply in the following year," Peter Hobbs, global head of real estate research at RREEF, part of Deutsche Bank and one of the world's biggest property fund managers.
"However, there are now more and more signs of that eventual sell-off, and the recent spike in bond yields increases the risk that the slowdown in property performance starts to occur before the end of the year," he told Reuters in a telephone interview.
Soaring prices in some Asian hotspots, such as major Indian and Chinese cities, have provoked fears risky bubbles are forming and price corrections are on their way. In China, the government is trying to cool the market with a raft of measures to deter speculation, including taxes and interest rate rises.
But in India, an influx of foreign funds has helped double property prices in Mumbai and New Delhi over the last two years.
Funds are becoming much more cautious and are increasingly eyeing up investment opportunities in distressed assets.
SINGAPORE (Reuters) - CapitaLand (CATL.SI: Quote, Profile, Research), Southeast Asia's most valuable developer, plans to launch two more property fund
SINGAPORE (Reuters) - CapitaLand (CATL.SI: Quote, Profile, Research), Southeast Asia's most valuable developer, plans to launch two more property funds worth a combined S$1 billion ($651 million) as part of its financial services expansion.
The group's assets under management would hit S$17-18 billion by the end of the year -- up from about S$14 billion now, Chief Executive Liew Mun Leong said on Monday.
"Our financial services make up less than 10 percent now but I would like our fund fees to be about 15-20 percent of our EBIT (earnings before interest and tax)," Liew told the Reuters Real Estate Summit in Singapore.
"We're still a real estate company essentially, but this would help us in our overall domain knowledge," he added.
The two new property funds, which will join CapitaLand's existing line-up of 10 funds, will invest in India and China with initial funds of S$500 million (US$325 million) each.
CapitaLand, 43-percent owned by Singapore state investor Temasek Holdings (TEM.UL: Quote, Profile, Research), has been aggressive in expanding its financial services business and controls five real estate investment trusts (REITs), including CapitaMall (CMLT.SI: Quote, Profile, Research) -- Singapore's most-valuable property trust.
Liew said the group could launch another five property trusts based on its global portfolio, which includes office buildings in China and apartments in Japan.
He said CapitaLand's next REIT would likely be one based on its properties in China as its assets there offered high yields.
RESORTS AND CASINOS
CapitaLand, which earns up to 80 percent of its profit abroad, is also looking to expand its entertainment and leisure properties division, whose first investment was in a casino and shopping complex in Macau.
The group's assets under management would hit S$17-18 billion by the end of the year -- up from about S$14 billion now, Chief Executive Liew Mun Leong said on Monday.
"Our financial services make up less than 10 percent now but I would like our fund fees to be about 15-20 percent of our EBIT (earnings before interest and tax)," Liew told the Reuters Real Estate Summit in Singapore.
"We're still a real estate company essentially, but this would help us in our overall domain knowledge," he added.
The two new property funds, which will join CapitaLand's existing line-up of 10 funds, will invest in India and China with initial funds of S$500 million (US$325 million) each.
CapitaLand, 43-percent owned by Singapore state investor Temasek Holdings (TEM.UL: Quote, Profile, Research), has been aggressive in expanding its financial services business and controls five real estate investment trusts (REITs), including CapitaMall (CMLT.SI: Quote, Profile, Research) -- Singapore's most-valuable property trust.
Liew said the group could launch another five property trusts based on its global portfolio, which includes office buildings in China and apartments in Japan.
He said CapitaLand's next REIT would likely be one based on its properties in China as its assets there offered high yields.
RESORTS AND CASINOS
CapitaLand, which earns up to 80 percent of its profit abroad, is also looking to expand its entertainment and leisure properties division, whose first investment was in a casino and shopping complex in Macau.
NEW YORK (Reuters) - GE Real Estate, one of the largest global real estate investors, like hotels and plans to lend hotel borrowers about $2 billion
NEW YORK (Reuters) - GE Real Estate, one of the largest global real estate investors, like hotels and plans to lend hotel borrowers about $2 billion this year, up from $500 million a year ago, the head of its North American Lending division said on Tuesday.
"We like the fundamentals of hotels," Alec Burger, senior vice president of North American Lending, said at the Reuters Real Estate Summit in New York.
"The fact it costs me $900 for a room in New York now means it's a pretty good time to be a lender," he said.
GE Real Estate, the real estate arm of General Electric Co. (GE.N: Quote, Profile, Research), has about $60 billion invested globally in real estate. In North America, it has an equity ownership of about $14 billion, controlling $18 billion worth of real estate. On the lending side, the company has about $17.5 billion of total investment lending in the United States and Canada and loans about $12 billion yearly.
"I think it's been a great run for hotels over the last three or four years," Burger said. "We're very comfortable to continue to be a lender in this sector."
As a real estate lender, GE typically focuses on three- or four-star hotels.
"It's based on supply-demand," Burger said. "There's just a hell of a lot more demand for three- or four-star hotels. We've stayed away historically from the luxury end."
As far as hotel ownership, GE Real Estate is not a big player, said Joseph Parsons, president of GE Real Estate North American Equity.
"I think we may have missed that opportunity," he said referring to the period after the September 11, 2001, attacks when hotels took a severe hit as travel dried up.
"I think three to four years ago was a great idea to be an investor in hotels," Parsons said. "We weren't prepared at the time. The real recovery cycle has played through."
"We like the fundamentals of hotels," Alec Burger, senior vice president of North American Lending, said at the Reuters Real Estate Summit in New York.
"The fact it costs me $900 for a room in New York now means it's a pretty good time to be a lender," he said.
GE Real Estate, the real estate arm of General Electric Co. (GE.N: Quote, Profile, Research), has about $60 billion invested globally in real estate. In North America, it has an equity ownership of about $14 billion, controlling $18 billion worth of real estate. On the lending side, the company has about $17.5 billion of total investment lending in the United States and Canada and loans about $12 billion yearly.
"I think it's been a great run for hotels over the last three or four years," Burger said. "We're very comfortable to continue to be a lender in this sector."
As a real estate lender, GE typically focuses on three- or four-star hotels.
"It's based on supply-demand," Burger said. "There's just a hell of a lot more demand for three- or four-star hotels. We've stayed away historically from the luxury end."
As far as hotel ownership, GE Real Estate is not a big player, said Joseph Parsons, president of GE Real Estate North American Equity.
"I think we may have missed that opportunity," he said referring to the period after the September 11, 2001, attacks when hotels took a severe hit as travel dried up.
"I think three to four years ago was a great idea to be an investor in hotels," Parsons said. "We weren't prepared at the time. The real recovery cycle has played through."
SINGAPORE (Reuters) - Mikihisa Hirai, president of Atlas Partners Japan Ltd., should be giddy with excitement as European and Middle Eastern clients
SINGAPORE (Reuters) - Mikihisa Hirai, president of Atlas Partners Japan Ltd., should be giddy with excitement as European and Middle Eastern clients are due to almost double the size of his property funds to just over $800 million.
But Hirai knows he has his work cut out for him.
With Tokyo office rents expected to rise another 60 percent to a peak in 2010 because of shrinking vacancy rates, now at just 2.7 percent, Japan is a popular place for property investors.
But average prices for commercial buildings have already jumped 25 percent in the last couple of years, and competition for assets between real estate investment trusts, private equity funds and institutional investors is hotting up, eating away at returns.
"There are no simple and easy deals," Hirai said. "I feel there are more deals where bid prices are ridiculously high."
With rock-bottom interest rates despite an economic recovery, Japan drew 55 percent of the $94 billion in property transactions in Asia last year, including an increasing amount of petrodollars from the Middle East.
But now, yield-hungry investors are having to scour the country for more complex deals.
For example, Australian listed property trusts (LPT) are starting to buy Japanese buildings, but employ heavy borrowing and currency hedging to artificially lift a property yield of 5 percent into a more attractive 7.7 percent yield for investors back home.
Four property trusts carrying Japanese assets have listed in Australia in the past two years, including Babcock & Brown Japan Property Trust (BJT.AX: Quote, Profile, Research) and Galileo Japan Trust (GJT.AX: Quote, Profile, Research).
But Hirai knows he has his work cut out for him.
With Tokyo office rents expected to rise another 60 percent to a peak in 2010 because of shrinking vacancy rates, now at just 2.7 percent, Japan is a popular place for property investors.
But average prices for commercial buildings have already jumped 25 percent in the last couple of years, and competition for assets between real estate investment trusts, private equity funds and institutional investors is hotting up, eating away at returns.
"There are no simple and easy deals," Hirai said. "I feel there are more deals where bid prices are ridiculously high."
With rock-bottom interest rates despite an economic recovery, Japan drew 55 percent of the $94 billion in property transactions in Asia last year, including an increasing amount of petrodollars from the Middle East.
But now, yield-hungry investors are having to scour the country for more complex deals.
For example, Australian listed property trusts (LPT) are starting to buy Japanese buildings, but employ heavy borrowing and currency hedging to artificially lift a property yield of 5 percent into a more attractive 7.7 percent yield for investors back home.
Four property trusts carrying Japanese assets have listed in Australia in the past two years, including Babcock & Brown Japan Property Trust (BJT.AX: Quote, Profile, Research) and Galileo Japan Trust (GJT.AX: Quote, Profile, Research).
Toll Brothers eyes China home market
NEW YORK (Reuters) - Luxury U.S. home builder Toll Brothers Inc (TOL.N: Quote, Profile, Research) is looking for a partner in China to help it jump into the housing business in the world's fastest-growing economy.
"We've discovered that we are known in China without ever having been there, which came as a complete surprise, but it's there," Chief Executive Robert Toll said at the Reuters Real Estate Summit in New York. "I can envision Toll suburbia, I can envision golf course communities, I can envision high-rise."
A team from the Horsham, Pennsylvania-based company, which last year generated $6.12 billion in revenue, is leaving next week to visit major and second-tier cities across China. Toll said the aim is to join forces with a well-established builder in the China market that would benefit from the Toll name.
"We've discovered that we are known in China without ever having been there, which came as a complete surprise, but it's there," Chief Executive Robert Toll said at the Reuters Real Estate Summit in New York. "I can envision Toll suburbia, I can envision golf course communities, I can envision high-rise."
A team from the Horsham, Pennsylvania-based company, which last year generated $6.12 billion in revenue, is leaving next week to visit major and second-tier cities across China. Toll said the aim is to join forces with a well-established builder in the China market that would benefit from the Toll name.
SINGAPORE (Reuters) - It's a decade since an asset bubble fed the Asian economic crisis and fears swirl over the U.S. housing market and interest rate
SINGAPORE (Reuters) - It's a decade since an asset bubble fed the Asian economic crisis and fears swirl over the U.S. housing market and interest rates, but investors still believe the only way for Asia's soaring property markets is up -- at least for a couple of years.
Asian economies are booming, and property is once again the hot subject of dinner conversations from Tokyo to Mumbai, fuelled by cheap credit, cross-border investment and rising incomes.
Policy makers fear a boom-and-bust cycle, where rising real estate prices fuel inflation and force interest rates higher, leaving households and companies loaded with debt and dragging on economic activity.
But at the Reuters Real Estate Summit this week in Singapore, where some residents are seeing their rents jump 50 percent overnight, property executives effused about India, despite a doubling in urban land prices since foreign property investment was ushered in two years ago.
Japan also appears to be still hugely popular, although average Tokyo office prices have leapt 25 pct in last two years.
And investors believe government cooling measures will bring order to China's market, while failing to stem a hunger for homes among the expanding and increasingly affluent middle class.
Justin Chiu, executive director of Hong Kong property giant Cheung Kong (Holdings)(0001.HK: Quote, Profile, Research), said the prospect of ever higher prices was driving Asia's notoriously sentiment-driven markets.
"If there are no bubbles, you don't drink beer. It's just plain water and there's no incentive to invest," he said. "Of course, if you see too many bubbles, you stop pouring."
Asian economies are booming, and property is once again the hot subject of dinner conversations from Tokyo to Mumbai, fuelled by cheap credit, cross-border investment and rising incomes.
Policy makers fear a boom-and-bust cycle, where rising real estate prices fuel inflation and force interest rates higher, leaving households and companies loaded with debt and dragging on economic activity.
But at the Reuters Real Estate Summit this week in Singapore, where some residents are seeing their rents jump 50 percent overnight, property executives effused about India, despite a doubling in urban land prices since foreign property investment was ushered in two years ago.
Japan also appears to be still hugely popular, although average Tokyo office prices have leapt 25 pct in last two years.
And investors believe government cooling measures will bring order to China's market, while failing to stem a hunger for homes among the expanding and increasingly affluent middle class.
Justin Chiu, executive director of Hong Kong property giant Cheung Kong (Holdings)(0001.HK: Quote, Profile, Research), said the prospect of ever higher prices was driving Asia's notoriously sentiment-driven markets.
"If there are no bubbles, you don't drink beer. It's just plain water and there's no incentive to invest," he said. "Of course, if you see too many bubbles, you stop pouring."
LONDON (Reuters) - German real estate company IVG Immobilien (IVGG.)
LONDON (Reuters) - German real estate company IVG Immobilien (IVGG.DE: Quote, Profile, Research) said on Wednesday that its underground oil and gas storage cavern unit will treble its profit contribution to around a third of group earnings within 4-5 years
"On the longer-term, it will have more than 30 percent of our earnings," Chief Executive Officer Wolfhard Leichnitz said at the Reuters Real Estate Summit in London, while emphasizing that it also intended to expand its funds and investment business. "Today it is about 10 percent."
Leichnitz said IVG owned 40 caverns and had a license to develop another 90, each of which would have around 500,000 cubic meters (17.66 million cu ft) of capacity and would take the company around 10-12 years to complete, providing it with an internal rate of return of around 12 percent, he said.
"It's like a net asset value growing machine," Leichnitz said.
"On the longer-term, it will have more than 30 percent of our earnings," Chief Executive Officer Wolfhard Leichnitz said at the Reuters Real Estate Summit in London, while emphasizing that it also intended to expand its funds and investment business. "Today it is about 10 percent."
Leichnitz said IVG owned 40 caverns and had a license to develop another 90, each of which would have around 500,000 cubic meters (17.66 million cu ft) of capacity and would take the company around 10-12 years to complete, providing it with an internal rate of return of around 12 percent, he said.
"It's like a net asset value growing machine," Leichnitz said.
Quotes from the Reuters Real Estate Summit
NEW YORK (Reuters) - The following are notable quotes about the U.S. commercial and residential real estate markets from executives attending the Reuters Global Real Estate Summit in New York on Wednesday:
JOHN DUGAN, U.S. COMPTROLLER, OFFICE OF COMPTROLLER OF THE CURRENCY
"Anybody who looks at our system of four banking regulators, when they come on it anew, wonders whether this is the best way to approach things. I think it is perfectly appropriate and healthy to look at that," he said of a U.S. Treasury Department study on whether to fuse the OCC with sister banking agency, the Office of Thrift Supervision.
"From my vantage point, we believe that as cumbersome as it appears on paper, we work hard to make the system work and we do think it works in practice."
ROBERT TOLL, CHAIRMAN AND CHIEF EXECUTIVE, TOLL BROTHERS INC. (TOL.N: Quote, Profile, Research)
"I see no reason to expect a change in confidence until probably April '08, when the candidates will fairly well be settled for the presidential election, and we'll start to listen to speeches about how we'll get better," he said of when the sagging U.S. housing market may rebound.
"(My) personal view is that it will be a very quick and strong rebound. We're not into this recession in housing for a long period compared to the other downturns."
"I think there ought to be regulation of subprime. I think there ought to be regulation of prime. I don't think that the economy is best left to its own devices almost ever."
"The excesses that are permitted in the mortgage industry can and perhaps have led us into a dark hole."
"We've discovered that we are known in China without ever having been there, which came as a complete surprise, but it's there. I can envision Toll suburbia, I can envision golf course communities, I can envision high-rise," he said of the company's plans in China.
JOHN ROBBINS, CHAIRMAN, MORTGAGE BANKERS ASSOCIATION
"Will subprime bring more consolidation to our industry? Well, our industry has been consolidating over time."
"There is always a natural cleansing of the hive coming off record years."
DOTTIE HERMAN, PRESIDENT AND CEO, PRUDENTIAL DOUGLAS ELLIMAN REAL ESTATE
"New York City is a combination of a lot of different things, and you put them all together and all the stars are aligned," she said of the strong New York City real estate market.
JORDAN ASH, DIRECTOR, CONSUMER-RIGHTS ADVOCACY GROUP ACORN FINANCIAL JUSTICE CENTER "If people are lied to or aren't told what's in the loan, we think that that's a predatory practice. In a number of subprime loans, people are not aware of the adjustable rates, the fees that are in them."
JOHN DUGAN, U.S. COMPTROLLER, OFFICE OF COMPTROLLER OF THE CURRENCY
"Anybody who looks at our system of four banking regulators, when they come on it anew, wonders whether this is the best way to approach things. I think it is perfectly appropriate and healthy to look at that," he said of a U.S. Treasury Department study on whether to fuse the OCC with sister banking agency, the Office of Thrift Supervision.
