Property sector sentiment down, but underlying demand still exists
The real estate industry’s business sentiment plunged after the latest round of property cooling measures, but the outlook of the services sector continued to hold firm even as manufacturing optimism waned. These findings came from separate quarterly reports released on Tuesday by the Economic Development Board and the Department of Statistics, which looked at business expectations for the second half of the year.
Manufacturing upbeat expectations dip, but services sector holds steady
Singapore’s services and manufacturing sectors both showed cautious optimism about business prospects for the second half of the year, according to separate findings released on Tuesday by the Economic Development Board (EDB) and the Department of Statistics (DoS). But of the two sectors, manufacturers were more wary about what lies ahead. A net weighted balance of 7 per cent of manufacturers forecast a brighter business outlook for the six months to December 2018, down from the 13 per cent seen in the previous survey a quarter ago.
June bank lending makes fastest gains since November
Bank lending in Singapore in June rose at its fastest pace from a year ago since November, driven by a sharp increase in business lending, preliminary data from the Monetary Authority of Singapore showed on Tuesday. Loans through the domestic banking unit – which captures lending in all currencies, but reflects mainly Singapore-dollar lending – stood at S$673 billion in June, up 5.9 per cent from a year ago.
Singapore Real Estate
URA nod for 4,107 units at Tampines Court, Normanton Park
The Urban Redevelopment Authority (URA) granted provisional permission for several residential projects in the second quarter of the year. These include two large projects with well over 1,000 units each on sites sold through collective sales.
Bungalow owned by Lim Kim San may go for over $100m
A rare freehold good class bungalow (GCB) near the Botanic Gardens, which was owned by one of Singapore’s first-generation leaders, hit the market yesterday with expectations that it could sell for more than $100 million. The two-storey bungalow, which sits on elevated ground at 81 Dalvey Road, is owned by the estate of Mr Lim Kim San, the first Housing Board chairman and a former executive chairman of Singapore Press Holdings.
New supply of retail space poses larger threat to Reits than online shopping, says Moody’s
A heightened supply of retail space will pose a bigger threat to Singapore’s retail Reits than online shopping over the next 12 to 18 months, according to a sector report released by Moody’s Investors Service on Tuesday. Nonetheless, analysts are maintaining their credit profiles on Reits (real estate investment trusts) such as CapitaLand Mall Trust (CMT) which is rated “A2 stable”, and Frasers Centrepoint Trust (FCT) which is rated “Baa1 stable”. “The addition of new retail space reduces the likelihood of a major recovery in rents, while the growing popularity of online shopping reduces demand for physical retail space,” Moody’s said.
Reits, business trusts improve disclosure practices
The second year of scrutiny of real estate investment trusts (Reits) and business trusts (BT) in Singapore found that despite a difficult year for some, the structures in general continued to perform well, with some even bettering their performances, in terms of their governance practices and how they managed their business risks.
Tech drive for built environment industry
Companies can soon take part in a crowd-sourcing programme to test new ideas and improve Housing Board estates. This is one of two new ways the Ministry of National Development is encouraging more technology for the built environment sector, its minister Lawrence Wong announced yesterday.
Surbana Jurong, NTU launch lab to find solutions to urban challenges
Surbana Jurong (SJ) and Nanyang Technological University (NTU) now have a joint laboratory which will develop next-generation solutions to urban challenges. Called the SJ-NTU Corporate Lab, the work at the S$61 million facility on the NTU campus will fall into three core areas – digitalisation, sustainable urban solutions and the future of the industry.
JTC launches one site for tender under Industrial Government Land Sales programme
JTC has launched one site for tender under the 2018 Industrial Government Land Sales (IGLS) programme, the government agency announced in a press statement on Tuesday. The launch is part of the government’s efforts to offer more choices for industrial development, and the site at Woodlands Industrial Park is the first of six confirmed list sites for the second half 2018 IGLS programme.
JTC Food Hub to offer rental equipment to manufacturers
Food manufacturers looking to test new products in small batches will soon be able to do so without the expense of buying processing equipment that can cost millions of dollars. By the end of next year, equipment like spray dryers and microwave-assisted thermal sterilisers will be available on a pay-per-use basis at the JTC Food Hub @ Senoko – a food factory facility with 50 units for lease which was officially launched on Tuesday.
a-iTrust to buy 2 office blocks in Hyderabad’s HITEC City
Ascendas Property Fund Trustee, the trustee-manager of Ascendas India Trust (a-iTrust), has agreed to acquire two office buildings in aVance Business Hub 2, a business park located in Hyderabad’s HITEC City. The transaction comprises a two-stage process. a-iTrust will first subscribe to debentures issued by Phoenix Infrasoft India Private Ltd (PIIPL 1) and Phoenix Infraspace India Private Ltd (PIIPL 2), the two entities developing the buildings, for 7.96 billion Indian rupees (S$157.8 million).
