News Highlights Friday 29 February 2008

The Business Times

Property players sweat over lending squeeze
Banks have tightened financing for property investment deals, which include big transactions like sales of office blocks and development sites, amid turmoil in the global financial market and as mega transactions leave less liquidity available. For one, lending amounts are more conservative now and covenants tighter. As a result, it is taking longer to wrap up property sales deals these days as securing funding becomes more of an issue – and this could be a drag on investment sales. Things are even harder for relatively unseasoned, smaller players buying residential development sites as they face greater scrutiny before banks give them loans.


The Business Times

Marina Bay to provide 1.1m sq m of office space
The upcoming financial district at Marina Bay will provide more than 1.1 million sq m of office space, to match the total amount of office space at Raffles Place today. The extension is expected to take more than 15 years to materialize, depending on market demand. URA will also release land around the Tanjong Pagar precinct as well as redevelop the Ophir/Rochor corridor into an office cluster. As for Orchard Road, URA plans to work with the private sector to build a pedestrian network with underground links, walkways at street level and second-storey links between buildings.

The Straits Times

URA launches 2 more temp office sites in Newton Analysts see good demand just like for a nearby plot launched earlier (Read also BT's Newton area growing as a hub for hybrid offices)


The Business Times

CDL boss punctures popular wisdom
CDL believes that the mass-market segments will do well this year, but not as well as what market watchers predict. It believes that the high-end residential segment is not in danger of collapsing as some market watchers are saying. For one, it notes that the segment is supported not only by wealthy local investors with holding power, but also by well-heeled foreigners. For the year ended Dec 31, 2007, CDL’s net profit doubled to $725 million – a record. The group sold about $6.2 billion of residential projects in 2006 and 2007.


The Straits Times, H31

CDL boss prepared to delay launches in subdued marketCity Developments (CDL) executive chairman Kwek Leng Beng is unworried about the property market stalling now, and is prepared to hold off launches of new developments until next year. CDL plans to launch 77 units at Shelford Suites in Bukit Timah, 100 units of the 228-unit Quayside Isle @ Sentosa Cove, 100 units at a new development on the former Lock Cho apartments in Thomson Road which will have 336 units, and about 150 of its 724 units at Pasir Ris Drive 1.


The Straits Times

The innovation evangelist Business guru and film producer John Kao shows how to mix competitiveness with creativity


The Business Times, P5

Banyan Tree fund gets first US$100m
Banyan Tree Holdings, which is seeking a commitment of $300-400 million for an Indochina real estate development fund, unveiled yesterday the first closing with three parties committing a total of US$100 million. The fund will invest primarily in the Laguna Vietnam project located in Vietnam’s Chan May-Lang Co Economic Zone. It will also invest in other yet-to-be-identified projects. The three parties are a Banyan Tree wholly owned subsidiary, HSIL Investments (a member of the HSBS Group) and a feeder fund of Nan Fang Group, a privately held real estate group in Hong Kong.


The Business Times, P7

Sixfold surge in Allgreen 2007 profit
Allgreen Properties’ 2007 net profit surged more than sixfold to $493.5 million on the back of a fair value gain of $348.5 million on its investment properties. Excluding revaluation gains, Allgreen’s 2007 net profit came to a more modest $145.0 million but was still 91 per cent higher compared to the previous year. Last year, Allgreen officially launched Cairnhill Residences, Blossoms@Woodleigh and phase 1c of Pavilion Park at Bukit Batok. Cairnhill Residences is fully sold while Blossoms and Pavilion Park phase 1c are almost fully sold. The company also sold 186 units of its 536-unit Cascadia at Bukit Timah Road.



The Business Times, P9

Newton area growing as a hub for hybrid offices
The URA announced yesterday that it would release two transitional office sites between Scotts Road and Anthony Road for sale. Both parcels are to be sold on short-term leases of 15 years. Parcel A, which has a maximum gross floor area (GRA) of 140,189 sq ft, could see bids of between $14 million and $18.2 million or $100-$130 psf ppr. Parcel B, with a maximum GFA of 145,915.4 sq ft, could see bids of between $14.6 million and $19 million or $100-$130 psf ppr. Companies which have bought similar sites in the area from URA and SLA include The Ascott Group, Hwa Hong Corporation and KOP Capital. The proposed transitional office developments are expected to be completed by the middle of next year – and about 2.6 million sq ft of new office space is expected to be supplied to the market in 2009.


The Business Times, P15

Abu Dhabi fund starts to turn heads
The Abu Dhabi Investment Authority (ADIA) is now buying big stakes in Western companies, including a US$7.5 billion investment in Citigroup. It has also taken a large position in Toll Brothers, one of America’s biggest home builders. ADIA is the largest of the world’s sovereign wealth funds and estimates of the fund’s size are in the region of US$650-700 billion. However, much of the fund’s activities are shrouded in secrecy, with few outsiders knowing for sure where ADIA invests or even how much money it controls.



The Straits Times, P1

Pricey Korea tries hard to woo back tourists
South Korea has been struggling to grow tourist arrivals because word has gone out that a holiday here means expensive hotel rooms and leisure activities. The Korea Tourism Organisation reported 6.4 million tourists last year, a 4 per cent rise from 2006 but short of the seven million target. Hotels blame high labour costs, because the industry is mostly barred from using foreign labour. The lopsided tourism spending is worrying the government who are keen to deregulate the tourism industry to help attract foreign visitors.



The Straits Time, H15

Singapore to respect Jakarta’s decision on sand
Singapore remains prepared to work with Indonesia on sand imports but will respect Jakarta’s decision said Foreign Minister George Yeo. Both sides have agreed to set aside the Extradition Treaty and the Defence Co-operation Agreement and are ‘determined’ not to let these affect bilateral relations, which remain strong.