PM Lee says University Town launch is key development for NUS

Prime Minister Lee Hsien Loong Thursday launched the University Town project at the National University of Singapore (NUS), which will also be the site of the Youth Olympic Village if the country wins the bid to host the Games.

The government has confirmed that the project has been given top priority and will be completed by 2010.

According to the Ministry of Community Development, Youth and Sports, the project is on the government’s “green lane”, a fast track to ensure that it clears all the necessary regulations faster than normal, without compromising on design standards, occupational health and safety.

Mr Lee also assured that the University Town will be completed in time for the Games in 2010.

“We are delighted that the International Olympic Committee (IOC) has selected Singapore as one of two candidates in the final shortlist. We plan to use the University Town as the Youth Olympic Village, and will make sure that it is completed in time for the Games,” he said.

He added he is confident Singapore can deliver a high-quality, memorable event that will celebrate the spirit of the Games, strengthen the Olympic movement and leave a lasting impact on young people around the world.

Located just 13 kilometres from the city centre, athletes will need only no more than 30 minutes to get to all sports venues from the University Town.

Mr Lee also noted that the S$500 million University Town project is a key development for NUS and for tertiary education in Singapore.

The sprawling 19-hectare site at the former Warren Golf Club on Dover Road will accommodate Singapore’s first residential colleges, offering students a holistic and unique learning experience.

The prime minister Lee said: “Currently, NUS has several halls of residence which fulfil some of the functions of residential colleges. The halls are student dormitories that allow students to enjoy the benefits of living on campus.

“They serve student life well with a range of social and sporting activities and help to develop a sense of community, but are not organised for residential learning in an integrated and multi-disciplinary setting.

“The University Town will take this one step further with the establishment of residential colleges. Along with two graduate residences, six residential colleges will be set up, with each headed by a Master and supported by a team of faculty fellows, graduate tutors and staff.

“Each college will have the flexibility to chart its future direction and evolve its own distinctive characteristics. But the emphasis across all colleges will be on multi-disciplinary learning, with intensive small-group sessions to encourage maximum interaction and discussion.

“At the same time, they will offer opportunities for social, cultural and recreational activities to deliver a more rounded learning experience.”

NUS Professor Lily Kong said: “The residential halls that we have at the moment… have done a fabulous job in terms of encouraging and developing a sense of student identity and community and commitment to NUS and their halls of residence. We want to continue. All we are trying to do here is to add another dimension which currently doesn’t exist – the learning component in the colleges.”

The prime minister also said the Committee on the Expansion of the University Sector, headed by Minister of State for Education Lui Tuck Yew, will be ready with its report in August.

Besides studying the form of the fourth publicly funded university, the committee is also looking at other major changes to help meet the future needs of the economy. – CNA/ac

Source : Channel NewsAsia – 31 Jan 2008

Property players hold back

Companies wary of acquisitions amid market uncertainty

EVEN as property prices come off their peaks, sector participants are keeping cautious, with Macquarie MEAG Prime Reit’s manager becoming the latest to say it will hold off making acquisitions for now.

The uncertain mood brought on by turbulence and volatility in financial markets is curbing enthusiasm for property around the world.

“We have been shy of making acquisitions at the wrong price. So far, we have been prudent in terms of looking at what’s a good buy for us,” said Mr Franklin Heng, chief executive officer of Macquarie Pacific Star, the manager of the Macquarie MEAG Prime Reit. The Reit has interests in properties such as Wisma Atria and Ngee Ann City.

He announced at a briefing that for the three months ended Dec 31, the Reit had a distributable net income of $16.2 million, which means a distribution per unit of 1.68 cents.

On Tuesday, Keppel Land CEO Kevin Wong said he will “selectively acquire commercial and residential sites”, while Mapletree Logistics trust said last week it “will continue with its yield plus growth strategy, but in the current environment, it will focus on optimising yield from its existing portfolio”.

This strategy to look to organic growth to drive earnings contrasts with that of last year, when property trusts derived a large part of their profits from acquisitions.

“Most Reits still have balance sheets to take on acquisitions. But for major acquisitions, perhaps not this year, especially if that requires equity fund-raising,” said Mr David Lum, an analyst from Daiwa Securities. “I don’t think any Reit wants to be forced into any equity fund raising.”

