Property news round up 3 June 2018

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High-speed rail loss ‘a setback, not knockout blow to Jurong’

THE Ministry of Transport (MOT) issued a statement late on Monday to say that Singapore has yet to receive official word from Malaysia regarding the supposed cancellation of the Kuala Lumpur-Singapore high-speed rail (HSR).

The MOT, indicating that it would wait for official word from Malaysia before proceeding, said in its statement: “We had agreed to proceed with the HSR project based on mutual benefits and obligations set out in the HSR bilateral agreement.”

Meanwhile, property analysts have said that although the cancellation of the project – which is to have its terminus in Jurong – will put a dampener on the area’s aspirations to be Singapore’s second central business district (CBD), it is unlikely to deal a knockout blow to the area’s prospects.

An opportune time for a PropNex listing

PROBABLY in a few months’ time, equity investors will have more options to ride the upswing in Singapore’s residential market besides developer stocks and APAC Realty, which owns Singapore’s second-largest property agency ERA Realty.

PropNex Realty, Singapore’s largest homegrown property agency, is preparing for a public listing on Singapore’s mainboard in the third quarter of this year. It is already talking to potential cornerstone investors, but has not obtained eligibility-to-list from the Singapore Exchange yet.

The last time PropNex Realty sought to undertake a public listing was believed to be around 2010-2011 after it switched its auditors to KPMG, a big four audit firm. But the plan was placed on the back-burner following a series of property cooling measures.

Keppel eyes S$114m gain from sale of 51% stake in Beijing prime commercial site

KEPPEL Corp could book a S$114 million gain after it sells a 51 per cent stake in a prime commercial site in the Chaoyang district of Beijing for US$297.9 million, the conglomerate announced on Monday.

Keppel Land China, through a subsidiary, has granted CBD Aether Center an option to buy its 51 per cent stake in the holding company of Beijing Aether Property Development, which owns and is developing the site.

Details about the identity of the buyer were not disclosed because of confidentiality reasons.

The remaining 49 per cent stake in the project is owned by British Virgin Islands-incorporated Xeno Origin. The option price is set at US$94.1 million, which Keppel will be allowed to keep if CBD Aether does not exercise its option within 120 days.

Far East Hospitality to get first hotel in Japan

HOTEL operator Far East Hospitality Holdings will get its first company-branded hotel in Japan with a joint venture to purchase a hotel project in Tokyo.

It is teaming up with a Far East Organisation unit Boo Han Holdings to buy a 2,542 sq m plot of land and a yet-unconstructed hotel in Tokyo, Far East Orchard – which owns 70 per cent of Far East Hospitality – announced on Monday.

The seller, Shimizu Corporation, will build the hotel and then deliver the trust beneficiary interest worth to an indirectly-held joint venture entity, in the form of a Tokutei Mokuteki Kaisha, or Special Purpose Company, upon completion of the sale.

The purchase price is 8.198 billion yen (S$100.6 million), shared equally by the two partners, and the forward purchase deal is expected to be completed in the second quarter of 2020.

Completed condo, private apartment prices slip 0.3% in April from March: NUS index

PRICES of completed private apartments and condominiums in Singapore dipped 0.3 per cent in April from the previous month.

This is according to the National University of Singapore’s (NUS) flash estimates for its Singapore Residential Price Index (SRPI) released on Monday.

The decline comes after prices rose 1 per cent month-on-month in March.

The price drop in April was driven by a 0.8 per cent drop in prices for apartments in the central region, excluding small units, which saw no price change in March.

CDL announces two new senior appointments

CITY Developments Limited (CDL) announced two new senior appointments on Monday as part of a new organisational structure for the property giant.

Leading the asset management division will be Yvonne Ong, who will begin her role as chief executive officer for commercial with effect from June 6.

This division will comprise departments involved in investment properties, namely leasing, property and facilities management and customer service.

Prior to CDL, Ms Ong has held various positions at CapitaLand from 2011 to 2018, most recently as head of global asset management for commercial.

Before CapitaLand, she was the head of real estate at the manager of Cambridge Industrial Trust, which is now known as ESR-Reit.

St Thomas Walk property in District 9 up for sale for S$68m

A FREEHOLD residential redevelopment site at St Thomas Walk has been put up for sale by a single family for S$68 million.

The asking price reflects a land rate of S$2,190 per square foot per plot ratio (psf ppr) including an estimated development charge of S$10.56 million to intensify to plot ratio 2.8, said its marketing agent Edmund Tie & Company on Monday.

Located in prime District 9, the property has a land area of about 1,190 sq m or 12,809 sq ft and is zoned for “residential” use at gross plot ratio of 2.8 under the Urban Redevelopment Authority’s (URA) Master Plan 2014.

SLB Development builds on property market upswing

PROPERTY and construction specialist Matthew Ong has a penchant for all forms of real estate – be it land, buildings or architecture.

The executive director and chief executive officer of SGX-listed SLB Development Ltd flexes his creative muscles by tinkering with colourful, plastic bricks to construct models or recreate iconic landmarks, such as the Sydney Opera House and Shanghai’s Oriental Pearl Tower.

