Complete Property Market Updates of Singapore

July 1, 2008

New homes set to raise level of city centre buzz

Filed under: General,Genius Thoughts,Investment Tips,Market Watch — Propertymarketupdates @ 3:29 am

With office units in short supply, condos make a good option for investors: Analysts

Singapore’s city centre is set to get bigger and bolder in the next decade, with the injection of around 23,000 homes that promise to take the buzz to another level.

And if Singapore’s urban planners have their way, more office buildings will sprout at Marina Bay, along with mixed-use developments in the Beach Road and Ophir-Rochor areas – bringing people closer to their jobs.

All this will come to pass while hotels and lifestyle hot spots in Little India and the Singapore River surroundings ensure that the city teems with activity.

And even if you need a quick getaway from the city’s frenzy, green open spaces such as the upcoming Gardens by the Bay and Esplanade Park are all within walking distance.

This vision for Singapore’s 1,650ha central area was unveiled by the Urban Redevelopment Authority (URA) last week as part of its latest masterplan, which outlines Singapore’s land use over the medium term.

With all these grand plans and more, is it time for investors to hunt within the city for a good buy?

Property experts say this depends on the location of the property, the timing and how quickly URA’s blueprint materialises in the next few years.

Let us start with the Central Business District (CBD).

Office space investments are limited, although there are some strata-titled commercial units available, such as those at The Arcade in Raffles Place and International Plaza in Tanjong Pagar.

However, there is only a small pool to shop from, and units in good locations could be beyond the reach of the average investor. Units at The Arcade, for example, changed hands at around $5,000 per sq ft (psf) at the end of last year.

Knight Frank director of research and consultancy Nicholas Mak said there are ‘very few good strata-titled office spaces in the city’. A more obvious choice would be to shop for homes.

With the government’s latest strategy to repopulate the city centre and bring people closer to their jobs, investors can rest assured that this pool will only get bigger.

Some projects that have already been launched include The Sail at Marina Bay and Marina Bay Residences. Further inland, One Shenton and Scotts Square also offer units in the heart of the city.

The latest URA data shows Marina Bay properties transacting at around $2,100 psf. This is a slight dip from the peak prices seen in the property boom last year.

At Scotts Square in Scotts Road, units are being sold at an average price of $3,700 psf this year, down about 8 per cent from $4,000 psf in last year’s fourth quarter.

At One Shenton, the latest sale went at $2,069 psf in January.

Prices might be falling at some condos now, but as these homes were launched at just below or around the $1,000 psf level, the question remains whether the upside is limited if one buys now, say some market watchers.

It is possible that prices might drop further, given the current cooling of the market, but Mr Mak added that owners are unlikely to let go of units if they would incur a loss.

Savills Singapore’s director of business development and marketing, Mr Ku Swee Yong, said that sellers are more likely to negotiate now given the current market sentiment.

For investors holding out for drastic price drops, he said it is unlikely that home prices in the city will drop as much as 30 per cent, as recent bank reports have predicted.

‘Current market conditions do not support that. At the most, we will see a 5 to 10 per cent decrease for top-end luxury homes.’

Mr Ku said that even at the $2,000 psf level, city homes can command rental yields of about 4 per cent as they are attractive properties to rent, catering to the international expatriate community.

At DTZ Debenham Tie Leung, senior director of research Chua Chor Hoon agreed.

‘City centre homes fetch pretty good rentals and therefore give good yields…URA’s data shows that rentals for condos such as Icon were in the range of $6.50 to $7.50 psf a month,’ she said.

Mr Ku added that investors who are in for the long haul might find that their investments will pay off in the next five to 10 years, especially after the Marina Bay integrated resort opens and the city gets busier.

Other homes to consider include those at Robertson Quay and Tanjong Pagar.

The condos include Robertson Blue, RiverGate and Watermark at Robertson Quay; at Tanjong Pagar, there are the Pinnacle @ Duxton and Icon. Units at these projects have changed hands for $1,400 to $1,600 psf in the last three months.

The other option for investors is to wait for further government land sales, for more new homes to be developed, said Mr Mak. These developments would probably be in the Marina Bay area, he added, unless URA allows city properties to be converted into mixed-use projects.

Around Beach Road and the Ophir-Rochor area – touted as the northern gateway to the city – investment opportunities are more diverse.

There is a good mix of shophouses and strata-titled commercial and residential units on the market for the average investor.

The 101, Premier Centre and The Plaza, for example, are all strata-titled properties with a mix of commercial and residential units. At The Plaza, transacted apartment prices have gone up 28 per cent, rising from $600 psf in June last year to $900 psf currently.

Commercial units in this area have generally stayed at the $1,500 psf price level this year, though transaction volumes have fallen since last year, said Mr Ku.

Over at Tanjong Pagar, shophouses are also a staple of the district. These properties are usually more affordable, added Mr Mak, although he warned that they are more sensitive to market downturns.

If plans for a revamped Kallang Riverside and Paya Lebar Central go ahead, the city centre will also benefit from the buzz added by these new, nearby commercial hubs.

How soon investors will see price movements in city investments will depend on the pace of development. Market watchers agree it is still too early to see the price effects from URA’s masterplan.

‘Prices are peakish now, so one should consider the investment time horizon and yield before making a purchase,’ said Ms Chua.

