The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 21st June 2016

Top Stories

Sustainability reporting rules seen offering flexibility
The Singapore Exchange’s “softly, softly” approach in rolling out its sustainability reporting rules on Monday gives listed firms here enough time and flexibility to implement them, but also requires investors and other stakeholders to be more discerning in evaluating the reports, market participants said.  They expressed concern that letting listed companies pick the environmental, social and governance (ESG) factors to report on may lead to some important ones being glossed over, but added that the process of engaging stakeholders to determine the material factors could benefit all parties eventually.

Singapore Economy

MAS closely watching UK developments
The Monetary Authority of Singapore (MAS) on Monday said it is monitoring the developments in Europe closely, with the UK referendum due this week.  “MAS is monitoring the developments in Europe closely,” said a spokesman from the central bank in response to queries from last week.

Relief rally as Brexit jitters subside
A wave of relief washed over local stocks after polls indicated that the ‘Remain’ camp was gaining momentum over their ‘Leave’ opponents in the crucial Brexit referendum this Thursday – at least, for the parts of the market that traders felt brave enough to jump into on Monday.  The Singapore market finished 1.4 per cent higher in the session, with the Straits Times Index (STI) rising 37.45 points to 2,800.87. But trading volumes were weak, with around 673.9 million shares worth just S$798.1 million in total changing hands across the entire bourse.  In the broad market, gainers outnumbered losers 247 to 126, or about two up for every one down.

To be or not to be

New guidelines on leave benefits, notice for contract staff
More term contract employees could be eligible for leave benefits under new guidelines released on Monday by the tripartite partners Manpower Ministry (MOM), the National Trades Union Congress (NTUC) and the Singapore National Employers Federation (SNEF).  Term contract employees, who make up about one in nine people in Singapore’s workforce, are those who are employed on fixed-term contracts that will terminate upon the expiry of a specific term unless it is renewed.  The different types of leave include annual, sick and childcare, according to the guidelines.

More workshops to be run to help SMEs go global
More workshops will be organised this year to equip small and medium-sized enterprises (SMEs) with information on overseas markets and to connect them with potential business partners, said International Enterprise (IE) Singapore on Monday.  More than 15 such workshops will be run in markets popular among Singapore companies, such as China, India, Myanmar and the US; last year, only nine were conducted.  These workshops, conducted jointly by IE Singapore and trade associations and chambers in-market overseas, typically last three to five days.

Singapore Real Estate

Rent then buy – property developer dangles new lure
Buyers will soon get the option of renting a property before deciding to buy, under the latest scheme unleashed by developers to rev up the market.  Programmes allowing buyers to move in after paying a small down payment have been tried at completed projects but TG Development is rolling out what it calls its experiential leasing scheme at an uncompleted development. It is being launched at Lloyd Sixtyfive, after an earlier version of the scheme was disallowed by the Urban Redevelopment Authority (URA).

Third Reit this year looking to list on SGX
A Third real estate investment trust (Reit), this time holding Chinese logistics assets, is said to be considering a listing on the Singapore bourse.  EC World Reit, as it is known, is reportedly looking to raise up to S$450 million. The trust is backed by Shanghai-based Forchn Holdings Group, which is a co-founder and shareholder of Cainiao Network, the logistics division of Chinese e-commerce giant Alibaba.  According to FinanceAsia and Reuters reports, it started meeting investors on Monday to test demand.

Four Seasons guns for growth in Asia-Pacific
Four Seasons Hotels and Resorts will continue to grow its footprint in the Asia-Pacific, as it banks on the growing numbers of outbound travellers from China and India, as well as on promising growth markets in the region.  Today, about a third of the group’s upcoming hotels are based in the region – 15 hotels are under development while a further five management contracts have been inked. The existing 24 hotels operating in the Asia-Pacific account for roughly a quarter of top line for the group, which has 98 hotels worldwide.

Ascott bags 7 properties and expects to grow faster than last year
The Ascott has secured seven new properties comprising 1,714 apartment units across seven cities in Asia, said CapitaLand on Monday.  It added that its wholly owned serviced-residence business unit is poised to outpace its growth in 2015.  As it is, last year was a record year for Ascott, which added 6,700 units to its portfolio; with this year barely six months in, it has already secured more than 5,000 units in 26 properties.