“We are starting to see some sellers coming out of the sub-prime crisis. They may have to sell their assets very quickly, particularly those who are heavily-geared. So, getting financing is very challenging now,” said Mr Heng.

Macquarie’s “balance sheet is very healthy, so, it’s much easier for us to gear up, to make those acquisitions. Especially towards the second half of this year, there should be some quality assets from Singapore, Japan and Hong Kong up for sale”.

Source : Today – 31 Jan 2008

Singapore companies can benefit from real estate boom in Qatar

DOHA, Qatar : It has been dubbed the “Venice of Qatar”; a project called “The Pearl-Qatar” is an upscale Riviera-style development, and when completed in 2011, the project will be home to some 40,000 residents.

Investors from 45 countries have flocked to the project to snap up properties there, but real estate is not the only attraction for Singapore companies.

With its mix of Venetian charm and Arabic chic, the US$20 billion project is built entirely on a man-made island.

All 4 million square metres of it is reclaimed land, creating 32 kilometres of new coastline.

The project has been launched in phases, and according to the developer, 35 percent of the units have already been taken up.

In fact, an entire residential district was sold within an hour recently.

That transaction alone amounted to over US$405 million.

These mind-boggling numbers were presented to the Singapore delegation, led by Senior Minister Goh Chok Tong.

The progress of the development was obvious as the visitors cruised the waters of the Arabian Gulf.

However, while property is one obvious area to consider, Singapore companies may want to venture into other sectors.

Minister of State for Education Lui Tuck Yew said, “There are some possibilities on how Singapore companies can participate because we were asking them about security arrangement, we were asking them about the operation and the running of the entire complex, and they thought that that’s an area where Singapore companies would be interested to look into.”

This is Qatar’s first international real estate venture, and it comes with all the frills of luxurious waterfront living.

Shaped like a string of pearls, the island retreat will house marinas, high-end retail shops, five-star hotels, schools and medical centres.

The development will also feature high-tech services and a fully-automated vacuum waste disposal system, amongst others.

Besides industry players, the Singapore delegation is in Qatar to touch base with the country’s leaders.

During a meeting with the Amir, Sheikh Hamad Bin Khalifa Al-Thani, both leaders discussed developments in the region and relations between the two countries.

One of the topics covered was how to strengthen the already close state of bilateral relations.

Opportunities to collaborate in various areas, including joint ventures in environmental technology, was among the ideas mooted.

The two leaders also exchanged views on recent developments in Asia and the Middle East.

SM Goh last met the Amir in June 2005, when the Amir made a state visit to Singapore.

The Amir hosted SM Goh to lunch and during their discussions, SM Goh praised the Amir for the rapid development of Doha since his last visit there in 2005.

SM Goh also met Crown Prince Sheikh Tamim Bin Hamad Al-Thani, the Heir Apparent, who led a high-level committee to Singapore for a working visit last October.

It was Sheikh Tamim who had invited Mr Goh to visit Qatar.

They last met when Sheikh Tamim visited Singapore last October.

During this meeting in Doha, Sheikh Tamim briefed SM Goh on Qatar’s economic development and its future outlook.

Sheikh Tamim also expressed satisfaction with the progress of the High Level Joint Committee which is chaired by himself and Singapore Deputy Prime Minister Wong Kan Seng.

The two leaders also discussed how Qatar and Singapore could cooperate in tapping business opportunities in third countries.

Apart from meeting the members of the royal family at the Diwan Amiri, SM Goh is also expected to address the business community at the inaugural Qatar-Singapore Business Forum.

The event will see a gathering of businessmen from both sides and the signing of three agreements to spur bilateral trade.

More educational exchanges could also be on the cards, following SM Goh’s visit to the Texas A&M University at the Qatar Foundation.

At the Foundation, SM Goh also held discussions with Sheikha Mozah bint Nasser Al-Missned, Consort of the Amir and Chairperson of the Qatar Foundation.

This was SM Goh’s second meeting with Sheikha Mozah.

During their talks, SM Goh said he was impressed by the progress of the Education City, which is a flagship project of the Qatar Foundation.

