US bank could be tweaking portfolio, sources say; DBS may move to new location.
Goldman Sachs is said to be discreetly looking around for a buyer for DBS Building along Shenton Way. The US bank, which bought the two office towers two years ago, could reap a tidy gain of almost $1 billion should a deal go through.
Market watchers say that it makes sense for Goldman Sachs to reshuffle its office portfolio to more prime locations in Singapore.
Goldman is believed to be seeking a price of at least $2,000 per square foot of net lettable area (NLA), which would work out to about $1.75 billion, compared with the $789 psf or $690 million that it paid for the property in late 2005.
Meanwhile, DBS which sold the property to Goldman and leased back the space it occupied, is expected to relocate to Marina Bay Financial Centre (Phase 2), as reported by BT.
DBS occupied the entire 49-storey Tower 1 - which is more than 30 years old - when it sold the property to Goldman in 2005. It also occupied almost 40 per cent of the 34-storey Tower 2, which is just 13 years old. It leased the premises for eight years, with an option for renewal.
The Singapore bank is now said to be eyeing a move to its prestigious new location, expected to be completed in late 2011. This suggests a period of overlap with its existing lease on DBS Building, that runs till late 2013.
Goldman, on the other hand, has been snapping up new office assets of late.
In August this year, it inked a deal to buy Chevron House at Raffles Place from CapitaLand and other parties for $730 million or $2,780 psf of NLA.
The building stands on a site with a remaining lease of about 81 years. Goldman Sachs is also expected to purchase the 37-storey Hitachi Tower next door, in which CapitaLand also has a stake. The price is understood to be around $3,000 psf, or about $840 million in total. Hitachi House has a 999-year leasehold tenure and faces Collyer Quay.
‘It’s good business sense for Goldman to move its Singapore office holdings from the old Shenton Way area to Raffles Place/Collyer Quay, where rental and capital values are likely to appreciate faster.
‘The new financial district at Marina Bay will be connected to the Raffles Place/Collyer Quay vicinity, which will also be rejuvenated with the Ocean Financial Centre development,’ a seasoned industry market watcher said.
Some office market watchers estimate that in the current market, Goldman Sachs may fetch around $1,750 psf to $1,800 psf of NLA for DBS Building - instead of the $2,000 psf minimum price it is seeking - given the property’s age and short balance land tenure.
‘A lot will also depend on what sort of rentals the building can fetch after DBS moves out,’ a property consultant said.
And while the Singapore office market has sizzled this year because of an acute shortage of offices, investors have become a little cautious lately on fears that the US sub-prime contagion could clip the space requirements of big financial institutions here.
‘Perhaps Goldman Sachs stands a higher chance of achieving its target price range it if waits a little longer and hopefully by then, the current sub-prime woes may ease,’ an observer suggests.
Investment in Singapore’s office sector, including land for development into offices, has seen a staggering $14.9 billion worth of deals sealed so far this year. This is about three times the figure for the whole of last year.
The supply crunch has also seen prime office capital values rise from about $2,000 psf at the start of this year to nearly $3,000 psf, as seen in the price that Goldman Sachs is believed to have negotiated for Hitachi Tower.
Source : Business Times - 12 Dec 2007
Wednesday, December 12, 2007
HONG KONG movie superstar Jackie Chan’s love affair with Singapore property continues with his latest purchase - the former Jinriksha Station
HONG KONG movie superstar Jackie Chan’s love affair with Singapore property continues with his latest purchase - the former Jinriksha Station at 1 Neil Road.
He fell in love with the historic building - once the central depot for rickshaw drivers in Singapore - and bought it for $11 million.
The three-storey corner building in Tanjong Pagar now houses a music lounge called EZ50 on the ground floor. Its sale price works out to $818 per sq ft (psf).
‘It’s a good price because the individual shophouses there are about $1,000 over psf on average,’ said Mr Simon Kwan, who helped broker the deal about a fortnight back. ‘As long as he purchases it at or below the market price, he will be comfortable,’ he said, of Chan.
Mr Kwan, who is the star’s property agent, also runs EZ50 and The 50s pubs, as well as the recently opened Jackie Chan’s Cafe Coffee and Tea at 1 Nassim Road.
The star purchased 1 Neil Road from a firm owned by Mr S. L. Cheong, which also owns the 1 Nassim Road property leased to Chan.