"From my vantage point, we believe that as cumbersome as it appears on paper, we work hard to make the system work and we do think it works in practice."
ROBERT TOLL, CHAIRMAN AND CHIEF EXECUTIVE, TOLL BROTHERS INC. (TOL.N: Quote, Profile, Research)
"I see no reason to expect a change in confidence until probably April '08, when the candidates will fairly well be settled for the presidential election, and we'll start to listen to speeches about how we'll get better," he said of when the sagging U.S. housing market may rebound.
"(My) personal view is that it will be a very quick and strong rebound. We're not into this recession in housing for a long period compared to the other downturns."
"I think there ought to be regulation of subprime. I think there ought to be regulation of prime. I don't think that the economy is best left to its own devices almost ever."
"The excesses that are permitted in the mortgage industry can and perhaps have led us into a dark hole."
"We've discovered that we are known in China without ever having been there, which came as a complete surprise, but it's there. I can envision Toll suburbia, I can envision golf course communities, I can envision high-rise," he said of the company's plans in China.
JOHN ROBBINS, CHAIRMAN, MORTGAGE BANKERS ASSOCIATION
"Will subprime bring more consolidation to our industry? Well, our industry has been consolidating over time."
"There is always a natural cleansing of the hive coming off record years."
DOTTIE HERMAN, PRESIDENT AND CEO, PRUDENTIAL DOUGLAS ELLIMAN REAL ESTATE
"New York City is a combination of a lot of different things, and you put them all together and all the stars are aligned," she said of the strong New York City real estate market.
JORDAN ASH, DIRECTOR, CONSUMER-RIGHTS ADVOCACY GROUP ACORN FINANCIAL JUSTICE CENTER "If people are lied to or aren't told what's in the loan, we think that that's a predatory practice. In a number of subprime loans, people are not aware of the adjustable rates, the fees that are in them."
Vietnam consumer confidence still rising
Vietnam consumer confidence still rising
Vietnam has enjoyed a steady increase in consumer confidence, making its way into the world’s top five markets in the first half this year, a survey by a global marketing information company has found.
A market increasingly in the spotlight, Vietnam registered a confidence index of 118, ACNielsen’s latest Global Consumer Confidence Study said.
The index recorded 116 in the second half of last year.
India again led the world with its latest consumer confidence index reaching 137, followed by Norway (132) and Denmark (127), all of them down by two points from November 2006.
The world’s most pessimistic consumers were from Europe, while South Korea (50), Japan (68), and Taiwan (75) remained at the bottom in Asia.
Globally, Portugal, South Korea, Japan, Taiwan and Hungary were the most pessimistic about the job market, state of their personal finances, and readiness to spend.
ACNielsen’s survey polled over 26,000 internet users in 47 markets in Europe, the Asia-Pacific, North America, and the Middle East about their job prospects, state of finances, and what they do with their spare cash.
Over 500 people aged 15 and above were interviewed in Vietnam.
Vietnam has enjoyed a steady increase in consumer confidence, making its way into the world’s top five markets in the first half this year, a survey by a global marketing information company has found.
A market increasingly in the spotlight, Vietnam registered a confidence index of 118, ACNielsen’s latest Global Consumer Confidence Study said.
The index recorded 116 in the second half of last year.
India again led the world with its latest consumer confidence index reaching 137, followed by Norway (132) and Denmark (127), all of them down by two points from November 2006.
The world’s most pessimistic consumers were from Europe, while South Korea (50), Japan (68), and Taiwan (75) remained at the bottom in Asia.
Globally, Portugal, South Korea, Japan, Taiwan and Hungary were the most pessimistic about the job market, state of their personal finances, and readiness to spend.
ACNielsen’s survey polled over 26,000 internet users in 47 markets in Europe, the Asia-Pacific, North America, and the Middle East about their job prospects, state of finances, and what they do with their spare cash.
Over 500 people aged 15 and above were interviewed in Vietnam.
Manhattan apartments prices rose again in the second quarter, defying the gravity pulling down
NEW YORK (Reuters) - Manhattan apartments prices rose again in the second quarter, defying the gravity pulling down most of the U.S. housing market, the head of Prudential Douglas Elliman said on Wednesday.
Although the second-quarter Prudential Douglas Elliman Manhattan Market Overview won't be released until Tuesday, the results will show that prices continued to rise and supply dwindled, Dottie Herman, president and chief executive, said at the Reuters Real Estate Summit in New York.
"We were up for Manhattan," Herman said, adding the figures to be released on Tuesday may show record prices.
"We were up in volume and sales and average sales price," she said. It also took slightly less time to sell an apartment, down to about 132 days from 136, she said.
The supply of apartments for sale also fell.
"Appreciation is up and the inventory is down, which is very unusual for a spring market for inventory to be down," she said, adding that Manhattan home owners tend to wait until spring to sell their apartments.
Herman attributed Manhattan's stellar performance to a confluence of limited ability to build on the island, Manhattan's international draw, baby boomers and older people moving into Manhattan to retire, and its continue allure to younger people. Relatively low mortgage rates, which averaged about 6.7 percent lately, also helped keep demand steady.
Although the second-quarter Prudential Douglas Elliman Manhattan Market Overview won't be released until Tuesday, the results will show that prices continued to rise and supply dwindled, Dottie Herman, president and chief executive, said at the Reuters Real Estate Summit in New York.
"We were up for Manhattan," Herman said, adding the figures to be released on Tuesday may show record prices.
"We were up in volume and sales and average sales price," she said. It also took slightly less time to sell an apartment, down to about 132 days from 136, she said.
The supply of apartments for sale also fell.
"Appreciation is up and the inventory is down, which is very unusual for a spring market for inventory to be down," she said, adding that Manhattan home owners tend to wait until spring to sell their apartments.
Herman attributed Manhattan's stellar performance to a confluence of limited ability to build on the island, Manhattan's international draw, baby boomers and older people moving into Manhattan to retire, and its continue allure to younger people. Relatively low mortgage rates, which averaged about 6.7 percent lately, also helped keep demand steady.
Malaysia, Vietnam to build $600 mln urban town
Malaysia, Vietnam to build $600 mln urban town
Malaysia's leading real estate group sealed a deal with a large Vietnamese property developer Tuesday to form a joint venture and develop a US$600 million housing project in southern Vietnam.
Following the contract between Malaysia’s SP Setia Bhd. And Vietnam’s Becamex IDC Corp., the new entity – SetiaBecame Joint Stock Company – will build the Eco Lakes My Phuoc housing estate in Binh Duong Province’s My Phuoc Industrial-Urban Park, about 40km away from Ho Chi Minh City.
Covering 226 ha, the town will be home to 200,000 residents and include healthcare facilities, an international school and shopping malls.
Developers also aim to construct a man-made beach in the heart of the town.
The venture expects the town to introduce a new standard and style of living to the local real estate market.
SP Setie is Malaysia’s largest property developer with 24 affiliates in construction, urban development, banking and securities.
The group has engaged in other Binh Duong projects in like the Vietnam-Singapore Industrial Zone, the My Phuoc – Tan Van Highway, and the My Phuoc Industrial-Urban IP.
Vietnam’s real estate market is promising on the back of the country’s remarkable economic growth, higher living standards, positive consumer trends, rapid urbanization and a burgeoning tourism industry, according to the property consulting firms’ research.
The housing saturation in Southeast Asian markets is expected to make Vietnam a lucrative option for regional developers.
Another Malaysian urban developer, Gamuda Group, has recently obtained the nod from the Hanoi municipal government to invest $1 billion in a 323 ha integrated commercial complex.
Construction is set to start by the end of this year for completion in eight years.
It includes a convention center, office towers, international five-star hotels, and luxury properties.
Malaysia's leading real estate group sealed a deal with a large Vietnamese property developer Tuesday to form a joint venture and develop a US$600 million housing project in southern Vietnam.
Following the contract between Malaysia’s SP Setia Bhd. And Vietnam’s Becamex IDC Corp., the new entity – SetiaBecame Joint Stock Company – will build the Eco Lakes My Phuoc housing estate in Binh Duong Province’s My Phuoc Industrial-Urban Park, about 40km away from Ho Chi Minh City.
Covering 226 ha, the town will be home to 200,000 residents and include healthcare facilities, an international school and shopping malls.
Developers also aim to construct a man-made beach in the heart of the town.
The venture expects the town to introduce a new standard and style of living to the local real estate market.
SP Setie is Malaysia’s largest property developer with 24 affiliates in construction, urban development, banking and securities.
The group has engaged in other Binh Duong projects in like the Vietnam-Singapore Industrial Zone, the My Phuoc – Tan Van Highway, and the My Phuoc Industrial-Urban IP.
Vietnam’s real estate market is promising on the back of the country’s remarkable economic growth, higher living standards, positive consumer trends, rapid urbanization and a burgeoning tourism industry, according to the property consulting firms’ research.
The housing saturation in Southeast Asian markets is expected to make Vietnam a lucrative option for regional developers.
Another Malaysian urban developer, Gamuda Group, has recently obtained the nod from the Hanoi municipal government to invest $1 billion in a 323 ha integrated commercial complex.
Construction is set to start by the end of this year for completion in eight years.
It includes a convention center, office towers, international five-star hotels, and luxury properties.
UK property market slowdown
LONDON (Reuters) - Investors have already seen the best of the capital returns from the UK property market and it is hard not to see the market slipping back, one of Europe's biggest property fund management firms said on Wednesday.
"Clearly the capital growth we've had in the past is behind us. Things are pretty flat, and people are unclear if it will stay fairly flat or whether it will fall," Nick Mansley, director of property strategy and indirect investment at Morley Fund Management, said at the Reuters Real Estate Summit in London.
"Some parts are showing rising values and some parts are showing falls. It (the property market) will be influenced by swap rates and rising yields, which have risen so rapidly. The market can't shrug these off ... It's difficult to see the property market in the UK not slipping back."
"Clearly the capital growth we've had in the past is behind us. Things are pretty flat, and people are unclear if it will stay fairly flat or whether it will fall," Nick Mansley, director of property strategy and indirect investment at Morley Fund Management, said at the Reuters Real Estate Summit in London.
"Some parts are showing rising values and some parts are showing falls. It (the property market) will be influenced by swap rates and rising yields, which have risen so rapidly. The market can't shrug these off ... It's difficult to see the property market in the UK not slipping back."
Emirates Tarian to launch $400 mln Asian fund
SINGAPORE (Reuters) - Singapore-based Emirates Tarian Capital will launch a Sharia-compliant investment fund worth over $400 million targeting Asian properties across all sectors, its managing director said on Wednesday.
"It will look at properties across the region. It will look mostly at commercial and residential and not so much at hospitality because of the sharia compliance (requirements)," Kunalan Sivapuniam said in an interview at the Reuters Real Estate Summit in Singapore.
Sharia or Islamic law prohibits the leasing of real estate for purposes such as alcohol production or pornography.
The investment firm is 60-percent owned by Emirates Investments Group, one of the investment firms such as Dubai World and Istithmar to have emerged from the oil-rich United Arab Emirates.
Kunalan said the fund would be managed by an independent fund manager with listed property trusts in Singapore.
"It will look at properties across the region. It will look mostly at commercial and residential and not so much at hospitality because of the sharia compliance (requirements)," Kunalan Sivapuniam said in an interview at the Reuters Real Estate Summit in Singapore.
Sharia or Islamic law prohibits the leasing of real estate for purposes such as alcohol production or pornography.
The investment firm is 60-percent owned by Emirates Investments Group, one of the investment firms such as Dubai World and Istithmar to have emerged from the oil-rich United Arab Emirates.
Kunalan said the fund would be managed by an independent fund manager with listed property trusts in Singapore.
China EnerSave spins off Vietnam engineering arms for S$82 mln
China EnerSave spins off Vietnam engineering arms for S$82 mln
Singapore-listed China EnerSave said Tuesday that it has spun off its 46.6 percent-owned Vietnam engineering arm Amanda for US$53 million through a reverse takeover.
China EnerSave builds and operates renewable energy plants in China.
As part of the deal, Amanda Industries Pte Ltd will be sold to die-cast collectibles maker Creative Master Bermuda, which will issue 381.4 million new shares at S$0.215 each to pay China EnerSave and the other shareholders of Amanda.
China EnerSave said it would own 37.7 percent of the enlarged share capital of Creative Master, which will be renamed Amanda Industries Ltd.
Vietnam-based Amanda Industries Pte. Ltd. makes steel parts and parts of gas turbines used in the energy industry.
Provenance Capital was the financial adviser for the transaction, said China EnerSave.
Source: Reuters
Singapore-listed China EnerSave said Tuesday that it has spun off its 46.6 percent-owned Vietnam engineering arm Amanda for US$53 million through a reverse takeover.
China EnerSave builds and operates renewable energy plants in China.
As part of the deal, Amanda Industries Pte Ltd will be sold to die-cast collectibles maker Creative Master Bermuda, which will issue 381.4 million new shares at S$0.215 each to pay China EnerSave and the other shareholders of Amanda.
China EnerSave said it would own 37.7 percent of the enlarged share capital of Creative Master, which will be renamed Amanda Industries Ltd.
Vietnam-based Amanda Industries Pte. Ltd. makes steel parts and parts of gas turbines used in the energy industry.
Provenance Capital was the financial adviser for the transaction, said China EnerSave.
Source: Reuters
Singapore's Carats in $300 mln RTO with Vietnam developer
Singapore's Carats in $300 mln RTO with Vietnam developer
Singapore-listed Carats Ltd., formerly known as Daka Designs, said Tuesday it has inked a memorandum of intent with Citra International Investment for a reverse takeover offer worth at least US$300 million.
Citra is a developer with projects in Vietnam and Cambodia.
Carats said in a statement it would acquire the entire share capital of City Development Pte Ltd, a unit of Citra and a town developer in Hanoi, Vietnam.
Carats said it would issue new shares at between S$0.07 to S$0.08 each as part of the deal, resulting in a reverse takeover of the firm.
Singapore-listed Carats Ltd., formerly known as Daka Designs, said Tuesday it has inked a memorandum of intent with Citra International Investment for a reverse takeover offer worth at least US$300 million.
Citra is a developer with projects in Vietnam and Cambodia.
Carats said in a statement it would acquire the entire share capital of City Development Pte Ltd, a unit of Citra and a town developer in Hanoi, Vietnam.
Carats said it would issue new shares at between S$0.07 to S$0.08 each as part of the deal, resulting in a reverse takeover of the firm.
Danang’s largest domestic investor puts $180 mln into real estate
Danang’s largest domestic investor puts $180 mln into real estate
A private trading company has signed an initial agreement to pour US$180 million into two real estate projects in Danang city on Vietnam’s central coast.
Under the deal signed earlier this week with the city government, Hoang Anh Gia Lai Corp. plans to invest $150 million to build a waterfront hotel-apartment-office-shopping-complex along the Han River in Hai Chau district.
Work on building the complex is scheduled to start early next year and finish in 2010.
The corporation, headquartered in the Central Highlands province of Gia Lai, will also build an estimated $30 million worth of high-end apartments for sale in Thanh Khe district.
Doan Nguyen Duc, chairman of the corporation, urged the city authorities to speed up site clearance to deliver land to the investor for the construction soon.
Additionally, the company is set to begin work on a $25 million resort project in Ngu Hanh Son District in August.
With the fresh investment, Hoang Anh has become the largest domestic investor in Danang with a total of $250 million at work in the city’s property and tourism projects.
Other plans
Hoang Anh – involved in a range of businesses from property to wood processing and tourism – plans to pour trillions of dong into high-end offices, hotels and apartment projects in Vietnam and abroad over the next four years.
The company has plans to open a 4,000-apartment project near the Phu My Hung urban area in South Saigon this year while striving to become a high-end and mid-range apartment leader by 2012 when it hopes to have 15,000 apartments completed.
Hoang Anh has branched out to electricity sector with $90 million invested in the construction of four hydroelectricity plants in the province.
The corporation, with a chartered capital of VND1.04 trillion (US$65 million), aims to list on the domestic stock exchange in the second quarter of 2008.
The group will invest $20 million or more in developing 10,000ha of rubber trees in Laos and 5,000ha more in Vietnam from now until 2012.
There are also plans to merge affiliates Hoang Anh Quy Nhon, Hoang Anh Saigon and Hoang Anh Housing Company into the conglomerate to increase financial capacity.
French investment fund Jaccar and two local biggies - Saigon Securities Inc. and Saigon Commercial Joint Stock Bank - now held 20 percent of the group’s total shares.
Last year, Hoang Anh posted revenue of VND289 billion ($18 million) and after-tax profits of VND50.5 billion ($3.1 million), predicting an expected VND813 billion ($51 million) in revenue and VND158 billion ($10 million) profits this year.
Source: Thanh Nien, VietNamNet – Compiled by Dong Ha
A private trading company has signed an initial agreement to pour US$180 million into two real estate projects in Danang city on Vietnam’s central coast.
Under the deal signed earlier this week with the city government, Hoang Anh Gia Lai Corp. plans to invest $150 million to build a waterfront hotel-apartment-office-shopping-complex along the Han River in Hai Chau district.
