Tuesday, September 30, 2008

HK Luxury Housing Market Unruffled By Economic Turmoil

Source : The Business Times, September 26, 2008

SO far this year the financial turmoil elsewhere has had surprisingly little effect on the luxury residential housing markets in Hong Kong and Singapore.

Following the demise of Lehman Brothers, the takeover of Merrill Lynch, and the strong possibility of future consolidation in the financial sector, it is difficult to gauge the number of European and American expats who are likely to continue to be posted to Hong Kong and Singapore. However, banks and other major multinational corporations are looking at the higher levels of growth in Asia to support future revenues, given the slowdown in the United States and European Union.

















That should provide some support for demand for high-end property in Hong Kong and Singapore, as leading locations for multi national headquarters for a range of industries.

Wealthy Asian expats are continuing to invest, where they are cash rich and less dependent on debt financing. China's new rich are buying in Hong Kong.

The discussions in the press about a downturn in the housing markets, particularly in Hong Kong, so far this year have not been seen at the luxury high end of the residential market.

Megan Walters, Asia economist for Cushman and Wakefield, commented: 'It is too soon to tell what effect the Wall Street crisis will have on the luxury residential market in Hong Kong, but people always want prime property. It is always in demand reflecting the lower risk and lower yields than that on secondary property, and invariably luxury and prime property occupy the same area of the market.'

Buying luxury residential property in leading cities can be an excellent investment, but the returns are a complicated three-way play between the point in the property cycle, long-term growth prospects and foreign currency exchange movements, as well as the particular characteristics of what may turn out to be a hot new location in a city.

The cost of buying a 120 sq m apartment in Hong Kong is comparable with buying one in London, New York or Tokyo. An apartment in a decent neighbourhood is in the order of US$1.2-1.9 million or about US$ 4,000 to US$6,000 per metre per month to rent.

Luxury property in Hong Kong can reach five times those figures, and with the level of wealth distribution much more unequal than in the US, UK and Japan, there are sufficient numbers of wealthy purchasers to support the prices. The Gini co-efficient is a measure of wealth distribution, where 0 is total equality and 100 is total inequality with very rich and very poor. Hong Kong has a higher Gini co-efficient than Japan, the UK and USA.



















In terms of where is the best long-term bet to buy a property, at the luxury end of the market, it is interesting to look at the GDP per capita figures for Hong Kong compared to those for the USA, UK and Japan.

There are no restrictions on foreigners buying in Hong Kong.

Investment yields in Hong Kong are comparable at around 4 per cent for prime 120 sq m apartment in a good neighbourhood, about the same as New York, London and Tokyo.

Foreign investors can occasionally see buying overseas property as more risky due to a lack of familiarity with local rules. For those looking to buy in Hong Kong, the country's position in the World Bank Ease of Doing Business ranking shows it to rate higher than Japan and the UK demonstrating no great risk to investments. From the property cycle perspective, luxury apartments at this level exhibit similar risk characteristics compared to other international cities and consequently exhibit similar returns.

In Hong Kong, the traditional high end luxury area of the Peak is being superseded by the new Kowloon side location. Fifteen years ago it would have been unthinkable that investment bankers would want to live anywhere other than on Hong Kong Island. Now, West Kowloon is home to fund managers and their spouses, with all the restaurants, shopping and gyms that are a prerequisite for some to lead a luxurious life style. The new Kowloon Station where the ICC is being developed is now home to prime office, retail, residential and hotel properties and prices are at historical highs.

Traditional high-end areas are Mid-Levels, Southside of HK Island and The Peak. The Peak is the traditional area for high net worth purchasers. Severn 8, a luxury town house development, concluded a transaction at HK$56,000 (S$10,220) psf in June, and developer Sun Hung Kai Properties also achieved a record price for an apartment when they sold a penthouse unit in their Arch development above Kowloon Station for HK$41,100 psf. This now holds the record price for an apartment surpassing Mid-Levels.

For those that want houses, developers are also focusing on building villa properties in the New Territories close to the border with Guangdong Province. Wealthy factory owners in the Shenzhen SEZ prefer to live close to the border and high quality properties are between HK$5,000-9,000 per sq ft.

Gary Knowles, head of residential services at Cushman and Wakefield's Hong Kong office, suggested that 'the expat community in Hong Kong has grown on the back of the financial sector. Due to the rapid increase in office rents, many banks have moved their back office to less expensive locations and the relocation of the airport to Chek Lap Kok has led to an increase in popular residential locations away from the more traditional areas of HK Island and Sai Kung'.

