ST : Prime resale condo prices hit new high

Jun 25, 2010

Prime resale condo prices hit new high

Prices of suburban units also rising at faster rate, says DTZ, but overall sentiment weaker

By Joyce Teo

PRICE rises of private resale homes have generally slowed this quarter, to under 3 per cent in most areas, amid weaker buying sentiment.

However, prime homes hit a new price high, and price rises for suburban homes grew at a much faster rate, property consultancy DTZ said yesterday.

Suburban resale condominium and apartment prices leapt by 4 per cent for the quarter ending June 30, from the first quarter, to yet another new high.

DTZ was giving its resale price estimates ahead of official figures for the entire private home market due out next month.

It said resale prices of leasehold suburban homes climbed 4 per cent quarter-on-quarter to $648 per sq ft (psf), compared with the 2.1 per cent rise in the first quarter. The 2007 peak for these homes was at $615 psf.

DTZ said the reason suburban home prices on the resale market rose faster was a combination of higher new launch prices and aggressive bids for government land sales sites in suburban areas.

Otherwise, the rise in housing prices has generally slowed in the second quarter as resistance to high asking prices and stock market uncertainty caused many buyers to take a wait- and-see approach.

DTZ referred only to prices of non-landed homes in yesterday's report.

Price rises for resale freehold condo units in prime districts 9, 10 and 11 came in at a slower 2.6 per cent pace, down from 3.7 per cent in the first quarter .

But that still brought prices to a new high of $1,493 psf, which is 0.7 per cent higher than the previous 2007 record of $1,483 psf.

Meanwhile, prices of resale freehold condo units outside the prime districts rose 2.9 per cent to hit a previous 2007 peak of $747 psf, down from a 4.2 per cent rise in the first quarter, DTZ said.

Only prices for luxury condo apartments have yet to reach the previous peak. They are still 7.6 per cent off the 2007 record of $2,800 psf, despite rising 3.5 per cent to $2,588 psf.

Developers have been bidding aggressively for land but they are likely to 'tone down' their bids.

This is in view of an unprecedented number of suburban sites to be sold in the second half-year government land sales programme, said DTZ head of South-east Asia research Chua Chor Hoon.

'This will keep a check on prices of mass-market homes going forward,' she said.

Concurring, Frasers Centrepoint chief executive Lim Ee Seng said: 'In terms of affordability, I would say prices are stretching the limit.'

For the year, Ms Chua is forecasting a rise of up to 10 per cent for mass-market prices and about 10 per cent to 15 per cent for the other segments.

While the market has slowed since last month, the slower take-up rate for new developments is viewed as more sustainable, said Ms Margaret Thean, DTZ's executive director (residential).

She said developers plan to launch more new projects in the coming months. 'If they are well taken up, that would motivate more developers to launch other projects and stimulate buyer interest.'

The 361-unit Waterfront Gold in Bedok Reservoir has already been lined up for launch tomorrow. It will be the first major suburban launch this month.

Frasers Centrepoint said it will be selling units at the project at an average price of $950 psf. It plans to launch not more than a third of the project, just enough to finance part of the construction.

joyceteo@sph.com.sg

· See Money


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STRETCHING IT

'In terms of affordability, I would say prices are stretching the limit.'

Frasers Centrepoint chief executive Lim Ee Seng



The 361-unit Waterfront Gold in Bedok Reservoir has been lined up for launch tomorrow. It will be the first major suburban launch this month. -- PHOTO: FRASERS CENTREPOINT

ST : Office rents pick up after sliding for six quarters

Jun 25, 2010

Office rents pick up after sliding for six quarters

Prime office rents get a lift from economic recovery, pent-up demand

By Esther Teo

RENTS for office space are finally on the way up after six consecutive quarters of decline.

The economic recovery and pent-up demand have boosted monthly prime office rents from about $6.70 per sq ft in the first quarter to $6.90 for this quarter, a rise of 3 per cent, said property consultancy CB Richard Ellis (CBRE) yesterday.

Grade A rents rose 5.6 per cent quarter-on-quarter to $8.45 per sq ft a month.

Rents outside the Central Business District (CBD) in areas such as Novena, Alexandra and Tampines have held steady in the past two to three quarters, giving tenants options of cheaper alternatives, CBRE said.

Rents for core and fringe CBD space have risen despite lingering concerns over an impending glut of supply and the hollowing-out of existing buildings within the CBD.

Leasing momentum stayed strong, in part due to pent-up demand from multinationals, which were finally in a position to act on their space needs, said Mr Moray Armstrong, CBRE's executive director of office services.

Mr Armstrong said the year- long lull after the financial crisis began in September 2008 has passed.

'With confidence restored in late 2009, decision makers initiated space planning, leading to a pick-up in requirements and in turn increased leasing volume in the first half of this year,' he added.

A number of investment banks signed leases in the first half of the year and are now following those up with multiple deals for space in new developments that should hit the market next year.

There has also been increasing demand from the insurance sector, professional services, private equity and hedge funds, with foreign legal firms 'very prominent in the market', CBRE said.

About 6.9 million sq ft of office space is scheduled to come on-stream from the second half of this year to 2015.

Just over 50 per cent of that is already pre-leased and the absolute volume of supply looks 'increasingly manageable', added CBRE.

Falling vacancy rates also reflect higher demand.

Vacancies in the core CBD area fell from 8.1 per cent in the first quarter to 6.7 per cent, while similar rates in outlying markets such as Tampines fell from 8.2 per cent to 6.8 per cent.

The fringe CBD area also saw a 3.2 percentage point decrease in vacancy rate to 9.6 per cent this quarter.

CBRE said prospects of oversupply are receding, thanks partly to the conversion of existing office stock into apartments in older parts of the commercial centre.

Mr Armstrong added that the outlook for the office sector remained favourable, thanks to strong business con-fidence and a healthy local economy.

'The only caution at present arises from external macroeconomic issues such as European Union debt,' he added.

'Nonetheless, medium-term demand is expected to remain positive as business expands and multinationals continue to view Singapore as one of the few growth stories to help counter the more sluggish markets in Europe and the United States.'

esthert@sph.com.sg


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CONFIDENT MOVES

'With confidence restored in late 2009, decision makers initiated space planning, leading to a pick-up in requirements and in turn increased leasing volume in the first half of this year.'

Mr Moray Armstrong, CB Richard Ellis executive director of office services



-- ST PHOTO: ALPHONSUS CHERN

ST : High-end property prices could appreciate: UBS

Jun 25, 2010

High-end property prices could appreciate: UBS

By Jonathan Kwok

THE buoyant economy and low interest rates mean property prices are not heading south anytime soon, according to Swiss bank UBS.