SM Goh and Sheikha Mozah also discussed opportunities for cooperation between Singapore and Qatar in education as well as research and development.

The Singapore delegation also toured the ASPIRE sports academy. – CNA/ms

Source : Channel NewsAsia – 30 Jan 2008

Govt to spend S$14b to improve Singapore’s road infrastructure

The government will spend S$14 billion to improve Singapore’s road infrastructure over the coming years.

The money will go towards building the new North-South Expressway, the earlier announced Marina Coastal Expressway, widening the Central and Tampines Expressways, and improving various interchanges.

The Transport Ministry is optimistic the changes will soften the traffic gridlock.

The go-ahead has been given for the new North-South Expressway, which will cost some S$7 billion to S$8 billion and be ready by 2020.

The 21-kilometre expressway will link Woodlands and Yishun in the north to the East Coast Parkway.

It will run somewhat parallel to the Central Expressway, thereby relieving traffic from the heavily-used CTE.

The S$2.5 billion Marina Coastal Expressway, linking the eastern and western parts to Marina Bay, will be ready by 2013.

Then there is the widening of the Central and Tampines Expressways, which will be completed by 2011.

When completed, the CTE will have four lanes on either side.

The Ministry is confident these changes will make road travel more efficient.

But Singaporeans are mixed in their views.

One person said, “I’m actually looking forward to all the new highways, because just by coming out of the new KPE, it’s improving traffic a lot. I’ve used it, and I’m very happy with it.”

Another noted, “There will always be people wanting to buy cars. So long as the government allows that, I think this thing (congestion) will still keep on continuing.”

A third added, “The government wants to have 6 million people. There’s no way it can stop.”

Others offered alternatives which they think will work.

One person suggested, “They have to make more roads underground.”

Another commented, “If you can get from Point A to Point B very conveniently on public transport, then I think I wouldn’t be driving a car.”

A third added, “Staggering working hours is a good idea.”

Whatever the view, it will take some time for the initiatives to settle in, and the authorities are hoping more people will switch to public transport to ensure Singapore does not end up in a gridlock. – CNA/ms

Source : Channel NewsAsia – 30 Jan 2008

Regent off the hook for now

STB stops Allgreen’s purchase of condo for lack of ‘good faith’

AN APPLICATION for the en bloc sale of Regent Garden has been dismissed by the Strata Titles Board (STB) – much to the delight of the majority owners.

A group of 25 owners at the 31-unit condominium had earlier sued the buyers, Allgreen Properties, for allegedly breaching the sale and purchase agreement by grossly undervaluing the property at West Coast Road. Allgreen has denied the allegations.

While the High Court has yet to hold a hearing on the case, the STB yesterday decided that the $34-million sale was not conducted in “good faith” because the basis for the valuation of the property was wrong.

The majority owners argued that developer Allgreen had overstated the development charge, or DC, thus depressing the sale price.

The DC was initially stated to be $7.6 million, but worked out to be just over $950,800. The STB heard that the sale committee had discovered the shortfall from a letter dated July 23 last year, sent from the Urban Redevelopment Authority to Allgreen’s architects in their proposed redevelopment project.

In explaining the STB’s decision, which also took into account the views of two valuers who had performed valuations of the condominium, deputy president Alfonso Ang said the first calculation of the DC “gave rise to incorrect market value”, thus resulting in “the sale price of $34 million that was well below the market value”.

When the STB announced its decision yesterday, owners who were present were all smiles and congratulated one another.

However, this is just round one of what is to come. There are still two High Court orders on whether the contractual agreement signed between the condominium’s sale committee and Allgreen is valid.

The developer said in a statement it was “surprised” at the STB’s decision to proceed with the hearing despite the pending Court proceedings initiated by both parties.

“The Board’s decision will have no bearing on Allgreen’s case in the High Court, where Allgreen will continue to ask for an order that the majority owners complete the sale and purchase of Regent Garden in accordance with the terms of the sale and purchase agreement,” it said.

Allgreen said that before the agreement was signed, it had offered the option of having a floating sale price that would be subject to the DC. The sale committee, however, rejected this option and decided to fix the sale price at $34 million in order to guarantee itself certainty of sale, the developer added.

