BT : Residential site at Bartley Road put on Reserve List

Business Times - 01 Dec 2009


Residential site at Bartley Road put on Reserve List

By UMA SHANKARI

THE Urban Redevelopment Authority (URA) yesterday said that a residential site along Bartley Road is now open for applications from interested developers.

The 99-year leasehold plot is located within an established residential estate next to the Bartley MRT.

It has a site area of about 2.21 ha and can generate a maximum gross floor area of 61,865 square metres.

The site is being offered under the Government's Reserve List system. Sites on the Reserve List are only put up for tender if a developer indicates a minimum bid price in an application, and that bid price is deemed to be acceptable.

The land parcel, which is located between Bartley Road and Lorong How Sun, was first unveiled during the Government land sales programme for the second half of this year.

It was officially put on the Reserve List yesterday.

Analysts said that the site could be triggered soon as interest in it is likely to be high.

Estimates for the eventual top bid range from $450-$550 per square foot per plot ratio (psf ppr).

'The site should be well received because it is attractive and there is lots of local and foreign interest in State tenders,' said Donald Han, the managing director of Cushman & Wakefield. He expects the top bid for the site, once it is triggered, to be between $450 and $520 psf ppr.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak is more bullish - he expects the winning bid to come in between $500 and $550 psf ppr.

The analysts also pointed out that increased interest from foreign developers in state land tenders could push up the price of the site.

In November, the top bid for a 99-year condo site on Upper Thomson Road came from Hong Kong tycoon Li Ka-shing's Cheung Kong Holdings. Cheung Kong unit Treasure Well Investments offered $251.3 million or about $533 psf ppr - the highest seen for a private housing site at a state land tender this year.

The company's top bid was 21.5 per cent above the next highest offer, which was made by Singapore's Far East Organization.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.

ST Forum : Demerit system for agents enough to protect clients

Dec 1, 2009

Demerit system for agents enough to protect clients

I REFER to last Saturday's letter by Mr Ho Kah Chuen, 'Rules should cover concerted action by agents'.

The purpose of regulating against the practice of dual representation is to ensure that consumer interests (be it seller or buyer) in a real estate transaction are safeguarded by restricting the same estate agent to acting for either of the two parties instead of both. There exists a conflict of interest when the estate agent acts for both parties.

However, there is no necessity to further prohibit two agents from the same team in an estate agency from acting for seller and buyer respectively. Such a practice, known as internal co-brokerage, is a form of general co-brokerage.

It is unfair to imply that estate agents are more likely to collude with their own team members to the disadvantage of their clients if they co-broke internally since the same can also be said of estate agents from different companies who co-broke regularly with each other as friendly business allies.

Besides, it is the seller's prerogative to grant exclusivity and it is both a contractual as well as ethical obligation of the estate agent to make known all valid offers to the seller regardless of their origin (from his team or elsewhere).

Moreover, in the proposed regulatory regime, estate agents shall be individually accredited to practise and are subject to a demerit point system should there be professional misconduct. Estate agencies to which they belong shall also bear the brunt of the demerit points and other punitive measures meted out to their agents.

These proposed regulatory measures, currently absent in the industry, are adequate as a whole to deter estate agents from compromising on the interests of their clients. It would suffice to regulate against dual representation and not dual agents.

Dr Tan Tee Khoon
Chief Executive Officer
Singapore Accredited Estate Agencies

ST : $60 million to reel in youth dollar

Dec 1, 2009

$60 million to reel in youth dollar

Orchard youth market landmarks to invest in events and makeovers

By Eisen Teo



THREE parties with an eye on the youth market have come together to sink $60million into wooing this audience.

The Heeren, Cathay Cineleisure Orchard and *Scape Youth Park, landmarks in the Orchard Road shopping belt targeting the young, want to put the money into events, renovations and promotions over the next four months.

These three places, forming Orchard Road's 'Youth Triangle' for their movie and shopping offerings, have drawn up these improvements to keep up with the revamp in the rest of the Orchard Road strip, and because their popularity among teens is flagging.

The plans they have announced come as a Straits Times survey last month indicated that the three centres had somewhat lost their sheen among the young, who now prefer Plaza Singapura, Vivo-City and Suntec City.

