Singapore bond market ending the year with a whimper
The local bond market is ending the year with a whimper – beset with anxieties over upcoming interest rate hikes and uncertainty over the incoming policies of the next US president. With issuance down 15 per cent in the first 11 months of the year over the first 11 months of last year, the full-year volume may turn out to be the slowest since the decade began. Returns are off their highs, but haven’t been half bad, although this may not be apparent from news about the slew of defaults. New issuances for the first 11 months of this year came to S$18.6 billion from 98 issues – down 15 per cent from the first 11 months of last year, which was S$21.8 billion from 157 issues.
Singapore Real Estate
Q3 home sales up 1%, strong resales offset primary home figures
Home sales rose by one per cent quarter-on-quarter to 4,596 units in the three months to September, led by a stronger showing in the resale market, according to a report by Edmund Tie & Company Research. The resale market saw a 15.7 per cent increase in sales in the third quarter, while primary home sales fell 13.2 per cent due to slower sales in August. Despite this upward trend in transaction volume, home prices continued to remain soft in the third quarter. This is due to the Urban Redevelopment Authority’s (URA) private residential property price index falling for the 12th consecutive quarter.
Buying opportunity in S-Reits: RHB
The current correction in the prices of Singapore Reits (S-Reits) offers a buying opportunity given the widest spread against the yield of government bonds among the global Reit sector, RHB Research said in a report on Monday. This comes as S-Reit prices have corrected by 3 per cent since the US elections amid a global shift in demand away from low-risk yield instruments. The correction comes amid expectations that a Donald Trump presidency would result in a pro-growth inflationary environment in the US.
CEA slaps fines on SQFT and ex-agent
The disciplinary committee of the Council for Estate Agencies (CEA) has slapped SQFT Global Properties Singapore and its former agent with financial penalties over the sale and marketing of a New Zealand property. In a statement on Monday, the council said it has imposed a fine of S$10,000 on SQFT for one count of failing to supervise its former property agent, Paleenia Wong Mui Wah. The council said the case involved the conduct of Ms Wong over the sale and marketing of Albany Heights Villas, a property in Auckland, New Zealand.
PAP town councils set aside $45m for safer lifts
To make lifts safer and more reliable, all People’s Action Party (PAP) town councils will join hands and pump in a total of $45 million between them over the next five years. This will go towards implementing recommendations unveiled by the PAP Town Councils Lift Taskforce yesterday, which the 15 town councils have accepted. Set up in July and led by PAP town councils’ coordinating chairman Teo Ho Pin, the task force made its recommendations upon the completion of a study to improve lift safety and reliability.
WP town council to spend $17.5m to replace lifts
The Workers’ Party-run Aljunied-Hougang Town Council (AHTC) expects to spend $17.5 million to replace selected lifts over the next five years, ahead of those lifts’ usual 28-year lifespan. The AHTC, which manages more than 1,700 lifts, also gave details of how it plans to implement the Housing Board’s Lift Enhancement Programme (LEP), which helps town councils fund the installation of recommended lift features. In a statement, AHTC chairman Pritam Singh noted that lift maintenance and part replacement costs have been rising.
HK-based PE firm eyes S’pore high-end homes, prime offices
Hong Kong-based private equity real estate firm Phoenix Property Investors is on the prowl for more investments in South-east Asia. Currently it has invested about US$120 million – or 5 per cent of the US$2.5 billion it has raised since it was set up in 2002 – in Jakarta, Manila and Singapore. The goal is to grow the region’s share to 15-20 per cent over time, if there are opportunities, said Samuel Chu, co-founder, managing partner and chief investment officer at Phoenix Property Investors, in an interview.
Tech unicorn makes rainbow connection at co-working space here
A Tech unicorn with about 100 staff will take up space at a new co-working office in Singapore’s Central Business District area in early 2017. The Working Capitol said on Monday that it would offer about 55,000 square feet across 11 floors at 140 Robinson Road to businesses across various industries. It said initial members of The Working Capitol on Robinson Road include a fintech (financial technology) lab by RHB Bank and a 100-person tech unicorn taking up an entire floor. It did not identify the tech company, with a unicorn referring to a startup that is valued at at least a billion dollars.
Two Aussie developers may list on SGX
Two Australian property developers are eyeing Singapore as a place to list. One would involve Australia-listed real estate investment manager Cromwell Property Group listing some European office properties it manages. The firm said last week that it was considering Singapore for an initial public offering. Crown Group would be an even bigger fish for the SGX to land. Founded by Indonesia-born Iwan Sunito, the Sydney-based developer had around A$4.8 billion (S$5.1 billion) worth of projects in the pipeline as at January this year.
A-Reit to buy 3 Science Park buildings for S$420m
Ascendas Real Estate Investment Trust (A-Reit) plans to acquire the DSO National Laboratories buildings and DNV GL Technology Centre at Science Park Drive for S$420 million in cash and equity, the manager of the business space and industrial property trust said on Monday. Of the purchase consideration, S$100 million will be paid in new units of A-Reit, the pricing of which will be based on the 10-day volume-weighted average price of the trust after an advanced distribution has gone ex. Either the buyer or seller, however, may opt for an all-cash settlement.
Oxley to acquire 40% stake in Australian developer for A$32m
Oxley Holdings will invest A$32 million (S$33 million) for a 40 per cent stake in an Australian property and construction company. Announcing this in a filing to Singapore Exchange before market opened on Tuesday, the mainboard-listed real estate developer said it intends to purchase a 40 per cent stake in Pindan Group, a four-decade-old privately owned property and construction company based in Western Australia.
Phoenix Property Investors keen on boosting investments in SE Asia and Singapore
Hong Kong-based Phoenix Property Investors, a private equity real estate firm with assets managed and under management in Asia of over US$6.7 billion, is looking to increase investments in South-east Asia property markets including Singapore. “The company is expanding its investment footprint from North Asia, particularly Hong Kong, Japan and China, to the South-east Asia region,” Phoenix said in a news release on Monday. In South-east Asia, the group is setting its sights on Jakarta and Manila, cities where it believes the demographics are strong fundamental drivers for real estate, as well as selectively in Singapore.
Views, Reviews & Forum
Property cooling measures have served objectives
It is disappointing to see no indication of a change in stance on the property curbs in place in the Monetary Authority of Singapore’s (MAS’) latest Financial Stability Review (“MAS cautions property investors as risks emerge“; Nov 30, and “Financials are sound, but watch growing debt: MAS”; Nov 28). When the property cooling measures were first implemented, the objective was clearly to curb demand and supply. That objective has largely been achieved as demand has dropped and growth in housing loans has eased considerably.
Global Economy & Global Real Estate
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Additional Articles of Interest – Local & Overseas Real Estate
Condo narrowly escaped $48.5 mil ABSD with discounts
Bartley Ridge narrowly escapes the punitive additional buyer’s stamp duty. The developer would have to fork out around $48.5 million of ABSD if it cannot sell all the units in the project by mid-January 2017. The 868-unit Bartley Ridge still had two penthouses remaining unsold as at end-October, but they found buyers in November based on caveats lodged. Developers have to pay ABSD on land price if they fail to sell all their units within five years from the land acquisition date. Even if the project is left with one unsold unit, the full amount of ABSD would apply.
Local & Overseas Real Estate – Full Article