Promising outlook

For property investors who are in for the long haul, they might find that their investments will pay off in the next five to 10 years, especially after the Marina Bay integrated resort opens and the city gets busier, says Mr Ku Swee Yong, Savills’ director of business development and marketing.

LOCATION AND TIMING CRUCIAL

Market watchers point out that while prices of many city centre residential properties have come down since last year’s peak, the upside may be limited as many of these homes were launched at much lower prices.

On the other hand, apartments at The Plaza, a development in the Beach Road and Ophir-Rochor area with a mix of commercial and residential units, have actually enjoyed price increases since last year.

Source : Sunday Times – 1 Jun 2008

June 24, 2008

Metro grows in China as property play

Filed under: China,General,Genius Thoughts,Property Investment — Propertymarketupdates @ 3:34 am

Q4 net profit rises 34% to $25.6m, helped by fair-value gains

THE property development and investment division of Metro Holdings, which is better known here as a retailer, is providing a bigger share of its earnings as retail revenue dips.

For the financial year ended March 31, Metro Holdings reported revenue of $224.4 million, up 4.8 per cent from the preceding year.

On a business segment basis, its property arm accounted for $49.2 million, up from $35.9 million previously.

For FY 2008, the property division contributed $75.6 million or 87.4 per cent to group pre-tax profit, up from 84 per cent previously. But revenue from retail business eased to $176.4 million, from $179.5 million.

Net profit for the year was $65.97 million, a 3.95 per cent drop. Earnings per share dipped to 10.46 cents from 10.89.

Net earnings were up 34.4 per cent at $25.6 million for the fourth quarter, helped by $14.9 million in fair-value gains from investment properties, while revenue was down 2.69 per cent at $53.2 million.

Metro Holdings, which has office and retail properties in China, said that for the quarter, its property division revenue was $17.2 million, up from $8.9 million in the previous corresponding quarter, due to initial income from Metro City Beijing, higher income from Metro City Shanghai and a one-time recognition of service charges of $4 million.

But Metro is not neglecting its retail business. It confirmed an earlier BT report that it will open a new outlet at City Square Mall near Little India. It will also open a new retail outlet in Jakarta’s Grandaria City.

Metro Holdings occupies more than 821,000 square feet of retail space here, but its group general manager Jopi Ong said that the costs of doing retail business in Singapore is prohibitive.

‘The prices here are definitely too high.’ he said. ‘To operate a department store, you need a lot of real estate.’

Metro Holdings chairman Winston Choo, who joined the company in July 2007, added: ‘In terms of property development and investment, we have no plans for Singapore because I think the opportunities are better in China.’

And Metro’s Chinese property portfolio is set to grow as it increasingly becomes a China play.

It now has 200,000 square metres of net lettable area in China, including Metro Tower Shanghai and GIE Tower Guangzhou.

Also in China, it has 127,500 properties under development including 1 Financial Street, Metropolis Tower and EC Mall, all in Beijing.

Occupancy rates in Metro City Shanghai and Beijing, in which Metro Holdings holds 60 and 50 per cent stakes, were 99.4 and 81.1 per cent respectively.

At Metro Tower Shanghai and GIE Tower Guangzhou, in which it holds 60 and 100 per cent stakes, occupancy was 97.9 and 68.1 per cent respectively.

Metro Holdings said that the lower occupancy at GIE Tower was due to not being able to provide existing tenant KPMG with the extra floor space that it required in the building.

A final dividend of one cent per ordinary share has been proposed.

Metro Holding’s share price closed half a cent down at 78 cents yesterday.

Source : Business Times – 29 May 2008

One-North: A place for a meeting of minds

Filed under: Education,General,Genius Thoughts,Property Add Value — Propertymarketupdates @ 2:57 am

one-north, encompassing Biopolis and Fusionopolis, is Singapore’s icon of the knowledge economy

THERE I was, standing in the middle of a gleaming complex of buildings, with blocks bearing names like Chromos, Proteos, Genome and Matrix. I was, of course, at Biopolis, conceived to put Singapore on the global map of the biomedical sciences industry. Biopolis itself is only one part of a vast development called one-north that is emerging around the Buona Vista area.


Brain space: Biopolis (left) was conceived to put Singapore on the global map of the biomedical sciences industry; global pharmaceuticals corporation Novartis houses its Novartis Institute for Tropical Diseases at Chromos. The institute ‘is dedicated to discovering treatments for diseases of the developing world, including tuberculosis, malaria and dengue fever’, says its chairman Paul Herrling

ha area is ‘Singapore’s icon of the knowledge economy’, according to the one-north website. It encompasses Biopolis and Fusionopolis, a sprawling area dedicated to the media and information businesses.

In its widest interpretation, one-north includes Rochester Park, Insead business school and one campus of the Nanyang Technological University. Clearly, it is planned to be a kind of ‘brain space’ and creative nerve for Singapore.

But does the talent really like working here? I approached a man and a woman chatting to each other and posed them that question.

The woman’s answer was emphatic. ‘Yes, it’s convenient. It’s got everything – there are restaurants, cafes, shops. There’s a shared system among all the corporations here, to take care of all our grocery and other needs.’ They declined to give their names but said that they work at the Institute of Bioengineering and Nanotechnology.

