DAILY NEWS

Daily News – 25th, 26th and 27th August 2018

Top Story

HDB lessees are owners of their flats, not renters: PM Lee
On the issue of 99-year Housing Board (HDB) leases, Mr Lee refuted the notion that the lease is “merely an extended rental” and not a sale. He said he found the argument by some commentators “frankly amazing”, as many private properties are also held on 99-year leases but no one argues they are merely being rented.
https://www.businesstimes.com.sg/government-economy/hdb-lessees-are-owners-of-their-flats-not-renters-pm-lee
https://www.straitstimes.com/politics/pm-home-ownership-gives-sporeans-a-stake-in-nation
https://www.channelnewsasia.com/news/singapore/home-ownership-hdb-helps-singaporeans-build-assets-pm-lee-10648722
https://www.todayonline.com/singapore/singapores-homeownership-and-asset-enhancement-policies-have-worked-well-pm-lee

Singapore Economy

Singapore output growth on cue, slowing to 6% in July
Backed by pharmaceuticals, manufacturing output rose by 6 per cent on the previous year, in line with economists’ forecasts, according to Economic Development Board (EDB) data on Friday. Growth was lower than in the month before, especially with June’s industrial production revised from 7.4 per cent to 8 per cent. On a seasonally adjusted basis, manufacturing output fell month on month by 1.7 per cent.
https://www.businesstimes.com.sg/government-economy/singapore-output-growth-on-cue-slowing-to-6-in-july
https://www.straitstimes.com/business/economy/growth-in-singapore-manufacturing-eases-to-6-as-expected
https://www.channelnewsasia.com/news/singapore/singapore-manufacturing-output-slows-for-second-month-in-july-10647894

H1 visitor arrivals to Singapore grow by more than 7 per cent
Singapore continued to attract more arrivals in the first half of this year, as 9.19 million visitors came to Singapore’s shores, up 7.6 per cent from a year ago. Preliminary estimates from the Singapore Tourism Board (STB) showed that China, Indonesia and India remained key feeder markets, with volumes from China rising 11.4 per cent to 1.73 million.
https://www.businesstimes.com.sg/transport/h1-visitor-arrivals-to-singapore-grow-by-more-than-7-per-cent
https://www.straitstimes.com/singapore/tourist-arrivals-up-73-in-q1-but-spending-dips-05
https://www.channelnewsasia.com/news/singapore/tourism-visitor-arrivals-to-singapore-rise-in-q1-2018-10648466

Singapore, Guangdong to tie up on modern services, high tech: Ong Ye Kung
Collaboration between Singapore and the southern China province of Guangdong is expected to continue growing, focusing on areas such as smart-city development and intellectual property protection. These were among priorities laid out by Education Minister Ong Ye Kung and Guangdong governor Ma Xingrui on Friday, during the Singapore-Guangdong Collaboration Council’s ninth meeting.
https://www.businesstimes.com.sg/government-economy/singapore-guangdong-to-tie-up-on-modern-services-high-tech-ong-ye-kung
https://www.straitstimes.com/singapore/guangdong-and-spore-eye-more-areas-for-link-up
https://www.channelnewsasia.com/news/singapore/sino-singapore-guangzhou-knowledge-city-to-be-upgraded-to-state-10649550

KL, Singapore agree to defer High-Speed Rail project; both parties to discuss terms
Singapore and Malaysia have agreed to put the High-Speed Rail (HSR) on hold after ministers in charge met on Aug 23, with senior officials now tasked with negotiating terms of the deferment. The Straits Times understands that Transport Minister Khaw Boon Wan communicated Singapore’s agreement to the request for a deferment at the meeting in Kuala Lumpur with Malaysia’s Economic Affairs Minister Azmin Ali.
https://www.businesstimes.com.sg/transport/kl-singapore-agree-to-defer-high-speed-rail-project-both-parties-to-discuss-terms
https://www.straitstimes.com/asia/se-asia/discussions-on-deferring-hsr-still-ongoing-says-singapore
https://www.channelnewsasia.com/news/singapore/discussion-on-malaysia-request-to-defer-hsr-ongoing-mot-10649394

