MAS puts more scrutiny on bank loans for property development
A spate of aggressive land deals by developers last year has prompted the Singapore central bank to take a closer look at the way banks are financing development projects.
The Business Times understands that the Monetary Authority of Singapore (MAS) is collecting more data from banks through a new survey sent out to them last month.
Some of the information sought by the MAS includes the size of banks’ exposures and details of the loan facilities granted for each project such as the key covenants and loan-to-value (LTV) ratios, sources say.
Analysts stick to ‘buy’ on CapitaLand
STOCK watchers were happy campers on last week’s news that CapitaLand is dropping 20 malls from its retail asset portfolio in China.
RHB Research Institute Singapore upgraded the stock to a “buy” call, from its previous “neutral” stance, in a note on Monday morning.
Meanwhile, other analysts dug in and reiterated earlier “buy” positions, with DBS Group Research putting out a report of its own on Monday too.
CIMB analyst Lock Mun Yee and OCBC Investment Research’s Eli Lee had also repeated the “buy” cry in separate flash notes last Friday, after CapitaLand’s announcement.
CIMB stuck to a target price of S$4.25, and OCBC to its fair-value estimate of S$4.13. RHB lifted its target price from S$3.90 to S$4.20.
But DBS was the most upbeat on where the share price could go for the property stock.
Analysts Derek Tan and Rachel Tan noted that their target of S$4.35 was “ahead of consensus average”, which now stands at S$4.24.
Proptech is all the buzz, just not yet in Asia
Altus survey shows property firms in Asia are less optimistic than rest of the world about its potential.
GIC invests in US multi-family properties through JV
GIC has formed a joint venture with US property investment firm Cortland Partners and Canada Pension Plan Investment Board (CPPIB) to acquire and renovate 8,000 to 10,000 property units in the US known as Class B multi-family units.
The partners target to raise an equity amount of US$550 million in total via the joint venture, as part of the acquisition hunt. GIC and CPPIB will each own a 45 per cent interest in the joint venture.
Cortland Partners will own the final 10 per cent interest.
Such Class B multi-family units are generally “well-maintained older assets”, said GIC in a press statement.
Singapore tops Asean for 2018 property market growth forecasts
Singapore’s property market came in as the most promising one among Morgan Stanley Research’s rankings of Asean markets which include the Philippines, Thailand and Indonesia.
So bullish is the research house on the Singapore market that it actually expects home prices to rise 8 per cent this year and again in 2019, as rising buyer demand outweighs a tight supply of unsold inventory.
It also expects new home sales growth to accelerate from 40 per cent in 2017 to nearly 50 per cent in 2018, as a buoyant collective sale market drives up home buyer demand while reducing the supply of available units to purchase.
SRX resale condo price index up for 5th consecutive month
Resale prices for condominium units and private apartments posted their fifth consecutive month-on-month gain in December, based on the latest flash estimates from property portal SRX Property.
Its overall resale price index for non-landed private homes went up 0.4 per cent in December over November, the same pace as November’s revised rate, said SRX Property.
It had earlier estimated a month-on-month price increase of 0.5 per cent for November.
December’s price gain was led by a 0.6 per cent month-on-month appreciation in the price index for the city-fringe or Rest of Central Region (RCR).
The respective price indices for the prime area or Core Central Region (CCR), and the suburbs or Outside Central Region (OCR) each rose 0.3 per cent.
Surbana tapped for Philippine city project
Singapore consulting firm Surbana Jurong is helping the Philippine government prepare detailed design standards and guidelines for a 9,450ha “smart, green city” being developed north of Manila.
Surbana Jurong will refine the New Clark City’s design, review agreements for providing water and power, and devise a framework for its long-term operation, according to the Bases Conversion and Development Authority (BCDA).
Far East Hospitality Reit buys Oasia Hotel Downtown for S$210m
Far East Hospitality Real Estate Investment Trust (Reit), which trades as part of the stapled Far East Hospitality Trust, is buying the 314-room Oasia Hotel Downtown in the Tanjong Pagar district for S$210 million in cash before fees.
The 65-year leasehold property is being sold by Far East Soho, a unit of the hotel and serviced residence trust’s sponsor, the Far East Organization Group.
