The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 15th December 2016

Top Story

2017 BTO flat supply set to dip
The Housing & Development Board (HDB) will launch about 17,000 new flats for sale to Singaporeans in 2017, about 5 per cent fewer than the 17,900 build-to-order (BTO) flats launched in 2016.  National Development Minister Lawrence Wong said in his blog post on Wednesday: “We are gradually tapering supply but still ensuring a healthy pipeline to meet demand. Once again, we will offer a good spread across the mature and non-mature estates. This will give buyers a range of choices, including young couples who wish to live near their parents, or the elderly who want to right-size and age in place.”  The 17,900 flats in 2016 were spread evenly across the mature and non-mature estates.

Singapore Economy

Economists slash GDP growth expectations once more
For the sixth consecutive time, private-sector economists have cut Singapore’s 2016 growth forecast – this time to just 1.4 per cent. They have also trimmed 2017’s projection to 1.5 per cent, evaporating any hopes for a marked improvement next year.  Both estimates are within the official forecast ranges of 1 to 1.5 per cent in 2016, and 1 to 3 per cent in 2017.  According to the Monetary Authority of Singapore’s (MAS) Survey of Professional Forecasters, analysts now see softer expansion in the services sector, as well as in private consumption.

Sibor, SOR up ahead of Fed decision and seasonal factors
Local interest rates rose on Wednesday, a day before the US Federal Reserve makes its last interest rate announcement for the year.  The key 3-month Sibor (Singapore interbank offered rate) typically used to price home loans rose to 0.932 per cent, up 0.006 from 0.926 per cent on Tuesday. The latest move brings the 3-month Sibor back to where the interest rate was in early July. The high in 2016 was 1.254 per cent on Jan 19.  The 3-month SOR (swap offer rate) moved a faster 0.062 to 0.818 per cent on Tuesday from 0.756 per cent on Monday. The 3-month SOR, a benchmark for commercial loans is updated late at night.

Singapore Real Estate

Rental prices, volume stay soft in Nov: SRX
The residential leasing market remained soft last month, with rents of both private homes and HDB flats continuing their downward drift.  Private rents slipped 0.8 per cent in November from a month ago, according to flash estimates by SRX Property. Rents of HDB flats fell 0.9 per cent during the same period.  The rental drag in the private segment came from all regions, with the prime or Core Central Region (CCR) down 0.7 per cent; and the city fringe or Rest of Central Region (RCR) and the suburban or Outside Central Region both falling 0.9 per cent.

Auction sales for properties surge in fourth quarter
Auction sales for properties in the final months of this year have bucked the usual trend of a year-end slowdown.  Consultancy JLL said yesterday: “Sales in the fourth quarter have exceeded expectations for the property auction segment, clocking a total sales figure of $47.2 million for the quarter (so far).”

This makes up 51 per cent of sales this year so far, and more than treble the value of sales – of $10.83 million – in the last three months of last year.

Companies’ Brief

Keppel Land units in share swaps with Viet real estate company
Keppel Land and Vietnam’s Hung Phu Real Estate Investment Corporation (HRPE) have unwound their cross holdings in two project firms, with each ending up with full ownership in one of them.  Keppel Corporation, the parent of Keppel Land, said in a filing to the Singapore Exchange on Tuesday night, that one deal involved Keppel Land’s VN Investment Pte Ltd buying a 40 per cent stake in Riviera Cove Joint Venture Limited Liability. The cash consideration is 131.46 billion Vietnamese dong (S$8.31 million). The purchase from HRPE gave Keppel Land full ownership of Riviera Cove.

Mapletree Logistics Trust to buy 4 Australia properties for A$142.2m
Mapletree Logistics Trust is looking to purchase four properties with a total of 103,517 square metres in gross floor area in Victoria, Australia, for A$142.2 million (S$151.9 million). The acquisition is expected to be completed over the next few days.  Should the acquisition go through, Australia will account for about 9 per cent of the trust’s overall gross revenue, up from the current 6.1 per cent, it said in a filing to the Singapore Exchange on Thursday morning.  The acquisition is also expected to generate a net profit income yield of 7.6 per cent, and be accretive at the distribution level, the release added.

Sabana Reit to buy Paya Lebar Central property for S$34.5m
The managers of Sabana Shari’ah Compliant Industrial Real Estate Investment Trust (Reit) are proposing to acquire a light industrial property on 107 Eunos Avenue 3 for S$34.5 million.  There is 24 years left on the lease of the property, a newly completed building between Paya Lebar and Eunos MRT stations.  The vendor, General Cars Fleet Management, will also provide income support for five years if the net property income is less than the guaranteed net property income of about S$3.1 million a year.

Oxley’s big dreams for Batam
Homegrown developer Oxley is chasing big dreams in Batam.  It is building the 20,000 sq m Oxley Convention City, which will house a convention hall and five towers – one for offices, three for residences and the other for a hotel.  Oxley executive chairman and chief executive Ching Chiat Kwong told a briefing in Batam late last month that “this is a huge development, it does have certain risk and it does involve a lot of cash commitment from the developer to make sure it works”.

GLP sets up US$620m fund with partners to invest US$1.5b over three years
Mainboard-listed Global Logistic Properties (GLP) has set up a US$620 million (S$893.6 million) fund that is expected to invest US$1.5 billion over three years.  The fund, GLP US Income Partners III, has secured US$620 million in equity commitments, GLP announced on Thursday (Dec 15). Six leading global institutional investors from Asia, US and Middle East have committed for a stake of about 90 per cent. GLP is the asset manager and will retain the remaining stake of about 10 per cent post-syndication.

Views, Reviews & Forum

URA will investigate short-term rental cases
We thank Mr Bennette Teoh Liy Ben for his letter (“Home sharing: Take action against offenders“; Dec 10).  For suspected cases of unauthorised short-term rentals in private residential premises, the Urban Redevelopment Authority (URA) will conduct a thorough investigation to determine whether a planning offence has been committed.  In the process, we will also need to identify the person(s) responsible, which may include agents, tenants and landlords.

Global Economy & Global Real Estate

US Federal Reserve lifts key interest rate, signals faster pace of hikes in 2017

Banks, Reits under watch as Fed hike looms

Fretting about China’s property market makes sense

Developers, funds target China demand for co-working space amid startup boom

Pinpointing the bubble in China’s real-estate market

China’s economy will stabilise in 2017 but challenges weigh on outlook

Sustainable cities could unlock huge opportunities for Asean

Japanese corporate sentiment buoyed by Trump effect: BOJ survey

New Irish rent controls to cap increases in major cities

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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