“I enjoy using Lego blocks to design and build my projects,” said the Bachelor of Science graduate in Business and Management Studies from UK’s University of Bradford.

Pacific Star Development riding on Asean’s growth potential

AS it wraps up its current mixed-use projects in Iskandar and Bangkok, Pacific Star Development (PSD) is sparing no effort to make itself known in the Asean market for its upper middle to high-end mixed-use projects.

The Catalist-listed developer is currently studying opportunities to partner Singapore developers to bid for sites either through government land sale (GLS) sites or en blocs.

Negotiations are ongoing for a joint venture to develop land in Kuala Lumpur’s core city centre and with JV partners following a memorandum of understanding (MOU) signed last year with a master developer, PT Kukuh Mandiri Lestari, to develop a 10 ha seafront project at Pantai Indah Kapuk in the northern part of Jakarta.

Bharti tycoon may pump US$1b into son-in-law’s hotel chain

THE billionaire who controls India’s biggest mobile-phone operator is looking to pump more than US$1 billion into a hotel chain founded by his son-in-law in London, people with knowledge of the matter said.

The money from Bharti Group chairman Sunil Mittal would fund acquisitions by Sharan Pasricha’s Ennismore, a developer that owns the Gleneagles resort and Hoxton hotel chain, which is expanding in the US and Europe, said the people, who asked not to be identified as the matter is private.

The injection would come from a Bharti unit that handles Mr Mittal’s family wealth and would help Mr Pasricha acquire and convert properties in trendy urban areas in US and European cities into hotels aimed at appealing to younger travellers.

Gilstead Mansion en bloc bid targets S$68m THE owners of the 24-unit

Gilstead Mansion near the Novena neighbourhood have put their development up for collective sale by public tender with an expected price of at least S$68 million.

The tender will close at 3pm on July 3. The freehold site on Gilstead Road occupies a land area of 35,751 square feet, and its estimated existing gross floor area of 43,463.8 sq ft translates to an effective gross plot ratio of about 1.22 times.

The expected minimum sale price of S$68 million works out to about S$1,564.50 per sq ft per plot ratio (psf ppr); no development charge is expected.

Indonesian group buys 2 floors at Octagon for S$30.3 million

AMID green shoots of recovery in the strata office market, a few whole-floor deals have surfaced recently in the Central Business District.

At The Octagon in Cecil Street, the family behind Indonesian conglomerate Central Cipta Murdaya (CCM) is shelling out nearly S$30.33 million or S$2,450 per square foot for levels nine and 10.

BT understands that a Singapore-incorporated company owned by members of the Murdaya family is acquiring the two floors from a fully-owned subsidiary of The Singapore-Johore Express, controlled by the Lee family which is also behind listed Hotel Royal.

JTC releases 2 sites at Braddell, Tampines

JTC has put up for tender two industrial sites in Braddell and Tampines, and released another in Corporation Drive for application for sale, it announced on Wednesday.

For tender is one confirmed list site at Tampines Industrial Drive and a reserve list parcel at Braddell Road under the first half 2018 Industrial Government Land Sale programme.

The tender of the reserve list site was triggered after JTC received an application for the sale, with a committed bid price of not less than S$18,302,300.

The 0.97 hectare site at Braddell Road has a 30-year tenure with a maximum permissible gross plot ratio of 2.5. Its tender closes on July 11 at 11am.

First Sponsor unit selling part of Chengdu project for S$97.5m

MAINBOARD-listed First Sponsor Group’s unit, Chengdu Gaeronic Real Estate Co, is selling parts of a mixed-used residential and commercial project, Chengdu Cityspring, for 465.0 million yuan (about S$97.5 million).

The buyer is Chengdu-based hotel, real estate and finance company Minyoun Industrial Group Corporation. Chengdu Cityspring comprises six residential buildings, four commercial buildings and 1,272 basement car park lots.

The sale involves one of the commercial buildings, a retail space and 318 basement car park lots. The property is owned by Chengdu Gaeronic Real Estate Co under a leasehold which expires in March 2049.

Mainstream brokerages enter en bloc fray

AS MORE sites here jostle to be sold in the red-hot collective sales market, mainstream real estate agencies are also deepening their involvement in this space, marketing such sales alongside property consultancies.

For some of these brokerages, it is a part of an expansion of services beyond the home sales and project marketing for which they are usually known, so their joining in the fray adds to a crowded landscape for marketing agents. Huttons Asia has sold S$2.26 billion worth of sites this cycle, including Tampines Court and Park West.

Its investment sales team of 15, set up in 2007, made its first collective sales deal with Jasmine Court in 2011, the team’s head Terence Lian told The Business Times.

Mapletree Investments’ Patmi up 39% at S$1.96b for FY17/18

MAPLETREE Investments announced a profit after tax and minority interests (Patmi) of S$1.96 billion for the financial year ended March 31, 2018, up 39 per cent from a year ago.

For FY17/18, its revenue rose by 37 per cent to S$3.19 billion, while recurring Patmi gained 6 per cent to S$685 million.

Mapletree Investments also recorded a higher return on equity of 15.7 per cent compared to a year ago.

