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 December 2016

Singapore Economy

Inflation to turn positive soon

Singapore Real Estate

Property investment sales surge to 3-year high
It’s been a banner year for big-ticket property transactions of at least S$10 million each. As at Dec 23, the tally stood at S$22.5 billion – up 31 per cent from 2015’s S$17.2 billion, going by Savills Singapore’s figures. CBRE and Cushman & Wakefield have similar numbers.  This year’s tally of property investment sales, as these transactions are also known, is the highest in three years and has been supported by two mega deals – BlackRock’s S$3.38 billion sale of Asia Square Tower 1 to Qatar Investment Authority and the government’s S$2.57 billion sale of a white site slated for mostly office use along Central Boulevard to a unit of IOI Properties Group.

Govt defers launch of Bidadari mixed-use site to Q1 2017
The launch of a plum commercial and residential site in Bidadari Estate along Upper Serangoon Road that property consultants had been very bullish on has been deferred until the first quarter of 2017.

The site was originally slated for launch this month under the confirmed list of the second-half 2016 Government Land Sales (GLS) programme.   With two days to the end of the year, however, the HDB announced the deferment and said that it was to “allow the site requirements for comprehensive development to be finalised”. This surprised consultants. SLP International executive director Nicholas Mak said that the deferment could be because the site is important to the development of the up-and-coming Bidadari housing estate. “The government may require the developer to build certain facilities that would serve the residents,” he said.

Companies’ Brief

Wee Hur Holdings
Property firm Wee Hur Holdings said its subsidiary is selling a plot fronting Ann Street in Brisbane for A$65.1 million (S$67.8 million) to Australian company Mirvac Projects.  The central business district site has a land area of 5,478 sq m.  Wee Hur Holdings said the site will be reconfigured into two lots: a 3,690 sq m lot fronting Ann Street and a 1,788 sq m plot facing Turbot Street.  It is selling the lot fronting Ann Street while the other will be retained.  “The board is of the view that the sale… is in the best interest of the group and the proceeds from the proposed disposal will be used for other developments in Australia,” it added.

The gain from the sale will be about $14.43 million after deducting taxes.

Tan brothers to get 1.2b VGO shares in backdoor listing of Hatten’s property arm
VGO Corp plans to issue 1.2 billion new shares in a reverse takeover that will give the property development arm of Malaysian conglomerate Hatten Group a backdoor listing in Singapore.  VGO will issue the shares, which will represent about 92.8 per cent of VGO’s post-enlargement issued share capital, to brothers Colin and Edwin Tan in exchange for full ownership of Sky Win Management Consultancy, Hatten’s property development arm. Hatten is a conglomerate owned by the Tan brothers with businesses in real estate, hospitality and education.

Rajah & Tann
Corporate real estate lawyer Norman Ho is joining Rajah & Tann Singapore from Jan 3 next year, boosting the firm’s corporate service and adding to the four partners and two associates in the practice. Mr Ho, previously a partner at Rodyk & Davidson LLP, has represented owners and investors in commercial, retail, residential and resort developments in Singapore, UK, China, Indonesia and Australia. He is best known for his work in collective sales in Singapore, and has successfully completed over 120 of such transactions including Farrer Court, the largest en bloc sale to date.

Views, Reviews & Forum

Trump and the Singapore economy
The biggest global market impact of the Trump election to date is the flood of capital into the US in anticipation of higher returns from fiscal stimulus and monetary tightening (rising interest rates).  This has led to depreciation of the euro, yen, yuan, pound and emerging market currencies, with the ringgit and rupiah among the hardest hit. The Sing dollar has also fallen against the US dollar, but going forward it could strengthen against other Asian currencies. The increased burden of US dollar-denominated debt and rising interest rates could precipitate a financial crisis in some countries, in which case the Sing dollar would become a “safe haven” and strengthen.

Flat owners buying private property: HDB replies
The same rules on ownership of private residential property apply to both resale flat buyers and existing flat owners (“Review policy on HDB flat owners buying private property” by Mr Philip Toh Kee Poon; Dec 22).  During the first five years following the purchase of an HDB flat, also known as the minimum occupation period, a flat owner cannot own, buy, or invest in a private residential property.  This rule serves to reinforce the home ownership principle underlining public housing policies.

The art of the property deal is mostly science
In every property deal, be it residential, commercial or otherwise, there is inherent conflict. The seller wants to maximise the price while the buyer wants to minimise it. Resolving this conflict to find the right price is the art of the property deal.  Let me explain by way of a real-life example. Not too long ago a property agent faced a typical problem in real estate sales: Her client wanted more for his condominium unit than its computer-generated valuation.

Global Economy & Global Real Estate

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