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The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 18th April 2017

Singapore Economy

March exports power ahead to score fifth straight monthly gain
Singapore’s exports appear to be firmly back on the growth path, with non-oil domestic shipments powering to a fifth straight monthly rise in March.  Non-oil domestic exports (NODX) registered a 16.5 per cent rise last month, easily beating market expectations of 7.3 per cent, going by figures released on Monday by trade promotion agency International Enterprise (IE) Singapore.  While March’s NODX expansion eased from a downward revised 21.1 per cent in February, it was still a double-digit growth, and surpassed the estimated average 15.4 per cent growth for the first quarter of the year.

$34m charm offensive to attract visitors to Singapore
With competition for the tourist dollar fiercer than ever, the Changi Airport Group (CAG), Singapore Airlines (SIA) and the Singapore Tourism Board (STB) have renewed their agreement to join forces and woo travellers, in their biggest commitment to date.  On the table is $33.75 million, pledged over the next three years, to continue the promotion of Singapore as a destination and Changi as a stopover for long-haul travellers.  The commitment, announced yesterday, comes less than two years after the three partners agreed to set aside $20 million to support joint marketing and other efforts.

Singapore Real Estate

Developers’ private home sales soar
The latest government figures on private home sales point to a turnaround in the market.  Figures released on Monday showed that, in the primary market, developers sold 1,780 new private homes last month. This was the strongest showing since the 1,806 units they moved back in June 2013, when sales were still buoyant just before the rollout of the Total Debt Servicing Ratio (TDSR) framework towards the end of that month.  The March 2017 sales volume is up nearly 82 per cent from February’s 979 units, and a 111 per cent jump from the 843 units sold in March 2016.

Rent dispute: Takashimaya case taken to apex court
Department store Takashimaya’s dispute over rent with its landlord, Ngee Ann Development (NAD), has been dragging on since September 2013. Dissatisfied that the High Court ruled in the store’s favour last year, the landlord has now taken its case to the Court of Appeal.  NAD’s lawyer, Senior Counsel Ang Cheng Hock, argues that Takashimaya’s rent is lower than what the market will bear, as it has not optimised the potential of its 56,000 sq m premises. It sublets 14,000 sq m – 25 per cent of its space – to speciality shops, which pay higher rent and in fact account for 75 per cent to 85 per cent of the total rent paid by Takashimaya to NAD, said Mr Ang.

Companies’ Brief

Frasers Centrepoint to pay 315m euros for 86.56% of Amsterdam property firm
Mainboard-Listed Frasers Centrepoint Limited (FCL) has entered into a conditional agreement to acquire an 86.56 per cent stake in Geneba Properties, an Amsterdam-based listed real estate investment company, for 315.9 million euros (S$467.8 million), with the intention of delisting Geneba.  FCL’s international property activities arm, Frasers Property, has also reached a conditional agreement with Geneba on an all-cash offer for the remaining 13.44 per cent free-float in Geneba.  This offer will be launched no later than a month after the closing date of FCL’s acquisition.

Keppel DC Reit posts 13.2% rise in Q1 DPU
Keppel DC Reit on Monday posted a 13.2 per cent growth in distribution per unit (DPU) to 1.89 Singapore cents for the first quarter ended March 31, 2017.  This came on the back of a 47.6 per cent rise in distributable income to S$21.8 million – boosted by a one-off capital distribution of about S$1.7 million from its acquisition of data centre Keppel DC Singapore 3, income from acquisitions announced last year as well as lower property-related and other expenses.  The increase in distributable income was offset by lower rental income from “a client downsizing its requirements” in Keppel DC Dublin 1 in Q1 2016, and lower variable income from Keppel DC Singapore 1 and Keppel DC Singapore 2 (the Reit’s first two data centres), due to lower recurring and power revenue.

First Reit’s Q1 DPU up 1.4%
Mainboard-Listed First Real Estate Investment Trust reported a 1.4 per cent increase in distribution per unit (DPU) to 2.14 Singapore cents for the first quarter from 2.11 Singapore cents a year ago.  Net property income for the three months ended March 31, 2017 was S$26.87 million, up 2.5 per cent from S$26.21 million the year before.  The firm’s interest income for the first quarter increased to S$310,000 from S$121,000 the previous year mainly due to the return from the first progress payment made in Q1 2016 for the development works on new Siloam Hospitals Surabaya.

Views, Reviews & Forum

HDB pricing does not reflect flat lease period
The report (HDB leases and what’s in store for retirement as society ages; April 15) brought up a concern that high-priced resale HDB flats do not reflect the shorter lease available and that the Government will have the right to retake the expensive flat with no compensation.  Recently, I noticed an interesting class of housing available called repurchased flats, which are flats that were previously sold and subsequently returned to the HDB.  It seems that prices of these flats do not reflect the lease period.

Make Orchard Road car-free on weekends for a start
I applaud the Singapore Tourism Board’s plan to turn Orchard Road into a car-free, fully-pedestrianised stretch for the purpose of rejuvenating the declining local retail landscape (Orchard takes pedestrian route to recapture traffic; April 14).  We should proceed with this grand idea incrementally.  For a start, the road should be closed to vehicular traffic only on weekends and public holidays.  Unlike other countries which Singapore wishes to emulate, we have a much smaller land mass.  Therefore, keeping every road accessible, especially the major ones, makes good economic sense.  The five-lane Orchard Road is a major arterial road and busy thoroughfare. It is imperative that it is kept open to traffic on weekdays.

Global Economy & Global Real Estate

Turkey’s weak economy exposed after referendum

China’s GDP expands 6.9% in first quarter

China’s growth robust in Q1 but rates unsustainable, analysts warn

China’s Q1 property investment accelerates, defying curbs

Chinese developer to bring Xiongan frenzy to offshore investors

Tokyo to have 45 new skyscrapers by 2020 Olympics

Hotels draw up battle plans as Airbnb poses rising threat

First Reit posts 1.4% rise in 1st-quarter DPU

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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