The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 27th October 2016

Top Story

Singapore developers’ forecast: less gloomy but still moody
Property developers here might just be at the final stage of grief, easing from depression to acceptance – going by a sentiment index for the sector.  The NUS-Redas Real Estate Sentiment Index, or RESI, survey for the third quarter shows continued improvement in both developers’ sentiment and overall sentiment.  The composite sentiment index, a derived indicator for the overall real estate market sentiment in Singapore went up to 4.5 from 4.2 in Q2. The current sentiment index increased to 4.5 from 4.3 in Q2; and the future sentiment index increased to 4.5 from 4.0 in Q2.

Singapore Economy

Singapore ranks 2nd in ease of doing business
Singapore is ranked second, behind New Zealand, among 190 economies in the ease of doing business, according to the latest World Bank’s annual ratings.  While this means the Republic, which has topped the rankings for over a decade, has slipped in its ranking from 2015, details in the 356-page report and accompanying 104-page country study suggest otherwise.  The latest reports, entitled “Doing Business 2017: Equal Opportunity for All”, say that after “capturing the effects of such factors as data revisions and the changes in methodology”, the “comparable ranking” for Singapore in 2015 is third – and not first, as published last year. With the revised third spot ranking for 2015, the latest second placing would be an improvement.

Singapore Real Estate

Swiss Club sells 3 plots of land at JLL auction
The Swiss Club has sold three vacant plots of land zoned for residential use in the Bukit Tinggi/Jalan Kampong Chantek vicinity for a total of S$15.222 million.  The land parcels were sold at JLL’s auction on Tuesday. The buyer is a Singaporean, said Mok Sze Sze, JLL Singapore auction head.  Market watchers note that two of the plots are long strips near the road, with only the third plot, which is also the biggest with a land area of 25,861 sq ft, viable for housing development. This plot, which has freehold tenure, is flanked by Jalan Kampong Chantek and Bukit Tinggi Road.

Singapore property investor, partner pump US$115m into Seychelles project
Singapore property investor Kishore Buxani and his Seychelles-based partner have invested US$115 million in the first-phase development of an island in the Seychelles.  A 30-villa plush resort operated by Six Senses soft-opened earlier this month and construction on four of 17 luxurious private residences for sale is nearly completed. These two components make up about one-third of the island.

Proposed sale of Jurong Point mall draws mixed views
Experts in the property industry are divided on how much interest Jurong Point — which has been put up for sale with a price tag of more than S$2 billion — will garner, given the current retail climate and hefty price tag.  The mixed views come after reports that the mall has been put up for sale at more than S$3,000 per sqf based on the commercial net lettable area of about 658,000sqf that is being offered for sale by its owners Guthrie GTS Limited and Lee Kim Tah Holdings.

Companies’ Brief

First Sponsor’s Q3 profit up 13.1% at S$19.3m
Property developer First Sponsor achieved a 13.1 per cent growth in net profit to S$19.3 million for the third quarter ended Sept 30 on the back of higher development income.  Higher other income (which was negative a year ago) and finance income, as well as lower tax expenses also helped to improve the bottom line.  Revenue during the quarter grew 11.5 per cent to S$80.4 million due mainly to higher revenue from the sale of properties, which was partially offset by a decrease in revenue from property financing.

Frasers expanding Capri brand to 10 new cities
Frasers Hospitality Group said it will expand its Capri by Fraser brand to 10 new cities, even as it celebrates the official opening today of its first Capri serviced residence in Barcelona, Spain.  The 97-unit Capri by Fraser, Barcelona marks Frasers Hospitality’s entry into the Iberian Peninsula.  Since the opening of the first Capri by Fraser at Changi in Singapore in 2012, the brand has expanded to six properties, all of which have been enjoying steady occupancy of more than 85 per cent.