Even Ion Orchard, with its high-end boutiques, outdid The Heeren and Cathay Cineleisure Orchard in the survey.

Young people interviewed for the survey said they liked the other malls for their cavernous size, wider variety of goods and the fact that they were fresh.

Ion, in particular, scored on its novelty factor.

But the Youth Triangle, where retailers have reported a drop in revenues of between 10 per cent and 30 per cent in the last year, is not taking this lying down.

*Scape, for example, will build a $40-million, youth-oriented mall across the road from *Scape Youth Park.

Due to open next March, it will house dance and recording studios and new-media production and editing suites for budding young talent.

Its non-profit operator *Scape Co expects the buzz created by its youth facilities to attract traffic for its retailers.

The Heeren said the $20-million makeover of its facade was part of an 'ongoing process' to keep those aged up to the early 30s interested.

Its outdoor eating area and plasma TV screens broadcasting music videos and commercials, will be ready by Christmas. Next year, it will open its rooftop for use and build an extension.

Cathay Cineleisure will keep its formula of 24-hour movie screenings, game arcades and band performances.

But with Cathay's 75th anniversary up next year, the mall will launch youth-oriented activities and publicity campaigns on popular youth networking platforms Facebook and Twitter.

All three landmarks have packed this month with youth-flavoured events, ranging from The Heeren's fashion show to *Scape's skimboarding demonstrations.

The Straits Times spoke to 30 young patrons who say they are intrigued by the revamp.

Even so, they have ideas for what they want out of malls (see other report) and point out that events alone may not get them to spend more.

For them, value for money and creative retail discounts count.

For example, Yvonne Low, 17 and in her first year at Tampines Junior College, typically spends $30 to $50 on food and movies a week.

She said: 'I'll go and soak up the atmosphere with my friends, but we won't spend more than we normally would.'

Retailers agree. They say events held on the ground floor may not drive traffic to upper-level shops the way mall-wide promotions and discounts would.

Mr Muhammad Hafiz, 23, a sales ambassador in men's shop NewUrbanMale on the fourth floor of The Heeren, said: 'Cut-out coupons and redeemable points for spending would be good.'

Such discounts would work on people such as undergraduate Marcus Kan, 21.

He said: 'I have only so much to spend on clothes and movies after deducting for food and transport. But a good discount off a $100 to $150 item will persuade me to part with more money.'

ST : Slide in prime retail rents levels off in 3rd quarter

Dec 1, 2009

Slide in prime retail rents levels off in 3rd quarter

By Dickson Li




Shoppers in a Toys 'R' Us store in New York, the city which came in as having the highest prime retail rents in the third quarter. Singapore came in at 18th place. -- PHOTO: BLOOMBERG

RENTS for prime retail space began to stabilise in key global markets in the third quarter after falling during the worldwide downturn.

New York, Hong Kong and Paris maintained their top three places as cities with the highest prime retail rents. Singapore inched up one notch from the second quarter to 18 in the top 20 rankings.

Prime retail rents here were estimated at US$448 (S$619) per square foot per year, while in New York the same space cost US$1,640.

Rents in most Asian cities either declined at a slower rate, stabilised or showed a slight uptick in the third quarter, said CB Richard Ellis (CBRE), which compiled the rankings.

Singapore retail rents across the market fell just 0.9 per cent in the third quarter after falling by 2 per cent in the second quarter this year, according to the Urban Redevelopment Authority.

But Mr Peter Gold, CBRE's head of cross-border retail in Europe, the Middle East and Africa, said suburban areas are not faring so well.

'Prime retail rents in the top locations are generally quite stable and able to attract tenants, but secondary locations and smaller markets are experiencing rising vacancy, reduced retailer demand and falling headline rents,' he said.

Singapore's situation could be altered by the number of new malls being built, which will increase the supply of retail space and so put pressure on rents.

A recent report by DTZ Research found 500,000 sq ft of new retail space is expected to hit the market before the end of the year. This will bring the total retail space completed this year to about 2.6 million sq ft, the highest level seen.

This year has seen many changes on the retail front, particularly on Orchard Road with the opening of Ion Orchard and Orchard Central. Mandarin Gallery reopened last month while 313@Somerset makes its debut this week.

