Q3 business climate in S’pore better, but external prospects start to fray
A survey among businesses here has found that conditions improved for them in the third quarter, lifting their outlook for the next half year. But signs of weakening international business prospects are already emerging, prompting economists to question how long the uplift will last. Economists noted that the latest Business Times-UniSIM Business Climate Survey was carried out at a time of intensifying sentiment against globalisation. The respondents were polled between late September and mid-October – late enough to have captured the sigh of relief as markets stabilised after “Brexit”, or the UK’s vote to leave the European Union. However, the survey came too early to reflect the global business outlook in the aftermath of real-estate mogul Donald Trump’s stunning upset victory in the US presidential election. ANZ economist Ng Weiwen said: “There was a relief rally after the Brexit vote, but a Trump victory has changed the optics. “If you conducted the survey right now, I wouldn’t be surprised if the results turned out much worse.”
Sustainable growth roadmap launched for hotel industry
A transformation roadmap has been launched to help the hotel industry position itself for sustainable growth at a time when it is battling a competitive operating environment and manpower constraints. The four key pillars of the map are to build manpower-lean business models, develop new solutions via innovation, boost businesses through internationalisation and create a strong pool of quality talent. Overall, the strategies and initiatives are expected to create jobs for 200 new professionals, managers, executives and technicians (PMET) each year until 2020.
Singapore Real Estate
Jefferies upbeat on S-Reits in contrarian report
Jefferies on Monday issued a report with a contrarian bullish view on Singapore-listed real estate investment trusts (S-Reits), even as other houses are turning bearish on rate-sensitive instruments in anticipation of a December rate hike. According to the federal funds futures rate, the probability of a December rate increase has surged to 98 per cent. The Federal Open Market Committee that decides on rate changes meets in three weeks’ time. In its study, Jefferies compared how Singapore Reits (S-Reits) and US Reits have performed through various regimes of growth and inflation (see chart). Its analysis shows that except for periods of high growth and low inflation, S-Reits have historically outperformed the broader market on a total return basis.
Reits put Singapore in top spot in S-EA IPO market
A Trio of real estate investment trusts (Reits) helped the Singapore initial public offering (IPO) market to bounce back from a dismal 2015 and capture South-east Asia’s largest share of proceeds in 2016, according to a study by Deloitte Singapore. A total of 16 IPOs have come to market in Singapore so far in 2016, raising S$2.3 billion and adding S$4.4 billion in market capitalisation at listing, according to Deloitte. That represented 36 per cent of the S$6.2 billion raised in South-east Asia, the largest share of IPO proceeds in the region. Singapore’s relatively active IPO market in 2016 was in stark contrast to the previous year.
Boustead Projects clinches JTC tender to build business park
Boustead Projects Limited’s wholly owned unit has clinched a contract from JTC Corporation to develop a multi-tenanted business park at the Mediapolis. BP-DoJo LLP was awarded the site based on its innovative development concept and a winning bid price of S$88.9 million, evaluated from among three competing bids, the real estate solutions provider said on Monday. JTC had launched the site under a concept and price tender in June, with a land lease period of 30 years, land area of 9,872.5 sq m and a proposed allowable gross floor area of 39,490 sq m.
CLSA Capital Partners bags 77 Robinson Road for S$530.8m
Things have come full circle for CLSA Capital Partners at 77 Robinson Road. BT understands that it has inked a deal to buy the 35-storey office tower for S$530.8 million or S$1,810 per square foot based on a net lettable area (NLA) of 293,269 square feet. SEB ImmoInvest fund, the seller, acquired the property from an earlier CLSA-managed fund in April 2007 for S$526 million or S$1,783 psf based on a slightly larger NLA of around 295,000 sq ft for the property at the time.
Homegrown Kingsland Global making waves in regional markets
Homegrown but Australia-listed real estate developer Kingsland Global wants to accomplish more with its development business in emerging markets. Perhaps, when it has amassed more scale, it will explore a secondary listing on the Singapore bourse, managing director Jeremiah Lee told The Business Times in an interview. The 38-year-old former army regular describes Kingsland Global’s business model as a straightforward build-to-sell one. That said, like several other property developers, it is also eyeing an entrance into the fund management space for acquiring third-party assets, in order to scale up more quickly.
Lian Beng, KSH, KOP consortium looking to dispose shares of indirect associated firms linked to Prudential Tower
A consortium comprising subsidiaries of four real estate and construction companies is looking to dispose the entire paid-up share capital of certain wholly-owned subsidiaries that are holding 17 strata office units in Prudential Tower, and also to settle a shareholder’s loan. The consortium, Epic Land Pte Ltd, has served a non-binding letter of intent to an interested purchaser which is an unrelated third party, the companies announced in three separate but similar filings to the Singapore Exchange on Monday evening.
CapitaLand to boost presence in Vietnam
Developer CapitaLand intends to expand its presence in Vietnam, with plans to set up a new commercial fund and to acquire more residential development sites. The firm will establish a US$500 million (S$713 million) fund by next year to invest in commercial property, mainly in Ho Chi Minh City and Hanoi, it announced yesterday. President and group chief executive Lim Ming Yan said: “We see opportunities in the commercial space in Vietnam… so we are prepared to take a position. I think the general trajectory… for Vietnam is favourable and we foresee that this trend will continue for at least the next 10 years.”
Indian cities are the Asian property bargain of 2017
Not only is India the world’s fastest-growing major economy, it may also offer Asia’s best real-estate investments next year. A survey has ranked Bangalore and Mumbai as the region’s top picks, vaulting both cities to lead a table of 22 Asian markets. Commercial property is key. The survey, compiled by the Urban Land Institute with input from PricewaterhouseCoopers LLP, cited a boom in business process outsourcing, or BPO, and IT firms that are driving demand for new office space.
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