DAILY MARKET UPDATES 22th August 2008

Cooling property market takes a seat at SLA auction
4 of 8 in-fill sites launched for residential use were sold yesterday at a SLA auction, for a total of $13.81 million. All 8 sites came with fresh 99-year leases. Response was cautious as attendees say opening prices were higher than expected and resulted in few biddings. While the auction did not generate heated competition throughout, one parcel received considerable attention. A 15,461 sq ft good class bungalow plot in Ridout Road attracted 34 bids, which eventually was won for $8.96 million or $579.50 psf by BreadTalk chairman George Quek for own use. The other two parcels are a three-storey bungalow parcel (7,771 sq ft) in Namly Avenue went for $2.63 million or $338.40 psf and a plot in Tanah Merah Kechil Road was sold for $1.51 million or $346.60 psf. As for the unsold sites, SLA will work with the Chief Valuer to re-assess their prices.
- The Business Times, P2
Stanchart launches transparent home loan pegged to Sibor
SCB’s MortgageOne Sibor home loan comes with an offset feature where customers can use the interest earned on their deposits to reduce the interest payable on their home loan. It will be priced at 0.8% a year above the three-month Sibor for the first 3 years. Customers enjoy the same interest rates as their mortgage loan on 2/3 of the deposits linked to MortgageOne Sibor, subject to a maximum of their loan principal outstanding. The remainder of the deposits will enjoy an interest rate of 0.5 per cent a year. By paying less interest every month, customers can repay their mortgage loan faster compared with a traditional mortgage loan. Under this loan package, customers can put any surplus funds in their current account to reduce interest costs. They also have the flexibility to withdraw these funds at any time and capitalise on investment opportunities. For a $500,000 mortgage loan with a 25-year tenure, a customer can reduce interest payments by 20%, just by saving $500 every month.
- The Business Times, P8
CityDev is issuing 1st tranche of Islamic bonds by year end
City Developments said it will issue the first tranche of $1 billion of Islamic bonds by the end of the year. The deal will be Singapore's first Islamic unsecured financing arrangement. CityDev said that it has not decided on the size or the coupon rate of the first tranche of notes. But management has indicated that the rates will be competitive and that it expects to see good institutional demand. It will use the funds to buy land or buildings, and has said that it will inject its own properties, freeing funds for new investments.
- The Business Times, P4
Lum Chang wins $76.5m contract from A-Reit
Ascendas Real Estate Investment Trust (A-Reit) has awarded a $76.5 million design-and-build contract to a unit of Lum Chang Holdings for the construction of a new 8-storey tower and a 3-storey ancilliary podium in Changi Business Park, with a land area of over 28,000sqm. The project is due to be completed by October 2009.
- The Business Times, P7
Making the rich list
Chief of Fragrance Group, which owns the chain of tourist-class Fragrance hotels, as well as boutique property developer Fragrance Land debuted on Forbes magazine's list of Singapore's 40 richest people at No.24. Fragrance - one of the few property companies that did better this year was an exception to the real estate riches rule. SC Global and Hoo Bee Group found their fortunes halved as the market slowed and stock prices tumble. The rankings released remained much the same as last year with Mr Ng Teng Fong, who heads Far East Organization, at number 1 with fortune of US$7 billion, followed by the family of the late banker Khoo Teck Puat, who are worth US$6.1 billion and third place, UOB chairman with a family fortune valued at US$3.6 billion. In 5th and 7th places are Singapore's newest billionaires: Mr Kuok Khoon Hong of Wilmar International and remisier-turned-investor Peter Lim. The total net worth of the richest 40 remained at US$32 billion.
- The Straits Times, P3
Yellow Pages to publish luxury magazine in South East Asia
Yellow Pages has signed a licence agreement with US-based CurtCo Robb Media to publish Robb Report in five countries in South-east Asia - Singapore, Malaysia, Indonesia, the Philippines and Brunei. Robb Report is said to be the international authority on the luxury lifestyle. The monthly magazine reports on issues and trends affecting the affluent market, with coverage of exclusive events and features on exceptional automobiles, motorcycles, aircraft, art, jewellery, watches, fashion, travel, homes, wines, spirits and cigars. Robb Report Singapore is expected to be launched by the end of 2008.
- The Business Times, P7
More flexible guidelines for M’sian reits
With the new Reit guidelines, Reit managers would be given more leeway to invest in foreign real estate and a portion of their portfolio can consist of real estate that it does not wholly own or claim a majority stake in. It also allow Reit management to seek a general mandate from unit-holders for issuing units up to 20% of its fund size. They can now buy property that is under construction or uncompleted real estate up to 10% of their total asset value. However, the issue of it’s uncompetitive withholding taxes was not addressed.
- The Business Times, P10

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