Property news round up 6 May 2018

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Alpha fund, CDL tie-up put two office assets on the market

AIMING to cash in on the upturn in the Singapore office market, Alpha Investment Partners and City Developments Ltd (CDL) are understood to have put Manulife Centre in Bras Basah Road, and 7 & 9 Tampines Grande up for sale through separate expressions of interest exercises.

The total price tag of the two assets exceeds S$1 billion, The Business Times understands.

The vendors are looking at prices in excess of S$550 million for Manulife Centre, which works to about S$2,270 per square foot based on the 11-storey commercial building’s net lettable area (NLA) of about 242,000 sq ft.

The building has retail space on street level and offices above.




Mapletree partners major Chinese courier group SF Express

MAPLETREE Investments has entered into a cooperation pact with Chinese courier group SF Express to establish a long-term strategic partnership to collaborate in logistics networks.

The official signing of a cooperation framework agreement between both parties took place last Tuesday.

Mapletree’s logistics business has a global footprint in the key countries, including China, where it currently has logistics properties spread across more than 20 cities.

Koh Bros and HK group to redevelop 2 District 10 sites

KOH Brothers Group Limited has tied up with Hong Kong-listed Far East Consortium to jointly acquire and redevelop two freehold sites in prime District 10 that were acquired en bloc.

The Singapore-listed contractor-cum-developer group said in a regulatory filing on Saturday that its wholly owned unit Changi Properties Pte Ltd has entered into a 20-80 joint venture with FEC Properties, a wholly owned unit of Far East Consortium.

The redevelopment of The Estoril site and Hollandia, which were acquired through collective sales, will be undertaken through the special purpose entity FEC Skypark Pte Ltd (FECS).

CDLHT posts 7.4% rise in distribution per stapled security

CDL Hospitality Trust (CDLHT) reported a 7.4 per cent increase in distribution per stapled security (DPS) to 2.17 Singapore cents for the first quarter ended March 31.

This came on the back of higher net property income (NPI), which grew 5.4 per cent to S$37.82 million. Gross revenue rose 11.6 per cent to S$51.8 million.

Inorganic contributions from The Lowry Hotel in the UK and Pullman Hotel Munich in Germany, which was absent last year, boosted the portfolio’s performance.

Despite a competitive retail and hospitality landscape, the Singapore portfolio recorded an improvement in NPI.

SPH Reit to acquire Rail Mall for S$63.24m

SPH Reit has agreed to acquire The Rail Mall for S$63.24 million, in a transaction expected to be funded by a combination of debt and internal resources.

This comes three months after The Business Times reported that the Rail Mall had been put on the market.

The mall, located along Upper Bukit Timah Road, comprises 43 single-storey shop units and 95 private carpark lots.

It has total net lettable area of about 50,000 square feet, and a 99-year lease which will expire in 2046.




CapitaLand Q1 profit down 19% on absence of one-time gain

EARNINGS for CapitaLand, one of the largest real estate companies in Asia, fell in the first quarter despite a rise in revenue, due to the absence of a one-time gain.

Net profit for the three months ended March 31 fell 18.8 per cent to S$319.09 million.

Excluding the gain from the sale of The Nassim in the first quarter of last year, operating net profit would have increased by 25 per cent to S$228.7 million on the back of higher development profits in Singapore and higher rental income from malls and offices in China and Japan, said CapitaLand.

Prologis to acquire DCT Industrial Trust for US$8.4b

PROLOGIS has agreed to acquire DCT Industrial Trust for US$8.4 billion in stock and assumed debt, making the world’s largest warehouse owner even bigger as demand surges in the age of online shopping.

DCT stockholders will receive 1.02 Prologis shares for each of theirs, the companies said in a statement on Sunday.

That represents a premium of about 16 per cent over DCT’s closing price of US$58.75 last Friday.

Oxley takes 10% stake in Malaysia’s Aspen for S$23.3m

PROPERTY developer Oxley Holdings is taking a 10.07 per cent stake in Aspen Group for S$23.28 million, or 24 Singapore cents per Aspen share.

The per-share price for the 97 million Aspen shares represents a 14.72 per cent premium over the volume weighted average price of 20.92 Singapore cents for Aspen’s stock on April 27, the last full market day prior to both parties signing the agreement on April 30. Aspen is a property development group based in Malaysia with a focus on developing affordable residential and mixed development properties.

Prices of completed condo, private flats 1% higher in March: NUS index

THE prices of completed private apartments and condominiums in Singapore rose one per cent in March, compared with the previous month.