Work on building the complex is scheduled to start early next year and finish in 2010.
The corporation, headquartered in the Central Highlands province of Gia Lai, will also build an estimated $30 million worth of high-end apartments for sale in Thanh Khe district.
Doan Nguyen Duc, chairman of the corporation, urged the city authorities to speed up site clearance to deliver land to the investor for the construction soon.
Additionally, the company is set to begin work on a $25 million resort project in Ngu Hanh Son District in August.
With the fresh investment, Hoang Anh has become the largest domestic investor in Danang with a total of $250 million at work in the city’s property and tourism projects.
Other plans
Hoang Anh – involved in a range of businesses from property to wood processing and tourism – plans to pour trillions of dong into high-end offices, hotels and apartment projects in Vietnam and abroad over the next four years.
The company has plans to open a 4,000-apartment project near the Phu My Hung urban area in South Saigon this year while striving to become a high-end and mid-range apartment leader by 2012 when it hopes to have 15,000 apartments completed.
Hoang Anh has branched out to electricity sector with $90 million invested in the construction of four hydroelectricity plants in the province.
The corporation, with a chartered capital of VND1.04 trillion (US$65 million), aims to list on the domestic stock exchange in the second quarter of 2008.
The group will invest $20 million or more in developing 10,000ha of rubber trees in Laos and 5,000ha more in Vietnam from now until 2012.
There are also plans to merge affiliates Hoang Anh Quy Nhon, Hoang Anh Saigon and Hoang Anh Housing Company into the conglomerate to increase financial capacity.
French investment fund Jaccar and two local biggies - Saigon Securities Inc. and Saigon Commercial Joint Stock Bank - now held 20 percent of the group’s total shares.
Last year, Hoang Anh posted revenue of VND289 billion ($18 million) and after-tax profits of VND50.5 billion ($3.1 million), predicting an expected VND813 billion ($51 million) in revenue and VND158 billion ($10 million) profits this year.
Source: Thanh Nien, VietNamNet – Compiled by Dong Ha
Denise Kee and Catherine Yang (Bloomberg) on Asian REITs
Denise Kee and Catherine Yang (Bloomberg)
Asian property owners plan to sell shares in as many as 15 real estate investment trusts (Reits) within the coming year, according to Michael Smith, head of Asian real estate investment banking at Goldman Sachs Group Inc.
Jakarta-based Lippo Group will sell as much as $5 billion (Rs20,500 crore) of assets to new property trusts, chief executive officer James Riady had said on 24 June. India’s Embassy Group, whose buildings house Hewlett-Packard Co.’s offices, plans an initial public offering (IPO) in Singapore. Goldman Sachs and UBS AG are advising on the issue. “There is huge capital flow coming into the Asian real estate market,” Smith said.
Property owners are using Reits to raise cash amid soaring investor demand for real estate, which has offered twice the average return of stocks. Reits raise money from equity investors to buy properties from shopping malls to business parks. They are usually required by law to pay most of their profit as dividends.
Morgan Stanley’s high-return real estate funds have posted average annual gains of more than 20% since 1991, about twice the annual returns for the Standard & Poor’s 500 Index. New money for property investments is coming from the public REIT market, big developers in China and India, and private equity funds, including those raised by the investment banks, Smith said.
The biggest real estate investor among investment banks, Morgan Stanley had said on 20 June that it raised $8 billion in the world’s largest property fund that will invest about half in Japan and 25% in countries, including China and India.
Funds, including Reits, may raise a record $69 billion globally this year, according to Private Equity Intelligence Ltd. Goldman Sachs this month drew $4.07 billion for a property fund, twice as much as originally sought.
Asia’s real estate trust market, with 100 listed Reits, will undergo a period of consolidation, Smith added.
Asian property owners plan to sell shares in as many as 15 real estate investment trusts (Reits) within the coming year, according to Michael Smith, head of Asian real estate investment banking at Goldman Sachs Group Inc.
Jakarta-based Lippo Group will sell as much as $5 billion (Rs20,500 crore) of assets to new property trusts, chief executive officer James Riady had said on 24 June. India’s Embassy Group, whose buildings house Hewlett-Packard Co.’s offices, plans an initial public offering (IPO) in Singapore. Goldman Sachs and UBS AG are advising on the issue. “There is huge capital flow coming into the Asian real estate market,” Smith said.
Property owners are using Reits to raise cash amid soaring investor demand for real estate, which has offered twice the average return of stocks. Reits raise money from equity investors to buy properties from shopping malls to business parks. They are usually required by law to pay most of their profit as dividends.
Morgan Stanley’s high-return real estate funds have posted average annual gains of more than 20% since 1991, about twice the annual returns for the Standard & Poor’s 500 Index. New money for property investments is coming from the public REIT market, big developers in China and India, and private equity funds, including those raised by the investment banks, Smith said.
The biggest real estate investor among investment banks, Morgan Stanley had said on 20 June that it raised $8 billion in the world’s largest property fund that will invest about half in Japan and 25% in countries, including China and India.
Funds, including Reits, may raise a record $69 billion globally this year, according to Private Equity Intelligence Ltd. Goldman Sachs this month drew $4.07 billion for a property fund, twice as much as originally sought.
Asia’s real estate trust market, with 100 listed Reits, will undergo a period of consolidation, Smith added.
News in brief
News in brief
KUALA LUMPUR: IJM Corp Bhd said its wholly-owned subsidiary IJM Overseas Ventures Sdn Bhd has disposed of its remaining 65.06 million shares in Guangdong Provincial Expressway Development Co Ltd for RM189mil.
# KUALA LUMPUR: Salcon Bhd has won a contract, worth about RM41mil, to produce and sell non-potable water in bulk to Nanfang District in Shandong province in China. – Bernama
# PUCHONG: Konsortium Logistik Bhd is focusing on addressing its balance sheet to maximise returns to shareholders.
Executive vice-president Loo Hooi Keat said the company repaid most of its borrowings and was looking at opportunities to expand its business in supply chain management.
“We hope to give a 20% return to shareholders' fund over the next two years,” he said at the company AGM yesterday.
# SINGAPORE: Tune Hotels.com told a media briefing it has set up a US$50mil joint venture with the Dubai government and a Singapore business tycoon to open 30 budget hotels in South-East Asia over the next 24 months.
Tune Hotels.com will hold a 20% stake in the venture while Istithmar PSJC, the investment arm of state-owned Dubai World, will take 40%.
The remaining 40% will be held by City e-Solutions, a hospitality business that is majority-owned by City Developments, which is part of Singapore tycoon Kwek Leng Beng's Hong Leong Group. – AFP
# SHAH ALAM: Padiberas Nasional Bhd (Bernas) plans to invest close to RM170mil over the next few years to upgrade its storage and production-related facilities to boost production capacity and operational efficiency, managing director Bakry Hamzah said.
Bernas would spend about RM100mil to buy more drying machines and other related equipment and RM50mil to RM70mil to expand its storage capacity – Bernama
# KUALA LUMPUR: Dolomite Corp Bhd is looking at opportunities in the utilities, water and power generation sectors for its overseas expansion, said managing director Lew Choong Keong.
The company, which is involved in construction, property development and quarry operations, was eyeing Vietnam and further expansion into China, he said after its AGM.
KUALA LUMPUR: IJM Corp Bhd said its wholly-owned subsidiary IJM Overseas Ventures Sdn Bhd has disposed of its remaining 65.06 million shares in Guangdong Provincial Expressway Development Co Ltd for RM189mil.
# KUALA LUMPUR: Salcon Bhd has won a contract, worth about RM41mil, to produce and sell non-potable water in bulk to Nanfang District in Shandong province in China. – Bernama
# PUCHONG: Konsortium Logistik Bhd is focusing on addressing its balance sheet to maximise returns to shareholders.
Executive vice-president Loo Hooi Keat said the company repaid most of its borrowings and was looking at opportunities to expand its business in supply chain management.
“We hope to give a 20% return to shareholders' fund over the next two years,” he said at the company AGM yesterday.
# SINGAPORE: Tune Hotels.com told a media briefing it has set up a US$50mil joint venture with the Dubai government and a Singapore business tycoon to open 30 budget hotels in South-East Asia over the next 24 months.
Tune Hotels.com will hold a 20% stake in the venture while Istithmar PSJC, the investment arm of state-owned Dubai World, will take 40%.
The remaining 40% will be held by City e-Solutions, a hospitality business that is majority-owned by City Developments, which is part of Singapore tycoon Kwek Leng Beng's Hong Leong Group. – AFP
# SHAH ALAM: Padiberas Nasional Bhd (Bernas) plans to invest close to RM170mil over the next few years to upgrade its storage and production-related facilities to boost production capacity and operational efficiency, managing director Bakry Hamzah said.
Bernas would spend about RM100mil to buy more drying machines and other related equipment and RM50mil to RM70mil to expand its storage capacity – Bernama
# KUALA LUMPUR: Dolomite Corp Bhd is looking at opportunities in the utilities, water and power generation sectors for its overseas expansion, said managing director Lew Choong Keong.
The company, which is involved in construction, property development and quarry operations, was eyeing Vietnam and further expansion into China, he said after its AGM.
SP Setia kicks off township in Vietnam
SP Setia kicks off township in Vietnam
By LEONG HUNG YEE
HO CHI MINH CITY: SP Setia Bhd made its maiden foray into Vietnam by teaming up with government-linked conglomerate Becamex IDC Corp to develop a RM2.1bil township, EcoLakes at MyPhuoc, in Binh Duong province.
SP Setia group managing director and chief executive officer Tan Sri Liew Kee Sin said the company chose Vietnam for its first overseas project because of the country's strong economic growth, sizeable population and stable socio-political climate.
”Having established a dominant presence in the Malaysian property market over the past decade, we are now ready to export our expertise to foreign markets in tandem with our expansion exercise,” he told StarBiz yesterday after SP Setia and Becamex IDC signed an agreement to set up a joint-venture company, SetiaBecamex Joint Stock Co, to undertake the residential project.
EcoLakes will feature a wide range of residential properties such as link and semi-detached houses, villas, apartments and condominium units.
Present at the event were Housing and Local Government Minister Datuk Seri Ong Ka Ting, People Committee of Binh Duong Province chairman Nguyen Hoang Son, and Becamex chief executive officer Nguyen Van Hung.
From left: SP Setia chairman Tan Sri Abdul Rashid Abdul Manaf, Tan Sri Liew Kee Sin, Datuk Seri Ong Ka Ting, Nguyen Van Hung and Vietnam People Committee of Binh Duong Province chief secretary Mai The Trung
“EcoLakes at MyPhuoc, spread over 226ha in the heart of MyPhuoc Industrial Park, is similar to our Setia Eco Park township in Shah Alam. We won the Master Plan category of the Fiabci Prix d’Excellence Awards 2007 for Setia Eco Park two weeks ago.
”We are now bringing this award-winning eco concept to Vietnam,” Liew said.
The project is scheduled to be completed within eight years.
By LEONG HUNG YEE
HO CHI MINH CITY: SP Setia Bhd made its maiden foray into Vietnam by teaming up with government-linked conglomerate Becamex IDC Corp to develop a RM2.1bil township, EcoLakes at MyPhuoc, in Binh Duong province.
SP Setia group managing director and chief executive officer Tan Sri Liew Kee Sin said the company chose Vietnam for its first overseas project because of the country's strong economic growth, sizeable population and stable socio-political climate.
”Having established a dominant presence in the Malaysian property market over the past decade, we are now ready to export our expertise to foreign markets in tandem with our expansion exercise,” he told StarBiz yesterday after SP Setia and Becamex IDC signed an agreement to set up a joint-venture company, SetiaBecamex Joint Stock Co, to undertake the residential project.
EcoLakes will feature a wide range of residential properties such as link and semi-detached houses, villas, apartments and condominium units.
Present at the event were Housing and Local Government Minister Datuk Seri Ong Ka Ting, People Committee of Binh Duong Province chairman Nguyen Hoang Son, and Becamex chief executive officer Nguyen Van Hung.
From left: SP Setia chairman Tan Sri Abdul Rashid Abdul Manaf, Tan Sri Liew Kee Sin, Datuk Seri Ong Ka Ting, Nguyen Van Hung and Vietnam People Committee of Binh Duong Province chief secretary Mai The Trung
“EcoLakes at MyPhuoc, spread over 226ha in the heart of MyPhuoc Industrial Park, is similar to our Setia Eco Park township in Shah Alam. We won the Master Plan category of the Fiabci Prix d’Excellence Awards 2007 for Setia Eco Park two weeks ago.
”We are now bringing this award-winning eco concept to Vietnam,” Liew said.
The project is scheduled to be completed within eight years.
Malaysians' overseas land-grab: Blame Canada!
Malaysians' overseas land-grab: Blame Canada!
By JACK WONG
KUCHING: More than 3,500 Malaysians bought land in Ottawa, Ontario, last year, a fourfold increase from 2003, said Walton International Group consultant Callistus Nilson Banti.
"Their total investments grew to C$49mil (RM169mil) from C$8mil (RM26mil) during the same period," he told The Star here on Wednesday.
He said there were 700 investors in Sarawak, who contributed one-third of the company's Malaysian revenue.
Calgary, Alberta-based Walton, a North American "land banking" company, set up its Kuching office last year, five years after opening its Kuala Lumpur office.
Nilson Banti said Walton now managed some 26,000 acres of land in Canada and 700 acres in the United States for some 35,000 investors in both North Amercia and Asia.
"About 92 acres of land in Ottawa is still available for sale to Malaysian investors. The land in Texas was offered to Singaporean investors last week, and might be open to Malaysians soon," he added.
He said most of the land was agriculture land, and that investors would reap good profits when it was converted for commercial purposes.
Nilson Banti claimed that annual returns for investors ranged from between 14.4% and 42%.
He said the minimium investment was C$10,000 for one unit, which is equivalent to one-sixth of an acre.
"The reservation (booking) fee is C$2,000. When the sales and purchase agreement is signed, an investor will pay the balance of the purchase price.
"There is no administrative or other hidden costs," he said.
He said investors could sell the land six months after purchase, but had to pay at least 21% in taxes to the Canadian government.
By JACK WONG
KUCHING: More than 3,500 Malaysians bought land in Ottawa, Ontario, last year, a fourfold increase from 2003, said Walton International Group consultant Callistus Nilson Banti.
"Their total investments grew to C$49mil (RM169mil) from C$8mil (RM26mil) during the same period," he told The Star here on Wednesday.
He said there were 700 investors in Sarawak, who contributed one-third of the company's Malaysian revenue.
Calgary, Alberta-based Walton, a North American "land banking" company, set up its Kuching office last year, five years after opening its Kuala Lumpur office.
Nilson Banti said Walton now managed some 26,000 acres of land in Canada and 700 acres in the United States for some 35,000 investors in both North Amercia and Asia.
"About 92 acres of land in Ottawa is still available for sale to Malaysian investors. The land in Texas was offered to Singaporean investors last week, and might be open to Malaysians soon," he added.
He said most of the land was agriculture land, and that investors would reap good profits when it was converted for commercial purposes.
Nilson Banti claimed that annual returns for investors ranged from between 14.4% and 42%.
He said the minimium investment was C$10,000 for one unit, which is equivalent to one-sixth of an acre.
"The reservation (booking) fee is C$2,000. When the sales and purchase agreement is signed, an investor will pay the balance of the purchase price.
"There is no administrative or other hidden costs," he said.
He said investors could sell the land six months after purchase, but had to pay at least 21% in taxes to the Canadian government.
Majuperak plans commercial development in Penang
Majuperak plans commercial development in Penang
By Loong Tse Min
KUALA LUMPUR: Perak state government vehicle Majuperak Holdings Bhd plans to launch a 17.9-acre commercial development in Seberang Prai in Penang by early next year.
Majuperak, which had on Wednesday taken over the listing status of United Chemical Industries Bhd (UCI), has already submitted applications to the government.
Part of the applications for the Penang project involved the conversion of the land, which is currently occupied by UCI's factories, to commercial status from industrial at present.
In conjunction with its takeover of UCI's listing status, Majuperak has also transferred to the main board effective Wednesday.
Of Majuperak's total landbank of 4,000 acres the company has 1,000 acres under planning for development, said chairman Datuk Seri Megat Najmuddin.
"With a large area like 1,000 acres we are looking at a township model, while our other smaller parcels would be mainly housing project," he said.
Located in Simpang Pulai, Perak the proposed township is fronting a lake and would be targeted at buyers from both within and outside of the state, he said.
By Loong Tse Min
KUALA LUMPUR: Perak state government vehicle Majuperak Holdings Bhd plans to launch a 17.9-acre commercial development in Seberang Prai in Penang by early next year.
Majuperak, which had on Wednesday taken over the listing status of United Chemical Industries Bhd (UCI), has already submitted applications to the government.
Part of the applications for the Penang project involved the conversion of the land, which is currently occupied by UCI's factories, to commercial status from industrial at present.
In conjunction with its takeover of UCI's listing status, Majuperak has also transferred to the main board effective Wednesday.