Sentiment about the retail landscape is mixed.

Property firm DTZ earlier reported that despite the rise in investment activity, retail spending remains weak and would depend on the extent of economic recovery. It expects retail rents to drift along with minimal decline for the rest of this year and next year.

CBRE's outlook for next year is more bullish. In a separate report, it predicts that the opening of the integrated resorts will draw in a line-up of old and new international brands against a backdrop of convention facilities, theme parks, hotels and other leisure amenities, all of which will perk up the retail scene.

ST : Asset bubbles all over Asia: UN economist

Dec 1, 2009

Asset bubbles all over Asia: UN economist

They may burst if short-term capital flowing in pulls out

By Fiona Chan

GOVERNMENTS have been urged by a top United Nations economist to keep an eye on asset bubbles, which he says are appearing all over Asia as investors pour money into the rapidly recovering region.

UN Assistant Secretary-General Ajay Chhibber also cited the woes faced by Dubai, in the Middle East, as an example of how the underlying issues of the financial crisis had not been solved.

'I see bubbles in many, many Asian countries,' he said during a visit to Singapore yesterday.

He was speaking to reporters at a press conference at the Institute of Southeast Asian Studies after releasing a UN Development Programme (UNDP) report on how the global financial crisis has affected the Asia- Pacific.

'The strengthening of the equity markets in most Asian countries is clearly a signal of fairly substantial inflow of capital coming in,' said Mr Chhibber, a former World Bank senior economist. 'It's Asia-wide, with some exceptions.'

While it is fine if the capital is used for long-term investments, the worrying thing is that some of the inflows are short term and volatile, he said.

Developed countries have relaxed their monetary policies in response to the recession, making liquidity readily available, but this means the money will quickly flow out again when these policies are eventually reversed.

Once the liquidity is withdrawn, the bubble may burst - similar to the situation in Dubai, where one of the government's flagship entities is threatening to default on US$59 billion (S$81 billion) of debt, Mr Chhibber said.

While the size of Dubai World's debt is 'not significant enough to have a major impact', the default is a signal that the underlying factors that caused the financial crisis have not been solved.

These problems have been temporarily papered over by the huge stimulus spending rolled out by governments, but how long that can continue is a question mark, he noted.

'The balance sheets are still heavily debt-laden, and therefore a small shift in expectations or investor sentiment can really turn things,' he said.

'When the tide starts to go out again, you will see where the rocks are.'

For Asia to remove those rocks and embark on a sustainable growth path, the region must undergo fundamental changes, said Mr Chhibber, who is also the director of the UNDP's regional bureau for Asia and the Pacific.

'If Asia wants this to be its century, it must more vigorously find an alternate development path away from its old export-led growth model.'

In introducing the UNDP report, which he co-authored with UNDP senior policy adviser T. Palanivel and Professor Jayati Ghosh of India's Jawaharlal Nehru University, Mr Chhibber laid out six areas where he said governments have to do more.

To tackle asset bubbles, they must put in place better tools to manage capital flows, he said. 'Property markets are also extremely frothy all across Asia but with capital which could easily reverse.'

Second, they have to rely less on export demand and develop greater domestic demand by spending more and encouraging households and businesses to do the same.

Governments should also invest more to make sure that poorer members of the population benefit from economic growth as well, so as to minimise the effects of income inequality, he said.

This ties in with the fourth aim of providing better social protection for the needy, with more government spending on health care and more extensive social insurance programmes, including pensions and unemployment insurance.

Cleaner and greener growth is a fifth area of focus. Even as developing countries power ahead, there needs to be a shift from heavy coal and oil usage to solar, nuclear and renewable energy, he added.

Lastly, intra-regional trade in Asia should be expanded, which would help smaller economies especially.

In Singapore, for instance, domestic demand can never hope to substitute for external markets, but Asean can provide a bigger market and a stronger economic base to help buffer external shocks.

ST : Large-scale asset sale may be on the cards

Dec 1, 2009

Large-scale asset sale may be on the cards




DUBAI: Dubai World's debt crisis is likely to result in a large-scale sell-off of assets as varied as the QE2 cruise liner, Turnberry championship golf course, and a raft of properties worldwide.