While prices of mid-range and lower-end units could stay at current levels for at least the next 12 months, high-end homes could even go higher.

'Luxury properties such as those at Sentosa, Nassim Road and Ardmore Park, where condominiums go for above $3,000 per sq ft, could see further upsides,' said Mr Kelvin Tay, chief investment strategist at UBS Wealth Management Singapore.

'From now until the end of the year, a 5 to 8 per cent price appreciation is not difficult. The lower luxury segment, at districts 9, 10 and 11, might see some positive flows because of the luxury end moving up but I think that will be muted.'

The luxury-end is 'not a sector that the Government is keen to control', said Mr Tay, who added that the rest of the market is likely to be flat.

Late last month, flash estimates from the National University of Singapore showed that its price index for non-landed private homes rose 2.5 per cent in April over March, meaning a rise of about 6 per cent since the end of last year.

Mr Tay said an extended period of low interest rates would support the market. He thinks Singapore's interbank rate may climb to about 1 per cent at the most in the next year, well under the long-term historical average of about 4.5 per cent.

The high cash savings of households here, coupled with the low unemployment rate, will also prop up prices. Mr Tay said the proportion of Singaporeans' cash savings - when compared to total assets - is higher now than before the Asian financial crisis of 1997.

The stock market could also see more upsides, said Mr Tay, with the benchmark Straits Times Index possibly hitting 3,200 by the end of the year - around 12 per cent above yesterday's close.

Mr Tay said he prefers high-yield stocks such as the real estate investment trusts (Reits) over property developers.

'We don't expect property prices to move very sharply up from here, so there is less incentive to be invested in a developer. But the Reits are still very attractive with their high yields.'

Mr Tay was speaking at a briefing on Wednesday on his bank's outlook for the rest of the year.

He said that economic fundamentals remain solid in Asia, making a double-dip recession unlikely.

The Korean won, Singapore dollar and Philippine peso rank as UBS's favourite Asian currencies, led by the continuous and gradual appreciation of the Chinese yuan.


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GOING UP



'From now until the end of the year, a 5 to 8 per cent price appreciation is not difficult. The lower luxury segment, at districts 9, 10 and 11, might see some positive flows because of the luxury end moving up but I think that will be muted.'

Mr Kelvin Tay, chief investment strategist at UBS Wealth Management Singapore

ST : Australian firm top bidder for Jurong site

Jun 25, 2010

Australian firm top bidder for Jurong site

Lend Lease's $748m offer more than double minimum expected bid

By Joyce Teo

AUSTRALIA-BASED Lend Lease has topped a tender for a large mixed commercial, residential and hotel development site which is set to kick-start Jurong Lake District's planned transformation.

It lodged a higher-than-expected bid of $748.89 million, which works out to $649.6 per sq ft of gross floor area.

This is more than double the minimum expected bid of $350 million for the 99-year leasehold site, next to Jurong East MRT station.

The top bid came in just 2.8 per cent above the second bid of $728.8 million or $632 psf of gross floor area from CapitaLand Retail RECM's Energy Trustee.

Far East Organization and Frasers Centrepoint were third with a price of $677 million or $587.3 psf of gross floor area.

China-based Qingdao Construction was the lowest of the six bids with $418 million or $362.6 psf of gross floor area.

'Today's tender result shows that although the momentum in the land sales market appears to be decelerating, developers are still looking to acquire attractive development sites,' said Ngee Ann Polytechnic real estate lecturer Nicholas Mak.

Colliers International's director for research and advisory, Ms Tay Huey Ying, said the encouraging response is 'proof of the private sector's confidence in the Government's plans to develop Jurong Lake District into a major regional centre and leisure destination by the lake'.

When awarded, this tender will probably serve as a catalyst for more private sector developments in Jurong, 'thereby accelerating the attainment of the Government's vision for this new growth area, and helping to chart Singapore's next lap', added Ms Tay.

The 1.9ha site has a maximum gross floor area of 1.15 million sq ft. Thirty per cent of the gross floor area has to be set aside for office development.

Property experts believe the top bidder is likely to develop a retail mall using all or most of the other 70 per cent.

Said DTZ's head of South-east Asia research, Ms Chua Chor Hoon: 'This combination will make the best use of the site, which is the 'crown jewel' in Jurong Gateway (the planned commercial hub).

'There will be high footfall through the retail mall due to the integration of the development with the MRT station and connection to nearby developments through elevated walkways required by the Urban Redevelopment Authority.'

CBRE Research executive director Li Hiaw Ho estimates a gross development value of $2,200 psf to $2,400 psf for the retail mall and $1,000 psf to $1,200 psf for the office component, based on the top bid for an office and retail complex.

If apartments are built on the site, they could be launched at some $920 psf, said Mr Mak.

Plans for Jurong Lake District, covering 360ha - about the size of Marina Bay - will be implemented over 10 to 15 years, with two precincts. Jurong Gateway precinct will be the biggest commercial hub outside the city centre. Lakeside precinct is to be turned into a world-class leisure destination for residents and tourists.

joyceteo@sph.com.sg

ST : Call for Malaysian govt to reveal details of railway land swop deal

Jun 25, 2010

Call for Malaysian govt to reveal details of railway land swop deal

KUALA LUMPUR: The Malaysian government has been urged to reveal the details of Prime Minister Lee Hsien Loong's proposal on the land swop deal to Parliament before signing a deal, reported news website FreeMalaysiaToday (FMT).

In a response to Malaysian Prime Minister Najib Razak's statement that KL will conclude its deal with Singapore by September, opposition MP Azmin Ali said that it was odd Singapore agreed with Malaysia on several contentious issues if it was not getting what it wanted.

'We are concerned as to how an issue which has been dragging on for so long, could be suddenly resolved within three months. It is very worrying,' he added.

Both premiers met in Putrajaya on Tuesday and agreed to meet again in three months' time to finalise details of a deal over Malayan Railway's land in Singapore.

The website said Datuk Seri Najib did not reveal the content of the proposal. Mr Azmin is vice-president of opposition Parti Keadilan Rakyat which is led by Datuk Seri Anwar Ibrahim.

'We want to know if the deal is done, and if so, what are the contents of the agreement? What are we actually surrendering and why the hurry to agree?' Mr Azmin was quoted as saying by FMT.

'We need to know the details of the what transpired because we don't want a repeat of the oil block incident where we lost blocks L and M in Sarawak to Brunei,' he added.

Mr Azmin also said opposition chief Mr Anwar had similarly called for the agreement to be brought to Parliament and discussed before any deal is signed.