Of Majuperak's total landbank of 4,000 acres the company has 1,000 acres under planning for development, said chairman Datuk Seri Megat Najmuddin.
"With a large area like 1,000 acres we are looking at a township model, while our other smaller parcels would be mainly housing project," he said.
Located in Simpang Pulai, Perak the proposed township is fronting a lake and would be targeted at buyers from both within and outside of the state, he said.
Singapore’s hotel room rates may rise by ‘quite a bit’ as the island-state draws more tourists, said Kwek Leng Beng, chairman of City Developments Ltd
Singapore’s hotel room rates may rise by ‘quite a bit’ as the island-state draws more tourists, said Kwek Leng Beng, chairman of City Developments Ltd, one of the country’s biggest hotel operators.
The city will be short of about 3,000 hotel rooms, Mr Kwek said, referring to the government’s sale of land sites for new hospitality developments. Mr Kwek, who spoke at a briefing in yesterday, wasn’t more specific on the time frame for the hotel room shortage.
Singapore, prospective host to Formula One’s first night Grand Prix and two casino-resorts that will help draw more convention delegates, may face a shortage of hotel rooms as the government expects the number of visitors to double to 17 million by 2015.
‘The meetings, incentives, conventions and exhibitions business is going forward, and with Formula One, rates will go up quite a bit,’ Mr Kwek said.
Hotel operators may charge tourists an average $600 daily from $170 now as occupancy increases in the next eight years, according to Merrill Lynch & Co. About 3,300 rooms are expected to be added annually, falling short of the average 4,100 units needed, a team led by Merrill Lynch analyst Melinda Baxter wrote in a June 18 report.
Singapore is adding new attractions, including a Universal Studios theme park and the world’s largest Ferris wheel, to tap an increase in global travel. The government expects to triple tourism spending to $30 billion by 2015.
City Developments is the parent company of Millennium & Copthorne Hotels plc, the UK operator of the Biltmore in Los Angeles.
Source: The Business Times, 27 June 2007
The city will be short of about 3,000 hotel rooms, Mr Kwek said, referring to the government’s sale of land sites for new hospitality developments. Mr Kwek, who spoke at a briefing in yesterday, wasn’t more specific on the time frame for the hotel room shortage.
Singapore, prospective host to Formula One’s first night Grand Prix and two casino-resorts that will help draw more convention delegates, may face a shortage of hotel rooms as the government expects the number of visitors to double to 17 million by 2015.
‘The meetings, incentives, conventions and exhibitions business is going forward, and with Formula One, rates will go up quite a bit,’ Mr Kwek said.
Hotel operators may charge tourists an average $600 daily from $170 now as occupancy increases in the next eight years, according to Merrill Lynch & Co. About 3,300 rooms are expected to be added annually, falling short of the average 4,100 units needed, a team led by Merrill Lynch analyst Melinda Baxter wrote in a June 18 report.
Singapore is adding new attractions, including a Universal Studios theme park and the world’s largest Ferris wheel, to tap an increase in global travel. The government expects to triple tourism spending to $30 billion by 2015.
City Developments is the parent company of Millennium & Copthorne Hotels plc, the UK operator of the Biltmore in Los Angeles.
Source: The Business Times, 27 June 2007
A chain of 30 budget hotels is to be set up across South-east Asia over the next three years in a US$50 million joint venture between Hong Leong Group
A chain of 30 budget hotels is to be set up across South-east Asia over the next three years in a US$50 million joint venture between Hong Leong Group and Dubai investment company Istithmar.
Hong Leong, through its subsidiary City Developments’ City e-Solutions (CES), will take a 40 per cent stake in the joint company, Tune Hospitality Investments. Another 40 per cent will be owned by Istithmar, the investment arm of Dubai World, which is fully owned by the government of Dubai.
The remaining 20 per cent stake will be held by Tune Hotels.Com, which will develop and operate the hotels. Tune Hotels.Com is owned by the founders of the AirAsia budget airline.
The partners plan to exit their investment through the private or public markets in four to six years’ time, they said. One option will be selling the hotels to CityDev’s listed real estate investment trust, CDL Hospitality Trusts.
With the hotels, which will all have the ‘Tune’ brand, the partners hope to address the lack of affordable and quality budget accommodation in the region.
The first Tune Hotel opened in Kuala Lumpur in April this year and has been enjoying 91 per cent occupancy since. Additional properties are due to be opened over the next few years in Penang, Johor Baru, Kuching and Kota Kinabalu, although these will not be owned by the new company.
The new company will instead look for new locations in Malaysia, Indonesia, Thailand, the Philippines and Singapore to set up its 30 hotels. The venture will focus on destinations served by the region’s rapidly growing low-cost airlines.
Tune operates a ‘no-frills’ hotel concept, using many tactics pioneered by budget airlines - including a Internet-based reservations system, demand-based pricing and outsourcing of operations such as F&B. Most of the hotels will have 150 to 250 rooms.
‘With low-cost carriers making air travel affordable and accessible to everyone, there has been a correspondingly strong demand for affordable and quality hotel accommodation to meet the needs of such economy travellers who are comfortable with prepaid, online bookings,’ said Vincent Yeo, chief executive of CES.
The investment will mark CityDev’s first foray into budget hotels. The developer has more than a dozen high-end hotels in the region, including the Grand Copthorne Waterfront Hotel, M Hotel and Orchard Hotel in Singapore.
CityDev’s shares closed 20 cents down at $17.20 yesterday.
Source: The Business Times, 27 June 2007
Hong Leong, through its subsidiary City Developments’ City e-Solutions (CES), will take a 40 per cent stake in the joint company, Tune Hospitality Investments. Another 40 per cent will be owned by Istithmar, the investment arm of Dubai World, which is fully owned by the government of Dubai.
The remaining 20 per cent stake will be held by Tune Hotels.Com, which will develop and operate the hotels. Tune Hotels.Com is owned by the founders of the AirAsia budget airline.
The partners plan to exit their investment through the private or public markets in four to six years’ time, they said. One option will be selling the hotels to CityDev’s listed real estate investment trust, CDL Hospitality Trusts.
With the hotels, which will all have the ‘Tune’ brand, the partners hope to address the lack of affordable and quality budget accommodation in the region.
The first Tune Hotel opened in Kuala Lumpur in April this year and has been enjoying 91 per cent occupancy since. Additional properties are due to be opened over the next few years in Penang, Johor Baru, Kuching and Kota Kinabalu, although these will not be owned by the new company.
The new company will instead look for new locations in Malaysia, Indonesia, Thailand, the Philippines and Singapore to set up its 30 hotels. The venture will focus on destinations served by the region’s rapidly growing low-cost airlines.
Tune operates a ‘no-frills’ hotel concept, using many tactics pioneered by budget airlines - including a Internet-based reservations system, demand-based pricing and outsourcing of operations such as F&B. Most of the hotels will have 150 to 250 rooms.
‘With low-cost carriers making air travel affordable and accessible to everyone, there has been a correspondingly strong demand for affordable and quality hotel accommodation to meet the needs of such economy travellers who are comfortable with prepaid, online bookings,’ said Vincent Yeo, chief executive of CES.
The investment will mark CityDev’s first foray into budget hotels. The developer has more than a dozen high-end hotels in the region, including the Grand Copthorne Waterfront Hotel, M Hotel and Orchard Hotel in Singapore.
CityDev’s shares closed 20 cents down at $17.20 yesterday.
Source: The Business Times, 27 June 2007
Hor Kew Corporation expects a turnaround for the company with the launch of two new property developments at 42 East Coast Road and 66 Kallang Pudding
Hor Kew Corporation expects a turnaround for the company with the launch of two new property developments at 42 East Coast Road and 66 Kallang Pudding, it said yesterday.
This is in addition to One Oxley Rise, which the company developed as well. Hor Kew, a building construction group which has been in the red in previous years, expressed optimism for its new developments.
‘These are turnkey projects for the company. In the past, we have mainly concentrated on construction projects. Now, Hor Kew will undergo a facelift and move on the next level of expanding our property development business,’ said group financial controller Lau Choon Hoong.
The company believes that it will be able to ride on the recent property boom and expects both new developments to do well. The increase in number of expatriates and immigrants, together with the recent integrated resort projects, will continue to sustain the property market for another two to three years, the company expects.
The development at 42 East Coast Road is a 17-storey freehold project situated next to Paramount Shopping Centre and Paramount Hotel, which was recently up for sale at around $200 million. With a total saleable area of 64,200 sq ft, it will comprise a mix of apartments, duplex units, penthouses and commercial units. Hor Kew estimates that units might sell at around $1,500 per sq ft. The property will be launched later this year or early next year.
Mr Lau cites the properties’ prime locations as one of the drawing factors. 66 Kallang Pudding, a high-tech industrial development, is in close proximity to Aljunied MRT and a 10-minute drive from the city.
Although Hor Kew intends to lease the 47,000 sq ft development, it is also open to selling its units. Estimated prices lie between $3.50 and $4 per square feet for rental and $550 to $600 per sq ft for sale. Construction is expected to start early next year.
Although not available on the market yet, both properties already have ‘a long list of potential buyers’, according to Mr Lau.
One Oxley Rise, Hor Kew’s other property development, has received 87 per cent of bookings, of which 81 per cent are secured sales. The average selling price now is $2,000 per sq ft, the company said.
Source: The Business Times, 27 June 2007
This is in addition to One Oxley Rise, which the company developed as well. Hor Kew, a building construction group which has been in the red in previous years, expressed optimism for its new developments.
‘These are turnkey projects for the company. In the past, we have mainly concentrated on construction projects. Now, Hor Kew will undergo a facelift and move on the next level of expanding our property development business,’ said group financial controller Lau Choon Hoong.
The company believes that it will be able to ride on the recent property boom and expects both new developments to do well. The increase in number of expatriates and immigrants, together with the recent integrated resort projects, will continue to sustain the property market for another two to three years, the company expects.
The development at 42 East Coast Road is a 17-storey freehold project situated next to Paramount Shopping Centre and Paramount Hotel, which was recently up for sale at around $200 million. With a total saleable area of 64,200 sq ft, it will comprise a mix of apartments, duplex units, penthouses and commercial units. Hor Kew estimates that units might sell at around $1,500 per sq ft. The property will be launched later this year or early next year.
Mr Lau cites the properties’ prime locations as one of the drawing factors. 66 Kallang Pudding, a high-tech industrial development, is in close proximity to Aljunied MRT and a 10-minute drive from the city.
Although Hor Kew intends to lease the 47,000 sq ft development, it is also open to selling its units. Estimated prices lie between $3.50 and $4 per square feet for rental and $550 to $600 per sq ft for sale. Construction is expected to start early next year.
Although not available on the market yet, both properties already have ‘a long list of potential buyers’, according to Mr Lau.
One Oxley Rise, Hor Kew’s other property development, has received 87 per cent of bookings, of which 81 per cent are secured sales. The average selling price now is $2,000 per sq ft, the company said.
Source: The Business Times, 27 June 2007
Office rents in Singapore will be higher than those in Hong Kong by the end of next year as supply here remains tight, a property firm said in a study
Office rents in Singapore will be higher than those in Hong Kong by the end of next year as supply here remains tight, a property firm said in a study released yesterday.
And industry sources said the overall rise in prime office rents may be serious enough for the government to see if it is worth moving some public organisations out of prime space in the Central Business District (CBD) so it can be freed for the private sector.
The move would also ease the upward pressure on rents and help Singapore stay competitive, the sources added.
Office rents in Singapore have been climbing at a fast clip and are set to overtake those in Hong Kong in about 18 months, according to property firm Savills.
Simon Smith, Savills’ senior director for regional research and consultancy, expects the average rent in Singapore’s ‘core’ areas - Raffles Place, City Hall, the Marina area, Shenton Way, Robinson Road, Tanjong Pagar and Orchard - to hit US$7.89 in the fourth quarter of 2008, up from US$5.10 in Q1 this year.
Average rents in Hong Kong’s core locations, on the other hand, are expected to drop from US$6.61 in Q1 2007 to US$6.15 in Q4 2008. Savills defines Hong Kong’s core areas as its CBD, Wan Chai and Causeway Bay and Tsim Sha Tsui.
Office rents in Singapore’s non-core locations are also expected to be higher than those in non-core areas of Hong Kong.
Mr Smith said the supply of office space in Singapore is expected to be tight until at least 2009, whereas in Hong Kong about 4 million sq ft of space will come on stream next year.
‘Singapore will not have any more major new Grade A office space this year,’ he said. ‘And all the activity driving up the demand for space - such as IPOs, M&A activities and private wealth management activities - are expected to continue growing.’
Demand for office space became more broad-based in the first half of 2007 after having been dominated by the financial and banking sector in the early part of the year, says property firm CB Richard Ellis (CBRE).
This has also put pressure on rents, it says. ‘Tenants from the shipping, energy, oil-trading, law and IT sectors have been taking up office space in the core CBD area of Raffles Place, Marina Bay and Marina Centre. There are precious few office options for large occupiers over the next couple of years.
Market watchers say having higher office rents than Hong Kong could dent Singapore’s competitiveness when it comes to drawing international firms, but point out that the overall cost of doing business here is still likely to be cheaper than in Hong Kong.
‘When you consider overall costs, such as residential and transportation, Singapore is still cheaper than Hong Kong,’ said Mr Smith.
The government is also aware of the space crunch and is doing its best to ease the problem. Besides seeing whether some operations can be moved out of the CBD, in May, the authorities called a halt to all conversion of offices in the central area to curb depletion of existing stock.
‘The government policy reaction is now in full swing and we expect will pay dividends in redressing the supply-demand imbalance in the medium to long-term,’ said Moray Armstrong, executive director for office services at CBRE.
Source: The Business Times, 27 June 2007
And industry sources said the overall rise in prime office rents may be serious enough for the government to see if it is worth moving some public organisations out of prime space in the Central Business District (CBD) so it can be freed for the private sector.
The move would also ease the upward pressure on rents and help Singapore stay competitive, the sources added.
Office rents in Singapore have been climbing at a fast clip and are set to overtake those in Hong Kong in about 18 months, according to property firm Savills.
Simon Smith, Savills’ senior director for regional research and consultancy, expects the average rent in Singapore’s ‘core’ areas - Raffles Place, City Hall, the Marina area, Shenton Way, Robinson Road, Tanjong Pagar and Orchard - to hit US$7.89 in the fourth quarter of 2008, up from US$5.10 in Q1 this year.
Average rents in Hong Kong’s core locations, on the other hand, are expected to drop from US$6.61 in Q1 2007 to US$6.15 in Q4 2008. Savills defines Hong Kong’s core areas as its CBD, Wan Chai and Causeway Bay and Tsim Sha Tsui.
Office rents in Singapore’s non-core locations are also expected to be higher than those in non-core areas of Hong Kong.
Mr Smith said the supply of office space in Singapore is expected to be tight until at least 2009, whereas in Hong Kong about 4 million sq ft of space will come on stream next year.
‘Singapore will not have any more major new Grade A office space this year,’ he said. ‘And all the activity driving up the demand for space - such as IPOs, M&A activities and private wealth management activities - are expected to continue growing.’
Demand for office space became more broad-based in the first half of 2007 after having been dominated by the financial and banking sector in the early part of the year, says property firm CB Richard Ellis (CBRE).
This has also put pressure on rents, it says. ‘Tenants from the shipping, energy, oil-trading, law and IT sectors have been taking up office space in the core CBD area of Raffles Place, Marina Bay and Marina Centre. There are precious few office options for large occupiers over the next couple of years.
Market watchers say having higher office rents than Hong Kong could dent Singapore’s competitiveness when it comes to drawing international firms, but point out that the overall cost of doing business here is still likely to be cheaper than in Hong Kong.
‘When you consider overall costs, such as residential and transportation, Singapore is still cheaper than Hong Kong,’ said Mr Smith.
The government is also aware of the space crunch and is doing its best to ease the problem. Besides seeing whether some operations can be moved out of the CBD, in May, the authorities called a halt to all conversion of offices in the central area to curb depletion of existing stock.
‘The government policy reaction is now in full swing and we expect will pay dividends in redressing the supply-demand imbalance in the medium to long-term,’ said Moray Armstrong, executive director for office services at CBRE.
Source: The Business Times, 27 June 2007
According to the Global Property Guide, Singapore experienced Asia’s highest residential property price increases last year
Ten years after the Asian financial crisis, Asia’s real estate markets are bubbling again, led by Singapore. Given the key role overheated property played in that crisis, it bears asking, to what extent the current exuberance is a cause for concern this time around.
According to the Global Property Guide, Singapore experienced Asia’s highest residential property price increases last year, with housing prices rising 9.5 per cent in real terms (although this masks higher percentage increases in prime market segments). Quite likely, it will be a similar story this year as well. Real estate markets in China, India, Korea and the Philippines have also witnessed sharp run ups - and in those countries too, prime segments have seen double digit price increases in percentage terms. Indeed, more and more real estate funds and other institutional investors are pouring money into Asian property. Some element of speculative activity is also evident.
