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13th May 2014

Singapore Economy

Singapore to release detailed Q1 GDP data on May 20

Source: Channel News Asia / Singapore

SINGAPORE: Singapore will release detailed first quarter gross domestic product (GDP) data on May 20 at 8 am, the Ministry of Trade and Industry (MTI) said on Monday.

The First Quarter 2014 Economic Survey of Singapore will contain more information about the country's overall performance during the first three months of 2014, with growth broken down by sectors.

Other details provided in the economic survey include sources of growth, inflation, employment and productivity.

According to advance estimates released in April, the Singapore economy grew by 5.1 per cent on a year-on-year basis in the first quarter of 2014, lower than the
5.5 per cent on-year expansion in the October-December period. 

- CNA/ac

Singapore banks keen to expand into Myanmar

Source: Straits Times 

Myanmar, the land of golden pagodas, is holding out the promise of riches for Singapore's local banks. All three local lenders are keen to set up shop in the country, a point underlined by Prime Minister Lee Hsien Loong as he made a pitch on their behalf on the sidelines of the Asean Summit in Naypyidaw, the nation's capital.

Singapore Real Estate

KOP Ltd to focus on mixed-use devts in key China cities

Construction of Shanghai project may begin around Q1 2015

Source: Business Times / Top Stories

SCORPIO East Holdings, now known as KOP Limited, following a $150 million reverse takeover, will focus on large entertainment-driven, mixed-use developments in key Chinese cities.

First off is Winterland Shanghai, a $2.8 billion project on 18 hectares of land. Construction is expected to begin around the first quarter of next year and the development is expected to be completed by end-2018. KOP will hold a controlling stake in the development, which will include retail, office, residential and hotel components, complementing strong entertainment content that will include a theme park, hiking trail and beach club.

The cost will be funded by seeking partners, financing instruments and presales in the project.

-By Kalpana Rashiwala

Private non-landed prices at 16-month low

Transaction volume in April goes in the opposite direction with 24.6% rise

Source: Business Times / Singapore

IN an indication that sellers are becoming more realistic about reduced demand, resale prices of non-landed private homes slipped 1.7 per cent in April, touching a 16-month low since December 2012.

This was despite the increase in volumes of resale transactions, which at 476 was 24.6 per cent higher than March's level, flash estimates by the Singapore Real Estate Exchange (SRX) showed. This also suggested that buyers are moving back into the resale market as prices stabilise, said market observers.

"It was the highest resale volume since October 2013, which means buyers and sellers are getting used to the market with all the measures in place," said ERA Realty key executive officer Eugene Lim.

Prices in the Rest of Central Region (RCR) led the decline with a 3.6 per cent drop, while those in the Core Central region (CCR) fell 2.3 per cent. Prices Outside Central Region (OCR) crept up 0.4 per cent.

-By Andrea Soh

Private home market likely to stay muted, say analysts

Source: Channel News Asia / Business

SINGAPORE: Some analysts say the private residential market is likely to stay muted for the next few months, as developers are faced with an increasing number of unsold units in the market.

There were 6,948 launched but unsold units as of March 2014, 252 units more compared to February 2014. In contrast, the number was at 5,560 in March last year.

It has been 10 days since the show flat of the Coco Palms in Pasir Ris opened its doors.

Its developer City Developments said more than 3,000 people visited the show flat last weekend.

Indicative prices are at about S$1,075 per square foot (psf) for a 1-bedroom unit and some S$960 psf for a 2-bedroom unit.

Property analysts say that while the prices are "reasonable", it remains to be seen if buyers will bite as demand may have been "soaked up" by other new private residential projects in the area.

Coco Palms is City Developments' fifth development in the Pasir Ris Grove estate.

Three of them -- Livia, NV Residences and The Palette -- are fully sold while the fourth project D'Nest, which launched in March last year, is 94 per cent sold.

Over in the northeast, a soon-to-be-launched project is freehold condominium Trilive Condo along Tampines Road.

The prices have not been announced, but property watchers say that other than land costs, developers are likely to take the cue from resale prices in the Kovan area.

"The developers would take into account what the recent transactions have been for the secondary market in that vicinity, and of course whether there are competitors who may be launching sometime in the near future,” said Ku Swee Yong, CEO of Century 21 Singapore.

“In the more discreet basis, developers will also consider in this location, were there similar launches in the past 10 years."

The median price of The Tembusu, another freehold condominium in the vicinity, was at some S$1,550 psf when it was launched in August last year.

Other 99-year leasehold properties in the vicinity -- Kovan Melody and Kovan Residences -- are trading at some S$1,100 to S$1,300 psf.

"In the case of Tembusu, when it was launched, there was no significant good-size piece of freehold land with condominium launched in Hougang, I think, in the last decade,” said Mr Ku.

“And so that was an attractive selling point in itself and that deserves a premium because there would be demand."

Mr Ku said the other freehold developments in the area generally come in smaller packages -- apartments comprising about 20 to 50 units.

The Tembusu had 220 units out of 337 units booked when it was first launched.

The Trilive Condo is expected to open its doors for preview at the end of the month.  

- CNA/ec

Orchardgateway gears up for GSS

Source: Business Times / Singapore

NEW fashion mall orchardgateway is nearly 100 per cent occupied - just in time for it to take part in the mid-year Great Singapore Sale (GSS).

The main shopping wing of the mall, sandwiched between 313 Somerset and Orchard Central, has frontages on both Orchard Road and Somerset Road, and houses more than 90 per cent of the mall's tenants. The remaining tenants will be housed across Orchard Road, in the wing called orchardgateway@emerald, which will open in October.