Mr Paul Reynolds, head of Rothschild's advisory operations in the Middle East, was this week asked to assess the group's assets alongside Mr Aidan Birkett of Deloitte, who was appointed last Wednesday.

A spokesman for the Dubai Department of Finance told Britain's Telegraph newspaper that all options and asset sales would be considered, except for the DP World subsidiary that bought P&O, the British port company.

'I'm sure all of the assets of Dubai World will be reviewed,' he was quoted as saying.

'It's part of the restructuring process, though it's too early to say whether there's any sale in mind.'

Dubai rocked the financial world last Wednesday when it said it would ask creditors of Dubai World, the conglomerate behind its rapid expansion, and Nakheel, builder of its palm-shaped islands, to agree to let it cease payments on billions of dollars of debts until a restructuring agreement has been negotiated.

Abu Dhabi - the richest state in the United Arab Emirates (UAE), the federation to which Dubai belongs - is seen as one of the main buyers of Dubai's assets. Analysts say Abu Dhabi will probably insist on Dubai selling some assets as part of its conditions for rescuing it.

On Sunday, the Abu Dhabi-based UAE central bank moved to quell fears that Dubai's debt crisis could escalate, by promising to provide liquidity for both foreign and local banks that had been expecting repayments, effectively covering any short- term losses.

Last year, when rumours about Dubai's debt problems first surfaced, sources said Abu Dhabi had offered to buy Emirates airline, but Dubai had refused to part with its flagship carrier.

Abu Dhabi is also said to be interested in Emaar, the property company that owns the Burj Dubai skyscraper, the Dubai Mall shopping centre, and Dubai's aluminium company Dubal, the Telegraph reported.

Dubai World's venture capital arm, Istithmar, owns stakes in global assets, including MGM Mirage, the Las Vegas gambling operation; Barneys, the New York department store; Cirque du Soleil; South African entrepreneur Sol Kerzner's hotel chain; and Standard Chartered Bank.

The group's London properties include Adelphi on The Strand and the Grand Buildings in Trafalgar Square.


--------------------------------------------------------------------------------

A world of big-ticket properties

HIGH-PROFILE assets that Dubai World could be forced to sell:

DP WORLD: The company owns P&O, one of the world's largest port operators and among the crown jewels of Dubai. Its 2007 initial public offering raised almost US$5 billion (S$7 billion), but its share price has since fallen by more than two-thirds.

STANDARD CHARTERED: A 2.7 per cent stake in the bank for about US$1 billion in 2006.

MGM MIRAGE: A US$5 billion investment in casino operator MGM and half of an US$8.5 billion Las Vegas project that has run into delays.

BARNEYS: A luxury retail chain in the United States, bought for US$942 million in 2007, and now near bankruptcy.

PERELLA WEINBERG: A US$100 million investment in this boutique investment bank in 2006.

CIRQUE DU SOLEIL: A 20 per cent stake in this international circus touring company, bought in 2008.

TURNBERRY GOLF COURSE: Bought in 2008 for about US$100 million, it hosted this year's British Open Championship. The Dubai group also owns more than 200 golf courses across the US.

QUEEN ELIZABETH 2 LINER: Bought in 2007 for US$100 million to be converted into a luxury hotel and moored off Dubai's Palm, the ship's future has been under scrutiny since it docked last year for refurbishment.

ATLANTIS DUBAI: The resort, which opened last year to a US$50 million fireworks display, is a joint venture with South African tycoon Sol Kerzner.

EMIRATES: The airline has US$55 billion worth of orders placed with Boeing and Airbus.

DUBAI ALUMINIUM: Set up in 1979 and now one of the world's largest producers and exporters of aluminium.

LONDON STOCK EXCHANGE: A 21 per cent stake in the bourse operator, bought in November 2007.

HSBC: An undisclosed stake in HSBC, made in 2007, that made Dubai World one of the largest investors in Europe's biggest banks.

DEUTSCHE BANK: A 2.2 per cent stake in the German lender bought in 2007 for US$1.83 billion.