And for those who think that the location is somewhat out of the way, there is the view of Edison Liu, executive director of the Genome Institute of Singapore (GIS). one-north is practically ‘in the middle of the city’, he said, speaking to BT in a phone interview as he was travelling in the US.

‘We are only some 20 minutes from all the major hospitals and universities. It’s not like some other research centres, where you’re stuck in the outskirts of suburbia.’

GIS is the national flagship programme for genomic sciences, and occupies – of course – the Genome block at Biopolis.

‘Of course I’m biased, but we are always counted among the top 10 genome centres in the world,’ said Prof Liu. ‘Within a 25-hundred-mile radius in Asia, there is no centre with better firepower than us.’ He said that the institute has made its mark in the areas of stem cell genomics, systems pharmacology (which is research related to cancer) and genomic technology.

Slightly more than half of GIS staff is of foreign origin, said Prof Liu, who himself is from the US but is now a Singapore permanent resident. In that sense, the institute shares the international flavour of other big research institutes.

As I walked along the paved streets of Biopolis, it seemed to me that the place, barring the occasional person in a business suit, has the feel of a large university. There is a big food court for the more budget-minded, but also espresso pit-stops and several restaurants.

These eateries are not only great places to grab a meal, but also to swap ideas and contacts, according to Paul Chapman of GlaxoSmithKline. He is head of GSK’s Centre for Research in Cognitive and Neurodegenerative Disorders.

‘While it is certainly possible to have this kind of interaction if you are located on a separate campus, there is no substitute for bumping into someone at the food court or the cafe,’ he said. ‘Those casual interactions, where people get to know each other and then discover their mutual scientific interests, just happen more easily at a place like Biopolis.’

Opportunity for study

Novartis, another global pharmaceuticals corporation, houses its Novartis Institute for Tropical Diseases (NITD) at Chromos.

The institute ‘is dedicated to discovering treatments for the diseases of the developing world, including tuberculosis, malaria and dengue fever’, said Paul Herrling, NITD’s head of corporate research and chairman.

‘Biopolis’s location in Singapore, a place where dengue is endemic, gives researchers the opportunity to study first-hand the epidemiology of the disease, and enables access to affected patients.’

one-north is not entirely about the medical and biotech sectors. Swissnex Singapore describes itself as a platform of the Swiss Embassy, ‘facilitating knowledge and competencies’ in science, education, art and innovation between Switzerland, Singapore and South-east Asia.

‘Being at Biopolis brings us closer to the stakeholder,’ said executive director Suzanne Hraba-Renevey. ‘We are more visible and accessible to our users and have easy access to our partners from academia, research, government and business.’

The entire Biopolis project itself is yet to be completed, and consists of several phases. Across the road looms Fusionopolis 1, comprising 24 floors, two towers and 120,000 square metres of floor area.

The building, which represents phase one of the Fusionopolis project, is dedicated to infocomms, or media-related firms that use the latest in technology. It is equipped with satellite access and the necessary power and bandwith for intensive computer use. There are also service apartments, a roof-top swimming pool and a performance theatre.

Fusionopolis 1 has just opened its doors to tenants, and Asian Food Channel was the first to make it its home. When I visited the premises of the cable-and-satellite channel on the 12th floor, there were still boxes to be unpacked and everything was spanking new.

‘We think three to five years ahead,’ said managing director Hian Goh. ‘In 12 months’ time, there’s going to be an MRT at the bottom of this building. There will be a Cold Storage and shops. There’s a sky garden – it’s beautiful.’

The new office is bright, airy and full of glass partitions. There is a room at the rear to be turned into a kitchen-cum-studio.

‘That’s where we’ll have people like Gordon Ramsay doing his shows,’ said Maria Brown, managing director of acquisitions and programming. ‘We’ll also be able to invite people over.’

I imagined the celebrity chef, brow furrowing, expletives flying, sticking a knife in a roasted carcass and calling it done.

‘Please invite me,’ I said.

Source : Business Times – 27 May 2008

June 16, 2008

Landscape design contest for Punggol waterway

Filed under: Developer News,General,Genius Thoughts,HBD Reviews — Propertymarketupdates @ 2:58 am

Competition includes design of Punggol Town Park

FOLLOWING its announcement to develop Punggol into a modern waterfront town, HDB is also engaging with the private sector to design the landscaping of the Punggol waterway through a Landscape Masterplan Design Competition for the Waterway.

The competition aims to draw on fresh and innovative ideas for the landscaping of the 4.2 km waterway, and also includes the designing of the Punggol Town Park – a 10.6 ha land that will provide a range of water-based activities and facilities.


Tapping talent: The winner of the competition will receive $300,000, which will form part of the professional fee to be paid to the appointed firm or team

Besides proposing the landscape design development direction of the waterway, entrants to the competition can also actively participate in creating the communal and commercial spatial typologies along the waterway.

Proposals for the competition are expected to introduce new sustainable development concepts and features, in line with HDB’s concept of ‘green living by the waters’.

According to HDB, response to the competition has been good, with 17 firms registered as of yesterday.

Design Link Architects is one such company, and its director Mabel Goh said: ‘We feel that this project is quite innovative. So far, waterfront housing has been largely limited to the East Coast side, but this is an innovative attempt to integrate the water body with public housing.’

Another firm, Atelier Dreiseitl Asia, which has years of experience in landscape architecture and urban hydrology, is evaluating the competition brief and its director Leonard Ng has expressed interest in the project.

