Property news round up 24 June 2018

Garden residences impression 1

Ascendas Hospitality Trust to buy three Osaka hotels for 10.29b yen

ASCENDAS Hospitality Trust has on June 15 entered into an agreement with ES-CON Japan via Ascendas Hospitality Real Estate Investment Trust (A-HReit) to acquire three hotels in Japan’s Osaka city for a purchase consideration of 10.29 billion Japanese yen (S$126.1 million). The manager of the hospitality trust said that the acquisition of the three hotels – Hotel WBF Kitasemba West, Hotel WBF Kitasemba East and Hotel WBF Honmachi – will deepen its presence in Osaka, Japan’s third-largest city with a population of 2.7 million people. The total acquisition cost is about 11.24 billion yen, comprising the purchase consideration, 102.9 million yen of acquisition fee payable to the Reit manager, and estimated professional fees and other transaction expenses of about 847.1 million yen.

Soilbuild bags Kemaman Point with S$143m bid

SOILBUILD Group Holdings has won the tender for the collective sale of Kemaman Point, a freehold 89-unit residential development along Balestier Road, with a bid of S$143.88 million. The marketing agent for the collective sale, Knight Frank, said each owner stands to receive between S$1.4 million and S$2.32 million. The sale of the property is subject to several conditions, including an order of the sale by the Strata Titles Board or the High Court.

Gloria Mansion at Pasir Panjang up for en bloc sale at S$79m

GLORIA Mansion at Pasir Panjang Road is hitting the market on Tuesday for S$79 million, the latest to hop on the collective sale train here. The freehold 12-storey, 31-unit hilltop apartment building is five minutes away from Haw Par Villa MRT Station and close to West Coast Highway and the Ayer Rajah Expressway. The reserve price of S$79 million translates to S$1,234 per square foot per plot ratio (psf ppr) based on its gross floor area of 64,039 sq ft. If authorities approve of the 10 per cent bonus balcony, that would bring the price to S$1,121 psf ppr and increase GFA to 70,443 sq ft. There will be no development charge as the existing baseline of 74,744.52 sq ft or an effective plot ratio of 1.634 is above the current plot ratio of 1.4 including the additional 10 per cent balcony space, said marketing agent Huttons Asia in a statement.

Jump in May home sales lifts hopes for second half

MAY’S firm pick-up in developers’ property sales has prompted consultants to predict a take-off in the second half of the year as more new launches come onstream. While the year got off to a slow start – with residential launches lagging that of last year – developers’ sales survey by the Urban Redevelopment Authority for May showed developers sold 53 per cent more private homes (1,121 units) than a month ago or 8 per cent more than a year ago. This came on the back of a 60 per cent month-on-month surge in launch units in May and a 186 per cent jump from a year ago as developers launched four new projects last month.

CapitaLand bags 2 mall management deals in China

PROPERTY group CapitaLand has clinched two new mall management contracts in the Chinese cities of Guangzhou and Chengdu. The group said before Tuesday’s trading hours that its shopping mall business, CapitaLand Retail, will manage the retail component of The Grand City, a landmark integrated development in Wanbo CBD in Panyu District, on behalf of Guangzhou Wan Shun Investment Management Co Ltd. On winning this contract, CapitaLand is adding a third mall in Guangzhou. Its retail network in South China now spans a total retail gross floor area (GFA) of 3.6 million square feet. Separately, Chengdu Lide Commercial Industrial Co has appointed CapitaLand to manage an open-lane, low-rise shopping mall in Qingyang District. This mall is less than two kilometres from the iconic Tianfu Square in Chengdu’s city centre. This latest addition is CapitaLand’s seventh mall in Chengdu. CapitaLand now owns and manages 11 malls with 11.3 million square feet of retail GFA in western China.

Wah Loon founder buys Boat Quay shophouse

WAH LOON Engineering founder Alan Chong, who recently bought a new freehold bungalow in Jervois Hill for S$41.2 million, has also snapped up one of the tallest conservation shophouses along Boat Quay for S$21.35 million. Spanning six levels, the shophouse has an estimated built-up area of 6,300 sq ft, according to information on the website of Clifton Partners, a real estate investment firm. The property is being sold by an affiliate of the company. Boasting views of the Singapore River from the upper levels, the shophouse is on a 1,119 sq ft site with 999-year leasehold tenure and is fully leased.

Holland Drive five-room HDB flat sold for S$1.1 million

A FIVE-room Housing Board flat at Holland Drive has been sold in June for S$1.1 million, setting a new record for the area. The 38th-floor resale unit at Block 18C Holland Drive has a floor area of 1,259 sq ft, which works out to about S$874 per sq ft (psf). Built under the Selected En Bloc Redevelopment scheme, the unit has a remaining lease of 93 years and has an unblocked view.

Rochor Centre’s demolition to commence on June 26

ROCHOR Centre will be demolished gradually beginning on June 26, in preparation for the upcoming North-South Corridor, said the Land Transport Authority (LTA) on Wednesday. The iconic public housing estate’s four residential blocks will be demolished floor by floor using machinery, with works starting at the top floors. The demolition is expected to be completed by April 2019. During the demolition works, pedestrians can use temporary sheltered walkways as alternative routes around the site. Signs have also been put up at public areas to redirect pedestrians. Noise barriers and dust screens have also been erected around the site, to minimise noise and dust affecting residents and businesses nearby, said LTA.

