Property Highlights of Singapore: 20 October 2007

Saturday, October 20, 2007

CapitaLand To Build Sixth Raffles City In Hangzhou

Source : The Business Times, October 20, 2007

It has acquired a 40,355 sq m site for $202.8m

CAPITALAND has acquired a site in the Chinese city of Hangzhou for $202.8 million and says that it will be the location for its sixth Raffles City after those in Singapore, Shanghai, Beijing, Chengdu and Bahrain.

Mr Liew: CapitaLand is aiming for 10 Raffles City developments in 5 years

The 40,355 sq m Hangzhou site is in Qianjiang New Town, Jianggan District, and has a gross floor area of 283,568 sq m. The price works out to be about $715 per sq m per plot ratio.

This will be CapitaLand's fourth Raffles City in China. The development will comprise a Grade-A office tower, a retail mall, a five-star hotel as well as residential units, and is expected to be completed by 2011.

On the expansion of the Raffles City brand, CapitaLand Group CEO and president Liew Mun Leong said: 'With growing interests from many countries to have CapitaLand develop a Raffles City in their respective cities, we aim to have a total of 10 Raffles City developments within the next five years.'

CapitaLand is building Raffles City Beijing, targeted for completion in 2008. It is also developing Raffles City Bahrain and has acquired a prime commercial site in Chengdu, the provincial capital of Sichuan, to build Raffles City Chengdu. Both will be completed in phases from 2010.

Mr Liew said: 'Given the site's excellent location, we are confident Raffles City Hangzhou will become a new landmark in the city, attracting consumers, tourists and business travellers from all over China and beyond.'

He added: 'Last year, we also acquired our first residential site in Hangzhou to build about 1,200 homes. We will look for further opportunities in China to expand our footprint into cities where there are strong real estate opportunities supported by urbanisation and rising income levels.'

Hangzhou is a two-hour, 180 km drive from Shanghai and was ranked by Forbes magazine in 2004, 2005 and 2006 as the top city in China for business.

CapitaLand believes that with the relocation of the municipal government office to Qianjiang New Town, the construction of several subway linkages and the establishment of a new cultural and civic centre, this area of Hangzhou will be transformed into a bustling commercial district.

The Raffles City Hangzhou site will be linked to a proposed subway interchange serviced by Metro Line 1, to be completed in 2010. Metro Line 1 connects directly to the high-speed Maglev train service, which is expected to start operating between Hangzhou and Shanghai by 2010.

Higher Distributable Income For CapitaMall Trust, A-Reit

Source : The Straits Times, Oct 20, 2007

TWO large real estate investment trusts (Reits) yesterday reported higher quarterly distributable income amid a positive economic climate.

CapitaMall Trust (CMT), Singapore’s first and largest reit, said distributable income was $53.2 million in the third quarter ended Sept 30. This is 17.2 per cent higher than forecast and a 29 per cent rise from a year ago.

The retail Reit said the sum includes a capital distribution of $1.5 million from its 20 per cent investment in CapitaRetail China Trust.

Distribution per unit reached 3.4 cents in the third quarter. Net property income was $76.8 million, up 21.7 per cent from forecast.

Compared with the third quarter of last year, annualised distribution per unit rose 19.3 per cent to 13.49 cents.

CMT owns 13 retail malls here, including Plaza Singapura, Tampines Mall and Rivervale Mall.

Its rental renewal rates for the first three quarters of this year registered 12.1 per cent growth over preceding rates, and 5.5 per cent over projected rates.

Mr Pua Seck Guan, the chief executive of the trust’s manager, said assets had registered good organic growth and the Reit is also actively seeking yield-accretive acquisitions to grow its target local asset size to $8 billion by 2010.

CMT, which has assets worth about $5.8 billion, is enhancing several assets. At Tampines Mall, for instance, several new tenants, including skin and hair-care firm Kiehl’s, will set up shop by December.