HDB’s latest 12-year bond deal makes it the biggest issuer in 2018

HDB last week sold a S$500 million 12-year bond despite poor market sentiment. It was also the third bond issue so far this year by HDB – the nation’s public housing body – and the longest maturity.

The S$500 million, 12-year bonds were issued under its S$32 billion multicurrency medium-term note programme. They are rated Aaa by Moody’s Investors Service.

Keen bidding expected for Dairy Farm GLS site

A 99-YEAR leasehold site at Dairy Farm Road, launched on Thursday under the Confirmed List of the government land sales (GLS) programme, is expected to see keen interest from developers, market watchers say.

There are also strong prospects for the two Reserve List sites – one at Sims Drive and the other at Tampines Avenue 10 – to be triggered for sale, they add.

This is especially so for the executive condominium (EC) site in Tampines, given the depleting stock of new ECs for sale and the continued appeal of the hybrid public-private housing product among homebuyers.

Perennial buys firm with big stake in Sentul City in Jakarta

MAINBOARD-LISTED Perennial Real Estate Holdings on Thursday said its wholly-owned subsidiary Perennial SL has acquired Sanctuary City from an unrelated party for US$15.6 million.

The jewel in Sanctuary City’s crown is its 60 per cent stake in PT Bhakti Bangun Harmoni (BBH), which owns a 246,982 square metre land parcel inside the Sentul City master-planned township, in the greater Jakarta area.

Perennial said that the acquisition is in line with its strategy to invest in high-growth emerging markets, which complement its portfolio of assets which are predominantly in China and Singapore.

Australia’s building activity slows in April, a bad omen for economy

AUSTRALIA’S housing activity slowed in April with approvals to build new homes down more than expected while non-residential permits also slipped in an ominous sign for broader economic growth.

Dwelling approvals skidded 5 per cent in April, data from the Australian Bureau of Statistics showed on Wednesday, when analysts had expected a fall of 3 per cent.

Approvals were still up about 2 per cent annually but far from the stellar double-digit increases seen last year.

CapitaLand group CEO to retire on Dec 31

LIM Ming Yan, the president and group chief executive officer of mainboard-listed CapitaLand will retire from his appointments on Dec 31, 2018, the company said on Friday evening.

The 55-year-old, who joined CapitaLand in 1996, had given notice to the company’s board of his intention to retire.

The board has accepted his resignation. CapitaLand said in its announcement: “Mr Lim will remain as president and group CEO until his retirement takes effect and will be working closely with the board to achieve a smooth transition.

PropNex planning to raise S$40m from IPO: report

PROPNEX Realty, Singapore’s largest homegrown property agency, is said to be looking to raise S$40 million from a proposed Singapore initial public offering (IPO).

The company is targeting a market capitalisation of as much as S$250 million, a Bloomberg article quoted sources as saying on Friday.

This confirmed an earlier commentary in The Business Times, which flagged that PropNex’s IPO is under way.

Australia’s home prices post first annual fall in 6 years

HOME prices across Australia’s major cities eased for an eighth straight month in May as tighter lending standards at banks cooled demand in Sydney and Melbourne, although regional markets continued to tick higher.

Property consultant CoreLogic said on Friday its index of home prices for the combined capital cities slipped 0.1 per cent in May, after a 0.4 per cent dip in April.

That left nationwide prices down 0.4 per cent for the year, the first annual decline since 2012.

Along with tougher rules from regulators, lenders have also been raising borrowing standards amid revelations of widespread malpractices on loans and financial advice among several major institutions.

Japanese activist shareholder sells penthouse at a slight loss

A FEW big-ticket apartment and penthouse deals have been done recently.

Japanese activist shareholder Yoshiaki Murakami has sold his penthouse unit at The Boulevard Residence in Cuscaden Walk for S$15.8 million or S$2,234 per square foot (psf).

This is close to the S$16 million that he paid for the 7,072 sq ft triplex unit, which has five bedrooms and an 11 metre lap pool, back in 2006. The buyer is understood to be linked to CY Tay, son of the late OG founder Tay Tee Peng.

Singapore co-working space company JustCo plans 100 centres in Asia by 2020

CO-WORKING space operator JustCo plans to set up 100 centres by 2020 in Asia and is looking to acquire firms that complement its operations, the company’s chief executive officer Kong Wan Sing said.

“We are tapping into companies’ need for flexibility,” he told Reuters in an interview in Bangkok on Thursday.

JustCo opened its first co-working centre outside Singapore in Thailand this year with plans to add offices in Jakarta and Shanghai by year-end, towards a goal of 50 centres in Asia by 2019, each with minimum space of 3,000 square metres, he said.

US commercial real estate deal volume rises, but headwinds are blowing

THE value of US commercial property deals rose 6.7 per cent in the first quarter from a year earlier, but higher interest rates and softer demand for office and retail real estate will weigh on the market in the quarters to come.

This is according to a report released by Ten-X Commercial, a leading commercial real estate marketplace in the US.

“Heavy supply is looming in the apartment, hotel and industrial sectors, while technological innovation is crimping demand for both office and retail space,” the real estate transaction platform said in the report that looks at data going back more than a decade.

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