News Highlights Thursday 19 June 2008

S'pore short rates dive, defying expectations
The three-month Singapore interbank offer rate (Sibor) fell 12.5 basis points to 1.25% yesterday - a shade above the year low of 1.24 on April 22. Analysts say they believe yesterday's big move was due to intervention by the Monetary Authority of Singapore (MAS), which tried to cap the rise of the Singapore dollar. A UOB analyst expects three-month Sibor to reach 1.50 by year-end, while a HSBC economist sees the three-month Sibor to fall to 1% over the next few months.

- The Business Times, P1




Apartments above $10m still shine in dull market
50 luxury apartments costing above $10 million each have been sold so far this year. And the tally for the full year, according to CBRE, is expected to come in at about 70 to 100 units. The 50-odd luxury apartments costing above $10 million each sold so far this year are the tally at June 17 and include not just units sold at Nassim Park Residences, but also a unit each transacted at Cliveden at Grange, The Tomlinson, The Grange and The Orange Grove condos. The highest-priced transaction so far this year is a $19.7 million ground-floor unit sold at Nassim Park Residences. In the landed sector, a total of 23 Good Class Bungalows (GCBs) have changed hands so far this year for a total of $380 million. CBRE expects that at least 50 to 60 GCBs will be sold in 2008 as demand will continue to be strong from Singaporeans and PRs. Market watchers say the volume of transactions for apartments costing more than $10 million will depend partly on when developers release new prime-district condos and their strategy on the mix of unit sizes.

- The Business Times, P2




HK flat fetches highest price in Asia
A luxury flat in Hong Kong has sold for HK$225 million (S$39.4 million), the most expensive apartment in Asia on a psf basis. The 80th floor penthouse, with a private swimming pool and a spectacular view of Victoria Harbour, sold for HK$41,000 psf. The 5,497 sq ft home, with its own roof-top terrace, is located in Kowloon area.

- The Straits Times, H16




Positive outlook for Asian property
The flow of capital into the Asia-Pacific's real estate market from outside the region is accelerating, said a report by KPMG, the FTSE group and the Asian Public Real Estate Association (Aprea). Many institutional investors are looking to increase their property allocations. Real estate as an asset class has outshone equities and bonds, providing average returns of 7-8%, said the report. Returns in Asia-Pacific are expected to remain higher than the global average of slightly over 5% for the coming year. The current sub-prime fallout elsewhere may act as a catalyst for the further development of Asia-Pacific as a centre of property and investment management. According to the report, real estate funds remain the dominant source of capital for property investments in Asia this year.

- The Straits Times, H16




Tycoon sees hard landing for developers in Russia
Russia's property market, facing soaring materials and credit costs, risks a hard landing that could cause many developers to collapse, said Mikhail Prokhorov, the country's fifth-richest man. The tycoon said he was looking to acquire distressed companies and was studying nine property projects worldwide, including a big elite resort development in South-east Asia.

- The Business Times, P31




CBRE S'pore earnings up 130% last year
CBRE Singapore has set up three new businesses this year - luxury homes, a residential agency of associates to market projects for developers and a hotel business - to provide a stable and broader business platform. Revenue was up 84% and net profit up 130% in 2007. The gains exceeded a 55% jump in revenue and a 56% increase in net profit in 2006. CBRE managing director said that foreign investors bought $4.94 billion of real estate in Singapore in 2007. So far this year, the figure is about $2.7 billion.

- The Business Times, P29



Building to start on Norway solar firm's S'pore plant
Norway's Renewable Energy Corporation (REC) will start construction this month of phase one of a $6.8 billion plant here, taking up 49 hectares of REC's 97-ha Tuas View site. REC expects to decide next year on phase two of the Tuas View complex. The complex will be the world's biggest integrated solar manufacturing plant. REC will employ 1,110 workers in the first phase.

- The Business Times, P2


­ ST Index weekly change 3,040.09 (+11.85)
SIBOR (3 mths): 1.25000 (S$)
SWAP (3 mths): 1.31354 (S$)