The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 20th December 2017

Singapore Economy

Giant tunnels to safeguard power supply network
A warren of giant tunnels which will safeguard Singapore’s electricity supply network for the future has been completed.  The multibillion-dollar effort to house 1,200km of extra-high-voltage cables – more than thrice the distance between Singapore and Kuala Lumpur – is one of the world’s deepest electricity supply projects.  Singaporeans will begin tapping this electrical source from next year, said energy utility company SP Group yesterday.

Bitcoin not a currency, investors risk losing all: MAS
As bitcoin continues its gravity-defying bounce, the Monetary Authority of Singapore (MAS) has yet again joined other regulators to warn that the cryptocurrency is not a currency.  “Bitcoin has no natural intrinsic value. Can you buy a house with it?” posed Sopnendu Mohanty, MAS’ fintech chief, in an interview with British daily The Telegraph.

Singapore Real Estate

West Coast Vale site put on sale from state land sales reserve list
Consultants varied in their expectations for the bidding response for a new plot of residential land at West Coast Vale that was released for sale by public tender by the Urban Redevelopment Authority (URA) on Tuesday.  The site was available for sale on the reserve list of the second half 2017 government land sales (GLS) programme.  Earlier in the month, the URA received an application from a developer who committed to a bid price of at least S$379.988 million, or S$643.53 per sq ft per plot ratio (psf ppr), for the site.

Casa Meyfort up for collective sale with reserve price of S$340 million
Casa Meyfort, a freehold residential site located in Meyer Road, is up for collective sale by tender.  Built in the 1990s, Casa Meyfort comprises 76 apartments on a land area occupying 85,249 sq ft.  As the condominium fronts Meyer Road, the site has a good view of the Central Business District, the sea, as well as the Mountbatten Road landed housing estate.

Keep an eye on mortgage rates
Interest rates in Singapore are set to continue rising gradually over the next year, after the United States Federal Reserve made a widely anticipated move to raise rates last week – its third this year.  This time around, the Fed hiked rates by 25 basis points to a range of 1.25 per cent to 1.5 per cent.  Rate hikes will likely be a regular feature of the United States economy next year, with three hikes said to have been pencilled in.

Companies’ Brief

IFA advises SingLand shareholders to accept UOL offer
The Australia and New Zealand Banking Group (ANZ) has, in its capacity as independent financial adviser (IFA), advised Singapore Land shareholders to accept the mandatory unconditional cash offer made by UOL Group Limited.  UOL had earlier this year made the offer for all the SingLand shares it does not already own, at S$11.85 apiece in cash.

M&C Hotels fight drags on; CDL’s Kwek addresses dissenters
The fight for the future of London-listed Millennium & Copthorne Hotels (M&C) drags on with the opposing parties getting more dramatic in their exchange of words.  In a sternly worded letter to shareholders delivered late on Monday night, the billionaire boss of City Developments (CDL) Kwek Leng Beng sought to swat away what he said was a “disingenuous” argument put forth by a trio of minority investors seeking to block CDL’s takeover of M&C on the basis that CDL’s offer was deceptively or unrealistically low.

CapitaLand to acquire office site in Shanghai for 838m yuan
CapitaLand China, a wholly owned unit of CapitaLand, has entered into a conditional agreement with an unrelated party to acquire a commercial site in Wujiaochang decentralised business district, Shanghai, for 838 million yuan (about S$171 million).  The site is next to CapitaLand’s Innov Center, an operational office with ancillary retail that was acquired in June 2017.

GIC to acquire 43% stake in Shinjuku property for 62.5b yen
Singapore’s sovereign wealth fund GIC will acquire a 43 per cent stake in Shinjuku MAYNDS Tower, a large-scale Grade A office property in Tokyo, from Daiwa Office Investment Corporation for 62.5 billion yen (S$747.7 million).  Daiwa Office Investment Corporation will retain the same stake as that of GIC, with the remaining stake held by a domestic company, according to a press statement.

ABR to buy 50% of Bintan Lagoon Resort
ABR Holdings said on Tuesday that its wholly owned subsidiary, ABR Land, has entered into an agreement to buy 50 per cent of Bintan Lagoon Resort for S$65 million in cash.  ABR runs chains such as Swensen’s and Yogen Fruz here, but has been diversifying into property in recent months. In September it acquired a 1,179.83 sq m plot in Kuala Lumpur for RM3.556 million (S$1.1 million).