The Malayan Railway land negotiations had dragged on for 20 years until the first breakthrough in negotiations was made in Singapore last month when both sides agreed to move the existing railway station in Tanjong Pagar to Woodlands by July next year.

The railway land left behind could then be jointly developed by both countries, or it could be returned to Singapore and land of equivalent value elsewhere jointly developed instead.

BT : Pent-up demand leads to Q2 pick-up in prime office rents

Business Times - 25 Jun 2010

Pent-up demand leads to Q2 pick-up in prime office rents

By EMILYN YAP

PRIME office rents finally picked up in the second quarter after a six-quarter slump, CB Richard Ellis (CBRE) said yesterday.

With strong leasing activity, the large supply of commercial space coming up looks 'increasingly manageable', the property consultancy added. In fact, it has become concerned about whether there will be enough space 4-5 years down the road.

In Q2, the average monthly prime office rent was $6.90 per square foot, up 3 per cent from $6.70 psf in the previous quarter. The average monthly Grade A office rent was $8.45 psf, rising 5.6 per cent quarter-on-quarter.

The vacancy rate in the core central business district was 6.7 per cent, improving from 8.1 per cent a quarter ago. Outside the CBD - in areas such as Orchard, Novena and Alexandra - rents remained stable in the past 2-3 quarters.

Pent-up demand from MNCs supported leasing momentum, said CBRE's executive director of office services Moray Armstrong. 'With confidence restored in late 2009, decision makers initiated space planning, leading to a pick-up in requirements.' Space demand from firms in the investment banking, insurance, professional services, private equity and hedge fund sectors also grew.

CBRE has become more optimistic about the take-up of new office space. There will be around 6.9 million sq ft of new offices coming onstream between H2 this year and 2015, and just over 50 per cent of that has been pre-leased.

It projects the market can absorb an average of 1.5 million sq ft of new space every year for the next 4-1/2 years. This exceeds the average annual take-up of 1.28 million sq ft in the past five years.

With the outlook for the commercial sector improving, CBRE said it was surprising that the government land sales programme for the second half of 2010 did not include prime development land in the core business district.

'Projecting forward 4-5 years, some early concerns on a potential gap in the office supply pipeline start to emerge,' it said.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : CCT evaluating all options for StarHub Centre

Business Times - 25 Jun 2010

CCT evaluating all options for StarHub Centre

Part of this process is a non-legally binding expression of interest exercise

By KALPANA RASHIWALA

THE manager of CapitaCommercial Trust (CCT) is evaluating all options relating to its asset plan for StarHub Centre, including the possibility of retaining the property as an office building, and has not made a decision yet.

'As part of the evaluation process, we conducted a non-legally binding expression of interest exercise to ascertain interest for the sale of the property.

As there is no certainty of any deal materialising, unitholders are advised to exercise caution in trading the units of CCT,' CCT said in a statutory filing to Singapore Exchange (SGX) yesterday.

Its announcement was in response to a BT article yesterday which, citing sources, said that the trust could be close to selling the 10-storey commercial building.

BT reported that StarHub Centre's transaction price was expected to be above the Dec 31, 2009, valuation of $268 million.

In its statement yesterday, CCT said that its manager had in January 2010 announced that, as part of its portfolio reconstitution plan for the trust, it had obtained outline planning permission from Urban Redevelopment Authority (URA) to convert StarHub Centre from pure commercial use to up to 80 per cent residential and 20 per cent commercial use.

BT reported yesterday that the expression of interest exercise for StarHub Centre closed last month and that parties had been shortlisted to do due diligence.

The outline permission granted by URA for a mostly residential project is capped at the current 4.9 plot ratio that the existing property is already built up to.

Based on this and the 80 per cent residential limit, a redevelopment scheme can yield about 266,230 sq ft of residential space, sufficient for 212 apartments of an average size of 1,200 sq ft, the BT report estimated.

StarHub Centre received Temporary Occupation Permit in 1998 and stands on a site with 99-year leasehold tenure starting Feb 1, 1996.

On the stock market yesterday, CCT ended one cent lower at $1.17 amid an overall weaker market.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : Lend Lease offers $749m for Jurong Lake site

Business Times - 25 Jun 2010

Lend Lease offers $749m for Jurong Lake site

By UMA SHANKARI

(SINGAPORE) Australian developer Lend Lease beat five other offers with its top bid of $748.9 million for a 1.9-hectare mixed-use site in the Jurong Lake district.

Its bid works out to $650 per square foot per plot ratio (psf ppr) - more than twice the minimum price asked for when the tender for the site was launched two months ago.

Lend Lease, which owns the 313@somerset and Parkway Parade shopping malls here, is expected to build a retail mall on most of the site.

The developer edged out CapitaLand's retail unit CapitaMalls Asia, which made the second-highest offer of $728.8 million or $632 psf ppr. Lend Lease's bid is just 3 per cent higher.

The other bids came from a consortium made up of Far East Organization, Frasers Centrepoint and Japan's Sekisui House; another consortium comprising Keppel Land, Guthrie International and Max Platinum; Sim Lian Land; and China's Qingdao Construction.

Lend Lease's bid is 79 per cent higher than the lowest bid of $418 million, or $363 psf ppr, from Qingdao Construction.

The 99-year-leasehold site, in Jurong Gateway Road next to Jurong East MRT Station, has been on the government's reserve list since November 2008. It was launched for tender in April after an unnamed developer committed to bid at least $350 million, or $304 psf ppr.

The site is the first plot put up for sale in the Jurong Lake area since the masterplan for the area was unveiled two years ago.

The fact that there were six bids shows developers are keen on well-located sites, said CBRE Research executive director Li Hiaw Ho. 'The bids are also a very clear indication of the developers' confidence in the government's vision for the Jurong Lake district and the evolution of the area as a commercial hub in the west of Singapore,' he said.

The plot is classified as a 'white' site, which means it can be put to commercial, residential or hotel use. A mandatory 30 per cent of the gross floor area will have to be set aside for office development, but it is likely that a suburban retail mall will be developed with the remaining 70 per cent of space, analysts said. Lend Lease could also choose to build some apartments.

Colliers International's director for research and advisory Tay Huey Ying said: 'Based on the bid price, the highest bidder is likely to be looking at a development with a predominant retail component to capitalise on the site's location next to Jurong East station, and the large residential and working population catchment of Jurong town.'

Using the offer price of $650 psf ppr and assuming an office and retail complex is built on the plot, CBRE estimates a gross development value of $2,200 to $2,400 psf for the retail mall and $1,000 to $1,200 psf for the office component.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : Q2 resale home prices rise: DTZ

Business Times - 25 Jun 2010

Q2 resale home prices rise: DTZ

Freehold condo units in districts 9, 10 and 11 fetching record prices

By UMA SHANKARI

PRIME freehold condo units in districts 9, 10 and 11 are fetching record prices in the resale market - more than they went for during the last peak in the fourth quarter of 2007 - says a new report.

