Govt to provide support as industries transform
While the industries of the world are changing rapidly as new business models disrupt existing ones, Singapore firms should not stay stagnant and let the competition overtake them. At the annual May Day Rally on Sunday, Prime Minister Lee Hsien Loong spoke of the growing popularity of online retailers Taobao and Amazon, home-share booking site Airbnb, and private-car hire services such as Uber and Grab. “What do we do? I don’t think we can stop this phenomenon and I don’t think we should try to stop it,” he told his audience of unionists, politicians and business leaders at Downtown East in Pasir Ris.
Right skills for right jobs ‘key in future economy’: PM Lee’s May Day message
Singapore must press on with the urgent task of transforming its economy so that there will be more opportunities for workers and their families to improve their lives, said Prime Minister Lee Hsien Loong. Preparing workers to take on good jobs will remain at the heart of this transformation journey, Mr Lee said in his May Day message, ahead of his May Day Rally today. “At the heart of our economic transformation is the need to ensure that Singapore continues to offer the right jobs, our workers have the right skills, and there is a good match between the two,” he added.
Singapore well-equipped to handle slowdown
Singapore is well equipped to weather the current slowdown in the global economy and tackle the long-term structural changes, labour chief Chan Chun Sing said on Friday night. Compared to many other countries, who are also struggling with the global economic headwinds, Singapore has in its favour the resources, the partnership and the attitude to take on the challenges everyone is facing, he said at the NTUC’s May Day Dinner celebration.
Up to S$200m boost for NTUC education fund
The labour movement in Singapore wants to inject up to S$200 million more into its Education and Training Fund to help mid-career working adults pick up new skills at a university. For a start, the National Trades Union Congress (NTUC) has joined forces with the Nanyang Technological University (NTU) – the first such tie-up between the labour movement and an institute of higher learning – to reach out to 30,000 such workers every year. This was announced by Prime Minister Lee Hsien Loong at the May Day Rally on Sunday, as he underscored the need to help the growing PMET group – professionals, managers, executives and technicians – deal with new challenges and stay relevant.
Services sector pessimistic about next 6 months
Companies in the services sector expect business conditions to worsen in the next six months, while manufacturers see no change. In two separate surveys, both released on Friday, firms here generally expressed pessimism about how economic conditions would turn out from April to September, although it was a less sombre mood than last quarter. A net weighted balance of 13 per cent of firms in the services sector expect less favourable business conditions from April till September, compared with October 2015 to March 2016.
Labour Movement to develop strategy of ‘employment insurance’: Chan Chun Sing
The Labour Movement will develop a strategy of “employment insurance”, by helping workers stay relevant and retain their jobs amid cyclical and structural weaknesses in the economy. Labour chief Chan Chun Sing said this at NTUC’s May Day dinner and awards on Friday (Apr 29). He said the tripartite partners – made up of NTUC, employers and the Government – must challenge themselves to lift their “game to the next higher level” as the workforce evolves. The Labour Movement will work with the Manpower Ministry to increase the pool of career counsellors in institutes of higher education. It will also continue to partner the Trade and Industry Ministry and MOM to develop sectoral manpower plans.
S’pore bank lending falls for 6th straight month in March
Singapore bank lending slid year on year for the sixth consecutive month in March as loans to both consumers and businesses fell amid sluggish economic growth. Overall loans contracted 1.74 per cent last month over a year ago. Business loans fell for seven straight months, making this the longest streak of year-on-year contraction since 1999, which saw six consecutive months of business loan declines between November 1999 and April 2000. March bank lending amounted to S$590.6 billion, compared to S$601.1 billion in the same month last year.
Singapore Real Estate
Shophouses draw keen investor interest
Investment property sales activity may be generally quiet but a small corner of the market is still seeing healthy interest. Values of shophouses in the Central Business District have jumped over the past two years, buoyed by their scarcity and demand from funds and foreigners. In what is thought to be the priciest deal this year on a per square foot (psf) basis, a shophouse in Ann Siang Road recently went for $10.8 million to a foreign investor, or about $3,750 psf in terms of gross floor area (GFA). The owner is believed to be Mr Zain Fancy of Clifton Partners. In comparison, District 1 and 2 shophouse prices went from $1,500 to $1,800 psf in 2012 to $1,800 to $2,300 psf in 2013 and 2014.
Malls sweeten lease deals amid tricky retail scene
Amid a multiple whammy hitting the retail scene, mall owners are re-looking their leasing strategies and throwing in incentives such as extending the rent-free settling-in period, and lowering rentals on longer leases, which are as long as five times (or more) the standard three-year duration. Brick-and-mortar retailers here have been buffeted by the economic slowdown, competition from e-commerce, the manpower crunch, rising business costs and lacklustre tourist spending, among other things. Despite the gloom, big-name retailers are signing long lease agreements. The idea, said industry players, is to take advantage of softening rents to position for the long-haul.