MCT’s Q2 distributable income up 25% on acquisition; DPU inches up
Mapletree Commercial Trust (MCT), which owns the mall VivoCity, on Wednesday posted a 1.5 per cent increase in distribution per unit (DPU) on an enlarged unit base from a placement funding an acquisition that boosted its earnings.  It posted a distribution per unit (DPU) of 2.05 Singapore cents for the second quarter ended Sept 30, 2016.  This includes an advance distribution of 0.74 cent paid out on Aug 29, 2016. The advance distribution was related to the private placement to raise S$529 million to partly finance the acquisition of Mapletree Business City I (MBC I).

Parkway Life Reit Q3 DPU down on absence of one-off divestment gain
Parkeway Life Real Estate Investment Trust (PLife Reit) marked a 8.8 per cent drop in distribution per unit (DPU) for the third quarter ended Sept 30 to 3.06 Singapore cents due to an absence of one-off distribution of divestment gain.  There was, however, improvement in underlying earnings. Gross revenue for the period rose 8.2 per cent to S$28.1 million driven by contribution from one nursing home acquired on March 31, higher rent from the properties in Singapore and the appreciation of the yen.

ARA fund to invest in Shanghai property worth 20b yuan
ARA Asset Management on Wednesday said it would set up a fund ARA Harmony VI to invest in a China commercial property worth 20 billion yuan (S$4.1 billion).  The property is a newly-completed premium-grade integrated commercial property located in the heart of Lujiazui Finance and Trade Zone in Pudong New District, Shanghai, China.  Investment in the property, known as Century Link, would be the biggest single-asset property transaction in the Asia-Pacific this year, ARA said.

Cambridge Industrial Trust posts 18% drop in Q3 DPU
Cambridge Industrial Trust (CIT) reported an 18 per cent drop in distribution per unit (DPU) to 0.987 Singapore cent for the third quarter ended Sept 30.  Its net property income fell 8.3 per cent to S$19.9 million, mainly due to higher operating expenses of properties converted from single-tenanted property to multi-tenancy, which was partially offset by revenue contribution from leasing and rental escalations of several properties.

Viva trust to buy Jurong West logistics property for S$87m
Viva Industrial Trust on Wednesday said that it has entered into an option agreement with turnkey business Sharikat National to buy a logistics property at 6 Chin Bee Avenue in Jurong West for S$87.3 million.  This will come together with the mechanical and electrical equipment and the lease of the property to Sharikat Logistics. The option may be exercised only after the required approvals from JTC have been obtained.

Lum Chang unit wins S$325m Tanah Merah MRT contract
Construction firm Lum Chang Holdings said its subsidiary has secured a S$325 million contract from the Land Transport Authority for addition and alteration works to Tanah Merah MRT Station.  This includes building an additional platform and concourse, and related road and drainage works. The contract also includes tracks and viaducts parallel to the existing East-West Line and connections to a new train depot.

Views, Reviews & Forum

Home sharing still up in the Airbnb
If home sharing were a plant, it would be a cactus – a godsend and easy to grow for some, unconventional and irksome to others, but above all, thorny.  The debate on whether to legalise short-term home rentals in Singapore has gone on for a while now, but has simmered to an unsatisfying standstill of late.  When asked for his stance in an interview with The Straits Times earlier this month, National Development Minister Lawrence Wong did not provide a clear game plan, and instead conceded that the decision is pretty much still up in the air.

Global Economy & Global Real Estate

New home sales stay close to almost nine-year high

U.S. housing, trade data boost third quarter GDP growth prospects

Landlord sees ‘pain’ for NYC apartments over surge in supply

U.S. mortgage activity index falls to lowest since May: MBA

UK mortgage approvals pick up from 19-month low: BBA

Mayor’s policies help Chongqing avoid a property boom and bust

Sydney, Melbourne House Prices Rise to Record as Perth Falls

Additional Articles of Interest – Local & Overseas Real Estate

Local & Overseas Real Estate – Full Article

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