How much should we worry about all this? In a study on Asia’s real estate markets in April, the IMF took a generally sanguine view - although with qualifications. It pointed out that while property prices have been rising more rapidly than inflation, most Asian countries ‘are not experiencing unusually rapid housing price hikes’. It noted that in many cases, the increases follow on the heels of extended declines (about eight years, in the case of Singapore). Moreover, housing prices have not risen exceptionally, compared with other asset prices. On average, housing price increases have run ahead of income gains in about half the 12 countries covered, but these average prices might mask affordability problems for some segments of the population.
Apart from income gains, there are other reasons for property price run-ups: the proliferation of mortgage products and a rise in mortgage credit - especially in China and India; higher non-speculative foreign demand for housing and commercial space (which is true in Singapore as well) as well as an element of speculative capital inflows - though less than in the 1990s.
Given that the run-up in real estate prices represents a rebound after several years of decline or stagnation, it does not, as yet, create cause for concern. The fact that institutional investors are far more active players in Asia’s (and particularly Singapore’s) property markets this time than they were in the 1990s is also reassuring. They introduce an element of stability and resilience because they have greater financial holding power than individuals, and are less likely to engage in panic selling.
However, all that said, policymakers and banking regulators across the region need to be vigilant to ensure that lending standards do not become overly relaxed and that housing lenders are adequately provisioned against what the IMF calls ‘a reasonable worst-case scenario of falling house prices’. The degree of household indebtedness - particularly in those segments of the population who are vulnerable to income shocks - is also an indicator that bears watching. But as of now, it is difficult to make the case that there are sufficient danger-signs to warrant government intervention in the market aimed at bringing property prices down.
Source: The Business Times, 27 June 2007
According to the Global Property Guide, Singapore experienced Asia’s highest residential property price increases last year, with housing prices rising 9.5 per cent in real terms (although this masks higher percentage increases in prime market segments). Quite likely, it will be a similar story this year as well. Real estate markets in China, India, Korea and the Philippines have also witnessed sharp run ups - and in those countries too, prime segments have seen double digit price increases in percentage terms. Indeed, more and more real estate funds and other institutional investors are pouring money into Asian property. Some element of speculative activity is also evident.
How much should we worry about all this? In a study on Asia’s real estate markets in April, the IMF took a generally sanguine view - although with qualifications. It pointed out that while property prices have been rising more rapidly than inflation, most Asian countries ‘are not experiencing unusually rapid housing price hikes’. It noted that in many cases, the increases follow on the heels of extended declines (about eight years, in the case of Singapore). Moreover, housing prices have not risen exceptionally, compared with other asset prices. On average, housing price increases have run ahead of income gains in about half the 12 countries covered, but these average prices might mask affordability problems for some segments of the population.
Apart from income gains, there are other reasons for property price run-ups: the proliferation of mortgage products and a rise in mortgage credit - especially in China and India; higher non-speculative foreign demand for housing and commercial space (which is true in Singapore as well) as well as an element of speculative capital inflows - though less than in the 1990s.
Given that the run-up in real estate prices represents a rebound after several years of decline or stagnation, it does not, as yet, create cause for concern. The fact that institutional investors are far more active players in Asia’s (and particularly Singapore’s) property markets this time than they were in the 1990s is also reassuring. They introduce an element of stability and resilience because they have greater financial holding power than individuals, and are less likely to engage in panic selling.
However, all that said, policymakers and banking regulators across the region need to be vigilant to ensure that lending standards do not become overly relaxed and that housing lenders are adequately provisioned against what the IMF calls ‘a reasonable worst-case scenario of falling house prices’. The degree of household indebtedness - particularly in those segments of the population who are vulnerable to income shocks - is also an indicator that bears watching. But as of now, it is difficult to make the case that there are sufficient danger-signs to warrant government intervention in the market aimed at bringing property prices down.
Source: The Business Times, 27 June 2007
Watten Estate Condominium at Shelford Road off Dunearn Rd has been put up for collective sale through an expression of interest exercise.
Watten Estate Condominium at Shelford Road off Dunearn Rd has been put up for collective sale through an expression of interest exercise.
So far, owners with more than 70 per cent of share values, but short of the minimum 80 per cent required, have signed the collective sale agreement, at a price believed to be around $400 million. This works out to $1,297 per square foot of potential gross floor area inclusive of development charges.
The 220,241 sq ft freehold site is zoned for residential use with a 1.4 plot ratio (ratio of maximum potential gross floor area to land area) and a five-storey maximum height. No development charge is payable, according to DTZ Debenham Tie Leung, which is marketing Watten Estate Condo. The site can be redeveloped into a new condo with about 200 units averaging 1,500 sq ft, market watchers reckon.
Currently, Watten Estate Condo has a total of 104 units comprising a block of apartments and four blocks of townhouses. Property tycoon Ng Teng Fong, who controls Far East Organization, is believed to own two units in the development. The expression of interest for Watten Estate Condo closes on July 20.
The property is near Raffles Girls’ Primary School, Nanyang Primary School, Hwa Chong Institution and National Junior College. The Botanic Gardens is a short drive away.
Lippo Realty recently paid $1,280 psf per plot ratio for Aura Park at Holland Road, which is also near Botanic Gardens.
Source: The Business Times, 27 June 2007
So far, owners with more than 70 per cent of share values, but short of the minimum 80 per cent required, have signed the collective sale agreement, at a price believed to be around $400 million. This works out to $1,297 per square foot of potential gross floor area inclusive of development charges.
The 220,241 sq ft freehold site is zoned for residential use with a 1.4 plot ratio (ratio of maximum potential gross floor area to land area) and a five-storey maximum height. No development charge is payable, according to DTZ Debenham Tie Leung, which is marketing Watten Estate Condo. The site can be redeveloped into a new condo with about 200 units averaging 1,500 sq ft, market watchers reckon.
Currently, Watten Estate Condo has a total of 104 units comprising a block of apartments and four blocks of townhouses. Property tycoon Ng Teng Fong, who controls Far East Organization, is believed to own two units in the development. The expression of interest for Watten Estate Condo closes on July 20.
The property is near Raffles Girls’ Primary School, Nanyang Primary School, Hwa Chong Institution and National Junior College. The Botanic Gardens is a short drive away.
Lippo Realty recently paid $1,280 psf per plot ratio for Aura Park at Holland Road, which is also near Botanic Gardens.
Source: The Business Times, 27 June 2007
Simon Cheong yesterday bought a freehold bungalow at Garlick Avenue for $7 million at auction
SC Global Developments boss Simon Cheong yesterday bought a freehold bungalow at Garlick Avenue for $7 million at auction, BT understands.
The price for 70 Garlick Avenue works out to $769 psf, based on the 9,100 sq ft of land. Bidding opened at $6.8 million and the property drew three would-be buyers.
The property is within an area zoned for Good Class Bungalow (GCB) use although its plot size is significantly shy of the minimum 1,400 sq metres (about 15,069 sq ft) required for a GCB.
There is a renovated, single-storey detached house in fairly good condition on the site, which was put up for auction by its mortgagee bank. The auction was conducted at Amara Hotel yesterday by DTZ Debenham Tie Leung.
Three other properties also changed hands at the auction. One was a three-bedroom apartment on the sixth storey of the freehold Avalon development at Anderson Road, which was sold by its owner for $2.7 million or $1,707 psf based on its strata area of 1,582 sq ft. A freehold maisonette at 104A Owen Road, near Farrer Park MRT Station, sold for $811,000 or $457 psf based on its strata area of 1,776 sq ft.
A single-storey, freehold terrace house at 27 Casuarina Road off Upper Thomson Road fetched $700,000 or $467 psf based on its land area of 1,500 sq ft. The Owen Road and Casuarina Road properties were mortgagee sales.
A three-bedroom apartment at the freehold Eunos Mansion at Jalan Eunos which had been put up for auction by its mortgagee bank was withdrawn from sale yesterday morning on speculation that a collective sale could be in the works at the estate, which could result in the unit fetching a higher price, BT understands.
Source: The Business Times, 27 June 2007
The price for 70 Garlick Avenue works out to $769 psf, based on the 9,100 sq ft of land. Bidding opened at $6.8 million and the property drew three would-be buyers.
The property is within an area zoned for Good Class Bungalow (GCB) use although its plot size is significantly shy of the minimum 1,400 sq metres (about 15,069 sq ft) required for a GCB.
There is a renovated, single-storey detached house in fairly good condition on the site, which was put up for auction by its mortgagee bank. The auction was conducted at Amara Hotel yesterday by DTZ Debenham Tie Leung.
Three other properties also changed hands at the auction. One was a three-bedroom apartment on the sixth storey of the freehold Avalon development at Anderson Road, which was sold by its owner for $2.7 million or $1,707 psf based on its strata area of 1,582 sq ft. A freehold maisonette at 104A Owen Road, near Farrer Park MRT Station, sold for $811,000 or $457 psf based on its strata area of 1,776 sq ft.
A single-storey, freehold terrace house at 27 Casuarina Road off Upper Thomson Road fetched $700,000 or $467 psf based on its land area of 1,500 sq ft. The Owen Road and Casuarina Road properties were mortgagee sales.
A three-bedroom apartment at the freehold Eunos Mansion at Jalan Eunos which had been put up for auction by its mortgagee bank was withdrawn from sale yesterday morning on speculation that a collective sale could be in the works at the estate, which could result in the unit fetching a higher price, BT understands.
Source: The Business Times, 27 June 2007
A Hong Kong company has won a case against the Comptroller of Income Tax who slapped it with a $3.3 million-plus tax bill after it sold 17 units
A Hong Kong company has won a case against the Comptroller of Income Tax who slapped it with a $3.3 million-plus tax bill after it sold 17 units in upscale Leedon Road.
The tax department said the sale by Madison Lighters & Watches Company, a wholly-owned subsidiary of Hong Kong property developer Far East Consortium International, was in the ordinary course of business and the profit was taxable.
But the company’s lawyer Edwin Lee, of Rajah & Tann, argued that the property was an investment and the gains were therefore capital in nature and non-taxable.
Madison appealed against the Inland Revenue Authority of Singapore’s (IRAS) ruling.
And the Income Tax Board of Review, chaired by former High Court Judge Goh Joon Seng, ruled in favour of the company.
Madison bought 17 of the 18 units at Leedon Court in September 1987 for a total of $10.77 million. Being a foreign entity, it could not buy the whole block, so the remaining unit was bought by a related company, Hepworth Investment.
All the units were sold en bloc to unrelated Glory Development on Nov 25, 1993 for $24 million, with Madison getting $22.67 million. IRAS served the company with a demand for $3.34 million tax in June 1995, being 27 per cent of its profit of $12.38 million for Year of Assessment 1995.
Madison’s auditors lodged an objection on July 4, 1995 saying the gains were capital in nature and therefore not taxable.
They also said that loan interest incurred in buying the property ought to have been tax deductible against rental income, and that with the exception of one item, IRAS had failed to convert the figures from Hong Kong dollars into Singapore dollars.
The review board, in finding in favour of Madison, notes that the company had consistently classified the property as an investment and ‘fixed assets’.
It also notes that the property was held for six years and was sold collectively in one lot to an unrelated buyer who made an unsolicited offer, that Madison was in a position to hold the property for the long-term and that it ‘was actually in a tax-paying position for most of the years during which it held the property’.
The board said: ‘We therefore find that it was the intention of the appellant (Madison) to acquire the property for long-term investment and for resale at a profit.’
It allowed the expenses to be deductible with the tax to be discharged on account of the bank loan interest agreed at $87,635.52.
The board also said IRAS wrongly used Hong Kong dollars in its computation of chargeable income and the tax to be returned as a result of this error was agreed at $265,009.59.
Source: The Business Times, 27 June 2007
The tax department said the sale by Madison Lighters & Watches Company, a wholly-owned subsidiary of Hong Kong property developer Far East Consortium International, was in the ordinary course of business and the profit was taxable.
But the company’s lawyer Edwin Lee, of Rajah & Tann, argued that the property was an investment and the gains were therefore capital in nature and non-taxable.
Madison appealed against the Inland Revenue Authority of Singapore’s (IRAS) ruling.
And the Income Tax Board of Review, chaired by former High Court Judge Goh Joon Seng, ruled in favour of the company.
Madison bought 17 of the 18 units at Leedon Court in September 1987 for a total of $10.77 million. Being a foreign entity, it could not buy the whole block, so the remaining unit was bought by a related company, Hepworth Investment.
All the units were sold en bloc to unrelated Glory Development on Nov 25, 1993 for $24 million, with Madison getting $22.67 million. IRAS served the company with a demand for $3.34 million tax in June 1995, being 27 per cent of its profit of $12.38 million for Year of Assessment 1995.
Madison’s auditors lodged an objection on July 4, 1995 saying the gains were capital in nature and therefore not taxable.
They also said that loan interest incurred in buying the property ought to have been tax deductible against rental income, and that with the exception of one item, IRAS had failed to convert the figures from Hong Kong dollars into Singapore dollars.
The review board, in finding in favour of Madison, notes that the company had consistently classified the property as an investment and ‘fixed assets’.
It also notes that the property was held for six years and was sold collectively in one lot to an unrelated buyer who made an unsolicited offer, that Madison was in a position to hold the property for the long-term and that it ‘was actually in a tax-paying position for most of the years during which it held the property’.
The board said: ‘We therefore find that it was the intention of the appellant (Madison) to acquire the property for long-term investment and for resale at a profit.’
It allowed the expenses to be deductible with the tax to be discharged on account of the bank loan interest agreed at $87,635.52.
The board also said IRAS wrongly used Hong Kong dollars in its computation of chargeable income and the tax to be returned as a result of this error was agreed at $265,009.59.
Source: The Business Times, 27 June 2007
DBS Bank has become the first bank in Singapore to adopt full transparency in home loans by pegging all its packages to a public benchmark rate.
DBS Bank has become the first bank in Singapore to adopt full transparency in home loans by pegging all its packages to a public benchmark rate.
The move - described by DBS as ‘creating a new playing field’ - means it will use just one single variable rate in its new mortgage packages which will be pegged to the 12-month Singapore Interbank Offered Rate (Sibor).
Sibor is the rate at which banks lend to each other and because it is publicly disclosed, customers can get a clear indication of how their mortgage rate is calculated.
But it may not mean cheaper loans as Sibor reflects market forces, so customers may in fact be paying more than existing rates at certain times. But if Sibor falls, DBS customers could benefit more as other banks may be slower in lowering rates in tandem with market rate movements.
DBS’ move kicked in on June 15, the same day new industry guidelines took effect to give customers more clarity on how their mortgage rate changes over time.
DBS said its new policy is designed to ‘give customers more certainty about how their rates are determined’.
Its new floating rate loans will now be pegged to the 12- month Sibor - which is now at about 2.56 per cent plus a mark-up of 1.25 per cent added by DBS. This gives a floating rate of 3.81 per cent.
In contrast, OCBC Bank’s floating rate package is 3.25 per cent in the first year but hits 4 per cent in the third.
The 12-month Sibor for new packages is revised monthly depending on interest rate movements while DBS can alter the premium component as it wishes.
‘This is what customers have been asking for…we are now taking the lead to set a new standard for more benchmarked board rates,’ said DBS’ head of home loans, Mr Koh Kar Siong.
New customers will also avoid volatility as the 12- month Sibor for their particular package is adjusted annually in line with market forces, while the premium part is fixed for the loan duration.
DBS will also continue to offer its POSB Home Ideal package pegged to the Central Provident Fund rate, which is highly stable.
Consumer Association of Singapore executive director Seah Seng Choon praised DBS’ move: ‘We believe consumers will benefit as the interest rates are better understood. We expect the other banks to announce their own formula so that overall transparency will be enhanced.
But other banks are not following suit just yet. OCBC said the needs of customers ‘have become increasingly diverse’ so it is keeping its suite of fixed and variable rate packages and loans pegged to the Swap Offer Rates. These comprise the Sibor plus a bank’s lending costs.
‘On occasion, our loan packages may come with promotional interest rates that will be lower than our regular board rates,’ said Mr Gregory Chan, OCBC’s head of consumer secured lending.
Mr Kevin Lam, head of United Overseas Bank’s loans division, said the bank reviews its packages to ensure they are competitive.
Banking analysts noted that DBS had undertaken ‘a bold move’ as the effective rates of its new packages could in fact be higher than those of its rivals that have not pegged their rates to the Sibor. They may even be higher than DBS’ previous rates.
But Mr Koh said there cannot be ‘a direct apples-to-apples comparison’ between DBS’ Sibor-linked rates and other banks’ rates. ‘You would just be comparing DBS’ clear box to other banks’ black box.’
One analyst noted that DBS may have to offset a ‘marginal loss of market share with the higher spreads it can earn from charging a premium on the Sibor’.
Source: The Straits Times, 27 June 2007
The move - described by DBS as ‘creating a new playing field’ - means it will use just one single variable rate in its new mortgage packages which will be pegged to the 12-month Singapore Interbank Offered Rate (Sibor).
Sibor is the rate at which banks lend to each other and because it is publicly disclosed, customers can get a clear indication of how their mortgage rate is calculated.