EUROPEAN AERONAUTIC DEFENCE AND SPACE COMPANY: A 3.12 per cent stake in Airbus' parent company.

EMAAR PROPERTIES: The Arab world's largest property developer by market value is in the midst of a merger with three other state-linked developers after a failed acquisition in the US and Dubai's real estate market crash left it vulnerable. Its portfolio includes the world's tallest tower, Burj Dubai, and one of the world's biggest malls.

SOURCE: REUTERS

BT : HK weekend home sales down 16%

Business Times - 01 Dec 2009


HK weekend home sales down 16%

Concerns over Dubai crisis holding back buyers

(HONG KONG) Hong Kong's weekend home sales fell 16 per cent at major developments as concerns about Dubai World's debt prompted buyers to slow purchases, Centaline Property Agency Ltd said.

Residential transactions at Hong Kong's 10 biggest developments dropped to 32 between Nov 28 and Nov 29 from 38 the prior weekend, Louis Chan, general manager of residential properties at Centaline, said by phone yesterday .

'Since the global financial crisis erupted last year, buyers have become more wary of any adverse news coming from the financial markets,' Mr Chan said.

Concerns about Dubai World's attempts to reschedule its debt last week also affected sales at Cheung Kong (Holdings) Ltd's Le Prime residential project, Mr Chan added.

Markets from Asia to the United States fell last week after Dubai's state-owned investment company sought a 'standstill' agreement to delay repayment on much of its US$59 billion of borrowing.

Hong Kong's Hang Seng Index fell 4.8 per cent on Nov 27, the most in eight months, led lower by bank shares. The Hang Seng Index finished yesterday's session with a gain of 3.25 per cent after the central bank in the United Arab Emirates on Sunday pledged support for banks in Dubai.

Hong Kong home prices have surged more than 30 per cent this year, according to Centaline, as record low interest rates and a rebound in the local economy help fuel demand for housing.

The rally has prompted the government to limit lending for luxury apartments, and suspend mortgage insurance for rental properties.

Hong Kong recently said it would clamp down on sales tactics that had been criticised by lawmakers.

Developers selling uncompleted homes will have to quote prices per square foot based on the usable space as opposed to the previous practice of including a proportion of common areas on the square footage\. \-- Bloomberg

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.

BT : Real estate attracts rich investors

Business Times - 01 Dec 2009


Real estate attracts rich investors

They see better long-term returns from property than from stocks: survey

(EDINBURGH) Individuals with more than US$800,000 to invest plan to increase their property holdings because they foresee better long-term returns than from stocks and bonds, according to a Barclays plc global survey.

Twice as many people plan to raise their investment in commercial and residential property as intend to reduce it, the Barclays Wealth unit said in a statement yesterday.

The richer the individual, the greater the proportion of wealth is placed in real estate, the survey found.

'I was surprised how big a share of their wealth property represents,' Mike Dicks, the London-based head of research at Barclays Wealth, said in an interview. 'It's not what I would tell grandma. None of our data suggests that would be a good allocation.'

The global recession pushed down commercial and residential real estate prices in every region except Asia. The value of US shops, offices and warehouses fell 21 per cent in the first three quarters of this year, following a 12 per cent decline in 2008.

Belief that properties are now undervalued was the second most common reason cited for increasing investment.

Real estate investment among wealthy individuals is set to rise to 30 per cent of the average portfolio for the next few years from 28 per cent now, according to the survey. That excludes properties used as a principal residence.

Most rich people, other than the extremely wealthy, should have no more than 10 per cent of their assets in property, said Mr Dicks.

'An emotional attachment to bricks and mortar' can mean that rich investors are often unwilling to sell real estate at short notice and may be less rigorous in measuring its performance as an asset, according to the report.

Investors from Canada and the Persian Gulf were the most likely to increase their property allocations, with an average rise of 4 per cent, the report said.

Spain was the only country in the survey where more individuals said they would reduce the proportion of real estate investment, said the wealth management division of London-based Barclays. About 60 per cent of rich individuals in that country have more than half their assets in property.

Almost 30 per cent of British and Indian investors have more than half their wealth tied up in real estate.

About 40 per cent of the total respondents worth more than £pounds;30 million (S$68.4 million) have a similar allocation, Barclays Wealth said.

