The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 14th July 2017

Top Story

Singapore economy grows 2.5 % y-o-y in Q2
Singapore’s economy grew 2.5 per cent compared to a year ago in the second quarter of 2017, based on advance estimates of gross domestic product (GDP) released by the Ministry of Trade and Industry (MTI) on Friday.  The latest print was lower than market consensus and was the same pace of growth clocked in the previous quarter, which was revised down from 2.7 per cent.

Singapore Economy

Three areas of Singapore-China cooperation can support Belt & Road project: DPM Teo
The significance of China’s Belt and Road (B&R) Initiative extends far beyond how China can benefit from this initiative, to how other countries can also benefit from it, said Singapore’s Deputy Prime Minister Teo Chee Hean on Thursday.  Singapore and Chinese leaders have thus agreed on three broad areas of cooperation so that the full potential of China’s marquee infrastructural project can be realised.

Services growth picks up pace in Q2 at 1.7% y-o-y, manufacturing leads at 8%
Growth in Singapore’s services sector picked up pace, according to advance estimates of second-quarter performance, while manufacturing continued to lead overall economic expansion, though at a slower pace.  Advance estimates released by the city-state’s Ministry of Trade and Industry on Friday morning showed that the services sector – which accounts for a major proportion of economic output – grew by 1.7 per cent in April and May, when compared with the same period a year ago.

Singapore venture capital market on a roll in Q2
A US$550 million (S$757 million) funding round by technology firm Sea – previously called Garena – helped propel Singapore’s venture capital (VC) market to fresh heights in the second quarter.  This came amid a surge in VC investment volumes globally, driven mainly by more such mega deals and a concurrent rise in the number of “unicorns” – firms worth more than US$1 billion.

Temasek unit invests $2.8m in fintech start-up
Singapore fintech start-up Turnkey Lender, which has developed an intelligent cloud software for lending automation, has raised US$2 million (S$2.75 million) from Vertex Ventures, the venture capital unit of Temasek Holdings.  Turnkey Lender will use this investment to fund expansive projects across the region, develop its products and expand its team.  Its solution makes use of machine learning and data analysis to understand potential loan applicants, ranging from small to large-scale loans.

Singapore Real Estate

S$1.82b redevelopment of Golden Shoe Carpark unveiled
It was, in the words of Lynette Leong, CEO of the manager of CapitaLand Commercial Trust (CCT), “the moment we have all been waiting for”. CapitaLand, CCT and Mitsubishi Estate on Thursday said that they were redeveloping Golden Shoe Carpark into a mixed-use project for about S$1.82 billion before acquisition costs.  The market has been waiting for the announcement since the trust first announced its intention last October, pending the authorities’ approval.

A super penthouse for S$108m, anyone?
Guocoland will release later this year the super penthouse in its 99-year leasehold Wallich Residence project in Tanjong Pagar which supposedly has an auspicious-sounding price tag of S$108 million.  While the 21,108 square foot triplex is the highest residence in Singapore – the 64-storey tower in which Wallich Residence is located is 290 metres high – it turns out there may be at least one other penthouse still in the hands of its developer which has an even higher price tag.

Companies’ Brief

Perennial, Yanlord-led consortium buys UEL stake, triggering takeover
A consortium led by Perennial Real Estate Holdings and Yanlord Land Group has acquired a 33.5 per cent stake in United Engineers Limited (UEL) at S$2.60 per share and an initial 10 per cent stake in WBL Corporation for S$2.07 per share.  The stake acquisition of UEL comprised 33.4 per cent of its ordinary shares and 70.2 per cent of its preference shares, triggering a mandatory offer for UEL.

GLP chooses CEO-led China bidder for buyout: sources
Global Logistic Properties Ltd, the Singapore warehouse operator pursuing a sale, has picked a Chinese bidder consortium for final talks on a deal valuing the company at about US$10 billion, people with knowledge of the matter said.  The investor group, fronted by GLP chief executive officer Ming Mei, edged out a rival consortium led by Warburg Pincus, according to the people. The Chinese consortium, which includes private equity firms Hillhouse Capital Management and Hopu Investment Management, is planning to offer around S$3 per share for GLP and will now negotiate definitive terms for the transaction, the people said, asking not to be identified because the information is private.