Monetising Frasers stake could be brewing for ThaiBev: DBS
Following its win to buy a majority stake in Vietnam’s largest state-owned brewer Saigon Beer Alcohol Beverage Joint Stock Corp (Sabeco), Thai Beverage Public Co Ltd (ThaiBev) could be monetising its stake in Frasers Centrepoint Limited (FCL) next, which is worth about S$1.7 billion, one analyst predicts.

Tee International secures US$15m investment from Pierfront Capital
Tee International, an engineering, infrastructure and real estate group, said on Tuesday that it has secured a US$15 million investment from Pierfront Capital Mezzanine Fund, a Temasek group investment company which focuses on growth capital for asset and corporate acquisition, refinancing and project expansion.

Fortune Reit sells Provident Square in Hong Kong for HK$2b to repay loan
Fortune Reit on Tuesday evening said it has signed an agreement with an unnamed buyer to dispose of Provident Square in Hong Kong, which comprises of the shopping centre and the sub-basement of the entire residential and commercial development known as Provident Centre.  The property is to be sold for HK$2 billion (S$345 million), plus the amount of net current assets or minus the amount of net current liability of the holding company of the property.

OUE H-Trust completes refinancing of its outstanding debts ahead of maturity
OUE Hospitality Trust (OUE H-Trust) announced on Tuesday that it has drawn down on the term loan facilities and completed the refinancing of its total outstanding debts of S$859 million ahead of their maturity.  This comes after OUE H-Trust entered into a facility agreement with BNP Paribas on Dec 13 for the grant of two term loan facilities and two revolving loan facilities totalling S$980 million.

SingHaiyi enters into agreement for bulk sale of its Vietnam Town Phase II units
Mainboard-listed SingHaiyi Group said on Tuesday that it has entered into a purchase and sale agreement, and initial escrow instructions for the bulk sale of all of its Vietnam Town Phase II units for a total cash consideration of US$95.3 million.  The sale, which was made to an unrelated third party, will see a non-refundable deposit of US$7.5 million paid out in five tranches and held in escrow on conclusion of the agreement, SingHaiyi said in a filing with the Singapore Exchange.

Yanlord acquires stake in a prime redevelopment site in Shenzhen Luohu district
Real estate developer Yanlord Land Group’s wholly owned subsidiary, Yanlord (Shenzhen) Investment Management Co, has acquired a 65 per cent stake in Shenzhen Dongguan Shengtai Investment Co for about RMB563 million (S$115 million).  The Shenzhen Dongguan Shengtai Investment Co holds the development rights to a prime 55,000 square metre gross floor area redevelopment site, Gongfang Dasha.

Lian Beng unit to receive S$200m building contract
Lian Beng Group announced on Tuesday that its wholly-owned subsidiary, LS Construction Pte Ltd, has received a letter of intent for a S$199.5 million building contract to be awarded for a proposed flat development at Serangoon North Avenue 1.  The letter of intent is from Oxley Serangoon Pte Ltd, in which another Lian Beng Group subsidiary, Lian Beng (Serangoon) Pte Ltd, holds a 20 per cent stake.

Views, Reviews & Forum

Jiak Kim St bid: FCL can opt for long-term play
Frasers Centrepoint Ltd’s (FCL’s) winning bid earlier this month for the Jiak Kim Street plot has been deemed to be bullish.  The S$1,732.55 per square foot per plot ratio (psf ppr) is some 40 per cent higher than the S$1,239 psf ppr that GuocoLand paid in June last year for a nearby site which it is developing into the Martin Modern condo.  FCL’s bid set a new high for a 99-year leasehold pure private residential site or residential site with first storey commercial use sold at a state tender.

Selling en bloc: Are residences not built to last?
I fully understand Mr Tan Khoon Hui’s desire to cash out (Selling Pine Grove would help older residents financially; Dec 17).  I have another perspective on collective sales.  While we are promoting a green environment, we are unnecessarily destroying buildings which may still be useful when we sell them en bloc.

Focus on the value of disruption
In 2017, the buzz word “disruption” continued to dominate the headlines. People debated the merits of transportation-sharing services and driverless cars, the viability of new payment methods and the feasibility of wearables marrying with healthcare, insurance and retail products.

Global Economy & Global Real Estate

Gold: less glittery in 2018

Single-family housing starts, permits hit 10-year high in Nov

US dollar struggles as tax bill doubts grow

Toys ‘R’ Us is said to consider closing at least 100 stores in US

UK housing market projected to be lifeless in 2018: RICS

World Bank raises China’s growth forecast

Hong Kong’s community malls that people simply can’t avoid

Japan upgrades GDP growth forecast; CPI seen below BOJ target

Japanese construction firms targeted in fresh raid

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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