‘Right now, it’s a clean slate and it gives you the potential to work out a complete approach to design, being sensitive to all the aspects of an urban environment. If that’s taken into consideration, it can have a cutting edge design that integrates the urban fabric with the waterway.’

The winner of the competition will receive $300,000, which will form part of the professional fee to be paid to the appointed firm or team. The professional fee will be fixed at 3.68 per cent of the total construction costs of the landscape development. In addition, two merit prizes of $50,000 each will be awarded.

The competition is opened to urban planners, architects and landscape architects from May 17 to September 16 and registration closes on July 16.

Source : Business Times – 22 May 2008

Leisure Plan promises fun times ahead

Filed under: About Singapore,General,Genius Thoughts,Property Trends — Propertymarketupdates @ 2:51 am

Devts include 150km round-island path, agri-tainment sites and urban hotspots

From a round-the-island jogging route to night festivals in the city, the Urban Redevelopment Authority (URA) has shown it is serious about fun by coming up with Singapore’s first Leisure Plan.

According to National Development Minister Mah Bow Tan, there is a need to ‘further sharpen Singapore’s distinctiveness as a vibrant yet liveable city’.


 
But the task is not simple, says URA chief executive Cheong Koon Hean. ‘It is not just about providing space and facilities to play, it is also about enhancing the variety and quality of leisure options we have around-the-clock, where there is something for everyone.’

Built on the 2003 parks and waterbodies and identity plans, the Leisure Plan aims to enhance Singapore’s quality of life. It is part of the 2008 Draft Master Plan that will also focus on sustaining economic growth.

The Leisure Plan seeks to provide recreation to suit everyone.

For those seeking active fun, more green spaces will be available.

For starters, a 150-km round-the-island route for joggers and cyclists is in the works. Linking park connectors and other trails from Changi to areas such as Punggol, Lim Chu Kang, Jurong Lake, Marina Bay and back, the route will be finished in 10-15 years. Stretches in some regions such as the Southern Ridges are already complete, and the next five years will see at least half the route laid out.

Bringing parks closer to homes, the park connector network will more than triple in size from 100 km to 360 km in the next 10-15 years. The web will expand further to include six more loops in the next five years, in areas such as Siglap-Kallang.

Parks will grow to 4,200 ha in the next 15 years, from 3,300 ha today. In the more immediate future, new parks in areas such as Lower Seletar Reservoir will appear.

Besides parks, more accessible waterways and new sports facilities will become must-go destinations for residents keen on outdoor play.

Beyond creating spaces, the Leisure Plan aims to carve out destinations with a distinctive character.

Under the second part of the plan, the 1,400-ha Kranji and Lim Chu Kang area will become a countryside getaway. Besides the 115 farms there, new parkland, new trails though Kranji Marshes, three agri-tainment sites and other facilities will be created.

In the city area, special lighting will dot areas such as Orchard Road, Bugis and Marina Bay to help give the island a vibrant nightlife.

And the National Heritage Board will step up the beat over two weekends in July in the Bras Basah and Stamford Road area, with night festivals featuring live music, street theatre and other performances. The Singapore Tourism Board will follow in September with its Singapore River Festival.

Arts activities and lifestyle hotspots such as Tanglin Village and Rochester Park will also provide urban entertainment.

Industry players are positive on more recreation. ‘The development of recreational venues is a boon to surrounding residential areas,’ said Cushman & Wakefield managing director Donald Han. ‘With more attractions and infrastructure being built, we are likely to see higher demand and a sustainable price increase over the longer term.’

Supporting that view, director of marketing and business development at Savills Singapore Ku Swee Yong said: ‘A planning approach that packages work and play around daily activities in one area, such as the proposed Jurong Lake District, will mean premium property prices in the area.’

In particular, more recreational venues will help the western region of Singapore shed its industrial image to present a better value proposition for home buyers. As Mr Han noted: ‘Residential prices in the east are traditionally higher because of the diversity of attractions in the area – golf courses, the beach, restaurants and interesting food and beverage chill-out concepts.’

Kranji Countryside Association president Ivy Singh-Lim supports the increased focus on agri-tainment. According to her, visitors will benefit from a refuge away from the city and farmers can gain additional income.

But Mrs Singh-Lim is concerned that development could encroach on the area’s rustic charm, and hopes agri-tainment will become just be ‘part of the scene (of sustainable agriculture)’.

URA will launch the Draft Master Plan 2008 exhibition tomorrow for the public to give feedback.

Source : Business Times – 22 May 2008

June 4, 2008

Home away from home overseas

Filed under: General,Genius Thoughts,Property Investment — Propertymarketupdates @ 4:59 am

Every fortnight, Mr Shahul Hameed, 50, packs his wife and three daughters into the car and drives across the Causeway.

The family’s retreat is a 2,400 sq ft, two-storey semi-detached house in Gelang Patah, Johor. It is part of a gated community called Leisure Farm Resort Residences, located 30 minutes from Singapore.

Their home away from home is where they can indulge in fishing, cycling and take the occasional boat trip to the nearby island of Tioman.

Mr Shahul, a financial planner with NTUC Income, bought the Balinese-style property, which features dark wood finishes and floor-to-ceiling glass windows, about four years ago for RM537,000.