Gig economy taking off but observers flag risks
The gig economy may be taking off, but labour and economy experts here are more concerned about traditional self-employed workers, such as private tutors and taxi drivers. Unemployment and lower wages are not the main issues for the freelancers tapping digital apps and platforms for work, said industry watchers. They cited instead old bugbears such as patchy insurance coverage.
https://www.businesstimes.com.sg/government-economy/gig-economy-taking-off-but-observers-flag-risks

EU firms in Asean see region as having greatest potential
A growing majority of European firms in South-east Asia believe further Asean economic integration will be important to their business, with many finding the current pace too slow, the fourth EU-Asean Business Sentiment Survey has found. Conducted by the EU-Asean Business Council, the survey found that European firms in the region were optimistic about prospects, though this was subdued compared to a year ago.
https://www.businesstimes.com.sg/government-economy/eu-firms-in-asean-see-region-as-having-greatest-potential

Starhub, UOB to launch digital marketplace for SMEs
Starhub will launch a digital marketplace for small businesses in October, with United Overseas Bank (UOB) named its first partner on Sunday. The two firms have tied up to help small and medium-sized enterprises (SMEs) here adopt digital business solutions. Under the memorandum of understanding, they will look into offering such companies real-time customer transaction insights and technologies such as artificial intelligence.
https://www.businesstimes.com.sg/companies-markets/starhub-uob-to-launch-digital-marketplace-for-smes
https://www.straitstimes.com/business/companies-markets/starhub-to-launch-digital-marketplace-for-smes

Majority of Singaporeans optimistic about Smart Nation projects: Poll
The recent SingHealth data breach – Singapore’s worst cyber attack to date – has somewhat dampened Singaporeans’ optimism about the Smart Nation push. But the majority are still confident about the authorities’ ability to handle the crisis, a new survey by the Institute of Policy Studies (IPS) Social Lab found.
https://www.straitstimes.com/politics/majority-optimistic-about-smart-nation-projects-poll

Singapore Real Estate

More than 52% of former Rio Casa units sold: joint developer
Riverfront Residences in Hougang has sold more than 52 per cent of its 1,472 homes, according to a member of the developing consortium. The project, launched for sale last month, was swarmed by buyers when overnight property cooling measures were unveiled on July 5.
https://www.businesstimes.com.sg/real-estate/more-than-52-of-former-rio-casa-units-sold-joint-developer
https://www.straitstimes.com/business/companies-markets/half-of-riverfront-residences-units-sold

HDB to launch over 2,000 new waterfront flats in Punggol
More than 2,000 families can opt for waterfront living when two housing projects at a new Punggol district are launched later in August. Occupying the north-eastern tip of Punggol town, where the land meets the Johor Strait, Punggol Point District has been envisioned as a smart and green town that pays homage to its heritage as a farming area, said the HDB on Sunday.
https://www.businesstimes.com.sg/real-estate/hdb-to-launch-over-2000-new-waterfront-flats-in-punggol
https://www.straitstimes.com/singapore/housing/2100-punggol-waterfront-flats-coming-up
https://www.channelnewsasia.com/news/singapore/hdb-to-launch-2-112-flats-in-punggol-point-cove-10649376
https://www.todayonline.com/singapore/sea-facing-flats-new-waterfront-punggol-district-go-sale-august-bto-exercise

Companies’ Brief

GuocoLand Q4 profit falls but full-year net profit up by 7%
GuocoLand’s earnings were down in the fourth quarter, tracking a fall in group revenue, on what the real estate player dubbed a “substantial” drop in its stock of private homes. Net profit was S$141.2 million for the three months to June 30, down by 42 per cent on the previous year, according to audited results out on Sunday. Revenue was more than halved, lower by 52 per cent to S$197 million.
https://www.businesstimes.com.sg/companies-markets/guocoland-q4-profit-falls-but-full-year-net-profit-up-by-7
https://www.straitstimes.com/business/companies-markets/guocoland-q4-profit-falls-42-on-lower-revenue

