The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 25th October 2016

Singapore Economy

Long spell of negative inflation close to an end
Singapore’s longest spell of negative inflation in decades, starting almost two years ago, may be nearing an end, going by the latest data.  Inflation is now expected to move back into positive territory in the months ahead. The CPI or consumer price index – the main measure of inflation – last month posted its smallest decline since December 2014.  Overall consumer prices fell 0.2 per cent last month from September last year, according to data from the Statistics Department yesterday.  This is the 23rd straight month of sliding consumer prices, marking the longest stretch of negative inflation seen here since 1977.

Consumer prices fall for 23rd straight month in September, but pace still slowing
Consumer prices fell further in September, marking the 23rd straight month of decline, according to data released by the Department of Statistics on Monday (Oct 24).  The consumer price index (CPI) fell 0.2 per cent last month, compared to 0.3 per cent the month before, which mainly reflected the smaller decline in private road transport costs and, to a lesser extent, higher food inflation, the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI) said in a joint statement.

Changi soars with 6.2% growth in Jan-Sept traffic
Changi Airport looks set to end the year strongly, with growth in passenger numbers already seen in the first nine months of the year.  From January to September, it handled 43.5 million passengers, 6.2 per cent more than the total traffic for the same period last year.  With demand for air travel typically strong in the last quarter, Changi should be able to maintain the momentum, said industry experts.  If it does keep up the momentum, the airport is looking at its strongest performance in three years.  Last year, Changi handled a record 55.4 million passengers, which was 2.5 per cent more than in 2014. The year before that, growth was just 0.7 per cent.  In an update yesterday, Changi Airport Group said so far this year, all its top 10 country markets have posted year-on-year growth.

Singapore Real Estate

Continuing decline in office and retail rents in Q3: Colliers
Overall office rentals across Singapore continued to slide under the pressure of oversupply and lacklustre demand, while in the retail scene, leasing activity slowed and the decline in retail rentals quickened in the third quarter of this year.  This was according to two separate reports by Colliers on Monday, setting the tone for possibly sombre official data to be released by the Urban Redevelopment Authority (URA) this Friday.  According to Colliers, rents in the Raffles Place/New Downtown area fell more sharply than before, in the third quarter compared to Q2. Monthly gross rents in the premium and Grade A office buildings fell 1.7 per cent and 1.5 per cent respectively, compared to the 1 per cent and 0.3 per cent quarter-on-quarter drop in Q2.

Companies’ Brief

Mapletree Industrial Trust Q2 DPU up 1.4%
Mapletree Industrial Trust on Tuesday reported a 1.4 per cent increase in distribution per unit (DPU) to 2.83 Singapore cents for the second quarter ended Sept 30, 2016.  Gross revenue rose 1.8 per cent to S$84.2 million due mainly to higher rental rates achieved across all property segments as well as higher occupancies achieved in its high-tech buildings, while net property income rose 4.3 per cent to S$63.6 million.

Mapletree Logistics Trust’s Q2 DPU stays flat at 1.86 cents
Mapletree Logistics Trust (MLT), which owns a suite of industrial properties across Asia, said distributable income to unitholders for its second quarter ended Sept 30, 2016 was S$46.6 million, up one per cent from S$46.2 million a year ago. Distribution per unit (DPU) for the quarter stayed flat at 1.86 Singapore cents.  Gross revenue was up 4.7 per cent to S$91.6 million, while net property income was up 5.3 per cent to S$76.8 million.

CapitaLand sets up third integrated development fund in China worth US$1.5b
In what is the largest private capital-raising that CapitaLand Limited has undertaken, the property group has raised US$1.5 billion for its third private investment vehicle in China to invest in integrated developments.  Known as Raffles City China Investment Partners III (RCCIP III) with a life of eight years, the fund will invest in prime integrated developments in gateway cities in China.  CapitaLand will subscribe for a 41.7 per cent sponsor stake in RCCIP III while the remaining interests will be held by major investors from Asia, North America and the Middle East, including new and existing investors.