Three out of four investors surveyed said residential property is looking attractive and two-thirds are keen to explore investing in commercial real estate, the survey said. About 75 per cent said they feel hampered by borrowing costs.

The US was the most attractive real estate market for investors outside their home country, the survey showed. The country was seen as having the highest potential for return on investment.

Barclays Wealth surveyed 2,000 people. Forty per cent were worth £pounds;500,000 to £pounds;1 million.

An additional 40 per cent were worth between £pounds;1 million and £pounds;10 million. Ten per cent had assets of as much as £pounds;30 million and the rest were wealthier than that\. \-- Bloomberg

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.



Good time to buy? The belief that properties are now undervalued was cited for increasing investment in commercial and residential real estate

BT : S'pore retail rents rank 18th highest

Business Times - 01 Dec 2009


S'pore retail rents rank 18th highest

Asia-Pac retail sector recovering faster and better than expected

By KALPANA RASHIWALA

SINGAPORE has moved up a notch in property firm CB Richard Ellis' latest survey of the most expensive retail markets. Prime retail rents here were the 18th most expensive in the world in the third quarter of this year, up from 19th spot in Q2.

New York, Hong Kong and Paris retained the top three positions.

Sydney overtook London as the fourth most expensive place to rent prime shop space, although this was due chiefly to the strengthening of the Australian dollar relative to the US dollar.

As a result of tougher trading conditions, gaps are appearing in some high streets and shopping centres as retailers consolidate networks or cease trading altogether, CBRE says in its latest Global MarketView on the retail sector. 'There is increasing differentiation between 'the best and the rest'.

The retail sector in the Asia-Pacific region is recovering faster and better than expected, as government programmes and strong economic growth in some markets help restore consumer confidence.

Hong Kong still ranks as the world's second most expensive retail rental market, with values of US$976 per square foot per annum.

'Prime retail rents vary significantly across the different Asian markets, but in Q3, retail rents in most cities either declined at a slower rate, stabilised or showed a slight up-tick,' CBRE says.

'However, the threat of supply-side risk remains significant in certain cities in mainland China, Singapore and India, where large amounts of shopping mall construction are expected to be delivered in the coming years.'

Knight Frank managing director and Singapore retail property veteran Danny Yeo noted that over the past six months, average rents for prime retail space in suburban malls have been more resilient, still managing to post low single-digit per cent increases as supply remains tight. Along Orchard Road, however, the opening of four new malls this year has put pressure on rentals.

'There's a window of opportunity, which is still open, for retailers to secure space at good rentals in the Orchard Road vicinity,' said Mr Yeo.

According to Knight Frank data, the stock of shop space in the Orchard Road area increased about 17 per cent in the first nine months of this year compared with end-2008 figures.

CBRE says New York's reign as the world's most expensive retail market continued in Q3 despite a 25 per cent drop in rental rates over the past 12 months. Prime New York retail rents ended Q3 at US$1,640 psf per annum.

The prime retail rents quoted by CBRE represent the typical 'achievable' open market headline rent that an international retail chain would be expected to pay for a ground-floor retail unit (either high street or shopping centre, depending on the market) of up to 200 sq metres (2,153 sq ft) of the highest quality and specifications and in the best location in a given market.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.



Orchard Central: One of the new malls completed in Singapore's prime shopping belt this year

BT : Realising Jurong Island's potential

Business Times - 01 Dec 2009

INDUSTRIAL SPACE
Realising Jurong Island's potential

Completed 21 years in advance, the island has become a magnet for petrochemical investments

FROM seven idyllic islands to one big bustling petrochemical centre, the formation of Jurong Island in the last 14 years has been nothing short of extraordinary. Even more striking is how reclamation works on the island recently ended - 21 years ahead of schedule.

'We had defied great odds to complete this reclamation ahead of time,' said JTC Corporation chairman Cedric Foo at Jurong Island's reclamation completion ceremony in September.

Jurong Island is the answer to a vision that came about as early as in the 1960s. Back then, Singapore was among the top three oil refining centres in the world, but it was looking for a 'quantum leap' to maintain its edge in the petrochemical industry.