GL net profit up by 20% in FY2018 at US$59 million; rocky road ahead for London hotels
GL Ltd, the former GuocoLeisure, reported a jump in its full-year earnings on the back of other operating income, despite challenges in the London hospitality business. Net profit was US$59 million, up by 20 per cent year on year, for the 12 months to June 30. Revenue came in 1 per cent lower at US$344.4 million, according to audited results released on Friday.
https://www.businesstimes.com.sg/companies-markets/gl-net-profit-up-by-20-in-fy2018-at-us59-million-rocky-road-ahead-for-london

Lum Chang records 33% increase in FY2018 net profit to S$24.9 million on fair-value gains
Fair-value gains lifted construction company Lum Chang Holdings’ full-year earnings despite a slide in revenue, according to unaudited financial results out on Friday. Net profit came in at S$24.9 million for the 12 months to June 30, up by 33 per cent on the year before, even as turnover fell by 29 per cent to S$260.7 million.
https://www.businesstimes.com.sg/companies-markets/lum-chang-records-33-increase-in-fy2018-net-profit-to-s249-million-on-fair-value

Lum Chang joint venture to sell part of stake in UK freehold land for £28.14m
Lum Chang Holdings’ joint venture company Kelaty Propco (KPL) has entered into a sale and purchase agreement with Kelaty House Wembley to sell part of its interest in a freehold site in London for £28.14 million (S$49.25 million). The land at Wembley consists of a serviced residence component and a student accommodation component, both of which are being developed. The sale pertains to the student accommodation component; KPL will continue to own interest in the serviced residence component and develop it, with a view of deriving recurring income from it.
https://www.businesstimes.com.sg/companies-markets/lum-chang-joint-venture-to-sell-part-of-stake-in-uk-freehold-land-for-%C2%A32814m
https://www.straitstimes.com/business/companies-markets/lum-chang-joint-venture-to-sell-part-of-stake-in-london-freehold-site-for

KSH Holdings awarded S$266.3 million contract for former Rio Casa redevelopment project
Property group KSH Holdings has secured the contract for the redevelopment at Riverfront Residences in Hougang, it announced on Friday. The S$266.3 million contract will see KSH build nine 17-storey apartment blocks and 21 strata landed units, as well as stores, car parks and communal facilities, with construction expected to begin in November 2018 and finish in February 2022.
https://www.businesstimes.com.sg/real-estate/ksh-holdings-awarded-s2663-million-contract-for-former-rio-casa-redevelopment-project

Oxley Holdings’ Q4 net profit more than trebles to S$138m
Property developer Oxley Holdings has chalked up a 231 per cent increase in net profit for the fourth quarter ended June 30, 2018. Profit rose to S$137.7 million from S$41.5 million a year ago. The group recorded a fair value gain of S$111.2 million comprising mainly of gain on revaluation of Chevron House, reversal of fair value loss on financial instrument of S$24.2 million, and a gain on the sale of an investment property in Ireland of S$20.2 million.
https://www.businesstimes.com.sg/companies-markets/oxley-holdings-q4-net-profit-more-than-trebles-to-s138m
https://www.straitstimes.com/business/companies-markets/oxley-holdings-q4-net-profit-more-than-trebles

Offer for Wheelock ‘fair, reasonable, but not compelling’: IFA
PrimePartners Corporate Finance, the independent financial adviser (IFA) to the recommending directors of Wheelock Properties (Singapore), on Friday said that the financial terms of the offer to take the company private are “fair and reasonable, but not compelling, and are not prejudicial to the interests of minority shareholders”. It reached this conclusion after considering that the developer’s revenue has decreased significantly in the period under review as most of the completed development properties have been sold, and the company has not added any new property development projects during this time.
https://www.businesstimes.com.sg/companies-markets/offer-for-wheelock-fair-reasonable-but-not-compelling-ifa
https://www.straitstimes.com/business/companies-markets/offer-for-wheelock-fair-and-reasonable-but-not-compelling