CMT is also applying for permission to add about 95,000 sq ft of office space at the mall. This will entail a cost of $25.9 million.

Ascendas Real Estate Investment Trust (A-Reit) too delivered a favourable set of results, with distributable income for its second quarter that ended Sept 30 rising 15 per cent year on year to $46.4 million.

Distribution per unit was at 3.51 cents, up 11 per cent from a year ago.

The industrial Reit has benefited from increased demand, due to the take-up of space by tenants forced out of the tight office market.

Property occupancy reached a high of 98.3 per cent, up from 97.2 per cent three months ago.

Mr Tan Ser Ping, the chief executive of A-Reit’s manager, said net income rose 15.9 per cent to $118.2 million on the back of positive economic performance and increasing demand for quality business space.

A-Reit achieved a 32.3 per cent rise in rental rates for its business and science park space compared with the previous quarter, and a 15.5 per cent increase for high-tech industrial space.

A-Reit said it has secured over $270 million in new investments in development projects and acquisitions. Strong growth

CapitaMall Trust’s assets registered good organic growth and it is actively seeking acquisitions to grow its target local asset size.

A-Reit has benefited from positive economic performance and increasing demand for quality business space.

Strong growth

CapitaMall Trust’s assets registered good organic growth and it is actively seeking acquisitions to grow its target local asset size.

A-Reit has benefited from positive economic performance and increasing demand for quality business space.

CMT’s Q3 Net Income Up 29.1% To $53.2m

Source : The Business Times, Saturday, October 20, 2007

The Reit’s Q3 showing is 17.2% above the trust manager’s forecast.

SINGAPORE’S biggest real estate investment trust, CapitaMall Trust (CMT), reported third-quarter group distributable income of $53.2 million, 17.2 per cent above the trust manager’s forecast and 29.1 per cent higher than in the year-ago period.

The shopping centre Reit yesterday also revealed plans to develop a low office tower with about 95,000 sq ft gross floor area (GFA) above the retail space at Tampines Mall. The time frame has yet to be finalised, but work could begin as early as sometime next year. CMT obtained outline planning advice from Urban Redevelopment Authority in July for a plot ratio increase for an office development and the trust has proceeded to apply for provisional permission to fully use the additional plot ratio increase from 3.5 to 4.2 for an office development.

For Funan DigitaLife Mall, CMT is currently exploring various options to unlock the value of this asset, after receiving provisional permission earlier this year, to build a nine-storey commercial block (predominantly offices) to maximise unutilised GFA of about 386,000 sq ft.

Related links: Click here for CapitaMall Trust’s news release Financial statement Presentation slides

Asset enhancement works at Bugis Junction will see balconies being added on level 2 along Hylam and Malay streets, while opaque shopfronts on level 3 will be converted to glass parapets. Sembawang Shopping Centre’s redevelopment is on track for completion in Q4 2008.

CMT is already one of Singapore’s biggest owners of malls with $5.8 billion worth under its belt, but CapitaMall Trust Management Ltd’s CEO Pua Seck Guan says he is confident of growing this to $8 billion by 2010.

This will come from acquisition of malls from parent CapitaLand’s portfolio (such as Clarke Quay and a half-stake in Ion Orchard), as well as from other parties because of ‘CMT’s competitive cost of capital, superior skill set to extract value and established platform that allows us to optimise rentals,’ Mr Pua says.

Group gross revenue for the third quarter ended Sept 30, 2007, was $114.5 million, which was 20.7 per cent or $19.6 million higher than CMTML’s forecast based on an offer information statement dated August last year.

Roughly three quarters of this outperformance was due to consolidation of three malls owned by CapitaRetail Singapore Ltd from June 1 this year, while the rest was due to top-line revenue growth at the other malls in the CMT portfolio.