Source : Today – 31 Jan 2008

Citigroup revises Singapore’s GDP growth this year to 5.6% from 6.2%

Citigroup has revised down Singapore’s economic growth forecast this year to 5.6 percent from 6.2 percent, amid market uncertainty.

However, the lender said it is confident about strong growth in emerging Asian markets for 2008.

Citigroup is also predicting that equities will be the asset class of choice.

With the volatile market, Citigroup is also advising investors to keep a close eye on telecom, banks and media stocks.

Singapore’s economic growth is expected to moderate this year because of worries over the US sub-prime crisis and anticipated slowdown in the world economy.

Citigroup thinks Singapore’s GDP will expand by about 5.6 percent in 2008. This is slower than the 6.2 percent that it had forecast in December.

Salman Haider, Head of Investments, Global Consumer Banking, Citibank, said: “If there is a longer recession, or protracted recession in the US, we do see an impact. I think retail investors should continue looking at equities as an asset class of choice.

“They should also be aware that there will be extended volatility which we have been advising clients on for a while now. And because of that, (it is) extremely important that they are diversified, in addition to being overweight in equities.”

Citigroup analysts expect the US Federal Reserve to cut its benchmark interest rate to 2.25 percent by mid-year to stabilise global financial markets.

Given the volatile market in recent weeks, Citigroup believes that valuations are starting to look attractive in certain equity sectors. It is bullish about the telecoms, media and banking counters.

Mr Haider explained, “(With regards to) banks, (it is) from the perspective that there is fairly limited CDO exposure; the calculation is strong, the dividend yield story is a strong one.

“(For) media and telecom (stocks), primarily from a cash flow perspective – (they are) strong companies, (with) very visual cash flows. (They are) positioned very well, and again the dividend yield play comes into position for the media companies as well.”

Commodities such as gold are also expected to continue to do well, as investors hedge against the dipping US dollar.

For 2008, Citigroup sees growth coming from emerging markets in Asia, such as China. However, on the flipside, slower growth is expected from the US, Japan and Europe. – CNA/ms

Source : Channel NewsAsia – 30 Jan 2008

MMP REIT reports full-year net income of S$76.8m

Macquarie MEAG Prime REIT (MMP REIT) has reported a full-year net income of S$76.8 million, boosted by a jump in its fourth-quarter earnings.

The trust, which owns Ngee Ann City and Wisma Atria, said this is due to higher rentals, new leases and revenue from its acquisitions in Japan and China.

Following the strong results, MMP REIT plans to distribute 6.19 cents per unit to its unit holders.

The revamp of the Wisma Atria shopping mall is paying off for MMP REIT.

Despite higher expenses from the installation of new escalators for the mall, net income for MMP REIT still grew to S$76.8 million in 2007.

In the fourth quarter, its net property income rose to S$22.2 million, up about 29 percent on-year.

Franklin Heng, CEO, Macquarie Pacific Star, said, “It’s slightly above our expectations. The most surprising is actually the office sector. Towards the first half of last year, we were only doing an average of 7 to 8 dollars (psf/per month). But towards the last quarter of 2007, we’ve actually done an average of S$12 – slightly above S$12 dollars psf. And in fact, most recently, we’ve done the lease of close to about S$13.50. So going forward, we believe that (the) office (sector) will continue to underpin the strong performance.”

The strong performance is clearly a boon for unit holders, who will receive 6.19 cents per unit.

MMP REIT has about S$60 million to be distributed in 2007, up 7.6 percent over the previous year.

For the fourth quarter, distributable income came in at S$16.2 million or 1.68 cents per unit.

This is 14.3 percent increase from the previous year.

Going forward, MMP REIT expects its major tenant Takashimaya at Ngee Ann City to pay 15 percent to 25 percent more rent in a new contract starting June.

On acquisitions, Macquarie said it is beginning to see good quality assets in Japan, Hong Kong and Singapore, and it is constantly reviewing proposals to find the right fit at the right price.

It is leaning towards retail due to its defensive qualities as office rents tend to be subject to cyclical changes.

Two other REITs also submitted their report cards on Wednesday.

Retail trust Suntec REIT reported a higher distribution income of S$33.5 million for its first quarter.