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

The price increase rose from the 0.5 per cent rise seen in February, based on the revised index value for that month.




Margate Point, Holland Tower put up for en bloc sale

MARGATE Point, a 15-unit apartment development at Margate Road, has been put up for sale by tender in its maiden en bloc attempt at a minimum expected price of S$38 million.

To date, owners representing 14 out of the 15 apartments have already inked their consent to the collective sale.

Should the final owner’s consent be obtained, the owners can bypass the Strata Titles Board application process and work towards legal completion taking place within three months of contract.

Pacific Star Devt partners holiday home blockchain startup

A WHOLLY-OWNED unit of Catalist-listed developer Pacific Star Development (PSD) has become the exclusive asset manager for Crowdvilla, a startup expecting to raise up to US$50 million in a digital token sale to build a portfolio of shared holiday homes

Under a non-binding Memorandum of Understanding signed on Wednesday between PSD Singapore, Crowdvilla and Reitech, which powers Crowdvilla’s blockchain technology, PSD will help source, evaluate and shortlist potential apartments, beach villas or hotel buildings for Crowdvilla to acquire or rent and operate.

These homes will fit the “casual luxury” segment, with room rates ranging from US$100 to US$200 per night depending on location, size and ratings by previous users.

Overseas data centre strategy to keep MIT humming

ANALYSTS have long attributed the trading premium enjoyed by Mapletree Industrial Trust (MIT) to its pure-play Singapore status since its listing in 2010.

But going by the surge in its unit price since it broadened its investment mandate and added US data centres to its portfolio, it may suggest that investors have come around to the reality that there is only so much the Reit can grow within the city-state that continues to keep a watchful eye over industrial rents. MIT’s recent expansion into overseas data centres charts a necessary growth path.

This is also a move underscored by prudence as MIT leverages the resources and network of its sponsor Mapletree Investments.

Buyers with HDB addresses acquiring taste for pricier condos

HDB dwellers appear to be acquiring an appetite for pricier homes in recent years, with a caveats analysis by OrangeTee & Tie showing that the increase was led by luxury home purchases worth at least S$5 million.

It said the proportion of private condos bought by those with HDB addresses in the price range below S$1 million fell from 97 per cent in 2003 to 37 per cent in Q1 2018.

But the proportion of those who bought non-landed homes in the S$1 million to S$1.5 million range soared from 3 per cent in 2003 to 41 per cent in Q1 2018, while the proportion for non-landed homes above S$1.5 million also shot up from 0.2 per cent in 2013 to 22 per cent in Q1 2018.




Prime heritage play

A NICHE market often bypassed by real estate investors due to its specific guidelines on use, the prime conservation shophouse market in Singapore’s city core has been buzzing with activity of late.

Shophouses in the CBD and Chinatown (the old postal districts 1 and 2) have seen increased transaction activity, along with price appreciation since the second half of last year.

These properties, costing anywhere from S$7 million to S$25 million each and housing tenants ranging from hipster bars to au courant restaurants to boutique offices, are sometimes compared to Good Class Bungalows (GCBs) for their scarcity value.

But there is a key difference between the two property segments which also explains their appeal: whereas foreigners are not allowed to buy landed homes in GCB Areas, they may acquire shophouses on sites that are fully zoned commercial.

This gives them ownership of the land title, and therein lies the attraction of such shophouses to foreigners.

Reitas picks new president and spells out plans to engage regulators

AMONG the issues the Reit Association of Singapore (Reitas) hopes to bring up with various regulators is that of lifting the gearing cap for Singapore-listed real estate investment trusts (S-Reits).

Other issues it plans to address are the consolidating of all guidelines governing S-Reits into a single rule book, and getting clarity on lease top-ups for older industrial properties.

Reitas, which now represents 85 per cent of S-Reits by market cap, said it is also looking to educate investors on Reits with overseas exposure, given the growing numbers of foreign Reit listings and local Reits buying overseas assets.

Millennium & Copthorne Hotels’ Q1 profit doubles to £26m

LONDON-LISTED Millennium & Copthorne Hotels (M&C) posted a profit before tax of £26 million (S$46.92 million) for the first quarter ended March 31, 2018, double that of the same period a year ago in constant currency terms.

The rise in profit was helped by a gain of £3 million from the disposal of Mercure Brisbane and Ibis Brisbane, both owned by CDL Hospitality Trust (CDLHT).

The group also benefited from the higher profit contributions from CDLHT and associated company First Sponsor Group, with total contributions being £3 million higher than the previous year.




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