Wing Tai Properties net profit more than doubles to HK$1 billion in H1 on W Square divestment in Hong Kong
Earnings soared in the first half of the year at Wing Tai Properties, thanks to a gain on disposal of subsidiaries, amid a boom in Hong Kong’s property market. Net profit more than doubled to HK$1 billion (S$180.5 million) for the six months to June 30 at the Hong Kong associate of Singapore-listed Wing Tai Holdings, up from HK$449.8 million the previous year, according to unaudited results released on Friday.
https://www.businesstimes.com.sg/companies-markets/wing-tai-properties-net-profit-more-than-doubles-to-hk1-billion-in-h1-on-w-square

ISOTeam swings into the red with S$1.99m Q4 loss

Construction company ISOTeam has sunk into the red with a fourth-quarter net loss of S$1.99 million for the three months ended June 30, compared to a net profit of S$1.38 million a year earlier. This came on the back of rising expenses and a drop in revenue. Loss per share stood at 0.7 Singapore cent for the quarter, versus an earnings per share of 0.48 Singapore cent for the year-ago period.
https://www.businesstimes.com.sg/companies-markets/isoteam-swings-into-the-red-with-s199m-q4-loss

Keong Hong Holdings to buy Chin Bee industrial buildings for S$10.8 million
Construction and property group Keong Hong Holdings plans to buy two industrial properties, to raise productivity in the pre-fabricated bathroom business. Keong Hong Construction, a wholly owned subsidiary, entered into an option to purchase the buildings in the Chin Bee area of Taman Jurong for S$10.75 million, the company said on Friday.
https://www.businesstimes.com.sg/companies-markets/keong-hong-holdings-to-buy-chin-bee-industrial-buildings-for-s108-million

Pacific Star Development posts S$8.43m profit for 18 months ended June 30
Property group Pacific Star Development’s net profit for the 18 months ended June 30, 2018 came to S$8.43 million, while revenue hit S$121.43 million. Pacific Star, which was formerly known as LH Group, was formed via a reverse takeover (RTO) of PSD Singapore; the RTO was completed on Feb 15, 2017, and in November last year, the company announced a change in its financial year-end from Dec 31 to June 30. For the 12 months ended Dec 31, 2016, its net profit was S$7.53 million, against a revenue of S$59.11 million.
https://www.businesstimes.com.sg/companies-markets/pacific-star-development-posts-s843m-profit-for-18-months-ended-june-30
https://www.straitstimes.com/business/companies-markets/pacific-star-development-posts-843m-profit-for-18-months-ended-june-30

Figtree Holdings snags S$12.2 million contract to design and build Pandan Loop factory
Figtree Holdings will design and build a factory in Pandan Loop for a pork and meat product distributor, under a contract announced on Friday. Wholly owned subsidiary Figtree Projects has secured a S$12.19 million deal with Tiong Lian Food Pte Ltd for a food processing and distribution facility, said the Figtree board.
https://www.businesstimes.com.sg/companies-markets/figtree-holdings-snags-s122-million-contract-to-design-and-build-pandan-loop

VIEWS, REVIEWS, FORUM & Others

Crazy, rich real estate: Will cooling measures affect super penthouse sales?
One glance from the 62nd floor of GuocoLand’s Wallich Residence – with its commanding 270-degree view of the Singapore Strait, most of the country’s skyline and famous landmarks – will underscore just why super penthouses like this are considered such trophy assets by the mega-rich. The 99-year leasehold Wallich Residence super penthouse – the largest non-landed residence here -sits atop Singapore’s tallest building at Tanjong Pagar Centre.
https://www.straitstimes.com/business/crazy-rich-real-estate-observers-divided-on-whether-cooling-measures-will-affect-super

Vers will only continue to raise property prices in S’pore
The recent policy announcements by the Government on increasing the value of old Housing Board flats, while calming the anxieties of some, unfortunately continue to propagate the story of ever-rising home prices in already expensive Singapore (Vers allows for more orderly redevelopment; Aug 20). Housing is for living and should not be thought of as a long-term investment.
https://www.straitstimes.com/forum/letters-in-print/vers-will-only-continue-to-raise-property-prices-in-spore