At 2.279 cents per unit, that is 16.1 percent higher than the previous year.

Fuelled by strong growth in tourism, CDL Hospitality Trust recorded a net income of some S$85.8 million for its first full-year earnings report.

That is 66 percent higher than its own projections.

The trust is distributing S$68.7 million of its income, or 8.98 cents per unit. – CNA/ms

Source : Channel NewsAsia – 30 Jan 2008

GuocoLand reports 15% rise in H1 net profit to S$60.6m

Property developer GuocoLand has reported a net profit of S$60.6 million for its half year ended December 31.

That was a 15 percent increase compared to the same period a year ago. Revenue rose 114 percent to S$402 million.

However, net profit in the second quarter actually fell 26 percent to S$33 million. This was due to the absence of an exceptional gain that was booked in the year-ago period.

GuocoLand also reported losses linked to foreign exchange hedging.

Going forward, GuocoLand is looking to develop more residential properties in the prime districts of Singapore. It will build residential properties on the sites of the existing Sophia Court and Leedon Heights.

It is also expanding its footprint in China, Malaysia and Vietnam.

The developer said that although the spectre of a recession is looming over the US economy, China and India are expected to remain resilient.

Barring unforeseen circumstances, GuocoLand expects to report satisfactory results for its third quarter and full year. – CNA/ms

Source : Channel NewsAsia – 30 Jan 2008

$1.73 decent exit price for Ascott: CIMB

CapitaLand’s offer to buy the remaining shares of its 67-per-cent unit, The Ascott Group, at $1.73 apiece represents a decent exit price for minority owners of the luxury residences operator, according to CIMB, who said the price “is a fair valuation from a historical perspective, but attractive in the current environment of heightened risk aversion”.

Stock markets worldwide have been rocked in recent months by the fallout from the US sub-prime mortgage fiasco, and banks and property counters have bore the brunt of the volatility. The ST Index is down about 12 per cent since the beginning of the year.

In its offer document despatched to Ascott shareholders yesterday, CapitaLand’s fully-owned Somerset Capital unit said the offer was unconditional in all aspects and that payment would be disbursed 10 days after the receipt of acceptances. The offer will close on Feb 26 and the offer price will not be revised. CapitaLand intends to take Ascott private and will exercise its rights of compulsory acquisition.

Source : Today – 30 Jan 2008

Keppel Land gets an early hongbao

Boosted by sale of stake in One Raffles Quay, the firm posts a seven-fold surge in Q4 profits to $572 million

Keppel Land kicked off the current quarterly earnings for the property sector on a positive note with a strong set of results, but analysts said the sharp gains may not be repeated in the current year as businesses could face weaker business conditions.

The seven-fold surge in net profit to $572 million for the three months ended Dec 31 was boosted by a one-time capital gain from the sale of its one-third stake in One Raffles Quay (picture).

Keppel Land is proposing a final dividend of 8 cents per share and a special dividend of 12 cents per share. For the full year, it said profit after tax rose almost four times to $780 million from $200.3 million the year before.

Singapore’s second largest property developer’s results bids well for the rest of the sector, but analysts warned that property developers in general may not see such buoyant conditions this year, with weak market sentiment resulting in delays in property launches.

The launch of the Marina Bay Suites has been delayed until after Chinese New Year “to wait until people get their bonuses and perhaps, after people get their hongbao (red packet)”, said Keppel Land chief executive officer Kevin Wong.

Both housing and office property prices reached records last year, but with the US sub-prime crisis widening, companies are starting to tighten their spending on worries of a global slowdown.

The latest Urban Redevelopment Authority data showed that sales and rental prices for private residential and office properties have risen at a slower pace in the fourth quarter versus the third quarter of 2007. For the whole of last year, private home prices rose 31.2 per cent and prices of office space rose 32.6 per cent.

The rising price trend will continue and will broaden to the mass residential market, but the gains won’t be as aggressive, with analysts forecasting no more than a 15-per-cent rise in property prices on average.

“The drivers for earnings growth this year (for Keppel Land) are most likely from projects in emerging markets like China and Vietnam,” said CIMB analyst Donald Chua.

Source : Today – 30 Jan 2008