CMT’s Q3 group gross revenue was also 39.5 per cent higher than that in the year-ago period and the increase was due to a full quarter’s contribution from the trust’s 40-per-cent stake in Raffles City this round, compared with just a month’s contribution in Q3 2006; the consolidation of the three malls under CRS since June 1 this year; as well as revenue increase in other malls largely because of new and renewed leases at higher rates, plus the completion of asset enhancement at IMM Building late last year.

Group net property income for Q3 2007 was $76.8 million, 21.7 per cent higher than the forecast and 44.5 per cent above that in the same year-ago period.

CMT unitholders will receive a distribution per unit (DPU) of 3.40 cents for Q3, inclusive of a 0.09 cent capital distribution from the trust’s investment in CRCT. The 3.40-cent payout works out to 13.49 cents on an annualised basis, or a distribution yield of 3.69 per cent based on CMT’s closing price yesterday of $3.66.

SLA Offers Property For Rent; 2 Freehold Sites Selling En Bloc

Source : The Straits Times, Oct 20, 2007

THE Singapore Land Authority (SLA) has launched another site for short-term office use, a move aimed at relieving the supply crunch.

The property is the former Upper Aljunied Technical School on Upper Aljunied Road. It has a land area of 19,704 sq m and a gross floor area of 7,722 sq m.

It comes with a guide rental of $74,100 a month or $9.60 per sq m, with the tenancy renewable up to 2012.

The SLA says property and leasing companies have already expressed interest.

It has put out various state properties as interim sites this year, including former childcare centres, and more are being identified in suburban areas or away from the Central Business District.

This was a response to the tight office market and soaring rents in prime areas, which are driving some tenants to seek cheaper locations further from town.

In the residential market, two more collective sale sites have been put on the market.

The bigger plot is Cavenagh Gardens on Cavenagh Road, near the Istana. Owners at the estate, a 130,000 sq ft freehold site, want $619 million, or $2,308 per sq ft of potential gross floor area.

PropNex, which is marketing the site, has applied for permission to amalgamate a piece of state land.

If this is allowed, the combined site will cost $770 million, excluding about $72.8 million for the state land. The cost will be higher in this case because whoever buys the combined site will be able to build a bigger project.

If the amalgamation is not allowed, developers will be restricted to a smaller project of up to seven storeys, said PropNex.

PropNex said the buyer could instead keep and revamp two existing blocks, which have 13 storeys each, but they would have to apply for permission to retain them. The tender closes on Nov 23.

The agent also put up the freehold Novena Hill in Novena for sale yesterday at a price of $56 million to $60 million, or up to $1,777 per sq ft of potential gross floor area. The tender closes on Nov 16.

Lippo To Raise Up To $587m With Retail Reit

Source : The Business Times, Saturday, October 20, 2007

INDONESIA’S Lippo Group will be raising up to $587.4 million with the planned Singapore listing of a real estate investment trust (Reit) based on its retail properties in Indonesia.

The Lippo-Mapletree Indonesia Retail Trust (LMIR) will offer 645.5 million units at 78 to 91 cents a unit, according to the trust’s preliminary prospectus which was lodged with the Monetary Authority of Singapore yesterday.

Separate from the offering, Lippo will subscribe for 287.7 million units in the trust while Singapore’s Mapletree Investments will subscribe for 127.3 million units. This means that Lippo and Mapletree will hold stakes of at least 27.1 per cent and 12 per cent in the trust once it is listed.

Of the 645.5 million units that will be part of the share offering, 625.5 million units will be placed out to institutional and other investors, while 20 million units will be offered to the public.

The trust will be the first Reit in Singapore to provide exposure to Indonesia’s growing retail sector.

Two other SGX-listed Reits have significant exposure to overseas retail markets - CapitaRetail China Trust, which owns retail properties in China, and Fortune Real Estate Investment Trust, which holds retail properties in Hong Kong.

LMIR’s initial property portfolio will comprise seven retail mall properties and seven retail spaces located within other retail malls, all of which are located in Indonesia.