In Singapore, he owns a 1,600 sq ft condominium apartment in Sims Avenue, which cost him $732,000.

He says: ‘When you have money just sitting in your bank, you tend to spend it. So I thought why not buy a second home nearby?’

The family has benefited from the regular weekend getaways, he claims. Since buying the house, he has consistently exceeded sales targets at work. His three daughters, whose ages range between five and 19, have performed better in their studies.

He adds: ‘I believe a change of environment now and then helps you lead your life in Singapore better.’

Owning a holiday home overseas may no longer be a luxury afforded only by Singapore’s super-rich, as more regular folk like Mr Shahul invest in overseas properties too.

Others discovered by LifeStyle include a teacher, an owner of a small business and a marketing consultant, though not all agreed to be interviewed.

Retired teacher Natahar Bava, 62, and his family own a semi-detached house at Sunset Way. But they spend holidays at their second home at the Kennedy Bay Resort in Perth, where their beach-facing, two-storey villa boasts an unobstructed view of the Indian Ocean.

Mr Bava, who has three daughters aged between 20 and 37, bought the house in 1997 for A$400,000 for his second daughter when she enrolled at a university there.

But the girl chose to live in the university hostel instead, so the property became the family’s holiday accommodation.

They visit as often as three times a year to rejuvenate, often paddling out to sea in a pair of kayaks they own.

‘It was a good turn of events that fulfilled an original dream I had,’ says Mr Bava. In 1982, he had taken a group of students to Perth on a school field trip. Smitten by the tranquillity of the place, he swore to one day own a home there.

‘WA (which stands for Western Australia, the territory Perth is located in) also means ‘wait a while’,’ he says in reference to the slower pace of life there.

Being an ‘average Singapore citizen’, he was only able to afford a place 15 years later, he adds.

There are no exact figures to the trend, but in general, developers and property companies who market overseas projects here point to a growing interest among Singaporeans to put their money in homes offshore.

At Colliers International, which has launched recent projects in places like Australia, Malaysia, New Zealand and Thailand, business in the overseas sector grew four to five times from 2004 to 2007, says its associate director of international projects Michael Tan.

Executive director of DTZ South-east Asia, Mr Heng Hua Thong, adds that the number of overseas property launches in Singapore has also increased.

‘At least every month you have one project launched in Singapore. That’s definitely more compared to one or two years ago,’ he says.

With the local property market only just settling after a spate of sky-high property prices, it makes sense for some to look elsewhere where risks are not so great, says managing director of Orange Tee Global Properties Dave Loo.

The agency markets developments in places like Malaysia, Thailand, Australia and the United Arab Emirates.

Thailand’s market, for instance, has undergone several tax revisions recently to entice foreign investors. An apartment in a place like Phuket can go for as low as $100,000, adds Mr Loo.

While it is still more common for Singaporeans to buy for investment, he estimates that between 30 and 35 per cent of his customers buy properties to use as holiday homes or for their children who are studying overseas.

For the former purpose, resort destinations like Phuket or Bali are naturally more popular than city locales, he adds.

Prominent National University of Singapore lecturer K. K. Seet, for instance, bought a 2,000 sq ft, Thai-Balinese house in Pattaya for $300,000 in September 2006.

Says the 40-something bachelor: ‘I’ve always wanted a house near the sea, which would be impossible to achieve in Singapore, unless one is prepared to fork out millions for Sentosa Cove.’

He bought the house somewhat unexpectedly while on holiday in Pattaya, and now visits about three to four times a year.

Dr Seet says he was attracted to the city’s contrasting flavours, such as the sight of a high school band performing on a pedestrian boulevard, ‘while go-go girls were twirling around poles in a nearby bar even as busloads of tourists were tucking into a seafood buffet in an adjoining restaurant’.

‘It’s this heady mixture where everything is ‘live and let live’ that is fascinating,’ he adds.

Industry players like Mr Peter Thng, executive director of Reapfield Property Consultants, agree that the demographics of overseas home buyers have diversified to include middle-income earners. The agency has sold properties in Australia, New Zealand, Britain and Malaysia.

He says: ‘This is not surprising given the affluence of the society and also the fact that many have either lived, studied or worked overseas.’

In the 1990s, middle-aged businessmen formed his main group of customers. Today, apart from professionals, ‘civil servants such as teachers and military personnel form the bulk of our client base’, he says.

For Singaporeans scouting for holiday homes, proximity is perhaps the biggest selling point. Properties in the region, such as Malaysia, Thailand and Australia are favoured, though countries like Malaysia – which offer advantageous exchange rates – have extra appeal.

In a recent survey carried out by Malaysia’s Real Estate and Housing Developers Association, Singapore was identified as its top foreign market. Malaysia has a My Second Home programme, which allows foreigners with a certain amount of capital to buy houses there.

At Johor’s Leisure Farm development, 49 per cent of buyers are Singaporeans or expats based here, says its sales manager Peter Lim. ‘Their profiles include professionals, businessmen, people looking for a shortcut to their dream home.’

Indeed, with holiday homes becoming a prized asset, few owners are willing to rent out their place to vacationers to cover costs. Says Dr Seet: ‘I’m not interested. What if they wreck the place?’

Still, those interviewed by LifeStyle say the returns on their investments have been far from poor. Mr Bava, for instance, reckons his Perth abode is now worth more than twice the A$400,000 he paid.