Tackling the HDB 99-year lease issue: Are HIP and Vers the answers?
Ten years ago, hospital support staff worker Patrick Lee toyed with the idea of selling his Housing Board terraced house – a rarity – located in Stirling Road and which has 49 years left on its lease. “It was getting old – the beams were rotting, the awnings were coming off, there was termite infestation,” says the 58-year-old.
https://www.straitstimes.com/singapore/easing-hdb-owners-anxieties

Deciding what gets Vers-ed
The Voluntary Early Redevelopment Scheme (Vers) gives home owners a shot at recouping some monetary value before the 99-year lease on their flats expires at zero value. But it is by no means a certainty that everyone will have the option. Where their flats are located, how old the estate is, and the condition of the individual building are some of the likely factors to be considered as to whether the Government picks a precinct for the scheme.
https://www.straitstimes.com/singapore/deciding-what-gets-vers-ed

Steadfast about growth
John Lim, group CEO and co-founder of ARA Asset Management, has left nothing to chance in his entrepreneurial journey, going by the calibrated moves he has made in the past 16 years. From the choice of major shareholders and strategic partners, the decision to delist ARA, to the firm’s corporate culture, they are all a result of much deliberation. Clearly, not anyone who knocks on ARA’s doors gets invited in. “We are not in lack of capital,” Mr Lim quips. “There is no reason for us to take in anyone who comes with a bag of cash. Everyone who comes into ARA must have a purpose and a reason, as far as I am concerned.”
https://www.businesstimes.com.sg/the-raffles-conversation/steadfast-about-growth

Retirement and housing: balanced approach needed
This week’s topic: To what extent should CPF savings be allowed for the purchase of shorter-lease property (both public and private)? How might the trade-off between protecting the value of older leasehold property and safeguarding Singaporeans’ retirement adequacy be managed?
https://www.businesstimes.com.sg/views-from-the-top/retirement-and-housing-balanced-approach-needed

Commentary: Windfalls and bailouts should not be an expected part of the public housing equation
Singapore: Apprehensions over ageing HDB leases might have eased to some extent after Prime Minister Lee Hsien Loong’s National Day Rally speech. Mr Lee did well to explain why HDB leases are limited to 99 years and cannot be indefinitely renewed, for the sake of future generations and for social and practical reasons.
https://www.channelnewsasia.com/news/commentary/national-day-rally-housing-vers-en-bloc-hdb-10648052

Commentary: Strong political commitment to housing is precisely what younger Singaporeans need
Singapore: Where does an award-winning conductor who directs world-renowned orchestras call home? That question would likely summon images of a grand Beverly Hills mansion or a luxurious skyscraper penthouse in London.
https://www.channelnewsasia.com/news/singapore/national-day-rally-housing-vers-hdb-public-housing-old-estates-10648478

Small changes that can enhance life in HDB estates
In most Housing Board estates, we have precinct pavilions built for community activities such as Residents’ Committee events, weddings and wakes. It is a waste for such sheltered common spaces to be used so sparingly.
https://www.straitstimes.com/forum/letters-in-print/small-changes-that-can-enhance-life-in-hdb-estates

What the future holds for the department store
“There was a power outage at a department store yesterday,” began one of comedian Steven Wright’s gags. “Twenty people were trapped on the escalators.” I thought of that while looking through pictures of Oxford Street’s House of Fraser store. The future of the chain of department stores had been in doubt, though after its acquisition by Sports Direct earlier this month, the flagship branch, at least, has been given a reprieve.
https://www.straitstimes.com/opinion/what-the-future-holds-for-the-department-store

Keeping employees safe and sound: On patrol with workplace safety inspectors
Singapore: In two cars, four safety inspectors pulled up outside a warehouse, about the size of three basketball courts, in Joo Koon Circle. “Where is the front gate? Why are there no directional signs?” asked 24-year-old Siti Hajar Salim in a perplexed tone. She was taking the lead in the operation and was acting as navigator to her buddy-mentor Aidil Mohamed Riduan, 39.
https://www.channelnewsasia.com/news/singapore/patrolling-with-safety-inspectors-wsh-manpower-ministry-10636856