Mr Cheong, the uncle of SC Global chief Simon Cheong, also sold Chan The 50s entertainment complex on Tanjong Pagar Road for $8.8 million in 1996.
Both the Tanjong Pagar buildings are in the Neil Road conservation area.
‘You can’t find buildings like this anywhere else,’ said Mr Kwan. ‘These are the two most outstanding buildings in Tanjong Pagar.’
The former Jinriksha station was built in 1903.
It is a commercial building with space for rent. The One Family KTV karaoke lounge used to occupy the second and third floors, but it had since closed down, according to Mr Kwan, who is managing the building on behalf of Chan.
Mr Kwan has plans for a piano bar, a foot reflexology business or offices for the 8,500 sq ft of space on the second and third floors.
‘The highest possibility is to have offices,’ he said, explaining that this plan would leave him time to concentrate on running Chan’s new restaurant business in Singapore.
Also, office rents are currently strong, supported by tight supply.
Rents at the nearby Red Dot Traffic Building are at $6 psf a month, while those at International Plaza next to the Tanjong Pagar MRT station are going for $7.50 to $8 psf.
Mr Kwan said they could have seven to eight office units.
A decision will be made after a trip to Hong Kong to meet up with Chan and firm up plans, he said.
Apart from commercial buildings, the movie star also owns a few condominium units in the Orchard Road area, including a three-bedroom unit in The Grangeford condo on Leonie Hill Road.
The 99-year leasehold Grangeford is by now known for the property that sold en bloc for more than half of Horizon Towers’ price on a psf basis.
Chan bought his Grangeford apartment, which is being rented out, for only $1.3 million back in 1996.
He will stand to reap about $3.4 million from the collective sale, which he was originally not keen on joining.
Another Hong Kong superstar, Andy Lau, also used to own an apartment at Grangeford, as well as a unit at the UE Square condo.
Mr Kwan said he had since sold these off for Andy Lau. He also used to manage the Singapore properties of the late Teresa Teng and Anita Mui.
Savills Singapore’s director of business development and marketing, Mr Ku Swee Yong, said there would be more celebrities entering Singapore’s property market.
‘For one, the Formula One event will bring in a lot of celebrities.’
Source : Straits Times - 12 Dec 2007
He fell in love with the historic building - once the central depot for rickshaw drivers in Singapore - and bought it for $11 million.
The three-storey corner building in Tanjong Pagar now houses a music lounge called EZ50 on the ground floor. Its sale price works out to $818 per sq ft (psf).
‘It’s a good price because the individual shophouses there are about $1,000 over psf on average,’ said Mr Simon Kwan, who helped broker the deal about a fortnight back. ‘As long as he purchases it at or below the market price, he will be comfortable,’ he said, of Chan.
Mr Kwan, who is the star’s property agent, also runs EZ50 and The 50s pubs, as well as the recently opened Jackie Chan’s Cafe Coffee and Tea at 1 Nassim Road.
The star purchased 1 Neil Road from a firm owned by Mr S. L. Cheong, which also owns the 1 Nassim Road property leased to Chan.
Mr Cheong, the uncle of SC Global chief Simon Cheong, also sold Chan The 50s entertainment complex on Tanjong Pagar Road for $8.8 million in 1996.
Both the Tanjong Pagar buildings are in the Neil Road conservation area.
‘You can’t find buildings like this anywhere else,’ said Mr Kwan. ‘These are the two most outstanding buildings in Tanjong Pagar.’
The former Jinriksha station was built in 1903.
It is a commercial building with space for rent. The One Family KTV karaoke lounge used to occupy the second and third floors, but it had since closed down, according to Mr Kwan, who is managing the building on behalf of Chan.
Mr Kwan has plans for a piano bar, a foot reflexology business or offices for the 8,500 sq ft of space on the second and third floors.
‘The highest possibility is to have offices,’ he said, explaining that this plan would leave him time to concentrate on running Chan’s new restaurant business in Singapore.
Also, office rents are currently strong, supported by tight supply.
Rents at the nearby Red Dot Traffic Building are at $6 psf a month, while those at International Plaza next to the Tanjong Pagar MRT station are going for $7.50 to $8 psf.
Mr Kwan said they could have seven to eight office units.
A decision will be made after a trip to Hong Kong to meet up with Chan and firm up plans, he said.
Apart from commercial buildings, the movie star also owns a few condominium units in the Orchard Road area, including a three-bedroom unit in The Grangeford condo on Leonie Hill Road.