Property firm DTZ said yesterday that the average resale price of freehold non-landed homes in the three districts rose 2.6 per cent quarter on quarter to $1,493 per sq ft (psf) in Q2 this year. This is 0.7 per cent higher than the previous record of $1,483 psf in Q4 2007.

But resale prices of more upmarket homes - classified by DTZ as those that sell for more than $2,500 psf - are still 7.6 per cent below the Q4 2007 peak.

The average price of freehold luxury non-landed homes rose 3.5 per cent quarter on quarter in Q2 to $2,588 psf. In Q4 2007, they were selling for $2,800 psf.

Outside the prime districts, prices of freehold non-landed resale homes climbed 2.9 per cent to hit the previous peak of $747 psf last achieved in Q4 2007.

And resale prices of leasehold homes outside the prime districts - that is, suburban mass market homes - rose 4 per cent quarter on quarter to $648 psf.

While prices climbed in all the categories tracked, DTZ said that the rate of increase slowed in Q2 as resistance to high asking prices and uncertainty in the stock market hit buying interest in the property market. The only exception was in the mass market segment, where prices of resale leasehold condos rose more than they did in the previous quarter. The 4 per cent climb in Q2 was higher than the 2.1 per cent increase recorded in Q1.

The comparatively higher prices of new developments and aggressive bids for government sites in suburban areas have had a cumulative effect in raising the prices of homes in the secondary market, DTZ said.

But looking ahead, developers are likely to 'tone down' their land bids in view of the unprecedented high number of suburban sites due to be sold in the second-half 2010 government land sales programme, said DTZ's head of South-east Asia research Chua Chor Hoon. This will keep a check on the prices of mass market homes, she said.

Analysts are still most bullish on the freehold luxury market, as prices there are still significantly lower than during the 2007 peak.

Kim Eng Research analyst Wilson Liew said that China's recent move to allow the yuan to appreciate gradually may spur more purchases of Singapore properties by high net worth Chinese nationals as their purchasing power improves. He said that as an asset class, high-end properties in Singapore are still attractive.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : More property launches in coming weeks

Business Times - 25 Jun 2010

More property launches in coming weeks

By KALPANA RASHIWALA

WITH many families returning from holidays as the June school vacation comes to a close, developers are starting to crank up their launch machinery again. Frasers Centrepoint and Far East Organization begin to preview today their 99-year leasehold Waterfront Gold condo along Bedok Reservoir at an average price of about $950 per sq ft (psf).

And within a few weeks, City Developments is expected to soft-launch 368 Thomson on the former Concorde Residence site. Prices in the 36-storey freehold development are expected to range from $1,300-1,500 psf. The condo's 157 units range from one-bedders to penthouses.

Over at the Changi/Still roads junction, Fragrance Group is offering freehold apartments, office and shop units for sale in a five-storey project.

Its residential component, Suites @ Changi, comprises 44 apartments - studios, one-bedders and two-bedroom penthouses. Unit sizes range from 409 to 1,152 sq ft. Prices of one bedders start from $576,000.

Office units in the project's commercial component, Icon @ Changi, begin at $492,000. These units range from 334 to 527 sq ft. Shop units are mostly 570-958 sq ft, although there is an 11,765 sq ft supermarket unit.

Over at Bedok Reservoir, about 150 units or two blocks will be released for this week's preview of Waterfront Gold. The entire development comprises 361 units in five blocks.

Waterfront Gold will be the first condo in Singapore to feature a skypark, according to the developers. The 8,000 sq ft park, on the roof of the 15-storey project, will serve as an observation and exercise deck offering views of the reservoir.

Waterfont Gold is the third in a series of four projects that Far East and Frasers Centrepoint are developing on the former Waterfront View site.

Prior to the latest condo, they released the 405-unit Waterfront Waves, which is fully sold, and Waterfront Key, a 437-unit condo of which 309 units were sold as at end-May.

The final project, which may be released next year, is expected to have about 500 units.

The entire series, dubbed the Bedok Waterfront collection, has been master-planned to maximise views and access to the reservoir, Frasers Centrepoint said yesterday. 'The masterplan ensures that all units have excellent views, either of the reservoir, pools or the landscape,' said Frasers Centrepoint Homes chief operating officer Cheang Kok Kheong.

In March, Sim Lian picked up a 99-year leasehold condo site on the other side of Bedok Reservoir, next to The Tropica, for about $421 psf of potential gross floor area.

Later this year, the government will make available for application through the reserve list a choice land parcel on the same side of the reservoir as the Waterfront collection.

Waterfront Gold comprises one-bedders to four-bedroom apartments and penthouses. The cheapest one-bedder of 581 sq ft will cost $560,000. Two-bedders will be priced from $800,000 for an 893 sq ft apartment. The minimum price for a three-bedroom apartment of 1,012 sq ft is $900,000.

Four-bedders cost from $1.17 million upwards (for a 1,378 sq ft apartment). All starting prices refer to second-floor units.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



Waterfront Gold: The Frasers Centrepoint and Far East Organization project will be the first condo in Singapore to feature a skypark. It will be previewed today

ST : S'pore property market 'third most transparent in Asia-Pacific'

Jun 24, 2010

S'pore property market 'third most transparent in Asia-Pacific'

By Joyce Teo

SINGAPORE is ranked the third most transparent property market in Asia-Pacific, according to a key industry index.

The league table places Singapore at 16th worldwide, two spots ahead of Hong Kong but behind regional rivals Australia, ranked first, and New Zealand at fourth.

Singapore has slipped two places from the last survey in 2008. Its score has remained unchanged but other countries have moved up the ladder.

'Rising levels of transparency are associated with rising levels of foreign direct investment, a powerful incentive for encouraging the free flow of information and the fair and consistent application of local property law,' said Jones Lang LaSalle, which compiled the index with its unit LaSalle Investment Management.

More transparent market conditions allow for quicker investment deals between one foreign investor and another, it said.

The index, which was started in 1999 and is updated every two years, covers all property sectors, though the bulk comprises commercial real estate.

It assessed 81 markets under five categories - performance measurement, market fundamentals, listed vehicles, legal and regulatory environment and the transaction process.

Jones Lang LaSalle's South-east Asia research head, Dr Chua Yang Liang, said the index showed that Singapore's strength lies in its regulatory and legal environment.

'The transparency of our regulatory framework supported the influx of US$4.7 billion (S$6.4 billion), which is more than half of the total dollar value investments, into the commercial asset market during the peak in 2007,' he said.