A-Reit’s Q2 Income For Distribution Up 15% At $46.4m

Source : The Business Times, Saturday, October 20, 2007

ASCENDAS Real Estate Investment Trust (A-Reit) said yesterday its second-quarter distributable income rose 15 per cent to $46.4 million, from $40.5 million a year earlier, as demand for the trust’s business space grew.

Related links: Click here for A-Reit’s press release Financial statements Presentation slides Supplementary information

The better performance lifted A-Reit’s distribution per unit (DPU) to 3.51 cents, up 11 per cent from 3.16 cents paid for the previous corresponding period.

Net property income for Q2 ended Sept 30, 2007 increased 16 per cent to $60.1 million, from $51.9 million a year earlier.

A-Reit said its better performance was due to higher revenue resulting from higher occupancy and rents.

The occupancy rate for A-Reit’s portfolio reached 98.3 per cent in Q2. And rents at business and science parks and hi-tech industrial properties rose 32 per cent and 15 per cent respectively from Q1.

‘This can be attributed to the spillover effect from the tight CBD office market and our active asset management initiatives,’ said Tan Ser Ping, chief executive of the Reit’s manager.

For the half-year ended Sept 30, A-Reit’s distributable income rose 14 per cent to $91.1 million, while DPU rose 10 per cent to 6.88 cents.

Going forward, A-Reit said that with the economy strong, demand for business and industrial space, especially at business and science parks and hi-tech industrial properties, is likely to remain healthy.

The trust said: ‘A-Reit expects to be able to deliver a return for the second half of the current financial year that is in line with its performance in the first half of the financial year.’

A-Reit’s shares closed three cents lower at $2.39 yesterday. The stock price has fallen 10.5 per cent since the start of the year, compared with a 25.5 per cent climb in the Straits Times Index.

CapitaMall’s Q3 Earnings Beat Forecasts

Source : Weekend TODAY, October 20, 2007

CAPITAMALL Trust yesterday said distributable income for the quarter ended Sept 30 was $53.2 million or 3.4 cents per unit, higher than forecast. Much of the increase
came from higher rents and a payout from CapitaRetail China.

CapitaMall had forecast a distributable income per unit of 2.9 cents.

The Trust, which owns 13 shopping centres including Raffles City (picture) and Plaza Singapura said gross revenue for the period was $248 million, up 7.5 per cent from the same period last year.

Chief executive officer Pua Seck Guan said: “We remain confident of the acquisition
opportunities in Singapore and are seeking yield-accretive acquisitions to grow our target local asset size to $8 billion by 2010.”

The units closed at $3.66, down 4 cents, even though the performance beat most analysts’ forecasts.

“The Q3 results came in better than our distribution-per-unit expectations of about
3.2 cents. We will be reviewing our forecast,” OCBC research analyst Winston Liew said.

Annuities - What's Toto Got To Do With It?

Source : Weekend TODAY, October 20, 2007

A few tweaks could be all it takes to make annuity scheme more accepted

THE largely negative feedback to the proposed compulsory annuity and longevity insurance scheme is not surprising given that it’s long on logic but short on marketing savvy.

For sure, a lot of effort and research has been put into studying the mortality trends, the actual investment performance of CPF members and the ability of the market and the Government to guarantee a long-term risk-free rate of return.

Over time, the Government has acted to ensure that the retirement accounts will not be frittered away by exorbitant sales charges and fund management fees.

The Government has worked out its sums to offer CPF contributors the most logical deals. But to critics of the plan, this logic does not add up. Why?

For the answer, we should turn to the field of Behavioural Finance. Just think of why 4-D and Toto are so popular even though basic mathematical logic clearly shows that the players, as a group, lose big time. Similarly, consider why people happily flock to casinos to leave loads of money behind.