'Regional countries were also planning to set up refineries for their own domestic market,' Minister for Trade and Industry Lim Hng Kiang recounted at the reclamation completion ceremony. 'We realised that we needed a quantum leap to stay ahead of the competition.'

What Singapore needed was to build up and integrate the petroleum industry with the petrochemical industry. But there was insufficient industrial land on the mainland to house more chemical companies. 'This gave rise to the bold idea to reclaim and join seven southern islands into what we know today as Jurong Island,' Mr Lim said.

Three oil giants were already operating on three of the islands - Esso on Pulau Ayer Chawan, Singapore Refining Company on Pulau Merlimau and Mobil Oil on Pulau Pesek.

The other four islands - Pulau Ayer Merbau, Pulau Pesek Kecil, Pulau Sakra and Pulau Seraya - also became important pieces of the vision.

In 1991, JTC became the agent for developing Jurong Island. Working closely with various government agencies, it delivered the necessary infrastructure and services such as roads, drains and utilities.

Reclamation works began in 1995 and a fair number of challenges cropped up as Jurong Island took shape.

For instance, in 2005, the authorities had to divert and realign a stretch of the Jurong Island Highway - together with 17 pipelines and 4 core fibre-optic cables - to meet ExxonMobil's needs for a contiguous plot of land next to their current cracker.

'This was a mammoth undertaking,' Mr Lim said. 'JTC worked closely with the affected companies and agencies to devise innovative solutions to minimise disruption to business operations on the island.'

Alternative ways

Disruptions to the import of sea sand also posed a risk to progress. But 'we opened up alternative sources of sand supply and explored other ways to meet our needs', Mr Lim said.

The aim was to complete reclamation works in 2030. But as demand for land on Jurong Island surged, JTC brought the third and fourth phases of the project forward and completed the reclamation well ahead of schedule.

Jurong Island is today the cornerstone of Singapore's energy and chemical industry. It spans 3,000 hectares - a giant compared with the seven islands which occupied a total land mass of just 991 ha.

Not only has Jurong Island grown in size, it has also grown in economic clout. In 2000, 61 petrochemical companies invested $21 billion on the island. Today, there are 95 firms pouring in over $31 billion into fixed assets.

The recession had at one point forced some companies to postpone projects on Jurong Island. But with the economy picking up, some plans are back on track.

For instance, China Huaneng - the new owner of Tuas Power - will go ahead to build a $2 billion clean coal and biomass cogeneration plant on Jurong Island. Reports also note that Jurong Aromatics Corporation could resume its US$2 billion petrochemical investment.

Because of strong investor interest, Jurong Island is running out of space. Some 75 per cent of the 3,000 hectares of land has been taken up or reserved by oil and petrochemical investors, JTC told BT recently. 'JTC is in discussions with companies for the remaining 25 per cent,' the agency's spokeswoman said. In his speech at the reclamation completion ceremony, JTC's Mr Foo said that the agency will continue to improve infrastructure on Jurong Island to anchor more investments.

One new facility Jurong Island will be getting is a barging terminal. This will give chemical companies an alternative transport option to trucking - there are only a few roads which trucks carrying hazardous materials can use to get to the island currently. The terminal will be built on the western part of the island and the first phase of the project will be ready by 2011.

New roads

There could also be a new road link to Jurong Island. JTC has completed a preliminary study on building another road from the mainland, which would cater to the growing working population. Some 38,000 people pass through the island's checkpoint daily. JTC still needs to iron out details such as the position and cost of the second link, which could be ready by 2017.

To boost security on Jurong Island, JTC will also introduce a biometric access system at the checkpoint. The system should be completed by 2011.

'We will continue to find ways to adjust the Jurong Island profile to bring about stronger integration for greater operating efficiencies by the companies, and in particular to include new entrants,' said Minister Lim.

'Our vision is for Jurong Island to be a global energy and chemical hub. We intend to achieve a critical mass of feedstock, move to higher value chemical chains which produce speciality chemicals and advanced materials, and partner companies in developing new chemical products.'

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.



Foresight: The aim was to complete reclamation works in 2030. But as demand surged, JTC brought the third and fourth phases of the project forward and completed the reclamation well ahead of schedule.