Singapore can lift its ranking by improving market performance and the transaction process such as introducing more openness, said Jones Lang LaSalle Asia-Pacific research head Jane Murray.

Dr Chua cited the launch of the National University of Singapore residential price index, an alternative to the Urban Redevelopment Authority service, as a move in the right direction.

He added that recent government moves to increase the level of professionalism and general practices of real estate agents are long overdue.

'As a key vital component in the real economy, the real estate industry needs to strengthen its ethical standards and the eventual regulatory structure if enforced will surely push Singapore further up on the rankings,' said Dr Chua.

In Asia-Pacific, Singapore ranks one place ahead of Hong Kong after new questions on commercial real estate debt - a contributing factor of the financial crisis - were considered.

Hong Kong is 'more laissez-faire' in the regulatory sector and its monitoring of debt is slightly less rigorous than in Singapore, Dr Murray said.

Overall, the index showed a notable slowdown in the progress of real estate transparency over the past two years, suggesting that industry players were focusing on survival rather than market advancement during the financial turmoil.

ST : Sales of new US homes plunge to new low

Jun 24, 2010

Sales of new US homes plunge to new low

WASHINGTON: Sales of new US homes dropped a record 32.7 per cent last month to the lowest level in at least four decades as the boost from a popular tax credit faded, adding to worries of a slowing economic recovery.

The Commerce Department said yesterday that single-family home sales tumbled to a 300,000-unit annual rate, the lowest level since the series started in 1963.

In addition, the April and March sales figures were revised down to 446,000 units and 389,000 units, respectively. The drop in sales last month unwound two months of gains, which had been inspired by a government tax credit for home buyers.

Prospective home owners had to sign contracts by April 30 to qualify for the tax credit. Analysts polled by Reuters had forecast new home sales sliding to a 410,000-unit pace. New home sales are measured at contract signing.

'The previous two months were revised down, so the lift from the tax credit was less than we previously realised. We are getting a little nervous,' said Mr David Sloan, an economist at 4Cast in New York.

US stocks fell after the report, with the Dow Jones Industrial Average down nearly 36 points, or 0.35 per cent, at 10,257.55 an hour into trading.

The report was the latest in a series to suggest that the economy's recovery from the worst downturn since the 1930s might be losing strength.

It also came as Federal Reserve policymakers gathered for a two-day meeting at which they were expected to extend their pledge to hold overnight interest rates ultra low for 'an extended period' to aid the still fragile economic recovery.

The United States central bank is not seen lifting rates, currently near zero, until next year. A report on Tuesday showed sales of previously owned homes, which are recorded at contract closing, fell unexpectedly last month.

'We see no chance of a quick, sustained recovery, though we are hopeful there is little further downside' Mr Ian Shepherdson, chief US economist at High Frequency Economics in Valhalla, New York, said in a note to clients. Mr Shepherdson had correctly forecast the drop in sales.

The expiry of the tax incentive also resulted in a decline in new home construction, and applications for loans to buy homes fell last week, staying near 13-year lows.

Last month's weak sales pace saw the supply of homes available for sale jumping a record 46.6 per cent to 8.5 months' worth, the highest in nearly a year, from 5.8 months' worth in April.

However, the number of new homes on the market dipped 0.5 per cent to 213,000 units, the lowest since November 1970.

REUTERS, BLOOMBERG

ST : Investment gains creating many more millionaires

Jun 24, 2010

Investment gains creating many more millionaires

New study supports earlier report of big increase in rich-list

By Gabriel Chen & Fiona Chan

THE rebounding share market and surging real estate prices have sent the number of millionaires here rocketing over the past two years, says a new study.

The number of people meeting the millionaire criteria jumped 32.7per cent from about 61,000 in 2008 to 80,947, according to estimates from Merrill Lynch Wealth Management and Capgemini.

A millionaire is defined as a person with net assets of at least US$1 million (S$1.39million), excluding his main residence and everyday possessions.

The new report reflects the findings of a recent Boston Consulting Group (BCG) report, which estimated that 11.4per cent of Singapore's households - about 125,000 - owned more than US$1 million as at the end of last year.

While numbers differ, observers agree that the sharp rise is largely because the well-heeled here invested heavily in stocks and real estate and caught the wave of the rebound.

Both sectors were hammered in the financial crisis but performed better last year when economic conditions improved.

Take the MSCI index of Asia-Pacific stocks traded outside Japan. It rose nearly 70per cent last year - its best performance since 1993.

And Knight Frank's Wealth Report 2010 showed that the prices of luxury residences here rose 17per cent last year.

Another reason for Singapore's good showing in the wealth stakes is that people here generally have a much better savings rate than a lot of countries with higher average incomes.

That meant that when the crisis came, Singaporeans did not suffer too badly when their asset values fell.

'A rising tide lifts all boats,' said Mr Nick Pollard, chief executive of private bank RBS Coutts Asia, yesterday.

'With Asia recovering more quickly than most other regions, the net worth of private clients in this region has also risen as their investment portfolios are largely concentrated in Asia.'

The Merrill Lynch and Capgemini report uses data on income distribution provided by the World Bank, Global Insight, the Economist Intelligence Unit and national statistics from surveyed countries.

It then uses what is known as Lorenz curves to distribute wealth across the adult population in each country.

Economists say the methodology is sound but could be improved.

'Year-on-year changes are very fleeting, so maybe a better way of looking at it would be a wider longer-term trend,' said Barclays Capital economist Leong Wai Ho.

Mr David Cohen, economist with Action Economics, said that 'it's not that out of line to estimate that the wealth distribution here is roughly in line with other developed countries'.

'In any case, the major message is how much things have improved from a year ago, and I think that's certainly the correct conclusion.'

Private bankers say there are indeed more rich people around, pointing to the growing numbers of newly minted Singaporean citizens from India and China, many of whom are professionals and entrepreneurs.

Anyone looking for advice on how to break into the millionaire ranks should see how assets like stocks and property can drive wealth creation.

Relying on income growth alone may not be the surest way to strike it rich. After all, the latest figures from Singapore's taxman show that there were just 3,838 taxpayers who earned more than $1million in 2007.

'Asset allocation is very important and it's one of the key things in all financial planning,' said Mr Paul Chan, a former president of the Insurance and Financial Practitioners Association of Singapore.

'Of course you can't put all your money into property, but holding on to cash won't make you a millionaire.'

BT : DIC pension fund to restart real estate investing

Business Times - 24 Jun 2010

DIC pension fund to restart real estate investing

(TOKYO) DIC Corp's pension fund, which manages 87 billion yen (S$1.3 billion) of assets, plans to invest in real estate at home and abroad for the first time since 2006.