The two wings will be linked by two walkways - a glass overhead bridge overlooking Orchard Road, and an underpass.

Most tenants in the main wing opened shop last month; they include international fashion retailers such as Swiss watchmaker Swatch, local retailers such as bespoke shirt maker CYC The Custom Shop and food outlets such as Dulce & Sucre and homegrown bakery Twelve Cupcakes.

-By Kara Quek

Frasers Centrepoint buys Sydney hotel for $242m

Source: Straits Times

Frasers Centrepoint (FCL) has bought a major Sydney hotel as the firm looks increasingly to Australia, given the softer Singapore property market. An FCL unit has bought the Sofitel Sydney Wentworth for A$207 million (S$242 million), it said yesterday.

Real Estate Companies' Brief

FCL unveils details of new trust

Hospitality trust will have an initial portfolio of six serviced residences and six hotels

Source: Business Times / Companies

THE hospitality trust to be listed by Frasers Centrepoint Limited (FCL) will have an initial portfolio of six serviced residences and six hotels spanning key cities in Australia, the UK, Japan and Malaysia as well as Singapore.

FCL is expected to raise gross proceeds of at least $651.7 million from the sale of six serviced residences to the new Frasers Hospitality Trust (FHT), which is slated to list in June.

Part of the gross proceeds will come in the form of stapled securities, giving FCL a 22 per cent stake in FHT - a stapled instrument comprising a Reit and a dormant business trust.

-By Lynette Khoo

Hiap Hoe's Q1 earnings surge to $354.2m

Source: Business Times / Companies

REAL estate group Hiap Hoe's net profit for the first quarter ended March 31, 2014, surged to $354.2 million from $10.2 million a year earlier.

This was boosted by the recognition of negative goodwill of $148.7 million arising from the acquisition of SuperBowl. In addition, the group recognised a gain of $199.9 million as a result of remeasuring its 50 per cent equity interest in HHP to fair value upon business combination which was achieved in stages.

The group acquired 90.8 per cent of SuperBowl as at Feb 28. At end-March, the group owned 97.8 per cent of the issued and paid-up capital of SuperBowl.

-By Mindy Tan

Views, Reviews & Forum

Ensure economic growth is in tandem with availability of labour

Source: Straits Times

Prime Minister Lee Hsien Loong was spot-on in saying that our small country cannot ease up on its curbs on foreign worker inflow, as that would put a strain on our limited infrastructure in critical areas such as housing, transport, health care and security ("S'pore can't ease up on foreign worker limits, says PM Lee"; last Thursday.

Developers, designers need to be proactive on workplace safety

Source: Straits Times

I applaud the Government's effort to make it compulsory for developers to ensure designs are safe to implement ("New building design rules to keep workers safe"; last Thursday). With our dismal safety record, such a measure is necessary. It sends a strong signal to developers, architects and engineers that they have an important role to play in construction safety and health.

Global Economy & Global Real Estate

Latest China property step seen as a way to fight graft

Academics confident that unified registration policy will deter and help uncover corrupt officials

Source: Business Times / Property

OFFICIALS and academics have hailed the government's recently pledged unified real property registration policy, saying that it will help fight corruption. The central government established a government agency to supervise real property registration last Thursday as part of an effort to accelerate the registration process.

The bureau, under the Ministry of Land and Resources, will be in charge of the registration of land, real estate, forest, grassland and maritime space. China plans to build a national real property registration system in about three years and make it operational for information sharing and queries in four years. A senior official with the new government agency said that the unified registration system does not target the housing sector specifically and its primary purpose is not to tackle corruption or curb home prices.

But some academics said that unified registration will be a deterrent and will help uncover corrupt officials. Zhou Keda, a researcher with the Guangxi Academy of Social Sciences, said that the system would help make data on officials' home ownership more transparent and lead to discovery of evidence in potential corruption cases.

-From Beijing, China

Jumbo loans thrive in US mortgage market

Competition heats up among big banks such as Wells Fargo for above-US$400,000 mortgage loans

Source: Business Times / Property

TODD Vitale, a personal trainer who opened his own gym last year, said he was having difficulty getting a mortgage of more than US$700,000 to buy a home in Greenwich, Connecticut, because his new business was untested.

Then he tried Wells Fargo & Co, the biggest US home lender, where he kept most of his savings in an account he opened more than a decade ago, he said. He worked with the bank's private mortgage unit, whose clients are entitled to loans of up to US$6 million and personalised service, and had the opportunity to explain that he had already run a similar business and could make the gym succeed. Wells Fargo approved his 30-year fixed-rate mortgage of more than US$700,000, he said.

"I don't think I would have gotten a loan unless Wells Fargo private mortgage gave me a shot," said Mr Vitale, 38, who moved in to his new 3,000 square-foot home in February. "I would have had to walk away from the home."

-From Washington, US

US developers take lead on school construction

A good school makes a tremendous difference in a master-planned community, says project director

Source: Business Times / Property

FIVEPOINT Communities Management Inc is already constructing a school at its Great Park Neighbourhoods project in Irvine, California, for 1,000 elementary and middle school students even as it's still building the first 700 homes.

"We build the schools ahead of time," said Emile Haddad, chief executive officer of Aliso Viejo, California-based FivePoint, which has permits for about 10,000 homes at Great Park. "That way we always have them ready."

Local schools, along with parks and recreation facilities, have long been draws for buyers in new communities. Now, as school districts face tight construction budgets and homebuilders compete to attract families able to qualify for mortgages, developers are taking the lead on school construction instead of waiting for local governments to do the job.

-From Los, Angeles, US

China e-commerce needs to upgrade warehousing

Source: Straits Times