Today, Jurong Island spans 3,000 hectares (above) - a giant compared with the seven islands which occupied a total land mass of just 991 ha




Developed: JTC worked closely with various government agencies, and it delivered the necessary infrastructure and services such as roads, drains and utilities

BT : Yongnam wins Marina expressway contract worth $21.5 million

Business Times - 01 Dec 2009


Yongnam wins Marina expressway contract worth $21.5 million

Latest deal raises firm's total contract value for MCE to $283 million

By JAMIE LEE

STEEL contractor Yongnam Holdings has been awarded a $21.5 million contract to build part of Singapore's new expressway.

The latest award raises its total contract win value for the Marina Coastal Expressway (MCE) project to $283 million, the company said yesterday.

Yongnam said that it would support the main contractor, Samsung C&T Corporation, by installing and removing temporary steel strutting and waling works for the wide and deep tunnel excavation.

This is expected to be completed by September 2012. The contract is not expected to have an impact on the group's financial performance this year.

The new expressway is expected to be done by 2013 and will connect the Kallang-Paya Lebar Expressway (KPE) and the East Coast Parkway (ECP) to the Ayer Rajah Expressway (AYE).

Separately, Yongnam said in April this year that it had won three new contracts worth about $40.4 million for construction works for the Dubai Metro. These include the supply and erection of the structural steelworks for sections of the train stations.

A company spokesman told BT: 'The three projects will be substantially completed by end 2009 and are expected to contribute positively to the group's revenue and profit, as well as consolidated net tangible assets and earnings per share for the current financial year.

'In addition, the contracts are with Japan-Turkey Metro Joint Venture (the JV partners are Obayashi, Kajima and a Turkish company) and these are infrastructure projects, that is, Dubai MRT, and the ultimate client is Roads & Transport Authority of UAE.'

Yongnam said in the April press release that the Middle East was its next key market after Singapore. Last year, revenue contribution from the region more than doubled to $143.3 million from $65.1 million a year ago.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.

BT : CDL open to raising South Beach stake

Business Times - 01 Dec 2009


CDL open to raising South Beach stake

By KALPANA RASHIWALA

(SINGAPORE) City Developments Ltd (CDL) says it is open to exploring the possibility to raise its stake in the South Beach project - in which Dubai World also has a share - if such an opportunity arises.

'South Beach is an iconic development and one which has excellent potential,' a CDL spokesperson noted.

She added that the joint venture company that owns the South Beach site may also choose to issue further notes if more funds are required in due course and it is open to any note holder and/or shareholder to subscribe for the notes.

CDL bought the South Beach site in 2007 jointly with Dubai World and El-Ad Group for $1.69 billion. In June this year, the JV company refinanced an earlier $1.2 billion land loan through an $800 million two-year secured bank loan and $400 million five-year secured convertible notes. Hong Kong's Nan Fung group subscribed for $205 million of the notes while CDL mopped up the remaining $195 million.

Dubai World is now asking all providers of financing to itself and its unit Nakheel to 'standstill' and extend debt maturities until at least May 30, 2010.

South Beach will have offices, hotels, residences and and retail space. Some market watchers suggest that in addition to the options outlined by CDL yesterday, another avenue for the JV company to fund the site's development would be to sell all or part of the project. If the apartments are launched and sold, sales proceeds would help to fund part of the development's construction. The hotels could also be divested to CDL's hotel units Millennium & Copthorne Hotels plc and CDL Hospitality Trusts, or a third-party buyer. Alternatively, the entire development, when completed, could be spun off into a real estate investment trust. Rough calculations show that Dubai World and El-Ad would have pumped in about $200 million each of equity in the project. As at Sept 30, 2009, CDL had cash and cash equivalents of about $979.5 million at group level. Market watchers reckon the South Beach consortium partners may have received offers for their stakes from potential buyers.

CDL said in August that South Beach's construction is likely to begin around Q3 2010, with CDL and Nan Fung probably the ones that will pump in further money. El-Ad and Dubai World are likely to be passive investors who may see their share in the project diluted.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.



South Beach: El-Ad and Dubai World are likely to be passive investors who may see their share in the project diluted