CapitaLand launches S$2m fund to empower vulnerable elderly in Singapore
Against the backdrop of an ageing population, CapitaLand Hope Foundation – the philanthropic arm of CapitaLand – has set up a S$2 million fund with the aim of improving the quality of life for the vulnerable elderly in Singapore through deeper social integration, as well as better healthcare and living conditions. The launch of the CapitaLand Silver Empowerment Fund marks the first time the foundation has expanded its mandate from helping underprivileged children to the vulnerable elderly, since its establishment in 2005.
Far East H-Trust reports 4.1% rise in DPS for Q2
Far East Hospitality Trust (Far East H-Trust) on Tuesday reported a 4.1 per cent increase in its distribution per stapled security (DPS) for the second quarter, thanks to better performance mainly due to its hotel portfolio. DPS for the three months ended June 30, 2018 stood at 1.01 Singapore cents, compared to 0.97 Singapore cent in the same period last year.
Roxy-Pacific Q2 net profit falls 56.7% to S$6.4m
The absence of revenue recognition as a result of the completion of several projects brought down second-quarter net profit of Roxy-Pacific by 56.7 per cent to S$6.4 million. For the three months ended June 30, revenue fell 52.5 per cent to S$37 million, due to lower revenue recognition from Trilive, which got its temporary occupation permit in June 2018, and an absence of revenue recognition from Jade Residences, Whitehaven and LIV on Wilkie following their completion in 2017.
Boustead inks contract to develop new production and warehouse facility
Boustead Projects on Wednesday said its co-investment partner, Boustead Development Partnership (BDP), has secured a development contract for a new integrated production and warehouse facility in Singapore, to be leased on a long-term basis to Amcor Flexibles Singapore. Amcor Flexibles Singapore is a unit of Amcor Limited, which is listed on the Australian stock exchange. The group produces packaging for a variety of consumer products including F&B (food and beverage) and pharmaceutical items, among others.
Pacific Star Development sells out Bangkok condo’s Phase 1 launch
Catalist-listed Pacific Star Development (PSD) has sold all 450 units in its first sales phase for The Posh Twelve mixed-use development in Bangkok at an average S$390 per square foot (psf). Besides locals in Thailand, buyers from Hong Kong, Macau, mainland Chinese and Singapore also signed up following marketing efforts in those countries, the Asean-focused developer said.
TEE International wins S$65 million worth of engineering contracts
Mainboard-listed TEE International landed some S$65 million worth of engineering contracts from February to July this year, boosting its outstanding order book to S$280 million. Its wholly-owned subsidiary, PBT Engineering, won an assets enhancement initiative (AEI) contract for Ang Mo Kio Hub from Mercatus Co-operative, which will include the upgrading of interior design finishes to the common areas, toilets, lifts, reconfigurations of tenants space as well the upgrading of the mechanical & electrical (M&E) systems. This contract is slated for completion in November.
Cache Logistics Trust Q2 DPU down 17.6%
Warehouse owner Cache Logistics Trust reported a second-quarter distribution per unit (DPU) of 1.419 Singapore cents, down 17.6 per cent from 1.722 Singapore cents a year ago. For the three months ended June 30, income available for distribution fell 6.3 per cent to S$15.2 million, mainly due to lower net property income (NPI) from CWT Commodity Hub, which was converted from master lease to multi-tenancy; the divestment of its Hi-Speed Logistics Centre; as well as distribution to perpetual security holders.
VIEWS, REVIEWS, FORUM & Others
Navigating a challenging landscape of disrupted global trade flows
While the risks have increased significantly for businesses due to the US-China trade spat, economists believe that Singapore companies can still benefit from potential trade flows into the Asean region. They say countries and companies have already started looking at alternative markets for their products if any should be caught within the tariffs list rolled out by the US and China.
KL-Singapore high-speed rail: How profitable can it be?
The Kuala Lumpur-Singapore high-speed rail (KL-SG HSR) project is under review following the election of a new government in Putrajaya led by Malaysian Prime Minister Mahathir Mohamad. Whatever the outcome, there is one issue that needs to be looked at more closely: profitability. The project’s profitability will depend on the extent of regional economic integration – the free movement of people, labour, goods and capital across national borders – as well as how urban agglomeration unfolds within Asean.
Global Economy & Global Real Estate
US considering higher 25% tariffs on US$200b in Chinese imports
US, China said to seek to restart talks to defuse trade war
US Fed set to hold rates steady, remains on track for more hikes
US consumer spending up solidly in June; inflation moderate
US labor costs post largest annual gain since 2008
A 350-Square-Foot Apartment Is on the Market for $750,000
China’s July PMI slows on US trade dispute, bad weather
Tycoon developer Ronnie Chan says Hong Kong vacancy tax is unfair
Eurozone growth slows as trade tensions persist
BOJ revises down inflation forecasts, makes minor tweaks
Australia home prices fall most in 7 years in July: CoreLogic
Australian home investors in full retreat as prices fall
Thai June factory output rises 4.74% y-o-y, above forecast
Brazil expected to keep key interest rate steady at 6.5%
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