Mr Shahul is even planning to buy a third home at Leisure Farm, a bungalow 21/2 times the size of his current semi-detached house.

If he cannot find a suitable buyer for his existing Johor property, he will still keep it, ‘as a present for my children’, he says with a smile.

‘When you have money just sitting in your bank, you tend to spend it. So I thought why not buy a second home nearby? I believe a change of environment now and then will help you lead your life in Singapore better.’ – SHAHUL HAMEED, a financial planner, who bought his house in Gelang Patah, Johor, which he visits every fortnight with his family, daughter Nur Istiqamah, eight, wife Nur Asyiqin Abdullah, 35, and daughters Nur Diyanah, five, and Zaakira Mahreen, 19

‘It was a good turn of events that fulfilled an original dream I had.’ – NATAHAR BAVA, who bought a house in Kennedy Bay Resort in Perth, in 1997

‘I’ve always wanted a house near the sea, which would be impossible to achieve in Singapore, unless one is prepared to fork out millions for Sentosa Cove.’ – DR K. K. SEET, NUS lecturer, who has a 2,000 sq ft Thai-Balinese house in Pattaya

Source : Sunday Times – 11 May 2008

May 5, 2008

Middle East investors ‘looking to S-E Asia’

Filed under: Financing,General,Genius Thoughts,Investment Tips,Market Watch,Singapore Economy — Propertymarketupdates @ 2:52 pm

MIDDLE Eastern investors are increasingly looking to Singapore and other South-east Asian nations for deals as financial ties grow between the two regions.

So says Standard Chartered (Stanchart) Bank’s group head for origination and client coverage, Mr V. Shankar.

Stanchart is well-positioned to become a leading player in this area. In the past year, it has advised on more than 40 per cent of the deal flow from Middle East to this region, which totalled US$8 billion (S$10.9 billion).

The figure was up from the US$987 million in the 12 months preceding, and Mr Shankar believes it will continue to rise in the years ahead.

‘The financial ties between the Middle East and Asia are strengthening by the day and we are seeing more East-East relationships being formed,’ he said in a recent interview.

‘Oil and natural gas from the Middle East are vital for China, Japan and all the fast-growing markets in the Asia-Pacific region, which are fast ramping up their infrastructure.

‘And the oil-generated capital and liquidity in the Middle East are fuelling a search for investments with high returns.’

Mr Shankar added that a recent report by McKinsey estimated that Gulf countries would have US$9 trillion to invest by 2020.

Stanchart began boosting its presence in the Middle East three years ago and now has a team of 50 corporate advisers there.

Mr Shankar, who is also a member of Stanchart’s group management committee, said this put the bank in an enviable position as Singapore’s business with the Gulf looks set to soar.

‘Between 2004 and 2006, total trade between Singapore and the Middle East shot up from US$20.9 billion to US$30.8 billion, an increase of 47 per cent.

‘Currently, Singapore companies are working on more than $6 billion worth of projects in the Middle East.’

Stanchart is no stranger to deals between the Republic and Gulf countries. It recently advised the Al-Futtaim group in its successful bid for Singapore’s oldest retailer, Robinson & Co.

Looking ahead, Mr Shankar said the bank would leverage on its experience and capabilities in the region to shore up its position as a major player.

‘Stanchart is well-placed to seize future opportunities, thanks to our growing geographical reach and the scale and breadth of our products and capabilities.

‘We have an established history in Singapore, having been in the market for 150 years, and we have been operating in the Middle East for more than 50 years. We feel we can act as a strong local bank in all the different markets for our clients.’

Source : Straits Times – 5 May 2008

February 28, 2008

Long-term savings for short-term costs

Filed under: Developer News,Financing,Genius Thoughts,Property Add Value — Propertymarketupdates @ 5:55 pm

SAVINGS of up to $1,000 a year on air-conditioning bills await home owners at The Oceanfront @ Sentosa Cove condominium.

Developer City Developments, known for its green condominiums, has installed energy-efficient air-conditioners at the 250-plus multimillion-dollar flats.

Although green features such as these air-conditioners and solar-powered lighting take up 3 to 5 per cent of a building’s construction cost, City Developments says it brings long-term savings in property maintenance and emissions reduction.

It has calculated that energy savings at its Sentosa Cove condominium will total $290,000 a year or up to $1,000 per apartment.

Pursuing sustainable development – in terms of infrastructure, public education and incentives – is not cheap, but green companies and environmentalists say there are long-term gains.

Apart from green buildings, another example is solar energy. It is costly to introduce, although it is the best clean-energy option for Singapore given its year- round tropical weather.

Using today’s electricity rates, the executive director of the Singapore Environment Council, Mr Howard Shaw, calculates that it will take 10 to 15 years for such an investment to turn in a profit.

But Mr Shaw argues it makes sense given the way oil prices have moved: ‘We’ve all seen how quickly oil prices escalated in recent months.

‘Placing in renewable energy infrastructure may be a way to ensure a more secure energy supply, one that will cost us less should oil prices rise to $200 to $300 a barrel,’ says Mr Shaw.

That head start can be seen in the Scandinavian countries such as Iceland, Norway and Denmark.

These countries began developing renewable energy sources like geothermal, hydroelectric and wind power after the oil price shocks of the 1970s.

Singapore took its first steps only last March when it announced a $170 million fund to research and develop clean energy projects.

