DAILY MARKET UPDATES 06th October 2008

Spruced-up Balestier set to create Buzz
There are about 600 hotel rooms in Balestier, 50 rooms due for completion this year, not including the new hotel site. Rents are around $2,000 a month with some of these flats bought for around $800 per sq ft (psf) or less. Newer existing condos such as The Marque @ Irrawaddy and The Verve went for around $1,100 to $1,200 psf in the first half. In recent months, prices at The Verve have slipped just below $1,000 psf. In contrast, Novena condos such as Lucida and the Soleil @ Sinaran fetch about $1,400 psf. On the other side of Balestier, there are newer condos along Martaban Road, such as Ecoville and Medge, going for $883 to $958 psf. Balestier is home to the Global Indian International School and Curtin University is opening a new campus there next month. It is targeting 5,000 students, with 1,000 enrolled by year's end.
- The Sunday Times, 05th Oct 08, Invest P24
F1 Drives Retail Profits up
Singapore Grand Prix drove up takings by 20 to 30 per cent for many businesses, especially those in food and beverage, entertainment and hospitality. At Tangs, sales revved up by 40 per cent compared to that in the first week of last month with 15 per cent more tourists turning up, especially men from Europe and Australia. Wisma Atria saw 13 per cent more shoppers. Wisma Atria in Orchard Road also saw 13 per cent more shoppers. Fairmont Singapore, reported its 769 suites and rooms were 90 per cent filled. Enjoying a 50 per cent spike in F&B takings.
- The Sunday Times, 05th Oct 08, Home P12
Five times more Rental Flats Recovered
147 rental flats have been recovered by HDB by end August, compared to 28 flats last year. Less than 20 flats were seized in 2005 and 2006 each. Rental flats rates range from $26 to $205 for a one-roomer and $44 to $275 for a two-roomer, depending on household income and other factors. There is a long waiting list of more than 4,000 applicants for these flats, which the Government reserves for needy, low-income families that cannot afford to buy a home or pay market rental rates. Rental cheats sublet these flats at market rates instead of staying in them. Many flats are sub-let for about $1,000 a month, netting their original tenants handsome profits. Since June, 4,387 are in the waiting list, with a waiting time of nine to 18 months. In 2006, the wait was just two to six months. HDB has since said it will ramp up its current stock of rental flats from 42,800 to 49,860 by end-2011.
- The Straits Times, A3
Dorm Plans draw new Objections
100 residents gathered at a local playground yesterday to voice their objections to a foreign worker dormitory planned for Serangoon Gardens. The plan has rankled residents, who are worried that the presence of foreign workers would lead to an increase in crime and drive down property values in the upper-middle class neighbourhood. The tender for the State-owned plot should be out by next month and the access road and dorm should be up and running in six to nine months.
- The Straits Times, A4
Slowdown to last Several Quarters
Singapore's economy is expected to slow for 'several quarters' as the sub-prime meltdown has evolved into phase two - an economic crisis, said Finance Minister Tharman Shanmugaratnam. 'It is no longer just a financial crisis. It is now an economic crisis,' he added, pointing to slowing growth in the US, Europe, Japan, India and China. 'We will also see a slowdown, from all indications, may last several quarters because we are heavily exposed to the global economy.' He said that sectors, such as the shipping industry and the high value-add manufacturing businesses, continue to thrive despite the crisis. While the financial sector is expected to slow down, some segments, including private banking and wealth management, continue to show strong growth.
- The Business Times, P22
(See also, The Straits Times, A1 – “Economy may slow for ‘Several Quarters’”)
S Korea seeks to Speed up US$80b Currency Swap plan
Seoul plans to propose a meeting of the finance ministers of South Korea, Japan and China be moved up from the original date of May 2009, so as to accelerate the currency swap scheme. The Asean+3 group is also considering setting up a regional surveillance system to insulate Asia from the financial crisis in other economies. That essentially gives to any of the signatory economies access to a foreign exchange reserves pool of at least US$80 billion in the event of a financial emergency. Finance officials said that loans will be made in US dollars against local currency collateral provided by the borrowing nation, either via a currency swap or a promissory note. They said the pact will be a significant step forward for the 13 nations involved in the bilateral swap deals created in the wake of the 1997-98 Asian financial crisis, bringing them closer to a regional equivalent of the International Monetary Fund.
- The Business Times, P18
(See also, The Straits Times, A7 – “Seoul eager for US$80b Fund”)
Germany Govt in Talks to bail out Hypo Real Estate
The German govt has led talks to salvage a 35 billion euro (S$70.2 billion) bailout plan for Hypo Real Estate Holding AG yesterday after the ailing property lender said that commercial banks withdrew their support. Hypo Real Estate's financing needs exceeded the bailout plan guarantee, Germany's Die Welt reported on Saturday. It will need 20 billion euros by the end of next week and 50 billion euros by the end of the year, according to the newspaper. As much as 100 billion euros may be needed to shore up the bank's finances by the end of 2009, Die Welt said. The bank sought the lifeline after its Dublin-based Depfa Bank plc unit, which specialises in government lending and depends on now-closed money markets for funding, failed to get short-term funding amid the credit crunch.
- The Business Times, P21
Jakarta says Global Crisis Slowing Growth
Indonesian officials met yesterday, after US lawmakers earlier approved a US$700 billion bank-rescue package, to try to reduce the impact of the crisis and keep it from spreading in the US$432 billion South-east Asian economy. The central bank said it will buy the currency if needed to boost the measure. Bank Indonesia has US$58.36 billion of reserves, which are sufficient to meet 4.6 months of imports. Indonesia's economic growth unexpectedly accelerated 6.4 per cent in the second quarter as rising prices and demand for coal, palm oil and rubber pushed exports to a record. The govt foresees growth slowing to 6.2 per cent in 2008 from 6.3 per cent a year earlier and expects its budget deficit will narrow to 1.3 per cent of GDP this year, from an estimated 1.9 per cent, as spending was reduced.
- The Business Times, P19

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