About S$195.8 million of the consideration will be funded from debt facilities, with the remaining S$22.7 from reinvestment of distributions.
Lian Beng’s Q2 net profit falls 43% on higher costs
Construction cum developer group Lian Beng on Friday said its net profit fell 43.2 per cent to S$3.2 million for its second quarter ended Nov 30, 2017, due to higher cost of sales and higher distribution expenses and finance costs.
For the quarter, revenue rose 2.5 per cent to S$50.5 million.
Cumulatively, its revenue for the first six months of its fiscal year fell 27 per cent to S$87.6 million, due to lower contribution from the construction segment.
Singapore-based M&L Hospitality launches third property in Sydney
Singapore-based M&L Hospitality has opened a new 182-room boutique hotel in Sydney, which is its third property in the city and its sixth Down Under.
The West Hotel is the second new hotel to be constructed in Sydney’s central business district in the last 17 years, the hotel group highlighted.
According to a 2015 media report, the site where the hotel is built was acquired by M&L Hospitality at a value of some A$70 million (S$73 million) then.
Mapletree awards SMU S$3m for new real estate programme
Starting from August, the Singapore Management University (SMU) will offer a course specialising in real estate investment and finance.
The Mapletree Real Estate Programme, as it is called, was announced on Friday and is the result of a gift of S$3 million from Mapletree Investments.
With a one-to-one matching grant from the government, the total of S$6 million will go towards the setting up of a professorship, awards, grants and speaker events supported by Mapletree.
SingHaiyi wins S$841m en bloc tender for Park West near Clementi MRT
Property firm SingHaiyi Group has snagged a S$841 million en bloc tender for a property in the west through its joint-venture (JV) firm amid ongoing collective sale fever.
The property is known as Park West and located at 2-20 Jalan Lempeng, near Clementi MRT station.
It is to be acquired by Sing-Haiyi Gold, a 50-50 joint venture between wholly-owned subsidiary SingHaiyi Land and Haiyi Wealth, an entity controlled by Gordon Tang and Celine Tang, it said on Thursday.
China’s Lanzhou relaxes property tightening curbs
The Chinese city of Lanzhou has eased property curbs amid a nation-wide clampdown on housing speculation, raising concerns that other cities may follow suit which will further inflate price bubbles in the sector.
The provincial capital of China’s northwestern Gansu province, with a population of 3.6 million, lifted property tightening measures in the suburbs while relaxing some restrictions on home purchases in downtown areas, according to a notice posted on the website of the city’s housing authority late on Friday.
Fortune of China’s richest woman up US$2b in 4 days
A share surge at Country Garden Holdings, China’s largest developer by sales, has sent vice-chairman Yang Huiyan’s wealth up by US$2.1 billion – and that’s just in the first four trading days of the year.
Ms Yang, controlling shareholder of Country Garden, saw her fortune soar to US$25.6 billion as at Jan 5 to rank as the fifth-richest person in the nation, according to the Bloomberg Billionaires Index.
That’s before Country Garden’s shares rose another 6.9 per cent on Monday in Hong Kong trading, taking its year-to-date-gain to 16 per cent.
UK house prices slip 0.6% in December, first fall in six months
BRITISH house prices unexpectedly fell in December compared with November, their first decline in six months, mortgage lender Halifax said on Monday, adding to signs of weakness in the country’s housing market since the 2016 Brexit vote.
House prices slipped by 0.6 per cent month-on-month after a 0.3 per cent rise in November, Halifax said. Economists taking part in a Reuters poll had expected prices to rise by 0.2 per cent.
HK home prices more than double 1997 levels
HERE’S a scary statistic: Hong Kong home prices are more than double their 1997 levels, when the city’s biggest housing bubble burst.
What’s more, affordability has deteriorated too, according to cautionary remarks made on Monday to legislators by Financial Secretary Paul Chan, who noted the ratio of mortgage payments to median household income hit 68 per cent in the third quarter, compared with a 45 per cent average between 1997 and 2016.
