The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 2nd December 2016

Singapore Economy

FinTech and the decline of the office sector
So much has been presented about the positives of FinTech — short for financial technology — that the opening statement of a recent report by business consultancy Capgemini stated that it might be “both the most over-hyped and under-estimated” term that the industry has seen in decades.” Probably similar in stature to the term “dotcom” around the turn of the century.  While there are thousands of articles about the benefits that this revolution will bring to the business world, one can hardly find any write-ups about what the aftermath of a FinTech tsunami might look like.

Singapore Real Estate

Credit quality of S-Reits coming under pressure: Moody’s
The credit quality of Moody’s-rated Singapore real estate investment trusts (S-Reits) will come under pressure over the next 12-18 months as their leverage weakens on the back of debt-funded investments, says Moody’s Investors Service.  “We believe S-Reits will maintain an appetite for growth in Singapore and overseas, as they pursue yield-accretive acquisitions,” said Moody’s analyst Rachel Chua.

3 Heartland Mall levels, 2 Havelock II units sold
The lower three levels of the four-storey Heartland Mall-Kovan and two strata retail units at Havelock II near Chinatown are being sold for a total sum of about S$250 milllion, BT understands.  The buyer is Master Contract Services, a Singapore-based group that is involved in the property and construction businesses. It is owned by Leow Ban Leong and Leong Suet Wah.  The properties are being sold by a fund managed by Alpha Investment Partners, which is part of Keppel Capital and sponsored by Keppel Group.

Application for Fresh Start Housing Scheme opens
The Fresh Start Housing Scheme – which aims to help second-timer families in rental flats buy a home – on Thursday (Dec 1) opened for applications, the Ministry of National Development (MND) and the Housing Development Board (HDB) announced in a joint media release.   Under the scheme, families who qualify will be able to by a new 2-room Flexi flat. The flats will come with shorter leases, ranging from 45 to 65 years, to keep the price affordable, and will also come with a longer Minimum Occupation Period of 20 years, to ensure a stable home for the children.

Can we fix Singapore’s retail scene?
In January, the oldest department store in Singapore, John Little, will be shuttering for good after being in business for 174 years.  The Plaza Singapura outlet will be the latest addition to the whopping 5.4 million square feet of vacant space in the malls — the highest in the past decade, according to data for Q3 2016 from the Urban Redevelopment Authority of Singapore (URA).

Companies’ Brief

Global Logistic Properties undertakes strategic review
Global Logistic Properties Limited (GLP) is undertaking a strategic review of options available to enhance shareholder value, following a request from its largest shareholder GIC.  It has appointed JP Morgan (SEA) Limited as its financial adviser and constituted a special committee, consisting of four independent directors, to oversee the strategic review.  “As part of the strategic review, the company, through JPMorgan, is in the process of making preliminary approaches to various parties to evaluate the viability of options available for its business,” GLP said on Thursday.

SPH on the lookout for bigger projects
Singapore Press Holdings (SPH) is on the lookout for “bigger projects” to support the group’s overall business, chairman Lee Boon Yang said, citing declining core media business.  “As revenue from core media business is continuing to decline, we need other investments to support the overall business of the group and to increase revenue and profit,” Dr Lee said on Thursday at the group’s annual general meeting at the SPH News Centre.  The move to raise its stake in Chinatown Point mall, which was announced on Monday, is one step towards this end.

Views, Reviews & Forum

Dec rate hike: Muted impact for Reits as event already priced in
It seems like investors of real estate investment trusts (Reits) have already priced in a definite rate increase in December, two weeks ahead of the Federal Open Market Committee meeting from Dec 13 to 14.  Two phenomena suggest so.  First, the federal funds futures rate shows the probability of a December rate increase at a full 100 per cent now. The probability has steadily climbed from about 70 per cent at the start of November. This shows a build-up in anticipation.

DBSS owners should not be charged for carpark use
Apartment owners of Design, Build and Sell Scheme (DBSS) developments should not be charged by the Housing Board for the use of the carpark within the development as they have already paid for the construction of the multi-storey carpark by the private developer – just like owners of executive condominiums and private condominiums.

Fall in property prices not enough to justify buying decision
I refer to the commentary “Interest in residential property remains strong” (Nov 25). Is this a good time to enter the market? In my view, the continued strong interest in the residential market is based on a misplaced view that it is the right time to enter the market.  Have prices dropped sufficiently to justify a buying decision? They have certainly not; prices have come down only by 10 per cent from a 60 per cent increase since 2009.

Global Economy & Global Real Estate

35 China cities at ‘high risk’ of falling house prices, says think tank

HK developers hit by double whammy; stock rally fades in Nov

UK house prices resume gains in Nov

Australian home price growth accelerates

Melbourne apartment risks mount as prices drop by most since 2014

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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