Other infrastructure developments are also affecting popular locations, with the Bridge Link to Macau and Zhuhai new rail links between the New Territories and HK Island as well as the redevelopment of the old Kai Tak Airport. The new Airport Express link has seen a plentiful supply of new residential properties built on the West Kowloon reclamation above the Airport Express stations.

Land sale auctions in Hong Kong have been limited and the majority of new residential developments are being generated by Urban Renewal Authority redeveloping older areas of HK and Kowloon.

Upcoming luxury developments are The Cullinan above Kowloon Station (which will be HK's tallest glass wall residential building) and the latest phase of Residence Bel-Air in Pokfulam on the Island.

The writer is managing director, Cushman & Wakefield Singapore

CapitaLand Chiefs Defend Strategy

Source : The Business Times, September 30, 2008

CEO refutes concerns over exposure in China, says group has strengthened risk management

AMIDST a raft of downgrades by analysts and a slump in the company's share price, CapitaLand's top brass have defended the group's strategy.

On the prowl: Mr Kee (left) and Mr Liew. CapitaLand is in a position to replenish land supply at more competitive prices as it does not have a huge China landbank

'We are a company that's much stronger than when we first started in terms of our balance sheet. We've also strengthened our risk management. We have an independent risk management team to countercheck all business initiatives. At the same time, we've built up a company with enough liquidity to not only weather the current position but take advantage of it,' CapitaLand Group president and CEO Liew Mun Leong said in a recent interview with BT.

'I can't think of any project that we have invested in during the last two years that is a lemon. I can think of a lot of projects that we have divested and made money (from). That's because we're very prudent and paranoid about risk analysis,' he says.

The property giant set up the strategic corporate development team in May to study acquisition opportunities - especially in China and Japan - to grow the company.

Said CapitaLand's chief investment officer Kee Teck Koon: 'To be able to leapfrog your competitors, usually it has to happen during a crisis.'

The current financial market turmoil emanating from the US has its origins in lax macro-economic policies that led to low interest rates, excessive liquidity and high leveraging.

'Our company, if you check our history, we have not done that,' Mr Liew stresses. The group had $3.4 billion of cash as at June 30, 2008 and this was not counting recently recycled capital of $2.9 billion from the divestment of properties like 1 George Street and Somerset Orchard in Singapore, the Raffles City projects in China, Capital Tower Beijing and Citibank Menara in KL. On a proforma basis, assuming these divestments were completed on June 30, 2008, and all things being equal, the group's net debt-to-equity ratio would have been 0.43.

Besides the $3.4 billion cash, the group's private equity funds had undrawn equity commitments of $2.2 billion and an average gross debts to assets ratio of 0.24 (inclusive of equity bridges) as at end-June 2008.

Mr Liew also refuted market concerns about the group's exposure in China. 'Unlike many other Chinese residential developers, we do not have a huge landbank. This leaves us in a position to replenish land supply at more competitive prices.' The group has a 1.5 million sq metre gross floor area residential pipeline in the Beijing, Shanghai and Guangzhou regions.

Some analyst reports recently highlighted that major Chinese residential developers have been chopping prices, which will put pressure on CapitaLand to do the same. Mr Liew says land for the projects it is marketing now was bought a few years ago, when land prices were lower. As residential land values in China go down, CapitaLand, with its strong balance sheet, will be on the prowl to restock its landbank.

Strong fundamentals

Asian real estate markets have started to tank but Mr Liew maintains that 'Asian economies and real estate will outperform western economies', citing strong demand fundamentals. 'In the Asian context, the buying power and source of funds through capital markets or other sources is still not as seriously affected as in USA, where the thing has completely frozen. The Arabs also have money.'

Mr Kee said German core funds and North European funds have also raised their allocation for Asian real estate over the years.

CapitaLand's head honchos also dis- agree with the view that the group has increased its risk profile in the past few years by undertaking more development projects, moving away from the earlier stated asset-light strategy underpinned by stable recurring income from investment properties and fund management.

Sharing risks

Despite undertaking more development projects lately, Mr Liew said the group has reduced its exposure by sharing the risks with joint-venture partners or by undertaking the developments through its private equity funds.

The group has also been collecting a steady stream of recurring income from its funds. Its five Reits, with about $16 billion of assets under management as at June 30, 2008, last year generated $124 million distributions to CapitaLand. In addition CapitaLand Financial produced $70 million earnings before interest and tax last year from managing various funds in the group. CapitaLand's stake in Australand also produced recurring earnings of A$58 million (S$67.5 million) from investment properties in 2007.

Some say CapitaLand has earned handsomely from divesting assets in the past few years but with the choicest ones sold, it may be a tough act to repeat.

