News Highlights Wednesday 26 March 2008

Safety scheme targets demolition, crane works
Last year’s condominiums sold en bloc are likely to be this year’s demolition sites. The concern now is that they do not become danger zones for construction workers. Therefore, both demolition works and crane operations will be scrutinized closely by safety professionals this year under the Probe, which stands for Programme-Based Engagement - a scheme to target high-risk work areas to boost overall workplace safety and health standards. Probe is an initiative by the Ministry of Manpower and that Workplace Safety and Health Advisory Committee.

- The Straits Times, H1



Hotel room rates hit record high for second month
Average room prices last month shot up to $256 per night, some 8% higher than January’s record of $237, according to the Singapore Tourism Board. Industry watchers believe a booming tourism sector could push the average room price above $300 within the year. Last month, 811,000 visitors entered Singapore, a record for February. The boom helped room revenues for all of Singapore to reach an estimated $174 million in February, a 43.5% jump from the same month last year.

- The Straits Times, H5



DBS gets nod to open 8 new branches in India
The Indian central bank has allowed DBS Group Holdings to open 8 new branches over the next year. The new branch licenses cover the big metros of Kolkata, Chennai and Bangalore, as well as the smaller cities of Pune, Nasik, Surat, Moradabad and Salem. All 5 smaller cities are on a rapid growth trajectory. The 3 big metropolitan branches will complement existing branches in Mumbai and New Delhi. DBS managing director for South and South-east Asia said that he is positively exultant about DBS’s prospects in India for everything from SME business to wealth management and for capturing the flows of Indians heading to Singapore. The bank expects all 8 new branches to be up and running over the next 6 months.

- The Straits Times, H18



Pacific Star starts $2.8b Asian property fund
Singapore property group Pacific Star has launched a S$2.8 billion Asian property fund targeted at European institutional investors. The company has lined up US$1 billion worth of “prime location” residential, retail and commercial properties across China, India, South-east Asia and North Asian countries such as Japan in readiness for the launch. Besides marketing the Asia Fund Select Concept fund, Pacific Star Europe will also eventually be able to offer Asian investors investment opportunities in the European property scene. The Pacific Star’s president for fund management is confident that the fund will attract US$500 million to US$1 billion by its first closing date in June.

- The Straits Times, H20



Yishun confo site draws record bid of $213.5m
Developer MCL Land offered $213.5 million for the 99-year leasehold plot, which works out to about $350 psf ppr, believed to be the new benchmark for Yishun. Knight Frank estimated that the end units for the Yishun project could be priced from $830 psf up to almost $900 psf. MCL Land’s bid pipped 4 others – Peak Green, Frasers Centrepoint, Sim Lian and Hong Kong’s Cheung Kong. CBRE Research said that the response was “fairly robust” and signaled developers’ confidence in the suburban segment despite the current lukewarm response to new projects. The Yishun site is at the corner of Yishun Avenues 1 and 2, and is 10 minutes’ walk from Khatib MRT Station. It is next to the Yishun stadium and overlooks Lower Seletar Reservoir.

- The Straits Times, H25



High Court rejects Airview Towers’ collective sale
A single home owner has managed to persuade the High Court to reject the $202 million collective sale of Airview Towers in the River Valley area. The High Court upheld a decision of the Strata Titles Board last October to throw out the sale application as the minimum 80% approval had not been met in the required time. Bukit Sembawang Estates was the prospective buyer. Unit owners would have reaped $2 million each.

- The Straits Times, P25



GIC, Host Hotels in property venture
The Government of Singapore Investment Corporation (GIC) has teamed up with a New York-listed real estate investment trust – Host Hotels & Resorts - to invest up to S$2.8 billion in Asian and Australian property. GIC’s real estate arm and Host Hotels & Resorts, one of the world’s largest owners of luxury hotels, have set up a joint venture with an initial investment of up to US $600 million. This, combined with anticipated leverage, will provide total investment potential of at least US$1.5 billion. Host, which will provide fund management services to the venture, will own a 25% stake, while GIC will hold 75%.

- The Business Times, P32



S’pore banks pursue India, the next frontier
Besides the approval for DBS to open 8 new branches in India, UOB has been granted in-principle approval yesterday to open a branch in Mumbai within one year. Under the Comprehensive Economic Cooperation Agreement (CECA) signed between Singapore and India in 2005, Singapore banks were to be allowed a total of 15 new branches in India within 3 years. The State Bank of India (SBI) – India’s largest state-owned commercial bank – has been awarded qualifying full bank status in Singapore. SBI plans to open 5 branches in Singapore within the first year of getting its retail bank license. Under CECA, Singapore was to give QFB status to 3 Indian lenders.

- The Business Times, P1



Roxy-Pacific to acquire Telok Kurau site
Roxy-Pacific Holdings intends to acquire a land parcel at Lorong N Telok Kurau for $21.97 million, inclusive of development charges. It will build homes for the mid-tier market on the parcel.

- The Business Times, P7



Bt Panjang, Jurong West sites go on reserve list
HDB has released 2 land parcels under the government’s reserve list system – a condominium site at Bukit Panjang and an executive condo (EC) parcel at Jurong West. The 99-year leasehold Bukit Panjang site in Chesnut Avenue is 244,300 sq ft and has a 2.1 plot ratio – yielding a maximum gross floor area of 513,100 sq ft. Savills estimated that the site can fetch $190 - $200 psf ppr, which works out to $97.5 - $102.6 million in all. The EC site in Jurong West Street 42 has an area of some 183,000 sq ft and a 3.0 plot ratio – giving it a maximum gross floor area of 549,000 sq ft. Knight Frank estimates that the site will fetch $120-$160 psf ppr.

- The Business Times, P8



MCL tops bids at $213.5m for Yishun 99-year condo site
MCL’s offer of $350 psf ppr is 68% above the next highest bid. The breakeven cost for a new condo development on the site will be about $680 psf, and MCL Land’s bid model assumed an average selling price of $750 – 800 psf. The group plans a 480 – 500 unit condo development 15-16 storeys high. Demand for the new condo on the plot at Yishun Avenue 1 and 2 is likely to come from HDB upgraders and those working the northern part of Singapore, said CBRE executive director.

- The Business Times, P8



Landmark Tower, goes en bloc again, at lower price tag
Landmark Tower, a 99-year leasehold residential site in Chin Swee Road, is up for collective sale again. This time, the sellers are asking $270 million, which works out to $1,324 psf ppr, including a $28 million charge to top up the tenure. The 60,821 sq ft site has a 3.7 plot ratio that would give a developer a total gross floor area of 225,038 sq ft to play with. The buyer can redevelop the site to accommodate a high-rise condominium development comprising 220 apartment units of about 1,000 sq ft each, said Colliers International, which is conducting a public tender for the project. If the asking price is met, owners will get an en bloc premium of about 70%. The tender closes on April 15 at 3pm.

- The Business Times, P8