Mr Chan’s warning seems to be falling on deaf ears. The Hang Seng Property Index is up 6.5 per cent so far this year, and more than 40 per cent in the past year, outperforming the broader index’s 37 per cent increase.
Wharf Holdings Ltd has soared nearly 16 per cent since the beginning of 2018, and China Overseas Land & Development, one of the most aggressive Chinese developers in Hong Kong, is up more than 15 per cent.
HNA ‘weighing sale of two Canary Wharf offices’
HNA Group Co has approached brokers about the possible sale of two office buildings in London’s Canary Wharf financial district as it seeks to shed assets and cut its debt burden, two people with knowledge of the discussions said.
The Chinese conglomerate has sought advice from brokers on the value of 30 South Colonnade and 17 Columbus Courtyard with a view to selling them, two of the people said, asking not to be identified because the plan is private.
It has also approached investors that may be interested in purchasing the properties, which cost HNA about £366 million (S$659 million) in total, a separate person said.
Govt agency questions Smithsonian over removal of garden, lack of details in changes
THE Smithsonian Institution’s plan to redevelop the area around its iconic administration building, known as the Castle, by replacing its formal garden and relocating three entrance pavilions received mixed reaction from the federal agency that must eventually approve it.
The US$2 billion plan is intended to increase the area’s visibility from the National Mall, add such visitor amenities as restrooms and food service, and improve its accessibility and circulation.
UK social housing deal with private equity giant sparks fears for tenants
Private equity giant Blackstone has struck a deal with UK social housing association Sage, sparking fears from campaigners that it will price out low-earning, elderly and sick tenants.
New York-based Blackstone, which owns the largest home rental company in the United States, will fund for-profit housing association Sage to buy affordable homes from private developers, property magazine Estates Gazette said.
Toronto, Vancouver home sales fall in 2017 as prices jump
Home sales in Canada’s two largest housing markets dropped in 2017, as government measures to cool skyrocketing prices in Toronto and Vancouver restrained demand, but prices kept rising particularly in the strong condo segment.
In Toronto, sales of detached homes fell 23 per cent, accounting for much of the 2017 drop, while condo sales pulled back a more muted 9.6 per cent, according to a report from the Toronto Real Estate Board (TREB).
The average sale price, meanwhile, jumped 12.7 per cent from 2016 to C$822,681 (S$880,110), with condo prices jumping 23.1 per cent and detached homes climbing 12.8 percent, TREB said.
Trump administration delays enforcing Obama-era law on fair-housing
Undermining another Obama-era initiative, the Trump administration plans to delay enforcement of a federal housing rule that requires communities to address patterns of racial residential segregation.
The Department of Housing and Urban Development (HUD), in a notice published last Friday in the Federal Register, said that it will suspend until 2020 the requirement that communities analyse their housing segregation and submit plans to reverse it, as a condition of receiving billions of federal dollars in block grants and housing aid.
GAW US Fund III secures US$100m in new cash
Hong Kong-based private equity real estate fund manager Gaw Capital Partners has raised another $50 million for its Gaw US Fund III commingled fund, according to a report in West Coast property news site The Registry citing a board meeting document from the Ohio Bureau of Workers Compensation Fund.
London beats New York among foreign investors in real estate
New York City took a double hit in an annual survey of real estate investors, which saw London overtake it in first place globally and Los Angeles tie it for top US city.
The annual survey of the Association of Foreign Investors in Real Estate asks its members, who are estimated to have more than US$2 trillion in real estate assets under management, to rank markets by various measures, such as stability and opportunity for capital appreciation.
This year’s poll, the 26th, also saw pricey San Francisco, which had been one of the top five global cities since 2011, fall to 11th place, and Washington, DC, skid to 25th from 15th place last year, part of a long slide.
Australia’s home building boom gets new burst of energy
Approvals to build new homes in Australia surged to 15-month highs in November 2017 as more apartment towers got the go-ahead, an unexpected return to strength that should drive activity and hiring across the economy.
The upbeat news came as the latest survey of Australian consumers found a marked improvement in mood for the new year.
The ANZ-Roy Morgan confidence index climbed 4.7 per cent from mid-December to the highest since November 2013, a hopeful sign for a much-needed pick-up in spending.