In short:
• You need big prizes to encourage participation
• You need to maintain interest by having small payouts frequently
• Most players don’t like to lose big, even if the probability is very small

Let me explain the last point. If a person has a monthly income of $1,000, he will not mind wagering $1 to win $1, in an even game of chance.

With 4-D, we know he is actually prepared to wager $1 for a very small chance of winning the top three prizes even though the overall return is about half the money wagered.

However, he will avoid risking $1,000 in only one bet, even if the odds are improved to 1:1. Basically the thought of losing $1,000 at one go is perceived to be more painful than losing $1 a thousand times. This is termed risk aversion.

To my mind, a revised Government proposal needs to address several issues for the scheme to gain broader acceptance.

By making annuities compulsory, the Government imposes a very small probability of losing your whole Minimum Sum (or most of it) on each retiree. Even though the Government will not benefit from those who die early, the very thought that there could be a huge loss is highly unacceptable to many.

By stretching the payouts to one’s dying days, the monthly payouts become smaller —
there is no “Jackpot” element. After a life of struggle and toil, workers do not have a chance to celebrate before settling down to a mundane life of subsistence retirement.

However, the scheme can be repackaged to widen its appeal.

The 1-per-cent bonus interest could be scrapped. Instead, keep the money in a separate pool and dish it out, in the form of a Retirement Bonus, to those reaching their CPF withdrawal age. This would be similar to the Terminal Bonus feature in Endowment Insurance plans.

Since the money is meant for retirement, the Retirement Bonus should only be added to the Minimum Sum if the member agrees to opt for the Compulsory Annuity (with a guaranteed minimum benefit of five years payment) cum Longevity Insurance Package.

Let me take the liberty of naming this package the “New Annuity”. Members who opt out of the scheme for no valid reason, would have to forego the Retirement Bonus. That is their choice, harsh as it may seem.

Furthermore, those who migrate will not get a cent of the Retirement Bonus, unlike the present proposal. This money would be saved for the pool.

While it may seem that members who pass away before their retirement lose out, it is actually their dependents who lose out. This issue could be addressed by enhancing the Dependants’ Protection Scheme.

Since the money for each cohort cannot be touched for many years, there is scope to invest in a broader range of assets.

There is certainly room to invest in good properties and international blue chips, similar to what life insurance companies practise, to give better returns for their Endowment Policy holders.

Every year, all annuitants will also be eligible for a lucky draw to win cash or other prizes. Perhaps the older ones can have more draw chances since they are likely to have smaller annuity receipts. Many older members will recall the POSB’s televised lucky draws fondly.

The Government, major corporations, religious and charitable organisations, rich individuals and foundations could sponsor the prizes.

It would make for a truly festive occasion. Residents’ Committees could organise Senior Citizens’ Dinners for their constituents to enjoy a nice meal and watch the televised draw.

To increase the size of the New Annuity pool, the well-off could be encouraged to buy additional annuities with cash. These should be tax-deductible. Any return of premium, due to early death, should be exempt from estate duty.

This is also an incentive for the better-off to buy annuities for their spouses and poorer relatives.

The additional cash purchases can be a powerful signal to CPF members who have doubts about the New Annuity.

All the cost of running the system should come from the Government’s general budget.

This will show that the Government really cares for retirees. It is better for the Government to absorb the cost of running the scheme as better payouts will result in a lighter burden on the welfare system.

Our workers toil and dream of the day they retire.

We can learn from the 4-D and Toto experiences to redesign the retirement system to help them live their dreams when they retire.

With the Retirement Bonus and the Annual Draw to look forward to, they may even gamble less with Singapore Pools!

The writer was the first CEO of the Radio Corporation of Singapore. He may be contacted at chia.anthony@gmail.com

Ascendas Reit DPU Up

Source : Weekend TODAY, October 20, 2007

Ascendas Reit said distribution per unit (DPU) in the second quarter was about 3.51 cents, up 11 per cent from 3.16 cents in the same period last year.

Ascendas said the higher DPU was the result of additional rental income from new properties.