Frasers to open 10 properties in China
Frasers Hospitality, the hospitality arm of Frasers Centrepoint Ltd (FCL), unveiled plans to open 10 new properties in China’s key cities as it officiated at the opening of Fraser Place Tianjin on Friday. These cities include existing markets Tianjin, Wuxi, Chengdu, Shanghai and Shenzhen, and new markets Nanchang, Dalian and Changsha. Its game plan to expand its footprint in China, with the goal of reaching 30 properties with 7,000 units, will be a major contributor to its global target of hitting 30,000 units by 2019.
FEH keen to expand brand to Australia, NZ
Hotel operator Far East Hospitality (FEH), which launches three properties under its Oasia brand this year, is keen on taking Oasia to Australia and New Zealand next. The brand, which focuses on the themes of health and wellness, first debuted in 2011 at Novena. Far East Hospitality opened both Oasia Suites Kuala Lumpur and Oasia Hotel Downtown in April, while upscale serviced residence Oasia Residence will be launched in Singapore’s West Coast later this year. “It makes sense for us to cross-pollinate our brands into Australia and New Zealand,” said chief executive of Far East Hospitality, Arthur Kiong. http://www.businesstimes.com.sg/companies-markets/feh-keen-to-expand-brand-to-australia-nz
The Straits Times Classified, PROPERTY
– Great neighbourhoods to live in (page 2)
– Q1 deals may signal market for Good Class Bungalows looking up (page 6)
– Emerging values in District 9 (page 8)
Mapletree Commercial Trust
MCT’s VivoCity mall recorded fourth-quarter rental revenue of $48.5 million and full-year income of $191.2 million on 12.3 per cent rental reversion and income from the newly created 15,000 sq ft space in basement 1. During the quarter, it also enjoyed a 5.8 per cent rise in tenant sales and shopper traffic. Committed occupancy remained high at 99.9 per cent. The trust has 15.3 per cent and 16 per cent retail leases to be renewed in financial years 2017 and 2018 respectively, including some anchor tenant space.
Mapletree Logistics Trust’s Q4 DPU falls 2.7%
Stronger results from overseas properties and contributions from recent acquisitions lifted fourth- quarter revenue and earnings at Mapletree Logistics Trust (MLT). However, it posted a 2.7 per cent drop in distribution per unit (DPU) for the three months to March 31 at 1.8 cents, down from 1.85 cents for the same period a year ago, Mapletree Logistics Trust Management, the trust manager, said yesterday. It attributed the lower DPU to higher borrowing costs, tax and management fees, the absence of distribution from divestment gain and the enlarged issued unit base due to the Reit’s implementation of the distribution reinvestment plan.
Frasers Hospitality Trust’s Q2 DPS falls 3.6% to 1.33 cents
Strong tourism growth in Australia and Japan boosted Frasers Hospitality Trust’s results in the second quarter. The hotel and serviced residence owner benefited from fast-growing numbers of international visitors in the two countries, offsetting weaker results in its London and Singapore properties. Foreign visitor numbers hit a record high of 19.7 million in Japan last year, a rise of 47.3 per cent from the year before. Net property income came in at $22.2 million for the three months to March 31, up 17.3 per cent on the same period a year earlier.
CDL Hospitality Trusts reports 9% drop in Q1 DPS
Headwinds in the hospitality industry in Singapore and the Maldives sent City Developments Limited (CDL) Hospitality Trusts’ results sliding in the first quarter. While gross revenue rose 5.8 per cent to $44.7 million, net property income fell by 2.3 per cent to $33.7 million for January-March compared with the year earlier. Income available for distribution fell 8.5 per cent to $21.9 million, while income available for distribution per stapled security (DPS) was down 9.0 per cent to 2.22 cents.
Comparing Reit fees: two cases of anomalies
A recent report by ING Bank did not sit well with the managers of Keppel Reit and Suntec Reit because it showed them to be grossly overpaid. This was not a research report, but an independent financial adviser’s report done by bankers to give an opinion to CapitaLand Mall Trust (CMT) unitholders. CMT was proposing to amend its fee structure, and needed unitholders’ approval. In wanting to show that the proposed fee structure of CMT is in line with market norms, ING selected some Reits to compare with and plotted their management fees as a percentage of performance metrics such as gross revenue and net property income (NPI).
Richard Magnus to succeed Danny Teoh as chairman of CMTML
Capitaland Mall Trust Management Limited (CMTML), the manager of CapitaLand Mall Trust (CMT), announced on Friday that Danny Teoh Leong Kay will retire as chairman of the board and non-executive independent director from May 1. He will also step down as chairman of the corporate disclosure committee and as a member of the investment committee. Richard R Magnus, who is currently a non-executive independent director of CMTML, will succeed Mr Teoh as chairman of the board and chairman of the corporate disclosure committee from May 1. Mr Magnus was a senior district judge from 1998 to 2008.
Views, Reviews & Forum
Condo sales terms favour developer
Here is the situation: You buy a condominium which is under construction and make payments progressively, as stipulated. Before the Temporary Occupation Permit is granted, the developer wants to make changes to the common areas. However, you do not like the proposed changes and object. The developer then annuls the sales and purchase agreement with you so that it can proceed with the changes. In doing so, it will refund all payments made without interest. Here are the financial implications for the buyer when the agreement is annulled by the developer before completion.
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