ESR-Reit Q2 DPU drops 11.3% as net property income falls
ESR-Reit’s second-quarter net property income fell 9.2 per cent to S$19.2 million as it lost revenue and incurred costs from converting single-tenant properties into multi-tenant projects, the industrial real estate investment trust announced on Thursday before the market opened.  Also cited were higher maintenance costs and property divestments in FY2016.  Distribution per unit decreased by 11.3 per cent to 0.956 Singapore cent as the amount available for distribution slid 11.4 per cent to S$12.5 million, said the trust formerly called Cambridge Industrial Trust.

Soilbuild Reit posts 6.3% drop in Q2 DPU
Soilbuild Business Space Reit (Soilbuild Reit) on Thursday reported an 8.1 per cent year-on-year increase in net property income for the second quarter to S$18.7 million.  For the three months ended June 30, 2017, the Reit recorded a distribution per unit (DPU) of 1.466 Singapore cents, down 6.3 per cent from 1.565 Singapore cents a year ago. Distributable income rose 4.3 per cent to S$15.4 million.

Fragrance announces start of Tasmania hotel, launch of Melbourne project
Fragrance Group on Thursday announced the start of its hotel in Tasmania and the launch of its development project in Melbourne.  The group’s new-build hotel in Hobart started its operations on July 1, 2017, and is centrally located, the group said in a Singapore Exchange filing.  Known as ibis Styles Hobart, the 296-room hotel spanning 10 floors is now the largest hotel in Hobart and is managed by travel and lifestyle group AccorHotels.

HPL to acquire Dutch firm that indirectly owns Langkawi resort for US$55m
Hotel Properties Limited’s (HPL) associate company Leisure Ventures plans to acquire Netherlands-incorporated Kingdom Langkawi BV (KLBV), which in turn indirectly owns the Four Seasons Resort Langkawi, for an aggregate consideration of US$55 million.  The consideration for the acquisition comprises US$1 million for the shares of KLBV and some US$54 million for the assignment of shareholder loans, which is subject to net working capital adjustments, said HPL, adding that the investment will be funded by internal resources.

Genting HK sells remaining Star Entertainment stake for A$235.2m
Genting Hong Kong has sold its remaining stake in Australia-listed Star Entertainment in a block trade for A$235.2 million (S$250.2 million), the leisure and entertainment company announced on Friday before the market opened.  The shares, representing a 5.62 per cent interest in gaming company Star Entertainment, were held by wholly owned subsidiary CCL, and the sale is being carried out through UBS AG.

Views, Reviews & Forum

Enhancing the potential of China’s Belt and Road initiative
China has made great progress since it started market reforms in 1978, and joined the World Trade Organisation in 2001. China’s economic development is now entering a new phase. Chinese companies and entrepreneurs are expanding beyond the Chinese market into our region and the world.  This significant shift signals a new trajectory in China’s development which manifests itself in several new dimensions that have an impact on the economics and geopolitics of our region.

Silicon Valley: Lessons in urban planning
Robert Metcalfe, an inventor of the Ethernet, once wrote: “Silicon Valley is the only place on earth not trying to figure out how to become Silicon Valley.” Every year, hundreds of people, tourists and entrepreneurs alike, come to the Bay Area hoping to “see Silicon Valley”.  So much so that an article in The Mercury News last year suggested that the Valley is giving Alcatraz, the Golden Gate and the Bay Area’s other tourist attractions a run for their money.

Global Economy & Global Real Estate

Fed rate hikes of little concern: economists

Yellen and China trade data boost markets

Kushners seek new plan for flagship New York office after failed Qatar deal

RBS faces burgeoning housing-related penalties

Tale of two Brooklyns: Renters vs buyers

UBS asset management secures mainland China private fund license

China June trade remains strong

Experts expect China to hit growth targets

Airbnb tests new ways to unlock doors during disasters

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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