The manager of retirement savings for about 6,200 employees is taking a look at real estate after it stopped investing in the asset class as the sub-prime mortgage crisis was emerging, said Hideo Kondo, the asset management director of the fund. The plan comes after Japan's commercial land prices dropped to the lowest in at least 36 years.

'One of the best investment decisions we made was to exit all our real estate investments in 2006 on the view that property prices worldwide were expensive,' Mr Kondo, 55, said in an interview here on Monday. 'But now, we're starting to see some investment opportunities in the real estate market.'

The pension fund of the world's biggest ink maker currently invests 55 per cent of its assets in domestic bonds and the rest in domestic and overseas equities, Mr Kondo said.

Japanese pension plans are adjusting their investments after two decades of slumping markets, an ageing population and a dependence on retirement packages immune to investment performance.

About 37 per cent of Japanese pensions surveyed by JPMorgan Chase & Co said they expect to boost allocations to alternative investments.

Alternative investments, under which real estate falls, currently account for about 16 per cent of the portfolio, Mr Kondo said.

In the category the pension also invests in private equity with a focus in Asia and emerging markets, as well as infrastructure in developed markets including in the US and the UK, he said.

DIC pension has invested mostly in overseas single-manager hedge funds with strategies including long-short, which bet on rising and falling stock prices, to hedge against its equity holdings, Mr Kondo said. It also invests in a macro strategy as a hedge against its bond investments, he said.

'When you think about diversifying your investments, you've got to use hedge funds,' Mr Kondo said. 'Otherwise, it's difficult to achieve your targeted returns.' DIC's fund targets a yearly return of 3.5 per cent, he said.

Hedge funds are mostly private pools of capital whose managers participate substantially in the profits from their speculation on whether the price of assets will rise or fall\. \-- Bloomberg

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : Potential seen in Cuba golf courses but issues remain

Business Times - 24 Jun 2010

Potential seen in Cuba golf courses but issues remain

Investors perceive risk amid political and social tensions

(HAVANA) If Cuba plays it right, thousands of tourists could eventually be swinging their clubs at an 18-hole golf course overlooking the turquoise waters and golden beaches just east of Havana.

They will moor their yachts at a swank marina and drive electric carts to luxury villas built around the course's scenic artificial lake.

The project, one of at least a dozen awaiting a thumbs-up from the island's communist authorities, appears closer than ever to becoming reality after Tourism Minister Manuel Marrero said last month that Cuba will go ahead with the construction of golf courses and marinas.

Letters of intent have already been signed between Cuba's state-owned tourism company Palmares and several investors from countries such as Spain, Canada, Britain and Vietnam, said a source close to one of the deals.

Cuba currently only has two courses. But sitting just 145km off the coast of the United States - the world's biggest golf market with 27 million fans - its potential as a golf tourism destination is huge and so are the potential revenues.

'Cuba can be one of the strongest golf destinations in the Caribbean,' said Peter Walton, chief executive of the London-based International Association of Golf Tour Operators.

In the half century since Fidel Castro's revolution turned Cuba into a communist state and its golf courses into art schools or military camps, the only well-publicised golf match has been between two guerrillas who hardly knew how to play.

Mr Castro and Che Guevara, who was a caddy in his boyhood days in Argentina, played golf in their military fatigues and boots in 1961 to thumb their noses at the US government.

But even if today's Cuban leadership has overcome its long-time ideological prejudices against the most capitalist of sports, the fine print regulating future joint ventures and real estate ownership remains a mystery.

Golf courses are generally financed by surrounding real estate developments, so the first thing investors will be looking at is Cuba's willingness to sell or lease land to foreigners. To justify the investment, leases will have to extend for at least 50 years.

'They seem ready to accept the real estate developments. But at this point nobody knows the terms of the leases or the conditions Cuba may attach to the contracts,' said a foreign businessman involved in one of the projects.

Over the years, several projects have been pitched to the Cuban government, including proposals by British architectural firm Foster + Partners, French construction company Bouygues Batiment International and, more recently, the Vietnamese Housing and Urban Development Corporation.

Most of the developments are planned along Cuba's northern coast, including Havana and up-market resorts such as Varadero and Cayo Coco.

Besides villas and apartments, some of these projects, worth hundreds of millions of dollars, include full-scale, Western-style restaurants, supermarkets and shopping malls - so far non-existent on the communist-run island.

But to see the rough hillsides of a suburb in Havana turned into smooth greens filled with foreign putters will probably take more than just reasonably long lease terms, says KPMG analyst Andrea Sartori.

'You need to have certain stability and guarantees to property ownership that I think the country currently doesn't have,' said Ms Sartori, the head of Golf Advisory Practice, a Budapest-based division of KPMG specialised in the industry.

'It is very much an issue of the perception and risk that an international investor will have in leasing a property in Cuba today.'

Although Cuba's 1995 foreign investment law foresees the sale of real estate to foreigners, the experiment in the late 1990s was soon halted after limited sales of apartments.

Business sources say that Cuba would seek to create joint ventures in which it would provide land in exchange for 51 per cent equity. Foreign partners would then be responsible for a huge cash injection, a model similar to the one used two decades ago to develop the island's hotel industry.

'That tends to bring down the returns (on assets) to foreign investors below the 15 to 20 per cent they will be looking for,' said a businessman with experience in Cuba.

To break into the regional golf circuit, Cuba would need to develop a cluster of at least 10 courses, foreign experts say.

Even if nobody says it, the investors behind these projects are betting on a future opening of American tourism currently prohibited by a Cold War-era US ban.

President Barack Obama has lifted restrictions on the visits of Cuban exiles to the island but a Congressional bid to end the travel ban affecting other Americans seems stalled amid renewed political tensions.

'These golf projects will take time to develop and the relationship with the US can improve a lot in the next two or three years,' said Tony Zamora, a Miami-based Cuban American lawyer familiar with some of the deals.

But the challenges facing Cuba's future golf tourism industry may also derive from the island's own domestic problems.

Before building thousands of luxury villas for foreigners, a businessman says, Cuba will have to address its overwhelming housing deficit to deflate potential social tensions.

'The key ingredients of a successful golf destination are there - the climate, the proximity to a major market, the flavour,' said Ms Sartori. 'However there are key issues that need to be resolved.' - Reuters

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



Swinging heaven: Sitting just 145km off the coast of the United States - the world's biggest golf market with 27 million fans - Cuba's potential as a golf tourism destination is huge and so are the potential revenues

BT : CCT may be close to selling StarHub Centre

Business Times - 24 Jun 2010

CCT may be close to selling StarHub Centre

GuocoLand among short list of potential buyers of Cuppage Road property

By KALPANA RASHIWALA

(SINGAPORE) CapitaCommercial Trust (CCT) could be close to selling StarHub Centre, a 10-storey commercial building at Cuppage Road, say sources.

