The Leading Professional and Representative Body for the Real Estate Industry

The Leading Professional and Representative Body for the Real Estate Industry



Daily News – 30th March 2017

Top Story

URA to revitalise Kallang River precinct
The Urban Redevelopment Authority (URA) is looking to revitalise areas along Kallang River, and wants the public’s and private sector’s ideas on how the 10-kilometre stretch from Lower Peirce Reservoir to Kallang Basin can be transformed.  News of this on Wednesday excited property developers and consultants, who began to envisage the possibilities this can present, and the value it can unlock from the developments along the waterway.


Singapore Economy  

SCCCI aims to strike balance between firms’ concerns and current economic transition
Many smaller, older companies here are now at a fork in the road to survival, and the newly-installed president of one of Singapore’s largest chambers of commerce knows that in order to help them, his chamber must “strike a balance” between their worries and the government’s push for economic restructuring.

Profits before legacy for family businesses in Singapore: survey
For family-run businesses in Singapore, profits come before legacy.  A new report by KPMG and CPA Australia on Singapore family businesses found that 93 per cent of business founders surveyed said continued profitability was more important than preserving their legacy.  This comes then, as nearly all business owners polled showed struggles with succession.

Cyclical markets likely to do better over next 6 months: asset manager
Singapore equities are not very appealing in general right now but bank shares could be worth buying, a Hong Kong-based asset manager said on Wednesday, adding that stocks here could pick up in around six months along with other cyclical markets.  Sean Taylor, chief investment officer for the Asia-Pacific region at Deutsche Asset Management, told a briefing at German lender Deutsche Bank’s Singapore office that for Singapore he was “more positive on banks” but still underweight the market, saying that it was still a relatively “lower-growth” market compared with the rest of Asia.


Singapore Real Estate 

World’s first Asia ex-Japan Reit ETF lists on Singapore Exchange
The NikkoAM-StraitsTrading Asia ex-Japan Reit Exchange Traded Fund (ETF) was listed on the Singapore Exchange (SGX) on Wednesday, with the units gaining to S$1.012 as at 10.46am.  The ETF – the world’s first such fund – was issued in partnership between Nikko Asset Management (NikkoAM) and Straits Trading, and managed by NikkoAM. This ETF is classified as an excluded investment product, making it accessible to all investors.

Sotheby’s sets up luxury home unit in Singapore
Luxury residential brokerage List Sotheby’s International Realty opened in Singapore on March 27 to capitalise on Singapore’s position as a global financial hub and the growing number of affluent individuals in the region.  Positioned to be its South-east Asia headquarters, the Singapore office plans to grow its staff strength to 30, where more than half will specialise in advisory and brokerage.

Time to rethink investment in residential property
With Singapore’s economy still weak, and property cooling measures still largely in place, potential investors are rightly apprehensive about prospects for real estate. On March 10, 2017, the government made a surprise announcement that the seller’s stamp duty (SSD) and total debt servicing ratio (TDSR) measures will be relaxed beginning March 11, 2017.

Unearthing the gems in landed homes
Landed homes are some of the most coveted real estate assets in Singapore, due to their scarcity and exclusivity. As at Q4 2016, there were only an estimated 1,352 landed residential properties slated to be completed over a stretch of five years, between 2017 and 2021. There are a handful of landed residential projects with units yet to be launched (Figure 1), including a future development on a site along Lorong 1 Realty Park that is slated to be launched in April through the confirmed list of the Government Land Sales Programme.

Promising 2017 for luxury condo market
Ever since the marketing of OUE Twin Peaks was refreshed by the deferred payment scheme in late first quarter 2016, the high end non-landed segment of the private residential property market sprung back to life. Initially treated with scepticism, the overwhelming acceptance of this payment plan ultimately surprised even seasoned marketing professionals.

Shorter tenures for more affordable private homes?
The jury is still out on the impact of recent tweaks to the seller’s stamp duty (SSD) and the total debt servicing ratio (TDSR) framework on residential home prices and volumes. What we do know is that Singapore’s private home prices have headed south for 13 consecutive quarters since peaking in Q3 2013, declining by about 11 per cent, the cumulative effect of a series of cooling measures introduced since September 2009, and more recently, the looming prospect of rising interest rates and a slowing economy.

Win-win scenario in HDB resale market
Housing and Development Board (HDB) flats house over 80 per cent of Singapore’s population and, more often than not, are the first choice of housing for young families. A perennial question among this group of buyers has always been: Build-To-Order (BTO) flats versus resale flats, which is the better option?  While BTO flats are cheaper, they come with a longer waiting time of around three years before buyers can move in. Resale flats are pricier, but the sale process takes a shorter time.

ECs still a value buy in current market
On March 10, 2017, many were taken by surprise by the government’s move to ease property cooling measures by adjusting downwards the holding period and rates for the seller’s stamp duty (SSD). Though this change does not directly impact the executive condominium (EC) market, there should be a positive spillover effect from the boost in sentiment in the private residential market.

Collective sales poised for recovery?
The residential collective sales market moves in tandem with the broader residential market cycle, registering stronger activity during the upturns while moderating during downturns. Responding to a rising market between 2005 and 2007, the collective sales market boomed, establishing a record sales volume of S$10.9 billion in 2007. In 2008/09, the global financial crisis resulted in collective sales plummeting to insignificant levels before staging a mild recovery between 2010 and 2013.