WeWork’s Chinese nemesis leases first Hong Kong space
The Chinese co-working startup formerly known as UrWork, has reportedly leased a full floor at Grand Millennium Plaza in Sheung Wan, preparing to open its first shared office centre just minutes away from Hong Kong’s Central business hub.
Now going by the more distinctive handle of Ucommune, the $1.3 billion shared office unicorn leased the 15,000 square foot (1394 square metres) space at HK$50 ($6.4) per square foot.
Airbnb ‘disappointed’ by Amsterdam plan to cut rentals
Rent-a-room giant Airbnb has voiced disappointment in Amsterdam’s plans to impose a 30-day limit on letting private homes, saying it will harm the local economy.
“We have built a responsible home sharing community on Airbnb benefiting the city and its inhabitants,” the company said in a letter sent to the Amsterdam city council.
The 19,000 Airbnb hosts in the Dutch capital were “disappointed by your announcement … to favour big hotels over local families who occasionally share their homes”, wrote Bo de Koning, Airbnb’s public policy manager, for the Netherlands.
Fidelity values Compass at US$2b in real estate tech deal
A New York startup called Compass is persuading investors that it can reshape the home-buying process through the use of technology.
A dashboard showing neighbourhood data and a Pinterest-like app for organising home listings would make real-estate agents more productive and therefore, more profitable, the company said.
The pitch caught the attention of Fidelity Investments, which made a rare bet on a private company, valuing the business at US$1.8 billion, Compass said this week.
Luxury condo sales in Canada hit new high
A C$20 million (S$21.2 million) penthouse with views of downtown Toronto and Lake Ontario helped luxury condominiums shatter sales records in Canada last year, bucking a cooling trend in the rest of the housing market.
The 650-square-metre residence in the city’s Bloor Street area was the most expensive condo sold in the country in 2017, according to Sotheby’s International Realty Canada.
Sales of condos with a price tag above C$1 million surged 59 per cent in Toronto, 27 per cent in Vancouver and 49 per cent in Montreal, pushing the number of units sold in three cities to 2,703.
NZ house prices up as buyers rush to beat curbs
New Zealand house prices rose for the second month in a row in December 2017 as buyers rushed to beat planned government regulations targeting property speculators.
Data from government valuer Quotable Value (QV) on Thursday showed its residential property price index rose 6.6 per cent year-on-year last month, picking up pace from the 6.4 per cent rise in November.
The robust growth in the final two months of the year was in stark contrast to a slowdown from around the middle of the year as sentiment was dampened by uncertainty over an election in September, which ushered in a new Labour-led government.
InterContinental exits Nigeria after fallout with partners
InterContinental Hotels Group is withdrawing from Nigeria four years after it opened its first site in Africa’s most populous country following a disagreement with local partners over the terms of how to bring the property out of receivership.
The UK company’s 358-room hotel in Lagos, Nigeria’s commercial capital, will no longer operate as an InterContinental-branded property from Jan 18, said Simon Stamper, IHG’s director of African operations. The company’s other hotels in sub-Saharan Africa are in South Africa, Mauritius and Zambia.
Manhattan office rents expected to rise in 2018: Cushman
The largest amount of new construction to hit Manhattan since the 1980s will lift asking rents this year for office space in New York as demand likely continues to grow faster than the US average, executives from Cushman & Wakefield said on Wednesday. “(New York) is still a magnate for corporations from around the world and that will allow New York to continue to grow even if job growth slows elsewhere in the country,” said Ken McCarthy, principal economist at the real estate services company in a media webcast. The announcement by Discovery Communications earlier in the week to relocate its global headquarters to New York next year from Silver Spring, Maryland, where it employs 1,300 people, is the latest example, Mr McCarthy said.
Trump Place asks if it can be called by any other name
Must a New York City condominium forever bear the name T-R-U-M-P in large, brasslike letters? Or can it choose to take them down in favour, perhaps, of what a majority of residents believe is a more dignified name, 200 Riverside Blvd, its simple street address? That is the question before a state Supreme Court judge in Manhattan as part of a heated legal battle between the condominium’s board and DJT Holdings, a corporate entity owned by US President Donald Trump.