SINGAPORE (Mar 3): As investors grapple with the possibility that the Covid-19 outbreak may be more prolonged than initially expected, this may just be the right time to cash in on Singapore REITs (S-REITs). Although highly sought after for their yields and stability, S-REITs have not been immune to the increasing macroeconomic uncertainty. The sector has been a victim of a broad-based sell-off of up to 4-5% in a day as a result of funds outflow. To be sure, the 10-year US treasury yield now stands at a multi-year low of some 1.3%, with the Singapore 10-year bonds tailing it at some 1.5%. Market watchers believe that these are in tandem with heightened worries of an economic fall-out. This has resulted in the prices of S-REITs being dragged down 6.5% from the previous week, and 5.6% year-to-date. While the fall is enough to send some investors scurrying back to “safer” assets such as gold, DBS Group Research is quick to advise otherwise.
SINGAPORE’S largest mall operator CapitaLand has laid down more specifics to its rental rebates for tenants amid pressure from various fronts, including a group of retailers that has banded together to seek more help from landlords. CapitaLand will be giving rental rebates to some 1,000 of its tenants as a start, while it reviews the rest of its 3,500 leases, a move industry associations urged other landlords to follow. After reviewing February sales and footfall data, CapitaLand on Wednesday issued letters to tenants at both its urban and suburban malls about their relief packages. Some were informed of a 25 per cent rebate each in April and May, on the fixed components of their one-month gross rent. This is in addition to the release of tenants’ one-month security deposit to offset their rent for March.
RETAIL Reit prices have been blown cold by rental relief measures, and then hot again by the US Federal Reserve’s surprise rate cut. Analysts believe that current Reit prices have already either fully or partially priced in the impact of temporary rent-relief measures and will take reference from the Fed’s rate movements from this point on. A compilation by The Business Times shows that on average, the six Reits with exposure to Singapore malls have risen 4.3 per cent since the announcement of the federal funds rate cut. However, they are still 4.5 per cent below pre-Covid-19 levels.
HONGKONG Land Holdings posted a record underlying net profit of US$1.08 billion for the 12 months ended Dec 31, 2019, up 4 per cent from US$1.04 billion in 2018. Its net profit – which is typically volatile – slumped 92 per cent to US$198 million from US$2.5 billion previously, owing to losses from revaluation of the group’s investment properties compared to gains a year earlier. The group said profits from the investment properties businesses remained stable despite the social unrest in Hong Kong, while a higher contribution from the development properties business in mainland China was partially offset by lower contributions from other markets
THE Housing and Development Board’s (HDB) resale market remained robust in February despite experiencing a seasonal dip from January. Fewer flats changed hands in February than in January, as prices inched up by 0.7 per cent. In all, 1,668 HDB resale flats were sold last month, 13.1 per cent fewer than in January, flash estimates from real estate portal SRX showed on Thursday. The figure reversed the 3.3 per cent increase in January from the preceding month. It was, however, 26.9 per cent more than the 1,314 units sold in February last year
ARA Asset Management has taken a majority stake in logistics property firm, Logos Group. Existing shareholders include real estate investment firm, Ivanhoé Cambridge and Logos’ founders, John Marsh and Trent Iliffe. With ARA’s buy-in, Macquarie Group’s MIRA Real Estate has exited as a Logos shareholder. According to a joint statement by the companies on Thursday, Logos will operate as ARA’s exclusive platform for logistics assets globally, offering ARA’s investors a suite of products in the private and public markets.
SINGAPORE-BASED flexible workspace operator Arcc Spaces will open its flagship project at One Marina Boulevard next month. This is the company’s fourth project in Singapore, adding to its regional footprint that now includes Kuala Lumpur, Yangon, Beijing, Shanghai and Hong Kong. The One Marina Boulevard project will take up 19,000 square feet of space on the 20th floor, and offer private office rooms, meeting rooms and a convertible multi-functional event space.
RISING buildings and skyscrapers mark the era of modernisation. However, buildings are responsible for nearly 40 per cent of annual worldwide greenhouse gas emissions. The world cannot reach its ambitious climatic targets if energy use in buildings is not drastically reduced. While Singapore has a relatively high penetration rate of green buildings at 30 per cent compared to other Asian cities, there is room to catch up with European cities like Paris and London, at 64 per cent and 68 per cent respectively. Europe has been the most competitive region globally for green buildings since the beginning due to its strong political leadership role.
INDIA’S economic slowdown coupled with a credit crisis is creating a surge in demand for capital from beleaguered companies that are providing Blackstone Group with buyout opportunities in Asia’s third-largest economy. “We are not taking a cautious stance of watch and wait,” Amit Dixit, Blackstone’s senior managing director, said in Mumbai on Wednesday. “We are actually taking a forward-leaning stance.” For Blackstone, India is the “strongest performer” in the world, said Stephen Schwarzman, chief executive officer of the world’s largest alternative asset manager.
SWITZERLAND’S negative interest rates make owning a home increasingly unaffordable in a country where a single-family property can cost more than 10 times the average annual salary, according to research by Credit Suisse Group. Amid a declining threshold at which banks start to charge savers negative interest on cash balances, investors are looking to the property market for positive returns and low risk from buy-to-let investments, Switzerland’s second-biggest bank said in a property market report on Wednesday. “Private investors seeking secure investments are following the example of more financially powerful investors by buying up residential properties with a view to renting them out,” it said. “Since multi-family dwellings are barely affordable in today’s environment, there is strong demand for condominiums and, in some cases, single-family homes.”
Despite the muted economy outlook, Singaporeans are more optimistic and satisfied with the property market, according to the latest findings in PropertyGuru’s H1 2020 Consumer Sentiment Study, a half-yearly poll which measures consumer perceptions of the local property market. This is reflected in The Sentiment Index, which rose 5 points from 40 in the previous wave to 45. The Sentiment Index measures factors such as current real estate climate satisfaction, property affordability, current real estate climate, perceived government effort, and property prices in the next 1-5 years.
Joel Su Jiqing, a former property agent, was fined $88,000 on Thursday (5 March) for unlawfully offering short-term accommodation to tourists via online platform Airbnb. Should he fail to pay the fine, he will have to serve 18 weeks behind bars. The fine was the highest meted out for such offence so far, reported CNA. Agent Earned A Total Of $115,112 From Renting Four Short-Term Accommodation To Tourists