MP Charles Chong (Pasir Ris-Punggol GRC) cites transport as one area where Singapore can do more.

He wants compressed natural gas (CNG), which is cleaner than diesel or petrol, to power more buses and taxis here.

But his wish runs smack into one major obstacle. There are too few points where these vehicles can re-fuel. There is only one at Jurong Island, and three more will open this year at Mandai, Jalan Buroh and Serangoon North.

It is not viable to set up more because the current number of CNG vehicles is not enough to support a wider network.

Official figures show Singapore has 334 natural gas vehicles and 381 hybrid vehicles on the road.

Hybrid cars run on both batteries and petrol. They consume 15 to 40 per cent less fuel and emit fewer pollutants than conventional vehicles of the same size running on petrol.

However, hybrids cost 10 to 20 per cent more, even with the Government’s 40 per cent rebate on their open market value, which excludes the certificate of entitlement premium and road tax that a car owner has to pay.

So, what is standing in the way of Singapore going green boils down to two main factors: high prices of green products and the absence of scale to make it viable for companies to invest.

These have, in turn, impeded consumer buy-in, says City Developments managing director Kwek Leng Joo.

Public education on protecting the environment is therefore needed to make such efforts viable, he adds.

NOT CHEAP AND NOT ENOUGH NUMBERS

What is standing in the way of Singapore going green boils down to two main factors: high prices of green products and the absence of scale to make it viable for firms to invest.

Source : Straits Times – 9 Feb 2008

Homespace.sg: Find your dream home easily online

Filed under: Agency News,Community Voices,Genius Thoughts,Property Add Value — Propertymarketupdates @ 2:50 pm

A new website launched recently, homespace.sg, takes the tedium out of househunting, reports FELDA CHAY

HOUSEHUNTING can be a tedious process. It involves going through tiny listings in the classified ads, making phone calls to homeowners or their agents, and going down to view the house and surveying the surrounding area before deciding whether to put money down.

Many will be pleased to know that a more fuss-free option is now available on the Internet at a website called homespace.sg.

HomeSpace, the brainchild of NUS undergraduates Vinod Nair, Zhuo Weifeng, and graduates Jarrold Ong, Timothy Kua and Staelen Yew, aims to make the process of home buying and selling easier for all parties involved.

The idea came about after Vinod and Weifeng worked on a school project on Google Maps, where users enter an address or area to quickly find its location on the map.

‘I felt that our project was quite relevant to the real estate industry, so I spoke to Weifeng and we decided to bring the other guys on board to embark on it,’ said Vinod. This view found more support when friends who work as real estate agents spoke to them about the difficulties they encountered while advertising through print media and on various websites.

‘Our real estate friends complained that the websites they advertised on were very messy and disorganised,’ said Timothy.

The agents also complained that print ads were sometimes expensive and there was no guarantee that people would respond. Agents also faced the problem of limited space. Print ads, therefore, were ‘not targeted’ as a result, said Vinod.

For homebuyers as well, it can be a frustrating experience.

‘As a buyer, you had to call up the agents or owners to find out the exact details. The ads may say that the house is very near the MRT, but in reality it could be a 20-minute walk,’ said Vinod. ‘Because of this lack of information, we felt that there should be a better way to give people the information they needed.’

The five then decided to establish a company that deals with these problems through the use of an easy-to-use search tool, a friendly interface and Google Maps technology. This led to the set-up of a company called The Real Group to create an uncluttered online real estate search engine. After months of detailed research into the needs of real estate agents and homebuyers, the group launched HomeSpace last December.

All homebuyers have to do to find a house of their liking is to type in the area where they want their home to be, using the website’s search function. Homes listed with the website that fall within the search parameters will then appear, along with a detailed map at the side showing the location of these homes and nearby amenities.

For those who have no clue as to where they want their future home to be, they can also window-shop by region. Accompanying each listing are details such as the floor area and selling price of the houses.

Additional information such as the exact distance between the homes and nearby amenities are also provided. Homebuyers can also view pictures of the interior of these houses, provided home sellers put them up.

All of this reduces the chances of homebuyers physically viewing a house that they are not interested in buying. And the best thing is that this pre-viewing is free for them. For home sellers and real estate agents, the time of high advertising costs with no guaranteed results is now over. At HomeSpace, advertisers need not pay a subscription or listing fee. They pay only when an interested party ends up buying a house.

The company also makes advertising extremely easy, since the only necessary fields that advertisers need to fill up are the postal code and price. All other fields are not mandatory as much of the vital information like the exact address is deduced by the search engine through the postal code.

The company makes use of SMS to reach users quickly. Upon finding a home they’re interested in, homebuyers just have to type in a note on the website and the message will be delivered to the seller’s mobile phone via SMS and a viewing session can be arranged.

This ‘allows buyers and sellers to maintain an initial level of privacy while still getting the negotiation message across’, said Timothy.

Once the SMS is delivered, the seller will then be given the option to buy the lead’s contact details for $3. 

Although it has been running for just over a month, the site has already drawn more than 3,000 listings. It has also managed to catch the eye of several venture capitalists (VC) from the UK and the US.

The five have, however, rejected funding offers from them, preferring to take up the recently launched NUS-MDA Microfunding Scheme, which has provided $55,000. This scheme supports start-ups in their early stages of development.