Mr Liew acknowledged that the investment sales market will slow down for now and possibly next year, but says the group has in the meantime built up a portfolio of investment and development properties in various private equity funds - including the Raffles City mixed development projects in China and a string of malls across China - and through joint ventures, as in the case of Ion Orchard. 'These were acquired at prices which would still enable us to monetise, at the right time, for good returns to our shareholders,' he added.

Mr Liew also notes that over the past two years, the group has divested more than $9 billion of assets, double the $4 billion it has invested over the same period. 'I want to conserve liquidity. My principle is: If you want to buy $1 of assets, you must give me $2 (of divestments).'

Singapore assets divested in the past 24 months include Hitachi Tower, Chevron House and Temasek Tower. 'On hindsight, we think the divestment of many of our stable assets was nearly perfectly timed. The main point is that we have recycled (capital). We have sold at high prices and bought at low prices. Because of that, every time we do a divestment, we have a gain. It's no point telling shareholders we have divested at a loss. Then you're in trouble. We are always selling at a gain. All of them. I'm quite proud of it.'

Looking back, Mr Liew says CapitaLand has emerged stronger from weathering two crises - the Asian Financial Crisis in 1997 and the prolonged economic slowdown from 2001 to 2003 that took place after the group's formation in 2000 from a merger between Pidemco Land and DBS Land. 'We've emerged as a stronger company, further extended our leadership in the real estate sector and adopted lessons to address this current global financial crisis.'

With its disciplined capital management culture and stronger risk management checks put in place recently, 'we're aggressive in our growth as before and not emotional in divesting our mature properties when return targets are reached, generating liquidity for the next business cycle'. 'This disciplined aggression is the hallmark of our management team,' says Mr Liew.

UK August Mortgage Approvals Fall To Lowest Since 1999

Source : The Business Times, September 30, 2008

(LONDON) UK mortgage approvals slid in August to the lowest since at least 1999 as the global credit squeeze prompted banks and building societies to curtail credit.

Huge slump: House prices in the UK fell an annual 6.2 per cent in September, says Hometrack, a London-based property research group that has been following property prices since 2001

Lenders approved 32,000 loans for house purchases, down from 33,000 in July, the lowest since comparable data began nine years ago, the Bank of England said.

The value of those loans fell to £143 million (S$370 million), the lowest since April 1993.

The worst house-price slump in at least a quarter century and a tightening global credit squeeze threaten to push the economy into its first recession since 1991. Central bank policy maker Kate Barker said last week that market turmoil may constrain bank lending 'for a considerable period'.

'The reading is very low, and consistent with a further decline in house prices,' said Alan Clarke, economist at BNP Paribas SA.

'With credit conditions likely to tighten further, the supply of credit will deteriorate.' Economists had forecast that UK lenders would approve 30,000 new home loans last month, according to the median of 27 estimates in a Bloomberg News survey.

During the past month, the Bank of England joined a coordinated effort by world central banks to increase the availability of dollars and ease money-market strains, with new auctions of overnight and one-week funds totalling US$40 billion.

UK authorities earlier yesterday seized the lending book of Bradford & Bingley p+lc, the nation's biggest lender to landlords, and forced the company to sell its savings accounts to Banco Santander SA, Spain's biggest lender, after it had trouble financing its daily operations.

For lenders facing global financial-market turmoil, 'the adjustment is proving highly painful and it is clear that lending by UK banks will be very constrained, relative to the past few years, for a considerable period', Ms Barker said on Sept 25.

UK house prices fell an annual 6.2 per cent in September, Hometrack, a London-based property research group that has been following property prices since 2001, said yesterday. Prices fell by the most in a quarter century in August from a year earlier, HBOS Plc, whose survey began in 1983, said on Sept 4.

Households, which have a record £1.4 trillion of debt, added to their unsecured borrowings, yesterday's report showed. Net consumer credit, which includes credit cards, personal loans and overdrafts, rose by £1.2 billion.

Bank of England policy makers voted to keep the key interest rate at 5 per cent this month as inflation quickened to 4.7 per cent, more than double the target. The economy's growth rate stalled in the second quarter.

The bank will make its next interest-rate decision on Oct 9. -- Bloomberg

S'pore In For 'Biggest Office Space Excess In 20 Years'

Source : The Straits Times, Sep 30, 2008

DEMAND for Singapore offices is likely to fall to recession-level lows next year and in 2010, resulting in the biggest excess supply of office space in 20 years, said Credit Suisse yesterday.