Gross revenue came in 15 per cent higher on year at $80.2 million.

Live It Up At Sentosa

Source : The Business Times, October 20, 2007

SOUTHERN DELIGHTS: A SPECIAL FEATURE ON SENTOSA

This is the first of a four-part series brought to you by Sentosa Sentosa, the rejuvenated one-stop recreational precinct, offers a unique blend of leisure and lifestyle experiences

THE difference between breaking point and a break is in the mind. And it then shapes reality.

Revitalised: The 500-hectare Sentosa Island has diverse facilities, including family attractions, beaches, golf courses, a world-class yachting marina, exclusive residence, spa and resort accommodation.

Most of us yearn for the idyllic getaway, especially in the stone-cold concrete jungle of Singapore. But we don't always get what we want. Fly to an exotic far-away destination? Too much hassle. Don't fret. Sun-kissed beaches, pristine waters, spas and resorts are actually just 10 minutes' drive from the city.

In about three decades, Sentosa has undergone a series of makeovers which has progressively taken it from humble beginnings to the swanky southern delight it is today. With the highlights at Sentosa Island, Mount Faber, VivoCity, St James Power Station, Singapore Cruise Centre, HarbourFront Centre and Sentosa Cove, the rejuvenated one-stop leisure destination, with its myriad offerings and refreshing transformation lends Sentosa to its integral role in reinforcing Singapore's position as a global city. Forming the core of the precinct is Sentosa Island, which offers a unique blend of leisure and lifestyle experiences.

Getting to the 500ha island is not a hassle, especially with the completion of the $140 million Sentosa Express in January this year. Journey time is whittled down to a mere three minutes from VivoCity, but if you're the sort looking for a novelty high, then brace yourself for a cable car ride 70 metres above the sea.

Eat, drink and be merry

With diverse dining options including local fares, fast food, cafes and even chic restaurants, the island resort can perhaps be called a culinary goldmine too.

For instance, sitting on the peak of Mount Faber and tucked away from the bustling city life is The Jewel Box, where - true to its name - it houses a treasure trove of wine and dine venues such as The Altivo Bar, Faber Hill Bistro and Faber Rock.

Elsewhere in Sentosa, award-winning restaurants such as The Cliff at Sentosa, il Lido Italian Dining and Lounge Bar and Nogawa Japanese Restaurant whip up dishes from various cultures.

Singapore's largest and most diverse retail and lifestyle mall VivoCity is also nearby, housing a vibrant mix of over 300 retail, food and beverage and entertainment outlets. Plus there's also HarbourFront Centre to enhance your shopping pleasure.

The art of living well

Other recent developments include six completed hotels, one of which is the Amara Sanctuary Resort, a plush five-star boutique getaway. The luxurious Capella Singapore, a six-star, super luxury resort worth $250 million, is expected to be completed mid-next year.

Those pining for their dream home may just get their wishes granted at Sentosa Cove, a prestigious waterfront residential development. The exclusive residential district is the only one in Singapore with an adjoining boating marina with berths for mega yachts, an intimate marina village with amenities, bungalows, terrace houses, and condominium apartments. Also at Sentosa Cove is the OneÃ‚Â°15 Marina Club, a $80 million world-class marina club featuring 260 berths, a business centre, gym and meeting facilities.

Bigger and better

Sentosa's packed calendar sees a score of international and local events sitting on its turf every year. Expect a swinging good time when the Barclays Singapore Open 2007 - primed as Asia's richest national golf open with a whopping US$4 million prize up for grabs - tees off on the island's greens in the first week of November.

Not a golf fan but still looking for a ball of a time? Look out for the annual Siloso Beach Party where you can do the mambo on the sandy dancefloor from dusk till dawn to celebrate the New Year.Of course, you don't have to wait for the year-end for a reason to party. Just barge into beach bars such as the iconic Cafe Del Mar on Sentosa Island to groove after experiencing the sun, sand and the sea.