CapitaLand Retail China Trust posts 10.6% drop in Q3 DPU
CapitaLand Retail China Trust (CRCT) reported a 10.6 per cent decline in distribution per unit (DPU) to 2.36 Singapore cents on the back of weaker net property income (NPI).  The weaker NPI, which fell 0.6 per cent to 161.28 million yuan, was impacted by a higher property tax provision of 11.2 million yuan made at the Beijing malls due to a change in property tax basis by the local tax authority with effect from July 1, 2016. In Singapore dollar terms, the drop in NPI was a bigger 6.9 per cent to S$32.77 million because of the relatively weak yuan.

GuocoLand Q1 profit plunges 95% at S$25.6m due to one-offs from a year ago
Property developer GuocoLand Limited reported net profit of S$25.6 million for its first quarter ended Sept 30, down 95 per cent from S$516.5 million a year ago.  Revenue was down 54 per cent to S$202.8 million, from S$439.8 million a year ago.  Lower revenue was mainly due to the absence of contribution from the sale of an office block in Shanghai Guoson Centre a year ago.

Frasers Property secures 115 hectare site in Melbourne for A$440m mixed-use project
Frasers Property Australia has secured a 115 ha site in Wyndham Vale, Melbourne, Australia, for a A$440 million (S$466 million) mixed-used community project.  The site – at 974 Black Forest Road – is adjacent to a proposed rail station. The residential component covers 69.4 ha and will yield around 1,200 lots, with 8.3 ha allocated to education/community use, a further 8.3 ha for retail and 14.8 ha dedicated to mixed-use commercial/employment.

GL Limited Q1 profit down 65% at US$11m on weaker UK hotel revenues
Property group GL Limited, the former GuocoLeisure, said net profit for its first quarter ended Sept 30 was US$11 million, down 65 per cent from US$31.4 million a year ago.  Revenue was down 15 per cent to US$97.8 million from US$115.1 million a year ago. Lower revenue was mainly due to its hotel and gaming segments, and was also due to a weaker sterling. GL operates hotels in London, owns a private gaming club, and also receives oil and gas royalties. Its oil and gas segment recorded higher revenue for the quarter.

Starhill Global Reit manager announces board changes
Starhill Global real estate investment trust (Reit), which has a stake in Orchard Road’s Wisma Atria and Ngee Ann City, said its Reit manager has made some changes to its board with effect from Nov 1.  Keith Tay Ah Kee, 72, has resigned as lead independent non-executive director and chairman of the audit committee, following his reaching the nine-year mark as an independent director. The current code of corporate governance requires the independence of any director serving on a board beyond nine years from the date of his first appointment to be subject to “particularly rigorous review”.

GK Goh to develop nursing home near Upper Thomson Road
Investment holding company GK Goh Holdings said subsidiary Canistel Pte Ltd has won a tender for a land parcel at Venus Drive near Upper Thomson Road.  The company bid S$24.3 million. It plans to develop a nursing home on the land “with a differentiated product that widens the range of aged care choices available in Singapore”, it said.  The project, which has a maximum gross floor area of 5,600 square metres, will be financed from a combination of internal resources and bank borrowings.

Vibrant Group joint venture buys mixed-use land in China
A joint-venture of logistics solutions provider Vibrant Group’s subsidiary has acquired a mixed-use parcel of land with a 70-year lease in eastern China for 225 million yuan (S$46.2 million).  The 30,249 square-metre plot is a mixed residential and commercial development site in the city of Jiangyin in Jiangsu province, said mainboard-listed Vibrant in a release issued to the Singapore Exchange on Monday after trading closed.

Global Economy & Global Real Estate

New York’s latest luxury apartment craze: driveways

Investors get short end of the stick with long-term US debt

Investors snap up offices in key Europe cities ahead of Brexit

As Europe and Asia hoard cash, economists see echoes of crisis

Aussie homes are ‘increasingly unaffordable’: Treasurer

Construction, small and mid-cap stocks expected to benefit

South Korea’s economy grows more than forecast in Q3 on property boom

BOJ warns against risks in property sector

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

Scroll to Top