But it may not mean cheaper loans as Sibor reflects market forces, so customers may in fact be paying more than existing rates at certain times. But if Sibor falls, DBS customers could benefit more as other banks may be slower in lowering rates in tandem with market rate movements.
DBS’ move kicked in on June 15, the same day new industry guidelines took effect to give customers more clarity on how their mortgage rate changes over time.
DBS said its new policy is designed to ‘give customers more certainty about how their rates are determined’.
Its new floating rate loans will now be pegged to the 12- month Sibor - which is now at about 2.56 per cent plus a mark-up of 1.25 per cent added by DBS. This gives a floating rate of 3.81 per cent.
In contrast, OCBC Bank’s floating rate package is 3.25 per cent in the first year but hits 4 per cent in the third.
The 12-month Sibor for new packages is revised monthly depending on interest rate movements while DBS can alter the premium component as it wishes.
‘This is what customers have been asking for…we are now taking the lead to set a new standard for more benchmarked board rates,’ said DBS’ head of home loans, Mr Koh Kar Siong.
New customers will also avoid volatility as the 12- month Sibor for their particular package is adjusted annually in line with market forces, while the premium part is fixed for the loan duration.
DBS will also continue to offer its POSB Home Ideal package pegged to the Central Provident Fund rate, which is highly stable.
Consumer Association of Singapore executive director Seah Seng Choon praised DBS’ move: ‘We believe consumers will benefit as the interest rates are better understood. We expect the other banks to announce their own formula so that overall transparency will be enhanced.
But other banks are not following suit just yet. OCBC said the needs of customers ‘have become increasingly diverse’ so it is keeping its suite of fixed and variable rate packages and loans pegged to the Swap Offer Rates. These comprise the Sibor plus a bank’s lending costs.
‘On occasion, our loan packages may come with promotional interest rates that will be lower than our regular board rates,’ said Mr Gregory Chan, OCBC’s head of consumer secured lending.
Mr Kevin Lam, head of United Overseas Bank’s loans division, said the bank reviews its packages to ensure they are competitive.
Banking analysts noted that DBS had undertaken ‘a bold move’ as the effective rates of its new packages could in fact be higher than those of its rivals that have not pegged their rates to the Sibor. They may even be higher than DBS’ previous rates.
But Mr Koh said there cannot be ‘a direct apples-to-apples comparison’ between DBS’ Sibor-linked rates and other banks’ rates. ‘You would just be comparing DBS’ clear box to other banks’ black box.’
One analyst noted that DBS may have to offset a ‘marginal loss of market share with the higher spreads it can earn from charging a premium on the Sibor’.
Source: The Straits Times, 27 June 2007
The Char Yong (Dabu) Association will pocket a cool $128 million from the sale of the 93,300 sq ft Char Yong Gardens condominium in the Cairnhill area
While the recent en-bloc property boom is making a million or two each for home owners, one of Singapore’s major Hakka clan associations has really hit the jackpot.
The Char Yong (Dabu) Association will pocket a cool $128 million from the sale of the 93,300 sq ft Char Yong Gardens condominium in the Cairnhill area.
The association - which owned 36 of the 106 units in the condominium sold to CapitaLand recently for $420 million - is now looking at how to best use the windfall.
Discussions have started on enriching clan activities, developing its youth wing, providing better care for old or needy members, as well as expanding its charity work.
The need for these talks nearly did not arise as some clan members had opposed the sale, despite the support of the 41-strong management council, said association president Lang Chin Ngau, 59.
If the dissenters had prevailed, the sale would have failed as the clan’s 36 units gave it more than the 20 per cent of votes needed to scrap the deal.
The opponents had noted that the flats sat on ancestral land and wanted it to stay that way. They also said a tree planted on the grounds in 1963 by Mr Lee Kuan Yew, now the Minister Mentor, should not be disturbed.
The issue was put to a vote in a special general meeting on Aug 27 last year. Of the 209 members who showed up, 168 voted for the sale and 23 opposed it. The other votes were declared void.
The Char Yong (Dabu) Association, founded in 1857, now has more than 2,000 members.
It bought the land in 1947 to house its office and the Khee Fatt School founded in 1906. But pupil numbers kept dropping and the school was handed over to the Ministry of Education in 1985.
The same year, the clan struck a deal with DBS Land and Char Yong Gardens was built in 1991. The clan’s 36 units were managed by The Ascott Group as service apartments, earning $4,000 a month each in 1995 - but rents slid to $1,500 in 2005.
Talks to sell the property began the next year.
Although the deal has now been sealed, the clan’s link to the land will not be completely lost
Said Mr Lang: ‘CapitaLand will give us priority to buy a few units in the development before it is open to the public.’
The tree planted by MM Lee will stay at the site or be relocated.
The focus now is on how to best use the $128 million, which the clan will get in 11/2 years’ time.
Its constitution dictates that one-third will go to the association for its operations, activities and charity work. The rest will go to the Char Yong (Dabu) Foundation for educational and cultural work.
Every year, the association hands out $250,000 in scholarships to pupils from Qifa Primary and Da Qiao Primary schools, and to members’ children. It also donates to charitable and cultural groups.
It recently gave $300,000 to the Confucius Institute Fund, making it the largest donor to the fund set up this year to establish a World Chinese Literature Award, and to fund the institute’s research projects and other events.
Mr Lang said plans to use and invest the money from the sale will be discussed thoroughly at management council and general meetings.
The association has three other properties which it rents out.
Source: The Straits Times, 27 June 2007
The Char Yong (Dabu) Association will pocket a cool $128 million from the sale of the 93,300 sq ft Char Yong Gardens condominium in the Cairnhill area.
The association - which owned 36 of the 106 units in the condominium sold to CapitaLand recently for $420 million - is now looking at how to best use the windfall.
Discussions have started on enriching clan activities, developing its youth wing, providing better care for old or needy members, as well as expanding its charity work.
The need for these talks nearly did not arise as some clan members had opposed the sale, despite the support of the 41-strong management council, said association president Lang Chin Ngau, 59.
If the dissenters had prevailed, the sale would have failed as the clan’s 36 units gave it more than the 20 per cent of votes needed to scrap the deal.
The opponents had noted that the flats sat on ancestral land and wanted it to stay that way. They also said a tree planted on the grounds in 1963 by Mr Lee Kuan Yew, now the Minister Mentor, should not be disturbed.
The issue was put to a vote in a special general meeting on Aug 27 last year. Of the 209 members who showed up, 168 voted for the sale and 23 opposed it. The other votes were declared void.
The Char Yong (Dabu) Association, founded in 1857, now has more than 2,000 members.
It bought the land in 1947 to house its office and the Khee Fatt School founded in 1906. But pupil numbers kept dropping and the school was handed over to the Ministry of Education in 1985.
The same year, the clan struck a deal with DBS Land and Char Yong Gardens was built in 1991. The clan’s 36 units were managed by The Ascott Group as service apartments, earning $4,000 a month each in 1995 - but rents slid to $1,500 in 2005.
Talks to sell the property began the next year.
Although the deal has now been sealed, the clan’s link to the land will not be completely lost
Said Mr Lang: ‘CapitaLand will give us priority to buy a few units in the development before it is open to the public.’
The tree planted by MM Lee will stay at the site or be relocated.
The focus now is on how to best use the $128 million, which the clan will get in 11/2 years’ time.
Its constitution dictates that one-third will go to the association for its operations, activities and charity work. The rest will go to the Char Yong (Dabu) Foundation for educational and cultural work.
Every year, the association hands out $250,000 in scholarships to pupils from Qifa Primary and Da Qiao Primary schools, and to members’ children. It also donates to charitable and cultural groups.
It recently gave $300,000 to the Confucius Institute Fund, making it the largest donor to the fund set up this year to establish a World Chinese Literature Award, and to fund the institute’s research projects and other events.
Mr Lang said plans to use and invest the money from the sale will be discussed thoroughly at management council and general meetings.
The association has three other properties which it rents out.
Source: The Straits Times, 27 June 2007
Singapore’s increasing popularity with foreigners could signal that it is time to relax restrictions on overseas ownership of landed properties
Singapore’s increasing popularity with foreigners could signal that it is time to relax restrictions on overseas ownership of landed properties, according to a Goldman Sachs report.
The giant investment bank said in a research note that if curbs are relaxed across the board, it could spur further foreign buying of private properties.
It could also boost the residential property market by having ‘positive spillover from rising landed property prices to condominiums and apartments’.
The United States bank said the average price of a top-end bungalow is 35 per cent lower than that of a comparable condominium, which sells for about $26.3 million.
‘We think this price gap can narrow to parity or very close to it should the restrictions on foreign ownership of landed properties be relaxed,’ it said.
Under the Residential Property Act, foreigners and permanent residents are forbidden from buying landed property without government approval.
And a foreigner who does win approval can own only one landed property at a time and they must occupy the home, not rent it out.
If the rules are relaxed, developers with land banks for landed projects would benefit, the bank said.
Meanwhile, all residential developers could also ‘gain from even greater foreign buying interest given the positive message such a move would send’.
A land bank is a stock of land with planning permission already granted but where development has yet to occur.
Goldman reasoned that removing such curbs would not hurt the national objective ‘of giving Singaporeans a stake in the country by being able to buy and own residential properties at affordable prices’.
It said the possibility that the Government would loosen its reins on the land restrictions is higher now.
Goldman cited its discussions with developers which have affirmed its view of foreign interest in landed property.
The bank also referred to a change in the tone of government policy which has become firmly pro-immigration, it said.
‘We think relaxing restrictions on foreigners buying landed property would accelerate Singapore’s efforts to attract foreign talent,’ Goldman said, though it acknowledged that for now, there is ‘no certainty of any policy change’.
Goldman has estimated that about 2,800 landed homes with written permission for development will be let out into the market over the next few years.
Source: The Straits Times, 27 June 2007
The giant investment bank said in a research note that if curbs are relaxed across the board, it could spur further foreign buying of private properties.
It could also boost the residential property market by having ‘positive spillover from rising landed property prices to condominiums and apartments’.
The United States bank said the average price of a top-end bungalow is 35 per cent lower than that of a comparable condominium, which sells for about $26.3 million.
‘We think this price gap can narrow to parity or very close to it should the restrictions on foreign ownership of landed properties be relaxed,’ it said.
Under the Residential Property Act, foreigners and permanent residents are forbidden from buying landed property without government approval.
And a foreigner who does win approval can own only one landed property at a time and they must occupy the home, not rent it out.
If the rules are relaxed, developers with land banks for landed projects would benefit, the bank said.
Meanwhile, all residential developers could also ‘gain from even greater foreign buying interest given the positive message such a move would send’.
A land bank is a stock of land with planning permission already granted but where development has yet to occur.
Goldman reasoned that removing such curbs would not hurt the national objective ‘of giving Singaporeans a stake in the country by being able to buy and own residential properties at affordable prices’.
It said the possibility that the Government would loosen its reins on the land restrictions is higher now.
Goldman cited its discussions with developers which have affirmed its view of foreign interest in landed property.
The bank also referred to a change in the tone of government policy which has become firmly pro-immigration, it said.
‘We think relaxing restrictions on foreigners buying landed property would accelerate Singapore’s efforts to attract foreign talent,’ Goldman said, though it acknowledged that for now, there is ‘no certainty of any policy change’.
Goldman has estimated that about 2,800 landed homes with written permission for development will be let out into the market over the next few years.
Source: The Straits Times, 27 June 2007
She will make close to $1 million if she sells her condominium apartment.
She will make close to $1 million if she sells her condominium apartment.
But an expatriate decided to reject the collective sale offer because she likes where she is living.
She even started a ‘Say No to En Bloc’ petition to get residents to speak up against the sale.
Unknown to her, another group of residents has also organised a petition against the sale.
And surprisingly, they are tenants who have no investment interest in their homes.
Some of these residents at the Dairy Farm Estate do not want to leave because they are in love with its lush, tranquil setting and the peaceful neighbourhood.
The 478-unit, 24-year-old freehold condo near Upper Bukit Timah Road is close to Bukit Timah Nature Reserve.
British expatriate Andrea Woolhead couldn’t believe it last month when she was offered a million more than she had paid for her flat.
The offer is about $1.8 million for her 2,200 sq ft unit if the sale goes through.
Ms Woolhead, a teacher in an international school here, paid about $840,000 for it in 2005.
It is not often that someone passes up a chance to be an instant millionaire.
The 49-year-old could have returned to the UK and retired on her million-dollar windfall.
But she turned the offerdown.
Harninious Living
She said: ‘I know I could be an instant millionaire, but in so many countries I’ve been to, this estate is probably one of the most unique, with such a wide variety of nationalities living in harmony close to each other.’
‘I could have taken the money, left the country and make good with the profit. But I didn’t because I like this estate.’
She may be making a wise choice.
Some homeowners who took the enbloc route are now finding it hard to get a replacement home because prices have soared beyond their reach.
Ms Woolhead’s anti-en-bloc-sale petition has garnered 91 signatures and needs at least 10 more to make up more than 20 per cent of the residents, she said.
On the other side is homeowner C S Lim, who is on the sales committee tasked with convincing residents to sign for the sale.
The committee has about 10 per cent of ‘yes’ votes from residents.
Under the legislation, an en bloc sale can proceed only if 80 per cent of the owners approve of it.
Ms Woolhead, who lives in the condo with her three children and her husband, a junior college teacher, said: ‘We started the petition because there are residents who are not doing anything even though they don’t want the collective sale to happen.
‘A group of us decided to start the ball rolling and it just snowballed from there.’
Residents can also sign the petition online.
The other petition to save the condo is being led by US expatriate Jean Rueckert, who said they have about 10 signatures so far.
The 39-year-old teacher said: ‘We were not aware of the other petition.
‘We just wanted residents here to share their perspective that this is a unique property that should be preserved as a heritage site because of the beautiful physical surroundings.’
Ms Rueckert, who came to Singapore eight years ago, has lived in the condo for six years.
Her group, like the other residents opposing the sale, wants to save the estate because of its greenery, spacious surroundings and location next to the nature reserve.
More Vocal Minority
The anti-en-bloc-sale community has become more vocal and active of late, said Mr Nicholas Mak, Knight Frank’s head of consultancy and research.
For example, in Ulu Pandan, a group that calls itself Save The Pine Grove is still trying to stop the enbloc process for that estate even though a first attempt at an enbloc sale fell through earlier this year.
Mr Mak added: ‘There have been many recent reports about people who are unhappy with enbloc sales for various reasons.
‘The tyranny of the majority to sell may have led more people to voice their unhappiness,’ he said.
But for Dairy Farm Estate, it’s still too early to rule out the possibility of a collective sale.
When there was talk about Farrer Court going en bloc in March, the dissenters there were out in full force.
But there’s a saying that there’s no property that can’t be sold - it’s just a matter of price.
The estate was subsequently put up for sale with a record-breaking reserve price tag of $1.5billion. More than 80 per cent of owners signed the collective sale agreement last month.
Ms Woolhead concedes that it’s a long road ahead for Dairy Farm.
She said: ‘It’s still a big question mark if we can stop the sale. Of the 91 who signed, some will not sell at any cost, (but) there are those who are just sitting on the fence.
‘I’m sure that when there’s a meeting of minds between the developer and residents’ asking price, more people will sign (for the sale) due to the dollar sign.’
Mr Lim, who spearheaded the sale action, said that there was no better time to sell the estate than now, when the enbloc fever ishot.
He said: ‘The economics of it looks better in today’s market. We could encash the property and unlock the value with the enbloc sale.
‘But ultimately, it’s up to the residents. If there’s poor response, then so be it. It’s the wish of the residents here.’
Source: The New Paper, 26 June 2007
But an expatriate decided to reject the collective sale offer because she likes where she is living.
She even started a ‘Say No to En Bloc’ petition to get residents to speak up against the sale.
Unknown to her, another group of residents has also organised a petition against the sale.
And surprisingly, they are tenants who have no investment interest in their homes.
Some of these residents at the Dairy Farm Estate do not want to leave because they are in love with its lush, tranquil setting and the peaceful neighbourhood.
The 478-unit, 24-year-old freehold condo near Upper Bukit Timah Road is close to Bukit Timah Nature Reserve.
British expatriate Andrea Woolhead couldn’t believe it last month when she was offered a million more than she had paid for her flat.
The offer is about $1.8 million for her 2,200 sq ft unit if the sale goes through.
Ms Woolhead, a teacher in an international school here, paid about $840,000 for it in 2005.
It is not often that someone passes up a chance to be an instant millionaire.
The 49-year-old could have returned to the UK and retired on her million-dollar windfall.
But she turned the offerdown.
Harninious Living
She said: ‘I know I could be an instant millionaire, but in so many countries I’ve been to, this estate is probably one of the most unique, with such a wide variety of nationalities living in harmony close to each other.’
‘I could have taken the money, left the country and make good with the profit. But I didn’t because I like this estate.’
She may be making a wise choice.
Some homeowners who took the enbloc route are now finding it hard to get a replacement home because prices have soared beyond their reach.
Ms Woolhead’s anti-en-bloc-sale petition has garnered 91 signatures and needs at least 10 more to make up more than 20 per cent of the residents, she said.