Or if pulsating beats are more your kind of tune, then the St James Power Station may just be the place to fuel you up. With nine thematic rooms, the entertainment hub certainly adds jazz to the nightlife scene in Asia.

Varied attractions

Other attractions down south include Sentosa Island's Songs of the Sea, a nightly show that strikes the right notes with the audiences with its spectacular water, fire and state-of-the-art laser effects. Designed by internationally-acclaimed director Yves Pepin, the $30 million high-tech extravaganza deserves a standing ovation - it has enjoyed sell-out shows since its opening day.

Still, many will be looking out for the highly-anticipated integrated family resort on Sentosa Island. The $5.2 billion Resorts World at Sentosa will feature a Universal Studios theme park, oceanarium and marine park, water park and MICE facilities amid other features in retail, dining, gaming and entertainment.

There's just so much to see and do at Sentosa that one is easily spoilt for choice. So come and discover the good life at Sentosa.

This is the first of a four-part series brought to you by Sentosa

Equation Corp Wins Bukit Ho Swee Bid

Source : The Business Times, October 20, 2007

EQUATION Corp has clinched a state property at Bukit Ho Swee for the stately rent of $90,000 a month. The Singapore Land Authority (SLA), which manages the property, said that this is twice the guide rent when the former community centre was put up for tender in June.

The building is on 40,892 sq ft of land and has a gross floor area of 27,361 sq ft. At $90,000 a month, the rent works out to $3.30 per sq ft (psf) per month. Deloitte & Touche Management Services put in the second highest bid of $54,700 a month.

Equation Corp - formerly Heshe Holdings - could not be reached for comment. But another company that clinched two other state buildings - a former childcare centre in Balestier and a former school at Toa Payoh - said that it is likely to offer these as office space.

Vita Holdings chief financial officer Kwek Siew Hwee said that her company has leased about a dozen state buildings and rented out 80 per cent of the space to tenants. Vita, through its subsidiary Whitehouse Holdings, bid $101,788 a month for the former school at Toa Payoh. After refurbishing the building, it hopes to achieve rent of $5-6 psf per month. 'We expect to recover our cost in about six years,' Ms Kwek said.

Whether Equation Corp plans to rent out the former community centre at Bukit Ho Swee is not known, but Savills Singapore director (commercial) June Chua reckoned that the space could fetch $8-9 psf a month after it is refurbished. Proximity to Tiong Bahru MRT station is its main attribute, she said, adding: 'This site could fetch a premium because it's an established office location.'

The rent may seem high considering that average prime office rent is $12-13 psf a month. But the supply crunch is exerting increasing upward pressure on rents, Ms Chua said.

Rents for some prime buildings in Raffles Place have now hit a record $18 psf per month. 'It would not be impossible for some of these prime properties in Raffles Place to cross the $20 psf a month barrier next year,' she said.

Other bids received by SLA include $288,999 a month or $1.30 psf per month from RichZone Properties for a former school in Alexandra Road, and $200,000 a month or $1.25 psf per month from Hean Nerng Investments for the former Gan Eng Seng School at Raeburn Park.

5.5m Population More Achievable For Singapore

Source : The Business Times, October 20, 2007

THE 6.5 million population used as a guide for planning purposes in Singapore is not within reach in the next 50 years, an academic said yesterday. Saw Swee Hock of the Institute of Southeast Asian Studies said 5.5 million is a more achievable target.

Prof Saw - the second Singaporean after former deputy prime minister Goh Keng Swee to be elected an honorary fellow of the London School of Economics - was speaking at the soft launch of the second edition of his book The Population of Singapore.

His comments are consistent with those of Minister Mentor Lee Kuan Yew, who indicated in August that Singapore's population is unlikely to touch 6.5 million.