The 99-year leasehold Grangeford is by now known for the property that sold en bloc for more than half of Horizon Towers’ price on a psf basis.
Chan bought his Grangeford apartment, which is being rented out, for only $1.3 million back in 1996.
He will stand to reap about $3.4 million from the collective sale, which he was originally not keen on joining.
Another Hong Kong superstar, Andy Lau, also used to own an apartment at Grangeford, as well as a unit at the UE Square condo.
Mr Kwan said he had since sold these off for Andy Lau. He also used to manage the Singapore properties of the late Teresa Teng and Anita Mui.
Savills Singapore’s director of business development and marketing, Mr Ku Swee Yong, said there would be more celebrities entering Singapore’s property market.
‘For one, the Formula One event will bring in a lot of celebrities.’
Source : Straits Times - 12 Dec 2007
DUBAI World’s real estate arm, Limitless LLC, officially started operations at it new regional office here at UOB Plaza
DUBAI World’s real estate arm, Limitless LLC, officially started operations at it new regional office here at UOB Plaza yesterday. It will use Singapore as a base to look for new investment opportunities here and in the region.
On route to Hanoi for the ground-breaking ceremony of its US$220 million Halong Star mixed development project in Vietnam, Limitless CEO Saeed Ahmed Saeed said yesterday: ‘Without doubt, South-east Asia is one of the most exciting and dynamic regions for Limitless. Its fast-growing economy presents us with endless opportunities to demonstrate our core skills of master planning large-scale, balanced projects and waterfront development.’
To date, Limitless, which was established in July 2005, has a portfolio of five real estate projects worth about US$100 billion. Three are in the Middle East, with the others in India and Vietnam.
Limitless has considered development sites in Singapore, including the first parcel at Marina View, although it decided not to put in a bid eventually.
‘We took strategic position on Marina View and decided it was not the right time to tender for it,’ said Philip Atkinson, regional director (South-east Asia) at Limitless.
Mr Atkinson added: ‘The Singapore market now is buoyant and fast paced, and we would take a cautionary view.’
Dubai World, through its subsidiary Istithmar, has however, recently acquired a one-third stake in the government land sales development site now known as South Beach, which is estimated to cost a total of $2.5 billion.
Mr Saeed would not say what its expected target rate of returns would be for its projects but added: ‘Different countries have different hurdle rates.’
Like its parent company, Limitless will mostly fund its investment with equity but Mr Saeed said that it could also raise debt from the capital markets.
Limitless is also likely to be looking at emerging markets around the world as this is where large-scale projects that can leverage on its town-planning skills will be.
Particularly bullish on the two huge markets, Mr Saeed said: ‘India and China will probably need new homes for the next 100 years.’
Source : Business Times - 11 Dec 2007
On route to Hanoi for the ground-breaking ceremony of its US$220 million Halong Star mixed development project in Vietnam, Limitless CEO Saeed Ahmed Saeed said yesterday: ‘Without doubt, South-east Asia is one of the most exciting and dynamic regions for Limitless. Its fast-growing economy presents us with endless opportunities to demonstrate our core skills of master planning large-scale, balanced projects and waterfront development.’
To date, Limitless, which was established in July 2005, has a portfolio of five real estate projects worth about US$100 billion. Three are in the Middle East, with the others in India and Vietnam.
Limitless has considered development sites in Singapore, including the first parcel at Marina View, although it decided not to put in a bid eventually.
‘We took strategic position on Marina View and decided it was not the right time to tender for it,’ said Philip Atkinson, regional director (South-east Asia) at Limitless.
Mr Atkinson added: ‘The Singapore market now is buoyant and fast paced, and we would take a cautionary view.’
Dubai World, through its subsidiary Istithmar, has however, recently acquired a one-third stake in the government land sales development site now known as South Beach, which is estimated to cost a total of $2.5 billion.
Mr Saeed would not say what its expected target rate of returns would be for its projects but added: ‘Different countries have different hurdle rates.’
Like its parent company, Limitless will mostly fund its investment with equity but Mr Saeed said that it could also raise debt from the capital markets.
Limitless is also likely to be looking at emerging markets around the world as this is where large-scale projects that can leverage on its town-planning skills will be.
Particularly bullish on the two huge markets, Mr Saeed said: ‘India and China will probably need new homes for the next 100 years.’
Source : Business Times - 11 Dec 2007
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