Eden Hall GCB plots up for sale again
A pair of freehold Good Class Bungalow (GCB) plots from the garden of Eden Hall, the official residence of the British High Commissioner to Singapore, has been relaunched for sale by public tender by the British government.  The relaunch, which sees guide prices being slashed by about 20 per cent, comes after bids during the initial tender period, which closed in January, failed to meet the guide price.

Companies’ Brief

GLP secures new leases totalling 98,000 sq m in China
Mainboard-listed Global Logistic Properties (GLP) has secured new leases totalling 98,000 square metres with five Chinese companies.  In a filing to the Singapore Exchange on Monday, the facilities provider said that the new leases are mainly related to expansion demand from the organised retail sector, including e-commerce and chain stores. Three of the leases are new customer relationships for GLP.

CDL is best-performing STI stock in June
Property developer City Developments (CDL) is the best-performing Straits Times Index (STI) stock month-to-date, and analysts say it is because of its reinstatement to the FTSE EPRA/NAREIT Global Developed Index.  CDL is up 6.3 per cent so far in June. Year-to-date, it is up 14.4 per cent. That said, when it was officially added back to the index on Monday, it fell 1.6 per cent to S$8.71.

Ayondo in $158m reverse takeover deal with Starland
Fintech and social trading firm Ayondo is eyeing a listing on the Singapore Exchange via a reverse takeover of property developer Starland.  Under the deal, Starland will acquire Ayondo for $157.5 million and pay for it through the issue of new shares priced at 18.7 cents.  Starland will work with UOB Kay Hian, the deal’s financial adviser, to determine how many shares are needed to ensure that the stock price exceeds 20 cents.

KOP Limited
REAL estate, hospitality and entertainment group KOP Ltd has struck off its dormant subsidiary Scorpio East Leisure Pte Ltd from the Register of Companies.  Catalist-listed KOP began trading in May 2014 after it completed a S$150 million reverse takeover of Catalist-listed Scorpio East.  The striking off of Scorpio East is not expected have any material impact on the net earnings per share or the net tangible assets per share of the group for the financial year ending March 31, said KOP on Monday.

LVMH is upbeat about thriving in Asia’s markets amid volatility
Top luxury brand, Moet Hennessy Louis Vuitton (LVMH), is thriving on the growth opportunities in Asia, especially in Japan, amid global economic volatility. These were part of the opening remarks at the inaugural LVMH-SMU (Singapore Management University) Luxury Research Conference on Monday.  The French group secured 37 per cent of its total revenue of 8.6 billion euros (S$13.1 billion) from the Asia continent during the first quarter of 2016, according to its financial report. This is also the largest share of its revenue.

Views, Reviews & Forum

Stop contractors from tampering with lifts
While the Building and Construction Authority’s move to tighten lift maintenance and boost safety is welcome, it does not go far enough (“BCA moves to tighten lift maintenance, boost safety” and “Tighter rules for lift upkeep welcomed”; both published last Friday).  Other equally important players, such as town councils, the HDB and police, must also make a concerted effort to boost lift safety on a daily basis.  Perhaps, they could tackle the misuse or abuse of lifts, such as when renovation contractors or house movers take control of the lift to transport materials or bulky household items.

Not surprising that crowdfunding schemes turned sour
The recent reports on crowdfunding schemes that failed to deliver should serve as a wake-up call for all investors (“Investors cry foul over builder’s crowdfunding”; June 11, and “Another crowdfunding scheme goes sour”; last Saturday).  Few should be surprised; investment portfolio theory makes it clear that investments with the potential for high returns necessarily come with high risks.  One of the schemes promised annual returns of up to 24 per cent.  This is too good to be true, considering that data from California-based Index Fund Advisers has shown that no asset class managed to generate a long-term average return of even 20 per cent a year.

Global Economy & Global Real Estate

Vote pits London, Scotland against middle England

Brexit: vulnerable pound may hurt UK bond’s haven status

Sterling rallies as Brexit worries ebb

Brexit could be catalyst for reinventing EU

London house prices fall as Brexit jitters, taxes cool demand

Japan’s trade prospects dim as May exports fall

Germany expects growth to slow after strong Q1

Pitfalls piling up for investments in Australian housing

CityNeon’s Victory Hills seen as silver lining for Star

China housing in flux as price recovery tapers off

Irish central bank sees mortgage limits as permanent

Australia taxes foreign home buyers as affordability bites

Major shareholder opposes Vanke’s 45.6b yuan share-sale plan

CEO Chesky vows to stamp out racism from Airbnb

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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