DAILY NEWS

Daily News – 21st, 22nd and 23rd October 2017

Singapore Economy

The brave new world of asset management
The asset management industry has hit an inflexion point where industry growth spurred by ageing demographics is being tempered by crimping profit margins, a top JPMorgan Asset Management executive told reporters at an international media conference. And as often heard in the private banking space, the strategy of building scale while offering tailor-made services should likewise be among the top priorities for asset managers, as diverse mid-sized players will struggle to retain market share, said Mike O’Brien, CEO of the Europe, Middle East and Africa (EMEA) region, and global co-head of solutions at JPMorgan Asset Management.
http://www.businesstimes.com.sg/banking-finance/the-brave-new-world-of-asset-management

Economists sound note of caution on flip side of the sharing economy
Technology has enabled platforms for people to share resources more effectively – be it cars, bicycles, or even homes – but there are also consequences that come with the rise of the sharing economy, said economists at the Singapore Economic Policy Forum 2017 on Friday morning at the Regent Hotel. The theme of the forum was “Preparing Singapore for the Future Economy”, and in the first session, Ivan Png, economics professor in the National University of Singapore, unveiled his findings on the “Airbnb effect” on Singapore, in a study said to be the first of its kind in Asia.
http://www.businesstimes.com.sg/government-economy/economists-sound-note-of-caution-on-flip-side-of-the-sharing-economy

Boost in Great Singapore Sale figures this year
After a few years of slow growth and even dips in retail sales during the Great Singapore Sale (GSS), stores finally have a reason to smile this year. Retail sales excluding motor vehicles registered the biggest year-on-year increase during the GSS period since 2012. Latest figures from the Department of Statistics showed that for June to August, retail sales grew 2 to 4.1 per cent over the same period last year. Sales last year fell 2.3 to 6.2 per cent for the same period compared with the previous year.
http://www.straitstimes.com/singapore/boost-in-great-singapore-sale-figures-this-year?login=true
http://www.straitstimes.com/singapore/great-spore-sale-billed-a-success-this-year

Jurong first to enjoy options for retail power supply
Come April next year, households and businesses in Jurong will be the first in Singapore to have the option of choosing their electricity retailers in the soft launch of a fully liberalised power market. Electricity retailers say they are ready to battle for the household market, which would currently enjoy savings of 15-25 per cent in switching from the regulated tariff to the wholesale electricity market; many have already beefed up their back-end IT systems to deal with increased volumes, among other preparations.
http://www.businesstimes.com.sg/government-economy/jurong-first-to-enjoy-options-for-retail-power-supply

Singapore Real Estate

Mayfair Gardens in collective sale bid
Mayfair Gardens, a residential redevelopment site off Dunearn Road in Bukit Timah, is being launched for collective sale on Monday with a reserve price of S$265 million. This translates to a land rate of S$1,058 per square foot per plot ratio (psf ppr), including an additional lease top-up premium of S$43.7 million payable to the state for a fresh 99-year lease.
http://www.businesstimes.com.sg/real-estate/mayfair-gardens-in-collective-sale-bid

China’s Logan Property buys Florence Regency for S$629m
Florence Regency, a privatised HUDC estate in Hougang, has finally found a buyer willing to match the independent valuation of S$629 million – Logan Property. Florence Regency’s sole marketing agent JLL said the Singapore-incorporated subsidiary of the Hong Kong-listed Chinese developer picked up the 336-unit development in Hougang Avenue 2 for S$629 million through a collective sale.
http://www.businesstimes.com.sg/real-estate/chinas-logan-property-buys-florence-regency-for-s629m
http://www.straitstimes.com/business/property/florence-regency-closes-collective-sale-for-629m

HDB’s portal signals change
The Housing Board is the latest agency to embrace digital disruption with a revamped portal that can halve the resale flat transaction time to eight weeks. This will no doubt benefit savvy buyers or sellers, who will have a more user-friendly platform to take them through the resale process from start to finish when it kicks in on Jan 1.
http://www.straitstimes.com/singapore/hdbs-portal-signals-change

The Pines club to relocate from Stevens Road
Members of The Pines will be informed next week of the new address for their clubhouse, which used to be at 30 Stevens Road – but only after its members made repeated requests for information on the status of the club a year past its redevelopment deadline. Earlier this week, 44 members had got together to e-mail the club management, demanding to know the status of the club, their anxiety rising with the development of two hotels by Oxley Holdings on the site where their club once stood.
http://www.businesstimes.com.sg/real-estate/the-pines-club-to-relocate-from-stevens-road
http://www.straitstimes.com/singapore/pines-members-fume-over-clubs-likely-relocation

Rochor Centre to be torn down next year
Demolition works for the iconic multicoloured blocks of Rochor Centre will begin early next year, with hoardings and noise barriers put up to reduce disamenities to the public, said the Land Transport Authority (LTA). The former residential and retail complex sits on a 13,749 sq m site that is earmarked for the upcoming North-South Corridor.
http://www.straitstimes.com/singapore/housing/rochor-centre-to-be-torn-down-next-year

Companies’ Brief

Mitsui eyes property in S’pore and consumers in Asia for growth
Mitsui and Co, one of the largest sogo shosha, or general trading houses in Japan, is planning to set up a Singapore real estate investment unit as part of the group’s ambitious transformation. The move, expected by the end of the year, is among Mitsui’s efforts to build new core businesses in mobility, healthcare, nutrition and agriculture as well as retail and services.
http://www.businesstimes.com.sg/companies-markets/mitsui-eyes-property-in-spore-and-consumers-in-asia-for-growth