The sources suggest that GuocoLand could be the frontrunner for the property, which is near Somerset MRT Station. It was one of the parties shortlisted to do due diligence after an expression of interest (EOI) for the property closed last month.

Frasers Centrepoint group, whose Centrepoint Shopping Centre is connected via a second-storey link bridge to StarHub Centre, is also said to have participated in the EOI exercise.

The transaction price for StarHub Centre is expected to be above its Dec 31, 2009, valuation of $268 million. The end-2009 valuation was 19.5 per cent below the end-2008 valuation of $332.8 million.

A sale of StarHub Centre would not be surprising. Earlier this year, CCT said it was reviewing plans for the non-Grade A property. It is currently zoned for purely commercial use but CCT has obtained outline planning permission from Urban Redevelopment Authority to change its use to a residential (capped at 80 per cent of gross floor area) and commercial property.

Market watchers suggest that CCT would have applied to Singapore Land Authority seeking a lease top-up to 99 years but a decision has probably not been made. The site has a remaining lease term of about 85 years.

Market watchers suggest that one issue CCT and any potential buyer would probably be hammering out is whether the sale will be subject to approval from SLA for the lease to be reset to 99 years.

The outline planning permission granted from URA for a mostly residential project is capped at the current 4.9 plot ratio that the existing property is already built up to.

StarHub Centre received Temporary Occupation Permit in 1998. It stands on a site with 99-year leasehold tenure starting Feb 1, 1996.

Its land area is 67,916 sq ft. Based on a 4.9 plot ratio and an 80 per cent cap on a residential project, a redevelopment scheme can yield about 266,230 sq ft of residential space, which would be equivalent to 212 apartments of an average size of 1,200 sq ft.

StarHub Centre reaped gross rental income of $18.5 million and net property income of $15.2 million for the year ended Dec 31, 2009.

The building contributed 5 per cent of the trust's net property income last year.

It has 21 tenants including Singapore Technologies Group, Kaplan Financial and Intel Technology Asia.

StarHub moved its headquarters from the building to new premises in the Ubi area last year but retains a small ihub outlet at the property to cater to corporate customers.

Earlier this year, CCT sold Robinson Point, another office block that it also classified as non-Grade A, for $203.25 million or about $1,527 per square foot of existing net lettable area, to a private fund managed by AEW Asia.

CCT will book a $19.2 million gain from the sale.

Market watchers suggest it makes sense for CCT to divest StarHub Centre rather than redevelop the asset into a mostly residential project itself as that may stoke concerns about the trust losing its focus on commercial property. Also, CCT's non-Grade A office properties did not perform as well as its Grade A stock during last year's office downturn.

CCT may be better off selling the property and reinvesting divestment proceeds to reduce debt, purchase new Grade A office properties or spruce up its existing Grade A assets.

Last month, CCT announced plans to execute a $92 million revamp of Six Battery Road - which earned about 23 per cent of the trust's net property income last year.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



StarHub Centre: Valued at $268 million at end-December 2009

BT : US borrowers exit mortgage scheme

Business Times - 24 Jun 2010

US borrowers exit mortgage scheme

Last month, 155,000 borrowers left, bringing the drop-out total to 436,000

(WASHINGTON)

THE Obama administration's flagship effort to help people in danger of losing their homes is falling flat.

More than a third of the 1.24 million borrowers who have enrolled in the US$75 billion mortgage modification programme have dropped out.

That exceeds the number of people who have managed to have their loan payments reduced to help them keep their homes.

Last month alone, 155,000 borrowers left the programme - bringing the total to 436,000 who have dropped out since it began in March 2009.

About 340,000 homeowners have received permanent loan modifications and are making payments on time.

Administration officials say that the housing market is significantly better than when President Barack Obama entered office. They say that those who were rejected from the programme will get help in other ways.

But analysts expect that the majority will still wind up in foreclosure, and that could slow the broader economic recovery.

A major reason so many have fallen out of the programme is that the Obama administration initially pressured banks to sign up borrowers without insisting first on proof of their income. When banks later moved to collect the information, many troubled homeowners were disqualified or dropped out.

Many borrowers complained that the banks lost their documents. The industry said that borrowers weren't sending back the necessary paperwork.

Carlos Woods, a 48-year-old power plant worker from New York made nine payments during a trial phase, but was kicked out of the programme after Bank of America said that he missed a US$1,600 payment afterward. His lawyer said that they can prove that he made the payment.

Such mistakes happen 'more frequently than not, unfortunately', said his lawyer, Sumani Lanka. 'I think a lot of it is incompetence.' A spokesman for Bank of America declined to comment on Mr Woods' case.

Treasury officials now require banks to collect two recent pay stubs at the start of the process. Borrowers have to give the Internal Revenue Service permission to provide their most recent tax returns to lenders.

Requiring homeowners to provide documentation of income has turned people away from enrolling in the programme. Around 30,000 homeowners started the programme in May. That's a sharp turnaround from last summer when more than 100,000 borrowers signed up each month.

As more people leave the programme, a new wave of foreclosures could occur. If that happens, it could weaken the housing market and hold back the broader economic recovery.

Even after their loans are modified, many borrowers are simply stuck with too much debt - from car loans to home equity loans to credit cards.

'The majority of these modifications aren't going to be successful,' said Wayne Yamano, vice-president of John Burns Real Estate Consulting, a research firm in Irvine, California. 'Even after the permanent modification, you're still looking at a very high debt burden.' So far nearly 6,400 borrowers have dropped out after the loan modification was made permanent. Most of those borrowers likely defaulted on their modified loans, but a handful either refinanced or sold their homes.

Credit ratings agency Fitch Ratings projected that about two-thirds of borrowers with permanent modifications under the Obama plan will default again within a year after getting their loans modified.

Obama administration officials contended that borrowers are still getting help - even if they fail to qualify. The administration published statistics showing that nearly half of borrowers who fell out of the programme as at April received an alternative loan modification from their lender. About 7 per cent fell into foreclosure.

Another option is a short sale - one in which banks agree to let borrowers sell their homes for less than they owe on their mortgage.

A short sale results in a less severe hit to a borrower's credit score, and is better for communities because homes are less likely to be vandalised or fall into disrepair. To encourage more of those sales, the Obama administration is giving US$3,000 for moving expenses to homeowners who complete such a sale or agree to turn over the deed of the property to the lender.