Blackstone’s first-of-a-kind India IPO confronts rate jitters

ABOUT two years after the Blackstone Group registered India’s first real estate investment trust (Reit), the private equity giant is close to taking it public. Rising interest rates, however, threaten to get in the way. Blackstone and local partner Embassy Group plan to file a prospectus for an initial public offering of the Reit as early as next month, a deal that may raise as much as US$1 billion, people with knowledge of the matter said. Even so, the listing could be delayed should investors demand a higher-than-expected yield, according to the people, who asked not to be identified as the information is private.

Marina One Residences launching tower at average S$2,700-S$2,800 psf

COME July, the developer behind the mega mixed-use project Marina One will find out whether its strategy four years ago of holding back half its 1,042 residential units from the market has paid off. M+S Pte Ltd, the joint-venture firm by Malaysia’s Khazanah Nasional and Singapore’s Temasek Holdings, will release 30 per cent of its 521-unit Garden Tower for sale, with the rest expected to be released in the remainder of the year. Prices at Garden Tower will start at S$2,400 per square foot (psf) and stand at an average S$2,700 psf to S$2,800 psf.

Ho Bee may have last laugh by eschewing crowded Singapore market for London

HO Bee Land’s acquisition of Ropemaker Place, a 21-storey London office property, has boosted its total investment in this asset class to about £1.3 billion or S$2.4 billion. This makes up 41 per cent of the group’s total investment portfolio. The property is less than 200 metres from the Moorgate Station on the Crossrail, which is expected to be operational in December this year. Ropemaker Place is also 400 m from the busy Liverpool Street Station. It’s a good idea for a property group to boost its recurring income pool to smoothen earnings volatility from property development. But is Ho Bee tilting too much from property development to investment?

Major developers vie for Sengkang Central site

THE commercial and residential site at Sengkang Central drew interest from major developers that submitted seven bids at the tender closing on Thursday. Most of them joined forces in joint ventures for the government land sale (GLS) site, which was launched for sale via the dual envelope system. They include a joint bid from CapitaLand Singapore and City Developments Ltd (CDL), as well as from Wing Tai Holdings and Keppel Land. Perennial Singapore and Qingjian Realty also tabled a bid together.

Cushman & Wakefield files for US IPO

CUSHMAN & Wakefield has filed for an initial public offering (IPO) in the US, saying it would use proceeds to reduce debt. The commercial real estate firm listed the amount of its offering in a filing on Wednesday as US$100 million. Cushman & Wakefield, the owners of which include private equity firms TPG and PAG Asia Capital, said it will also use the IPO proceeds for general corporate purposes and for making deferred payments to employees who worked for Cassidy Turley, a brokerage that its predecessor agreed to buy in 2014, said the filing. Those payments represented a liability of US$112 million as at March 31. The offering will be led by Morgan Stanley, JPMorgan Chase, Goldman Sachs Group and UBS Group.

Malaysia to inject RM2.8b to complete 1MDB-linked financial district

MALAYSIA said on Thursday that it will provide up to RM2.8 billion (S$950.4 million) to complete an integrated financial district from which more than RM3 billion was diverted to pay debts of scandal-plagued 1Malaysia Development Berhad (1MDB). Finance Minister Lim Guan Eng said the decision will “help allay concerns” of local and foreign investors on the fate of the TRX City project in Kuala Lumpur. It includes nearly-complete Exchange 106, which will be the tallest building in South-east Asia. The TRX City case is an example of how 1MDB used money that was intended for a venture to instead repay debts “not related to the project”, Mr Lim told a news conference.

Once again, Hong Kong has the world’s priciest office market

THE rent is due, the rankings are out and it is another year at the top for Hong Kong, the most expensive office market in the world. Occupancy costs – which include rent, local taxes and service charges – for the city’s notoriously pricey Central district are 30 per cent higher than in London’s West End, which took the No. 2 spot in CBRE Group’s survey of prime office real estate in the first quarter. This is the third year in a row that Hong Kong’s Central district has outstripped its peers in the survey.

OUE Lippo Healthcare’s joint venture to operate hospital in Shanghai

OUE Lippo Healthcare’s subsidiary, China Merchants Lippo Hospital Management Shenzhen (CMLHM), has entered into a framework agreement with China Changjiang National Shipping Group Co and Shanghai Changjiang Shipping Co to incorporate a new joint venture company in China that will operate a hospital in Shanghai. The Shanghai Changhang Hospital, which is currently managed by Shanghai Changjiang Shipping Co, is located in the Pudong New District area of Shanghai. Under the agreement, CMLHM will hold a 51 per cent stake in the new joint venture company, while China Changjiang will hold the remainder.

Selegie Centre, Peace Centre trying for en bloc sale again

THE rejuvenation of Selegie Road will move further along if the owners of two buildings there succeed in their collective sale bids. Selegie Centre, a 10-storey freehold commercial building, has obtained approval from around 90 per cent of owners by share value and strata area to launch a tender with a reserve price of S$120 million. The land rate works out to S$1,942 per square foot per plot ratio (psf ppr).

Highest yielding REITs

20180623 highest yielding reits