CCT reports rise in Q3 DPU but expects lower income from negative rental reversions
Office landlord CapitaLand Commercial Trust (CCT) reported a 2.6 per cent rise in distribution per unit (DPU) for the third quarter ended Sept 30 to 2.36 cents on the back of higher net property income. Though market rents for Grade A office have reportedly bottomed out, it is still expecting lower net property income in fiscal 2018 at select properties in its current portfolio.
http://www.businesstimes.com.sg/companies-markets/cct-reports-rise-in-q3-dpu-but-expects-lower-income-from-negative-rental

CMT posts flat DPU for Q3; negative rent reversion for first 9 mths
Reflecting the challenging retail market conditions, CapitaLand Mall Trust posted negative rental reversion in the first nine months of this year, even as the trust manager said it will “continue to focus on sustaining distribution per unit”. CMT reported unchanged third quarter distribution per unit (DPU) of 2.78 Singapore cents from the year-ago period.
http://www.businesstimes.com.sg/companies-markets/cmt-posts-flat-dpu-for-q3-negative-rent-reversion-for-first-9-mths
http://www.straitstimes.com/business/cmt-keeps-q3-dpu-steady-at-278-cents

CDL moves to quell disquiet among shareholders
As a shareholder revolt hangs over City Developments’ (CDL’s) proposed £1.8 billion (S$3.2 billion) takeover offer for sister company Millennium & Copthorne Hotels (M&C), CDL has moved to soothe claims that it is buying minorities out on the cheap. In a letter to M&C’s independent directors on Tuesday, fund managers from International Value Advisers, which holds 7 per cent of M&C, and MSD Partners (roughly 1.4 per cent) criticised the directors’ recommendation to accept CDL’s proposed cash offer of 552.5 pence a share.
http://www.businesstimes.com.sg/companies-markets/cdl-moves-to-quell-disquiet-among-shareholders
http://www.straitstimes.com/business/cdl-moves-to-quell-ire-over-mc-offer-price

Frasers Commercial Trust Q4 DPU slips
A larger unit base, higher repair rates and lower occupancy rates for its properties resulted in Frasers Commercial Trust’s (FCOT) fourth-quarter distribution per unit (DPU) slipping to 2.41 Singapore cents, down 1.6 per cent from a year ago. DPU for the full year ended Sept 30, 2017 remained the same as the year-ago period at 9.82 Singapore cents.
http://www.businesstimes.com.sg/companies-markets/frasers-commercial-trust-q4-dpu-slips
http://www.straitstimes.com/business/companies-markets/16-dip-in-frasers-commercial-trusts-q4-dpu

Mapletree trust posts 5.8% jump in Q2 DPU
Higher average rental rates for Hong Kong and Beijing properties helped Mapletree Greater China Commercial Trust (MGCCT) deliver a 5.8 per cent jump in second-quarter distribution per unit (DPU). DPU for the three months to Sept 30 came in at 1.868 cents, up on the 1.765 cents in the same period a year ago. The improved performance was also due to lower accrued revenue for the Beijing development in the same quarter previously, given the uncertainty in the applicable value-added tax rate then, said the manager yesterday.
http://www.straitstimes.com/business/mapletree-trust-posts-58-jump-in-q2-dpu

Keppel Corp soars on signs of multi-business portfolio bearing fruit
Shares in Keppel Corporation surged at the start of Friday following its first quarterly revenue and operating profit increase since 2014. The stock opened at S$7.10, up eight cents from the previous close and surged to an intra-day high of S$7.33 before paring some gains to close at S$7.30. Over 15.9 million shares changed hands, compared to a three-month average of 3.04 million shares.
http://www.businesstimes.com.sg/companies-markets/keppel-corp-soars-on-signs-of-multi-business-portfolio-bearing-fruit

Fragrance CEO makes offer for New Wave
The chief executive of real estate developer Fragrance Group is intending to make a voluntary conditional cash offer for electronic component supplier New Wave Holdings at S$0.013 per share. The offer by Koh Wee Meng represents a premium of about 44.4 per cent over the company’s closing price of S$0.009 as at Oct 19, 2017.
http://www.businesstimes.com.sg/companies-markets/fragrance-ceo-makes-offer-for-new-wave

Buybacks decline, Yanlord Land leads tally for second straight week
In the four trading sessions spanning Oct 13 to Oct 19, the Straits Times Index (STI) edged 0.5 per cent higher. This brought its dividend-inclusive return for the year through Oct 19 to 15.8 per cent, compared with an average 11.7 per cent return (in Singapore dollar terms) for the benchmarks of Japan, Hong Kong and Australia.
http://www.businesstimes.com.sg/companies-markets/buybacks-decline-yanlord-land-leads-tally-for-second-straight-week

Views, Reviews & Forum

Magnetic Middle Kingdom
This week’s topic: What is the impact of China’s rise as a global power?
http://www.businesstimes.com.sg/views-from-the-top/magnetic-middle-kingdom

A major bear market around the corner? Not quite yet
The month of October often creates apprehension among investors, given its track record with the 1929 and 1987 share market crashes. And it was in October 2007 that US shares peaked ahead of 50 per cent-plus falls (in most share markets) through the Global Financial Crisis (GFC).
http://www.businesstimes.com.sg/investing-wealth/a-major-bear-market-around-the-corner-not-quite-yet

Could buoyant stock markets be a case of rational exuberance?
Hardly a day goes by without Wall Street hitting a fresh record. If you want to know why the market keeps going up, all you have to do is look at the survey of global fund managers released by American investment bank BofA Merrill Lynch last week.
http://www.straitstimes.com/business/could-buoyant-stock-markets-be-a-case-of-rational-exuberance
http://www.straitstimes.com/business/companies-markets/wall-street-highs-likely-to-boost-sti