‘The reason behind not taking VC funding at such an early stage is because we wanted to retain ownership of the company,’ said Vinod. ‘When the business is unproven, early-stage VCs usually take higher equity because of the increased risk. However, when the business model has been proven and the money starts coming in, they have less leverage and the company has more control over the terms of the funding. The Microfunding Scheme has provided us with just the right amount of capital while not taking a major stake away from the founders.’

Soon, the group could expand their service to include a home rental portal. ‘This is not the end; there is always room to be better. If we don’t take the action and responsibility to continue improving ourselves, somebody else will do it,’ said Vinod. ‘The users are the king – if they like your stuff, they will continue to use it. Otherwise, they will go to somebody else.’

Source : Business Times – 4 Feb 2008

January 9, 2008

Circle Line key to higher plot ratios: JLL

Filed under: Construction News,Genius Thoughts,Property Add Value,Regulators — Propertymarketupdates @ 1:42 am

Study looks at how Master Plan 2008 could change landscape, usher in new initiatives

When Master Plan 2008 is unveiled sometime this year, certain areas are likely to see an increase in plot ratios. A study by Jones Lang LaSalle has tried to zero in on which areas could be allowed more intensive use of land.

bt_080104_circle-line-key-to-higher-plot-ratios_jll.jpg
Its conclusion: Look out for undeveloped state sites within walking distance of Circle Line MRT stations, particularly those that intersect with existing MRT lines. They are the top candidates for higher plot ratios.

The property consulting group specifically highlighted the areas near Paya Lebar MRT Station, Buona Vista MRT Station (which will see the Circle Line intersecting with the existing East-West Line) and HarbourFront MRT Station (Circle Line crosses North-East Line). Also, while Buona Vista is shaping into an R&D/commercial hub, the HarbourFront district’s redevelopment potential is increasing because of projects in Sentosa and Keppel Bay nearby.bt_080104_circle-line-key-to-higher-plot-ratios_jll2.jpg 

Another promising area is in the vicinity of the Circle Line Station at Telok Blangah. Although it does not intersect with an existing MRT line, it will benefit from a spillover from the ongoing redevelopment in Sentosa and HarbourFront.

JLL does not see major, across-the-board increases in plot ratios in MP 2008. But it argues that intensifying land use for undeveloped state plots along these stations will spread social benefits from the government’s investment in the Circle Line to more people and also improve accessibility.

Raising plot ratios (ratio of maximum potential gross floor area to land area) will also address the issue of rising demand for Singapore’s properties and prevent overcrowding in specific areas such as the central and CBD regions.

Although the Circle Line also touches locations near Dhoby Ghaut and Bishan MRT stations, JLL excludes them as these areas already have high plot ratios.

The study also suggests that white sites – with a range of uses and change in use mix allowed – will be more readily available islandwide instead of being confined largely to the CBD. ‘It further promotes creativity in future projects,’ says JLL’s head of research (South-east Asia) Chua Yang Liang.

He also sees the Urban Redevelopment Authority introducing more mixed use, rather than traditional single-use zones, to ‘further provide the flexibility needed to accommodate changing demand patterns as a result of shifting demographics’. MP 2008 could also be more tolerant of non-traditional types of residences. For instance, obsolete industrial buildings could be re-modelled along the lines of New York’s Manhattan lofts. ‘This will accommodate shifting market forces and tastes,’ Dr Chua argues.

JLL also suggests that URA may realign traditional industrial estates to support demand needs of the knowledge-based economy or rezone them for other uses. ‘For example, industrial areas within housing estates such as those found in Jalan Pemimpin could potentially be rezoned to residential or possibly an education hub,’ it said. After all, the area is near Raffles Institution and Raffles Junior College.

MP 2008 could also extend the ‘work, live and play’ concept beyond Marina Bay into the suburbs as Singapore cannot live by its business image alone, JLL predicts. ‘We can expect to see more areas designed for cultural developments, for example, the civic, cultural and retail complex in Buona Vista, and new conservation areas that serve to retain the fabric of the collective memory,’ Dr Chua said.

JLL also expects to see many more recreational zones across Singapore. ‘The likes of the recent Punggol announcement will be more common,’ the study said.

On the back of Sentosa Cove’s success, JLL expects other islets around Singapore like Southern Islands and Pulau Ubin to be put for waterfront residential use.

In the existing CBD, JLL suggests that Shenton Way will see a further shift towards a mixed-use (including residential) district, once the current office supply crunch eases. In May last year, URA announced a temporary ban on conversion of office use in the central area, including the CBD, to other uses until end-2009.

Last year, the government identified Jurong East and Paya Lebar for development into business hubs. Dr Chua says land around Paya Lebar MRT Station will be intensified in line with government plans to transform it into a sub-regional centre and that the location will be ideal for cost-conscious office tenants.

However, Dr Chua suggests that the area around Jurong East MRT Station is more suited for research and development because of its proximity to universities, the Science Park and one-north rather than as an alternative backoffice hub along the lines of Tampines.

National Development Minister Mah Bow Tan last year also ruled out massive, across-the-board islandwide increases in plot ratios for MP 2008 to cope with a higher population target of 6.5 million. The Master Plan, a detailed land use plan that guides Singapore’s medium-term physical development, is reviewed every five years.

Source : Business Times – 4 Jan 2008

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