Is technology a disruption or an opportunity for retailers?
Singapore’s retail real estate sector showed continued signs of distress, with softening demand for retail spaces and sliding rental performance. In Q4 2016, Urban Redevelopment Authority’s Retail Rental Index for the Central Region fell by 8.3 per cent year-on-year (y-o-y). From its recent peak in Q4 2014, the index has eased 12.1 per cent.

Activity-based working, co-working the new buzzwords on office scene
Activity-based working has been a buzzword of the office sector, gaining significant traction in recent times. However, is it really the future of the workplace or just another cost-cutting measure?  Companies over the years have already increased office space densities significantly in order to reduce cost.


Companies’ Brief

Lendlease eyes more urban regeneration projects in Singapore, KL
Australian developer Lendlease has identified Singapore and Kuala Lumpur as the key Asian markets where it hopes to win another three to four urban rejuvenation projects over the next five years, on top of the current two projects in these countries.  This would take its development pipeline for urban rejuvenation in Asia past the A$15 billion (S$16 billion) mark, up from the current A$6 billion, said Lendlease Asia CEO Tony Lombardo.

Lendlease staff to experience co-working space
As a precursor to introducing innovative and productive workspaces in Paya Lebar Quarter (PLQ), Lendlease is going to experience first-hand how it is like to be a co-working space user.  Ahead of a planned relocation of its Asia headquarters in Singapore to PLQ next year, Lendlease will be moving its staff to a co-working space at The Work Project at Downtown Gallery, OUE Downtown from the end of June. It will be vacating its current office spanning 2,000 sq m at Mapletree Anson at 60 Anson Road come mid-2017.

Imperium Crown may sell 3 properties for 3.3b yen
Imperium Crown has received letters of intent worth a potential 3.3 billion yen (S$41.5 million) for three of its Japanese properties, the property developer announced on March 24.  The company said it is taking steps to ink definitive agreements for the sale of the Green Forest Kuramae, New City Apartments Kuramae and New City Apartments Minowa properties.

Top Global jumps 54.5%, overshoots offeror’s final price by a cent
Modest hopes for a better offer drove shares of property developer Top Global up 54.5 per cent to close at 34 Singapore cents on Wednesday, one cent higher than a privatisation bid that launched the night before.  Company chairwoman Oei Siu Hoa is offering 33 Singapore cents per share to take the company private, valuing the developer at about S$106 million.

Second Chance Q2 bottom line bolstered by gain on financial assets
Second Chance Properties chalked up a 79 per cent rise in net profit for the second quarter ended Feb 28, 2017, boosted by a gain recorded on its financial assets.  Revenue slid 9.4 per cent year-on- year to S$7.65 million while earnings per share came in at 0.26 Singapore cent, up from 0.16 cent in the corresponding period a year ago.

Centurion to build student housing in Australia for A$45.5m
Centurion Corporation on Thursday said it plans to acquire a site in Adelaide, Australia, for A$3.5 million (S$3.75 million) and developed it into a new 280-bed student accommodation. The total cost, including the cost of land, to develop the site is expected to be about A$45.5 million.

EtonHouse invests S$110m in China campus project
EtonHouse International Education Group announced on Wednesday that it is investing S$110 million to open its largest campus project yet in Deyang of Sichuan, China.  When completed in about five years’ time, the project will accommodate 5,000 students from kindergarten to high school on three campuses.  “We feel that there is a very strong demand for high-quality education in China, especially in the tier 2 and 3 cities,” said Ng Gim Choo, founder and group managing director of the Singapore-based education group.


Views, Reviews & Forum 

Has Warburg Pincus’s S-Reit game plan only just begun?
Warburg Pincus has been gradually building up its presence in the Singapore real estate investment trust (S-Reit) sector over the past few months, in a manner which appears too systematic to be just isolated acquisitions.  In typical private-equity fashion, it seems to have a bigger agenda at hand: the restructuring of the small-cap S-Reit space, with the end goal of combining managers and portfolios for efficiency purposes.

Affordable housing and the price of vitality
Here is an SAT-style question that occurred to me after a recent trip to my birthplace, San Francisco.  One of these places is not like the others: San Francisco, Cleveland, Hong Kong, Sydney and Vancouver. I am going to take a wild guess and say that you have chosen Cleveland.  You are right. But why?  One of the many ways Cleveland is different is in the cost of living.

TDSR rule change applies only to loans on existing properties
We thank Mr Ong Kim Bock for his letter “Allow similar exemption from TDSR for loan repricing” (March 22).  Mr Ong suggested not applying the total debt servicing ratio (TDSR) to the refinancing of housing loans used to purchase investment properties if the loan-to-value ratio does not exceed 50 per cent.


Global Economy & Global Real Estate

May fires starting gun on Brexit amid uncertainty

Buyer of Trump’s childhood home in Queens, NYC, said to be from China

Feb pending home sales surge to 10-month high

Kushner, Anbang end talks to redevelop Manhattan office tower

Brexit trigger: Market reaction muted, as serious talks start only in May

UK housing post-Brexit: what lies ahead

London real estate targeted by fund running Lego wealth

Opportunities beckon in Malaysia residential properties

Australia: Push towards inner-city living

Big four Aussie banks still face risks: Fitch

Tiny Florida city faces big housing shortage


Additional Articles of Interest – Local & Overseas Real Estate 

Local & Overseas Real Estate – Full Article

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