On the other side is homeowner C S Lim, who is on the sales committee tasked with convincing residents to sign for the sale.
The committee has about 10 per cent of ‘yes’ votes from residents.
Under the legislation, an en bloc sale can proceed only if 80 per cent of the owners approve of it.
Ms Woolhead, who lives in the condo with her three children and her husband, a junior college teacher, said: ‘We started the petition because there are residents who are not doing anything even though they don’t want the collective sale to happen.
‘A group of us decided to start the ball rolling and it just snowballed from there.’
Residents can also sign the petition online.
The other petition to save the condo is being led by US expatriate Jean Rueckert, who said they have about 10 signatures so far.
The 39-year-old teacher said: ‘We were not aware of the other petition.
‘We just wanted residents here to share their perspective that this is a unique property that should be preserved as a heritage site because of the beautiful physical surroundings.’
Ms Rueckert, who came to Singapore eight years ago, has lived in the condo for six years.
Her group, like the other residents opposing the sale, wants to save the estate because of its greenery, spacious surroundings and location next to the nature reserve.
More Vocal Minority
The anti-en-bloc-sale community has become more vocal and active of late, said Mr Nicholas Mak, Knight Frank’s head of consultancy and research.
For example, in Ulu Pandan, a group that calls itself Save The Pine Grove is still trying to stop the enbloc process for that estate even though a first attempt at an enbloc sale fell through earlier this year.
Mr Mak added: ‘There have been many recent reports about people who are unhappy with enbloc sales for various reasons.
‘The tyranny of the majority to sell may have led more people to voice their unhappiness,’ he said.
But for Dairy Farm Estate, it’s still too early to rule out the possibility of a collective sale.
When there was talk about Farrer Court going en bloc in March, the dissenters there were out in full force.
But there’s a saying that there’s no property that can’t be sold - it’s just a matter of price.
The estate was subsequently put up for sale with a record-breaking reserve price tag of $1.5billion. More than 80 per cent of owners signed the collective sale agreement last month.
Ms Woolhead concedes that it’s a long road ahead for Dairy Farm.
She said: ‘It’s still a big question mark if we can stop the sale. Of the 91 who signed, some will not sell at any cost, (but) there are those who are just sitting on the fence.
‘I’m sure that when there’s a meeting of minds between the developer and residents’ asking price, more people will sign (for the sale) due to the dollar sign.’
Mr Lim, who spearheaded the sale action, said that there was no better time to sell the estate than now, when the enbloc fever ishot.
He said: ‘The economics of it looks better in today’s market. We could encash the property and unlock the value with the enbloc sale.
‘But ultimately, it’s up to the residents. If there’s poor response, then so be it. It’s the wish of the residents here.’
Source: The New Paper, 26 June 2007
HSBC Holdings, the world’s fourth-biggest bank, said yesterday it will occupy 53,000 square metres of new office space in Shanghai
HSBC Holdings, the world’s fourth-biggest bank, said yesterday it will occupy 53,000 square metres of new office space in Shanghai’s financial district for its China headquarters.
The bank will take 20 floors at the Shanghai IFC complex, which is due to be completed by 2010, from Hong Kong’s Sun Hung Kai Properties, the two companies said in a joint statement.
The statement did not disclose details of the proposed transaction.HSBC said the new office space would support its expansion across China. The bank launched its domestically incorporated Chinese unit in April, allowing it to conduct full-fledged local-currency business.
HSBC Group chairman Steven Green said at a groundbreaking ceremony for the IFC project that the bank expected to grow significantly in China. He did not say whether HSBC would buy or rent the IFC office space.
The bank had not yet made a decision on what to do with its existing Shanghai office building, also in the Pudong financial district, he told reporters.
One of the two towers of the 400,000-sq-metre Shanghai IFC complex, which will also include two hotels and a shopping mall, will be named the HSBC Building, the statement said.
Sun Hung Kai executives said they were optimistic about Shanghai’s office property market and expected to lease out the entire project before its completion.
Jones Lang LaSalle, a global real estate consultant, said in a recent report that office rents in Shanghai would spiral higher this year partly because of limited new supply.
Grade A office rents increased 23 per cent year-on-year to US$1.06 per sq m/day in 2006 in Pudong.But with several large, new, top-grade office buildings scheduled to be completed in the next few years, office rents are likely to trend lower, Jones Lang Lasalle said, adding that rising office property prices had pushed down investment yields to an average of 7 to 8 per cent.
Beijing’s moves to cool the property market have not dampened investor sentiment in Shanghai in the first quarter, real estate consultant CB Richard Ellis Group said in a recent report, as overseas investors, including Morgan Stanley, made more acquisitions.
Source: The Business Times, 26 June 2007
The bank will take 20 floors at the Shanghai IFC complex, which is due to be completed by 2010, from Hong Kong’s Sun Hung Kai Properties, the two companies said in a joint statement.
The statement did not disclose details of the proposed transaction.HSBC said the new office space would support its expansion across China. The bank launched its domestically incorporated Chinese unit in April, allowing it to conduct full-fledged local-currency business.
HSBC Group chairman Steven Green said at a groundbreaking ceremony for the IFC project that the bank expected to grow significantly in China. He did not say whether HSBC would buy or rent the IFC office space.
The bank had not yet made a decision on what to do with its existing Shanghai office building, also in the Pudong financial district, he told reporters.
One of the two towers of the 400,000-sq-metre Shanghai IFC complex, which will also include two hotels and a shopping mall, will be named the HSBC Building, the statement said.
Sun Hung Kai executives said they were optimistic about Shanghai’s office property market and expected to lease out the entire project before its completion.
Jones Lang LaSalle, a global real estate consultant, said in a recent report that office rents in Shanghai would spiral higher this year partly because of limited new supply.
Grade A office rents increased 23 per cent year-on-year to US$1.06 per sq m/day in 2006 in Pudong.But with several large, new, top-grade office buildings scheduled to be completed in the next few years, office rents are likely to trend lower, Jones Lang Lasalle said, adding that rising office property prices had pushed down investment yields to an average of 7 to 8 per cent.
Beijing’s moves to cool the property market have not dampened investor sentiment in Shanghai in the first quarter, real estate consultant CB Richard Ellis Group said in a recent report, as overseas investors, including Morgan Stanley, made more acquisitions.
Source: The Business Times, 26 June 2007
Australian real estate manager MacarthurCook Ltd said yesterday that it is likely to list another real estate investment trust (Reit) in Asia
Australian real estate manager MacarthurCook Ltd said yesterday that it is likely to list another real estate investment trust (Reit) in Asia with potential assets of offices, residential properties or healthcare facilities. It also said that its Singapore Reit will likely make its first overseas investment in the next year.
‘I would expect that within about three years, we will be managing another Reit in Asia,’ Craig Dunstan, managing director and chief investment officer for MacarthurCook, said at the Reuters Real Estate Summit in Singapore. MacarthurCook launched a Reit in April in Singapore based on industrial properties, MacarthurCook Industrial Real Estate Investment Trust.
Mr Dunstan said acquisitions of foreign asset won’t happen this year, but in the next 12 months’ time. ‘Within 12 months, we hope to have acquired some real estate overseas,’ he said. ‘I would expect that within five years, the portfolio might be 50-60 per cent in Singapore still, and might be 20 per cent in Japan and the rest in key market such as Malaysia, Hong Kong, possibly within five years in the Philippines, Vietnam, and South Korea.’
Source: The Business Times, 26 June 2007
‘I would expect that within about three years, we will be managing another Reit in Asia,’ Craig Dunstan, managing director and chief investment officer for MacarthurCook, said at the Reuters Real Estate Summit in Singapore. MacarthurCook launched a Reit in April in Singapore based on industrial properties, MacarthurCook Industrial Real Estate Investment Trust.
Mr Dunstan said acquisitions of foreign asset won’t happen this year, but in the next 12 months’ time. ‘Within 12 months, we hope to have acquired some real estate overseas,’ he said. ‘I would expect that within five years, the portfolio might be 50-60 per cent in Singapore still, and might be 20 per cent in Japan and the rest in key market such as Malaysia, Hong Kong, possibly within five years in the Philippines, Vietnam, and South Korea.’
Source: The Business Times, 26 June 2007
Sales of previously owned homes in the US fell in May to the lowest in almost four years, reinforcing concerns about a protracted housing slump.
Sales of previously owned homes in the US fell in May to the lowest in almost four years, reinforcing concerns about a protracted housing slump.
Purchases last month declined 0.3 per cent to an annual rate of 5.99 million, the lowest since June 2003, from a revised 6.01 million in April, the National Association of Realtors said yesterday in Washington. The supply of unsold homes jumped to the highest in almost 15 years.
Weakening demand for existing homes, along with a decline in construction starts on new homes reported last week, make the housing market the biggest threat to economic growth, economists said.
An increase in mortgage rates this month will further discourage buyers, leaving a glut of properties on the market.
‘We’re seeing a little more deterioration going on,’ said Jonathan Basile, an economist at Credit Suisse Holdings in New York, whose firm forecast sales at a 5.9 million rate. ‘What’s even more striking in this report is the supply numbers continue to go higher and that suggests downward pressure in prices going forward.’
Resales were forecast to fall 0.3 per cent to a 5.97 million annual rate from a previously reported 5.99 million in April according to the median forecast of 61 economists in a Bloomberg News survey. Estimates ranged from 5.75 million to 6.15 million.
Existing home sales averaged 6.51 million last year, lower than the 7.07 million average for 2005. Sales last month were down 10.3 per cent compared with a year earlier.
The supply of homes for sale rose 5 per cent to 4.43 million. At the current sales pace, that represented 8.9 months’ worth, the highest since June 1992 and up from 8.4 months’ worth at the end of the prior month.
The median price of an existing home fell 2.1 per cent last month from a year ago to US$223,700, the 10th consecutive month of year-over-year declines, the Realtors group said.
Rising defaults among subprime mortgage borrowers, people with poor or scant credit histories, are hampering a recovery in housing. At the same time, mortgage rates near an 11-month high make borrowing more expensive, even for those with good credit.
Source: The Business Times, 26 June 2007
Purchases last month declined 0.3 per cent to an annual rate of 5.99 million, the lowest since June 2003, from a revised 6.01 million in April, the National Association of Realtors said yesterday in Washington. The supply of unsold homes jumped to the highest in almost 15 years.
Weakening demand for existing homes, along with a decline in construction starts on new homes reported last week, make the housing market the biggest threat to economic growth, economists said.
An increase in mortgage rates this month will further discourage buyers, leaving a glut of properties on the market.
‘We’re seeing a little more deterioration going on,’ said Jonathan Basile, an economist at Credit Suisse Holdings in New York, whose firm forecast sales at a 5.9 million rate. ‘What’s even more striking in this report is the supply numbers continue to go higher and that suggests downward pressure in prices going forward.’
Resales were forecast to fall 0.3 per cent to a 5.97 million annual rate from a previously reported 5.99 million in April according to the median forecast of 61 economists in a Bloomberg News survey. Estimates ranged from 5.75 million to 6.15 million.
Existing home sales averaged 6.51 million last year, lower than the 7.07 million average for 2005. Sales last month were down 10.3 per cent compared with a year earlier.
The supply of homes for sale rose 5 per cent to 4.43 million. At the current sales pace, that represented 8.9 months’ worth, the highest since June 1992 and up from 8.4 months’ worth at the end of the prior month.
The median price of an existing home fell 2.1 per cent last month from a year ago to US$223,700, the 10th consecutive month of year-over-year declines, the Realtors group said.
Rising defaults among subprime mortgage borrowers, people with poor or scant credit histories, are hampering a recovery in housing. At the same time, mortgage rates near an 11-month high make borrowing more expensive, even for those with good credit.
Source: The Business Times, 26 June 2007
Market activity this week will likely be dominated by US housing data in the first half and the US FOMC statement
Market activity this week will likely be dominated by US housing data in the first half and the US FOMC statement on Thursday. The Federal Reserve is largely expected to maintain its tilt towards inflation risks as growth seems to be escalating in the midst of a weakening housing sector.
On this note, existing home sales data will be released first in overnight markets. Although consensus estimates suggest this reading to be flat, the impact of recent rises in mortgage rates will only appear on next month’s register since the data series is latent.
Given the correlation between the housing market and consumers, the knock-on impact will determine investor sentiment for capital markets.
For the sixth time this year, the Straits Times Index bounced off the top of its upward trend channel after hitting an all-time high of 3,652 on June 20.
We foresee that if the economic data surprises on the negative side, there would be a pullback towards the mid-point of the 150-point trading band where the 20-day moving average is situated. This upper limit of the trend channel has proven to be very resilient and is unlikely to be breached any time soon.
Daily stochastics and 14-day RSI are retreating from overbought territory and are pointing towards a market consolidation in the near term. Downside risk is at 3,500, where the 50-day moving average and the lower end of the trend channel coincide.
Source: The Business Times, 26 June 2007
On this note, existing home sales data will be released first in overnight markets. Although consensus estimates suggest this reading to be flat, the impact of recent rises in mortgage rates will only appear on next month’s register since the data series is latent.
Given the correlation between the housing market and consumers, the knock-on impact will determine investor sentiment for capital markets.
For the sixth time this year, the Straits Times Index bounced off the top of its upward trend channel after hitting an all-time high of 3,652 on June 20.
We foresee that if the economic data surprises on the negative side, there would be a pullback towards the mid-point of the 150-point trading band where the 20-day moving average is situated. This upper limit of the trend channel has proven to be very resilient and is unlikely to be breached any time soon.
Daily stochastics and 14-day RSI are retreating from overbought territory and are pointing towards a market consolidation in the near term. Downside risk is at 3,500, where the 50-day moving average and the lower end of the trend channel coincide.
Source: The Business Times, 26 June 2007
Tuesday, June 26, 2007
The idea of owning a nest in Singapore is becoming increasingly attractive to foreigners.
In the eyes of some, at least, there may never be a better time to slaughter one of the sacred cows of the landed home market.
The idea of owning a nest in Singapore is becoming increasingly attractive to foreigners. The Government, too, has been effusive in its efforts to draw foreign talent here to build the economy.
So why not relax restrictions on the sale of landed property to foreigners — and satisfy both needs at one go?
Making this controversial proposal in a report released on Sunday, Goldman Sachs — one of the world’s largest investment banks — cited suggestive figures.
The proportion of foreigners buying private homes here climbed to 26 per cent in the first quarter of the year, up from 21 per cent in 2005. But as of May, foreigners were involved in only 8 per cent of landed property transactions this year — compared with 29 per cent of apartment transactions. The average price of a top-end bungalow falls short of that of a luxury condominium unit by about 35 per cent.
“We think this price gap could narrow to parity, or very close to it, should restrictions on foreign ownership be relaxed,” said the report, adding that “foreigners would like the flexibility of greater housing choice and the positive signal of Singapore’s open door policy emanating from such a move”.
But the argument will be a thorny one for the Republic to swallow, given the socio-political barbs of such a move. And going by industry players’ reactions, the debate is likely to remain an academic one.
Since 1973, the Residential Property Act has restricted foreigners and permanent residents from owning private residential property without prior official approval — and for good reason.
“The restrictions on foreign ownership of landed property is unlikely to be eased because it is an emotional issue. It involves (putting) a tangible, physical part of Singapore in foreign hands,” said Mr Colin Tan, director for research and development at Chesterton International.
“Landed properties should not be priced out of Singaporean’s reach (or) it could lead to disgruntled Singaporeans, which would be a cause of concern for the Government,” said Mr Charles Chong, chairman of the Government Parliamentary Committee for National Development and Environment.
Even so, a concession was made in 2004 for Sentosa Cove (picture), where potential foreign buyers were given fast-track approval. Of the 36 landed transactions at Sentosa Cove, 44 per cent involved foreigners. A seaview bungalow plot within the luxury enclave set the record at $1,308 per square foot.
But that is most unlikely to herald any universal lifting of control over landed property ownership in Singapore, say property analysts.
Goldman Sachs argues in its report that removing such restrictions would not hurt the national objective “of giving Singaporeans a stake in the country”; neither would it price them out of the market.
It reasoned that the public housing market met the needs of 80 per cent of Singaporeans by making affordable homes available. The report also conceded that any policy change could be limited to selected types of landed property, such as good-class bungalows.
But Mr Ku Swee Yong, director of marketing and business development at Savills Singapore, argued that the influx of buyers would give landed property owners the upper hand in this land-scarce environment. “It would be a sellers’ market. This will definitely have an immediate impact on prices,” he said.
According to forecasts released by property firm CB Richard Ellis yesterday, home prices are estimated to have risen by 4 to 6 per cent between April and June, and they are expected to climb by another 3 to 5 per cent. One driving factor: The limited supply of new homes in the $600 to $800 psf price range.
Mr Nicholas Mak, Knight Frank’s director of research and consultancy, said: “Prior to the Residential Property Act, rich Indonesians snapped up properties, pricing Singaporeans out of the market. Today, high-end property prices are up. That is starting to filter down to the mid-tier properties.”
He added that keeping certain privileges of home ownership for citizens only “encourages foreigners to commit to Singapore, to sink their roots here”.