Prof Saw said yesterday that for the population to hit 6.5 million by 2050, Singapore needs an influx of 1.85 million newcomers after 2015, assuming the non-resident population rises from 0.8 million in 2005 to 1.01 million in 2015.

The proportion of newcomers arriving after 2015 would constitute 40.5 per cent of the total population in 2050 - the highest ever.

But for the population to hit 5.5 million in 2050, the number of newcomers entering Singapore after 2015 would be 1.63 million and they would make up a smaller 29.6 per cent of the population.

'The 5.5 million target is not only more achievable viewed in terms of the type of newcomers we want, but also more conducive to the maintenance of a harmonious multiracial society,' Prof Saw says in his book.

The figures were generated assuming the total fertility rate stays constant at 1.31, which will result in the resident population growing from 3.55 million in 2005 to a peak of 3.64 million in 2015, before shrinking steadily.

The challenge, said Prof Saw, is to get newcomers to stay to make up for the declining resident population.

Alongside a contracting resident population, the resident labour force is estimated to decline from 1.74 million in 2005 to 1.15 million in 2050.

Workers aged 60 and over are projected to make up 13.6 per cent of the workforce in 2050, up from 4.4 per cent in 2005. And workers aged 30-39 are expected to account only for 19.3 per cent of the work force in 2050, down from 28.7 per cent in 2005.

GuocoLand Earnings Surge To $27.7m In Q1

Source : The Business Times, October 20, 2007

QUEK Leng Chan's Singapore-listed property arm GuocoLand has posted a group net profit of $27.7 million for the first quarter ended Sept 30, 2007, up from $8.1 million for the corresponding year-ago period, as revenue more than doubled from $88.2 million to $191 million.

The improved showing was due mainly to higher contribution from the group's property development projects in China, especially from West End Point condo in Beijing.

GuocoLand's bottom line also received a fillip from other income, which jumped from $9.2 million to $15.8 million, mainly due to higher net foreign exchange gains arising from the revaluation of US dollar bank loans.

However, finance costs rose by 74 per cent to $12.6 million due to an increase in bank loans and the convertible bonds.

Cash and cash equivalents increased from $1.09 billion as at June 30 to $1.53 billion as at Sept 30, largely because of net proceeds of about $555 million received from a renounceable 1-for-3 rights issue at $2.50 per share in July this year.

GuocoLand also gave an update of its various projects. In Singapore, it achieved sales of 86 per cent for Le Crescendo in Paya Lebar and 91 per cent for The View @ Meyer as at Oct 18. The group has also sold 97 per cent of the 337 units launched in The Quartz condo in Buangkok.

In Beijing, the 810-unit West End Point is 96 per cent sold.

Piling for the group's development sites situated in Nanjing's Qixia District (Ascot Park Phase 1) and Shanghai's Putuo District (Changfeng Phase 1) has been completed. Construction has started for Changfeng Phase 1. Resettlement for the development site in Nanjing's Xuanwu District (Hillview Regency) is largely completed.

The group's 65 per cent-owned subsidiary GuocoLand (Malaysia) Berhad has eight ongoing mixed residential development projects in the Klang Valley. Earthwork and piling for an integrated commercial development project in Damansara Heights is in progress.

In Vietnam, the master plan for the group's integrated development project next to Vietnam Singapore Industrial Park near Ho Chi Minh City has been submitted to the authorities.

'Given the robust economies in the countries in which the group operates, namely, Singapore, China, Malaysia and Vietnam, the group believes that demand for quality residential properties and well-located commercial properties in these countries will remain sustainable,' GuocoLand said.

In Singapore, GuocoLand is expected to launch the 210-unit Goodwood Residence in the prime Bukit Timah area in the next few months.

GuocoLand's earnings per share rose to 3.62 cents for Q1 ended September 2007, from 1.32 cents for the year-ago period. Net asset value per share stood at $2.37 as at Sept 30, seven cents higher than in June 30.

On the stock market yesterday, GuocoLand closed unchanged at $5.55.