Administration officials said that their work on several fronts has helped stabilise the housing market. Besides the foreclosure- prevention plan, they cited government efforts to provide money for home loans, push down mortgage rates and provide a federal tax credit for buyers.

'There's no question that today's housing market is in significantly better shape than anyone predicted 18 months ago,' said Shaun Donovan, President Barack Obama's housing secretary.

The mortgage modification plan was announced with great fanfare a month after Mr Obama took office. It is designed to lower borrowers' monthly payments - reducing their mortgage rates to as low as 2 per cent for five years, and extending loan terms to as long as 40 years. Borrowers who complete the programme are saving a median of US$514 a month. Mortgage companies get taxpayer incentives to reduce borrowers' monthly payments.

Consumer advocates had high hopes for Mr Obama's programme when it began. But they have since grown disenchanted. 'The foreclosure-prevention programme has had minimal impact,' said John Taylor, chief executive of the National Community Reinvestment Coalition, a consumer group. 'It's sad that they didn't put the same amount of resources into helping families avoid foreclosure as they did helping banks.' - AP

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



Domino effect: As more people leave the mortgage programme, more foreclosures could occur; that could weaken the housing market and hold back the broader economic recovery

BT : Mall owners holding retail tenants to leases

Business Times - 24 Jun 2010

Mall owners holding retail tenants to leases

Both sufficiently strong to see through existing contracts, as conditions have stabilised

(NEW YORK) US mall operators are holding retail tenants to their leases as the industry remains in waiting mode for growth to return, possibly not until 2011, a retail real estate insider said recently.

During the height of recession last year, mall landlords got a 'reality check' about the state of the economy and modified leases for retail tenants to help prevent them from falling into bankruptcy.

But now conditions have stabilised. Mall owners and tenants alike are sufficiently strong to see their existing agreements through, even if the economy recovers in fits and starts.

'It is business as usual,' Nina Kampler, executive vice-president at Hilco Real Estate, told the Reuters Consumer and Retail Summit.

At the same time, it has not translated into a real pickup in the commercial business.

'There's very little retail closures right now,' she said.'There's very little retail expansion. There's very little retail activity.'

The economic crisis forced a number of US retailers to fail last year, including electronics chain Circuit City and department store Mervyn's, squeezing in turn the malls that had housed them.

General Growth Properties went bankrupt, setting off a bidding war between Brookfield Asset Management and Simon Property Group, as declining demand spurred consolidation.

But the 2009 holiday shopping season saw a slight uptick in consumer spending, and contrary to expectations, the wave of retailer bankruptcies seems to have subsided.

These days, mall owners know their surviving tenants are not likely to file for bankruptcy. For their part, the retailers know that they are going to need healthy relationships with their landlords when they want to grow again in 2011 and 2012, Ms Kampler said.

Until growth picks up significantly, most retailers will likely cut their store counts and sizes when current leases expire, Ms Kampler said.

'You trim the deadweight off your otherwise healthy growing tree,' she said.

The United States' overall store count is still a bit too high, especially in secondary and tertiary markets. In prime markets such as the New York City area and Southern California, there are malls with no vacancies, Ms Kampler said.

But even there, landlords have a price.

'Someone who wants to get into a top centre can get into a top centre, if they are prepared to pay those dollars,' she said\. \-- Reuters

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



Survivors: The Shops at Columbus Circle, an upscale mall in New York. The economic crisis forced a number of US retailers to fail last year, squeezing in turn the malls that had housed them

BT : New home prices continue to rise in China

Business Times - 24 Jun 2010

New home prices continue to rise in China

(BEIJING) New commercial home prices in 36 major Chinese cities continued to climb month-on- month in May despite the government's attempt to cool the property market, the National Development and Reform Commission (NDRC) said yesterday.

Average new commercial home prices in 36 popular cities were priced at 8,479 yuan (S$1,719) per square metre in May, up 0.81 per cent from the April figure, according to the NDRC.

However, the May growth rate in those 36 major cities was 2.65 percentage points lower than the April figure.

According to the National Bureau of Statistics figures released on June 10, home prices in 70 large- and medium-sized Chinese cities rose by 12.4 per cent year- on- year in May.

To rein in house prices, the Chinese government has tightened scrutiny of developers' financing, limited loans for third-home purchases, raised minimum mortgage rates and tightened down-payment requirements for second-home purchases\. \-- Xinhua

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



Still climbing: Average new commercial home prices in 36 popular cities were priced at 8,479 yuan per sq m in May, up 0.81% from April

BT : S'pore slips to 16th in real estate transparency ranking

Business Times - 24 Jun 2010

S'pore slips to 16th in real estate transparency ranking

Its score remained the same while other markets improved theirs

By UMA SHANKARI

SINGAPORE has slipped two places to 16th in a ranking of the transparency of major real estate markets worldwide.

The city-state's position in the latest Global Real Estate Transparency Index compiled by Jones Lang LaSalle (JLL) fell as other countries' scores improved, while Singapore's remained the same.

Singapore scored 1.73, which placed it 14th in the previous index. But with the same score this year, Singapore has taken 16th spot, as several European nations including Sweden, Ireland and France improved their scores. A score of one is the best and five is worst.

According to the index, Australia is now the world's most transparent real estate market. In the Asia-Pacific, Australia and New Zealand (fourth globally) are the region's most transparent markets, followed by Singapore and Hong Kong (18th globally).

The greatest improvements in transparency in the region were recorded in China and India.

'The big improvement for China and India has been mainly due to increased data availability and ongoing regulatory changes,' said Jane Murray, JLL's head of research for the Asia-Pacific.

In both markets, a recent boom in real estate contributed to the improvements as public and private sector players took steps to promote transparency, she said. 'International corporate occupiers and investors are increasingly demanding better information on market fundamentals, while government agencies and market regulators have made slow but steady progress on the regulatory and legal front.'

Singapore and Hong Kong are classified as 'transparent' but not 'highly transparent' because there is room for improvement in two areas for both markets, Dr Murray said. Both countries lack investment performance indices, for example, she said.

In light of the global financial crisis, the index assessed - for the first time - the transparency of the real estate debt markets in terms of the breadth and depth of data available on commercial real estate debt.

Factors such as outstanding balances, maturities and defaults, as well as how thoroughly real estate debt on banks' balance sheets is monitored, were considered. Singapore did well in this aspect, scoring high for its regulatory and legal environment.

Alastair Hughes, JLL's chief executive for the Asia-Pacific, said one of the chief concerns for international real estate investors is where to place their capital safely.

The index helps investors and occupiers operating in foreign markets to anticipate challenges, he said. And for governments and industry organisations, the index provides a gauge to help improve transparency in their home markets.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.