Chesterton’s Mr Tan added: “Some things have to be preserved for Singaporeans. Landed property ownership is one of them. It is the privilege of being Singaporean.”
Source: Today, 26 June 2007
The idea of owning a nest in Singapore is becoming increasingly attractive to foreigners. The Government, too, has been effusive in its efforts to draw foreign talent here to build the economy.
So why not relax restrictions on the sale of landed property to foreigners — and satisfy both needs at one go?
Making this controversial proposal in a report released on Sunday, Goldman Sachs — one of the world’s largest investment banks — cited suggestive figures.
The proportion of foreigners buying private homes here climbed to 26 per cent in the first quarter of the year, up from 21 per cent in 2005. But as of May, foreigners were involved in only 8 per cent of landed property transactions this year — compared with 29 per cent of apartment transactions. The average price of a top-end bungalow falls short of that of a luxury condominium unit by about 35 per cent.
“We think this price gap could narrow to parity, or very close to it, should restrictions on foreign ownership be relaxed,” said the report, adding that “foreigners would like the flexibility of greater housing choice and the positive signal of Singapore’s open door policy emanating from such a move”.
But the argument will be a thorny one for the Republic to swallow, given the socio-political barbs of such a move. And going by industry players’ reactions, the debate is likely to remain an academic one.
Since 1973, the Residential Property Act has restricted foreigners and permanent residents from owning private residential property without prior official approval — and for good reason.
“The restrictions on foreign ownership of landed property is unlikely to be eased because it is an emotional issue. It involves (putting) a tangible, physical part of Singapore in foreign hands,” said Mr Colin Tan, director for research and development at Chesterton International.
“Landed properties should not be priced out of Singaporean’s reach (or) it could lead to disgruntled Singaporeans, which would be a cause of concern for the Government,” said Mr Charles Chong, chairman of the Government Parliamentary Committee for National Development and Environment.
Even so, a concession was made in 2004 for Sentosa Cove (picture), where potential foreign buyers were given fast-track approval. Of the 36 landed transactions at Sentosa Cove, 44 per cent involved foreigners. A seaview bungalow plot within the luxury enclave set the record at $1,308 per square foot.
But that is most unlikely to herald any universal lifting of control over landed property ownership in Singapore, say property analysts.
Goldman Sachs argues in its report that removing such restrictions would not hurt the national objective “of giving Singaporeans a stake in the country”; neither would it price them out of the market.
It reasoned that the public housing market met the needs of 80 per cent of Singaporeans by making affordable homes available. The report also conceded that any policy change could be limited to selected types of landed property, such as good-class bungalows.
But Mr Ku Swee Yong, director of marketing and business development at Savills Singapore, argued that the influx of buyers would give landed property owners the upper hand in this land-scarce environment. “It would be a sellers’ market. This will definitely have an immediate impact on prices,” he said.
According to forecasts released by property firm CB Richard Ellis yesterday, home prices are estimated to have risen by 4 to 6 per cent between April and June, and they are expected to climb by another 3 to 5 per cent. One driving factor: The limited supply of new homes in the $600 to $800 psf price range.
Mr Nicholas Mak, Knight Frank’s director of research and consultancy, said: “Prior to the Residential Property Act, rich Indonesians snapped up properties, pricing Singaporeans out of the market. Today, high-end property prices are up. That is starting to filter down to the mid-tier properties.”
He added that keeping certain privileges of home ownership for citizens only “encourages foreigners to commit to Singapore, to sink their roots here”.
Chesterton’s Mr Tan added: “Some things have to be preserved for Singaporeans. Landed property ownership is one of them. It is the privilege of being Singaporean.”
Source: Today, 26 June 2007
The financial industry is becoming so exposed to the property sector
The financial industry is becoming so exposed to the property sector, via loans to developers and other market players, that the Government may have to impose cooling measures.
The warning came yesterday in a Citigroup report highlighting the surge in lending to firms making the running in Singapore’s real estate boom.
It said the lending pattern is unusual in that there has not been an expected increase in home loans along with the boom. ‘Instead, property developers, construction companies and financial holding firms have been driving the lending boom.
‘In the next phase, mortgages will likely climb and accelerate over the next few years as the rate of completion surges, development of collective sale properties gets under way and investment companies unload their properties to end-buyers.’
In the report by Citigroup economist Chua Hak Bin, the bank identified three causes for the debt dynamics.
Firstly, the deferred payment scheme has moved the financing burden to developers. Debt-equity ratios of listed developers rose to 61 per cent in the first quarter from 50 per cent a year ago.
Secondly, there has been a surge in collective sales, which explains lagging mortgage growth. A recent Jones Lang LaSalle report noted that $16.2 billion of collective sales were done between the beginning of 2005 and May 15 this year.
Thirdly, there has been a sharp rise in property purchases by investment firms or funds - a tenfold jump over the last nine months, according to the Urban Redevelopment Authority.
Citigroup said recent moves to apply a touch of the brakes to the market - such as bringing forward stamp duty and releasing more land - have had limited impact.
‘However, any new measures will likely be calibrated and will not be as draconian as those in 1996, which included capital gains tax, Central Provident Fund restrictions for down payment and restrictions on foreign borrowing and purchases.
‘Some tightening of the deferred payment schemes may be a possibility,’ it said.
But the Monetary Authority of Singapore said existing measures were adequate. It said yesterday: ‘We are monitoring developments and expect banks to maintain prudent credit standards in their property-related loans.’
Most market players feel intervention is premature and unnecessary.
Daiwa Institute of Research analyst David Lum said: ‘There’s a boom but it is happening only after eight or nine lean years. It’s part of the cycle. I don’t think the authorities will clamp down so soon.
‘Besides, the overlending is largely confined to the luxury sector, so I don’t think the Government will touch that as it is more concerned with the mass market.’
One bank economist said: ‘The boom is not yet huge. It’ll be alarming only when we see people no longer being able to afford HDB flats, and that hasn’t happened.’
Minister for National Development Mah Bow Tan said last week there was no danger that the heat from the private property market would filter down to the HDB segment.
Industry experts say the market is a long way from the property hysteria of the mid-1990s. Knight Frank’s head of consultancy and research Nicholas Mak said: ‘The Government should let the market correct itself.’
He said speculation purchases accounted for close to 30 per cent of total transactions in 1995. The figure now is about 7 per cent.
‘If the Government decides to intervene, it should address problems very specifically, unlike the broad-based measures introduced in 1996. Those scared away speculators but also genuine investors and home buyers.’
Source: The Straits Times, 26 June 2007
The warning came yesterday in a Citigroup report highlighting the surge in lending to firms making the running in Singapore’s real estate boom.
It said the lending pattern is unusual in that there has not been an expected increase in home loans along with the boom. ‘Instead, property developers, construction companies and financial holding firms have been driving the lending boom.
‘In the next phase, mortgages will likely climb and accelerate over the next few years as the rate of completion surges, development of collective sale properties gets under way and investment companies unload their properties to end-buyers.’
In the report by Citigroup economist Chua Hak Bin, the bank identified three causes for the debt dynamics.
Firstly, the deferred payment scheme has moved the financing burden to developers. Debt-equity ratios of listed developers rose to 61 per cent in the first quarter from 50 per cent a year ago.
Secondly, there has been a surge in collective sales, which explains lagging mortgage growth. A recent Jones Lang LaSalle report noted that $16.2 billion of collective sales were done between the beginning of 2005 and May 15 this year.
Thirdly, there has been a sharp rise in property purchases by investment firms or funds - a tenfold jump over the last nine months, according to the Urban Redevelopment Authority.
Citigroup said recent moves to apply a touch of the brakes to the market - such as bringing forward stamp duty and releasing more land - have had limited impact.
‘However, any new measures will likely be calibrated and will not be as draconian as those in 1996, which included capital gains tax, Central Provident Fund restrictions for down payment and restrictions on foreign borrowing and purchases.
‘Some tightening of the deferred payment schemes may be a possibility,’ it said.
But the Monetary Authority of Singapore said existing measures were adequate. It said yesterday: ‘We are monitoring developments and expect banks to maintain prudent credit standards in their property-related loans.’
Most market players feel intervention is premature and unnecessary.
Daiwa Institute of Research analyst David Lum said: ‘There’s a boom but it is happening only after eight or nine lean years. It’s part of the cycle. I don’t think the authorities will clamp down so soon.
‘Besides, the overlending is largely confined to the luxury sector, so I don’t think the Government will touch that as it is more concerned with the mass market.’
One bank economist said: ‘The boom is not yet huge. It’ll be alarming only when we see people no longer being able to afford HDB flats, and that hasn’t happened.’
Minister for National Development Mah Bow Tan said last week there was no danger that the heat from the private property market would filter down to the HDB segment.
Industry experts say the market is a long way from the property hysteria of the mid-1990s. Knight Frank’s head of consultancy and research Nicholas Mak said: ‘The Government should let the market correct itself.’
He said speculation purchases accounted for close to 30 per cent of total transactions in 1995. The figure now is about 7 per cent.
‘If the Government decides to intervene, it should address problems very specifically, unlike the broad-based measures introduced in 1996. Those scared away speculators but also genuine investors and home buyers.’
Source: The Straits Times, 26 June 2007
Pearl Bank Apartments
Two iconic buildings - The Riverwalk next to Boat Quay and Pearl Bank Apartments in Outram - could be torn down soon if their collective sales go through.
Elsewhere, two other residential developments - in Leonie Hill and Upper East Coast - were also put up for sale by tender yesterday.
However, it is the pair of eye-catching landmarks that have attracted the most interest.
Jones Lang LaSalle yesterday put The Riverwalk, a mixed development in the central business district, up for sale through an expression-of-interest exercise that will close on July 26.
The property, which houses businesses such as Home Club, has 181 commercial units ranging from 54 sq ft to 20,161 sq ft, plus 118 apartments ranging from 818 sq ft to 3,821 sq ft.
Jones Lang LaSalle said it is zoned for commercial use and can be redeveloped into a building with a gross floor area of up to 403,351 sq ft.
Its regional director and head of investments, Mr Lui Seng Fatt, said developers could build shops, offices or small office, home office units. Apartments cannot be built for now, as the Government has temporarily halted the conversion of commercial space to flats in the central region until the end of 2009.
Owners of The Riverwalk want $700 million, up from the $500 million they asked for earlier. Developers will also have to pay a development charge and a premium to top up the lease, which could add up to about $70 million.
The price, including the extra charges, could work out to $1,900 to $2,000 per sq ft (psf) of potential gross floor area, said market experts.
The 280-unit Pearl Bank Apartments, completed in 1976, could be put up for sale soon for more than $500 million, said market watchers.
While some owners are keen on a sale, some architects hope the building will be preserved.
One had reportedly said that it should be kept because it represents the emergence of modern architecture in Singapore.
The value of Pearl Bank has risen greatly recently, with a 1,323 sq ft two-bedroom unit sold last month at a record $1.07 million, said an ERA agent who brokered the deal.
The property has an allowable plot ratio of 7.2 based on the 2003 masterplan, though some owners are hoping for a higher plot ratio to be approved, market sources said. Pearl Bank has two-storey maisonettes, penthouses and shops.
And the 74-unit Rivershire at Leonie Hill Road has been put up for sale by tender at a revised price of $348 million or $2,200 psf of potential gross floor area. There is no development charge payable on the freehold site.
Its previous asking price was about $237 million and the tender closes on July 24.
At Upper East Coast Road, Credo Real Estate has put the 40-unit Rich East Garden up for sale, with an indicative price of $92 million to $95 million.
This translates to $630 psf to $650 psf of potential gross floor area, including development charges. The tender closes on July 31.
Source: The Straits Times, 26 June 2007
Elsewhere, two other residential developments - in Leonie Hill and Upper East Coast - were also put up for sale by tender yesterday.
However, it is the pair of eye-catching landmarks that have attracted the most interest.
Jones Lang LaSalle yesterday put The Riverwalk, a mixed development in the central business district, up for sale through an expression-of-interest exercise that will close on July 26.
The property, which houses businesses such as Home Club, has 181 commercial units ranging from 54 sq ft to 20,161 sq ft, plus 118 apartments ranging from 818 sq ft to 3,821 sq ft.
Jones Lang LaSalle said it is zoned for commercial use and can be redeveloped into a building with a gross floor area of up to 403,351 sq ft.
Its regional director and head of investments, Mr Lui Seng Fatt, said developers could build shops, offices or small office, home office units. Apartments cannot be built for now, as the Government has temporarily halted the conversion of commercial space to flats in the central region until the end of 2009.
Owners of The Riverwalk want $700 million, up from the $500 million they asked for earlier. Developers will also have to pay a development charge and a premium to top up the lease, which could add up to about $70 million.
The price, including the extra charges, could work out to $1,900 to $2,000 per sq ft (psf) of potential gross floor area, said market experts.
The 280-unit Pearl Bank Apartments, completed in 1976, could be put up for sale soon for more than $500 million, said market watchers.
While some owners are keen on a sale, some architects hope the building will be preserved.
One had reportedly said that it should be kept because it represents the emergence of modern architecture in Singapore.
The value of Pearl Bank has risen greatly recently, with a 1,323 sq ft two-bedroom unit sold last month at a record $1.07 million, said an ERA agent who brokered the deal.
The property has an allowable plot ratio of 7.2 based on the 2003 masterplan, though some owners are hoping for a higher plot ratio to be approved, market sources said. Pearl Bank has two-storey maisonettes, penthouses and shops.
And the 74-unit Rivershire at Leonie Hill Road has been put up for sale by tender at a revised price of $348 million or $2,200 psf of potential gross floor area. There is no development charge payable on the freehold site.
Its previous asking price was about $237 million and the tender closes on July 24.
At Upper East Coast Road, Credo Real Estate has put the 40-unit Rich East Garden up for sale, with an indicative price of $92 million to $95 million.
This translates to $630 psf to $650 psf of potential gross floor area, including development charges. The tender closes on July 31.
Source: The Straits Times, 26 June 2007
The Riverwalk
A prime commercial site and two residential sites have been put up for sale, the property firms marketing the sites said yesterday.
The Riverwalk, a commercial site in the heart of the central business district (CBD), is up for collective sale by expressions of interest, and market watchers estimate that the property could fetch about $700 million.
The price works out to about $1,900 per square foot per plot ratio (psf ppr), inclusive of the cost of topping up the lease on the site from its present 72 years to 99 years (estimated at $69 million-$70 million) as well as a development charge (DC) of about $1.2 million.
The 82,300-sq-ft site has a maximum plot ratio of 4.9 - giving it a maximum gross floor area of about 403,400 sq ft.
Right now, The Riverwalk consists of 181 commercial units and 118 apartments. Jones Lang LaSalle (JLL), which is marketing the site, said owners with a total 60-70 per cent of share value have agreed to the collective sale.
Under the rules, the property cannot be sold unless at least 80 per cent of owners agree to collective sale.
‘Coupled with the soaring property market and shortage in office space, The Riverwalk is definitely a rare gem in the CBD,’ said Lui Seng Fatt, regional director at JLL.
The expression of interest exercise will close at 3pm on July 26.
The 74-unit Rivershire on Leonie Hill Road is also up for sale - for the second time. Property firm Knight Frank expects that the property will fetch about $348 million, or $2,200 psf ppr. There is no DC payable.
The 56,400-sq-ft site was previously put on the market through an expression of interest exercise in April, where it was expected to fetch about $237 million - a land value of $1,500 psf ppr. But the asking price was not met. In addition, Knight Frank did not have the required 80 per cent owner consent then, the firm said.
This time around, with the continued upturn in the property mar
The Riverwalk, a commercial site in the heart of the central business district (CBD), is up for collective sale by expressions of interest, and market watchers estimate that the property could fetch about $700 million.
The price works out to about $1,900 per square foot per plot ratio (psf ppr), inclusive of the cost of topping up the lease on the site from its present 72 years to 99 years (estimated at $69 million-$70 million) as well as a development charge (DC) of about $1.2 million.
The 82,300-sq-ft site has a maximum plot ratio of 4.9 - giving it a maximum gross floor area of about 403,400 sq ft.
Right now, The Riverwalk consists of 181 commercial units and 118 apartments. Jones Lang LaSalle (JLL), which is marketing the site, said owners with a total 60-70 per cent of share value have agreed to the collective sale.
Under the rules, the property cannot be sold unless at least 80 per cent of owners agree to collective sale.
‘Coupled with the soaring property market and shortage in office space, The Riverwalk is definitely a rare gem in the CBD,’ said Lui Seng Fatt, regional director at JLL.
The expression of interest exercise will close at 3pm on July 26.
The 74-unit Rivershire on Leonie Hill Road is also up for sale - for the second time. Property firm Knight Frank expects that the property will fetch about $348 million, or $2,200 psf ppr. There is no DC payable.
The 56,400-sq-ft site was previously put on the market through an expression of interest exercise in April, where it was expected to fetch about $237 million - a land value of $1,500 psf ppr. But the asking price was not met. In addition, Knight Frank did not have the required 80 per cent owner consent then, the firm said.
This time around, with the continued upturn in the property mar