It expects office vacancy rates to hit a high of 16.5 per cent in 2010 - up from an islandwide vacancy of about 2 per cent currently - as firms' expansion plans are hit by the global financial turbulence.

Office rentals are also predicted to peak earlier than expected this year, and fall 50 per cent by 2011, said research analyst Shirley Wong, who has downgraded the Singapore office trusts sector to underweight.

After her report was released, office trusts CapitaCommercial Trust (CCT) and Suntec Reit saw large drops in their unit prices that put them among the worst-performing property stocks yesterday. Property counters fell across the board as the wider stock market faltered.

CCT fell 17 cents to its lowest level in almost four years, while Wing Tai and Keppel Land each dropped more than 6 per cent to three-year lows.

'Focus of the office sector has always been on supply, but actual demand is hurting, and repercussions from the US economic shocks could strain it further,' Ms Wong said in the report. Tenants are resisting rent rises, while capital values have been flat for three quarters and vacancies have risen for two quarters.

But not all analysts are as bearish.

The supply of offices in the pipeline could be affected by construction delays, while property market sentiment and prices may start picking up at the end of next year when the integrated resorts take shape, said Kim Eng analyst Wilson Liew.

'I do not foresee drastic cuts in the headcounts of financial institutions in the Asia-Pacific and, in fact, the private banking sector may provide some support.'

But Mr Liew conceded that the looming imbalance caused by more supply and less demand will ultimately lead to lower office rentals. He expects a moderate decline in rents of 10 to 15 per cent between now and the end of next year.

More broadly, property developers may soon be forced to write down their assets as real estate prices fall around the world, said another Credit Suisse research analyst in a separate report.

Developers were holding out for a recovery in sentiment, but 'a confidence crisis from the recent near-collapse of global financial markets could hasten and steepen price falls', said Ms Tricia Song.

Catalysts include the large upcoming supply of homes, a slower expatriate influx, potential job losses, and delays to the completion of the integrated resorts.

Ms Song noted that major write-downs in previous property downturns triggered developers' stocks to plunge as much as 79 per cent in 1998 and up to 50 per cent in 2001.

'CapitaLand and Keppel Land wrote down the most and could do so again due to aggressive acquisitions and revaluation gains in recent years,' she added.

The only major property counters spared yesterday's carnage were GuocoLand, up one cent at $1.85; CapitaMall Trust, up six cents at $2.31; and Bukit Sembawang, up 10 cents at $6.30.

Thomson Collective Sale Back On Track After SLA Appeal

Source : The Straits Times, Sep 30, 2008

THE collective sale of five small estates in Thomson Road is back on track after getting stalled two months ago.

An appeal by buyers Mergui Development has been granted by the Singapore Land Authority (SLA), to reduce the price of a 1,000 sq m section of a road needed for redeveloping the project.

Developer KSH Holdings, the parent company of a firm in the Mergui Development consortium, told the Singapore Exchange yesterday that the SLA had cut the land premium payable from $16.74 million to $8.37 million.

KSH project manager Richard Tham said the SLA's revised offer was more in line with the price 'initially expected'. The buyers were caught off guard by the initial $16.74 million land premium, which is believed to have delayed the completion of the $120 million sale.

Owners at the five estates - Norfolk Court, Mergui Lodge, Northern Mansion, Mergui Court and The Mergui - were said to be considering walking away with the 10 per cent deposit of $12 million because buyers had failed to complete the sale, despite a two-month deadline extension.

Both sides have since agreed on a deadline extension until November, but this involved paying a further $3 million deposit to the 88 sellers.

The SLA said it had originally priced the land 'similar to that offered by the developer to the existing land owners along Mergui Road'. However, on review, it noted the land had some development constraints and considered the revised price 'in order to facilitate the development proposal'.

Mergui Development is a joint venture between Bursa-listed IOI Properties unit Multi Wealth Singapore, a local private firm LBH, and KSH unit Kim Seng Heng Realty, which holds 35 per cent.

The strip of land is needed so the five estates near Rangoon and Moulmein roads can be combined and developed into one project. This will give a land area of 74,355 sq ft and a gross floor area of 208,196 sq ft. It will allow a high-rise block with about 140 luxury flats each measuring 1,250 sq ft on average.

Even Pricey Flats In Great Demand

Source : The Straits Times, Sep 30, 2008

HDB BALLOTING EXERCISE

Pinnacle draws 3 times more applications than the number of flats

THEY are among the priciest flats ever launched by the Housing Board, but there has been no shortage of potential buyers.

The 50-storey Pinnacle@Duxton in Tanjong Pagar has attracted 1,467 applications for the 428 four- and five-roomers on offer - that is about 3.5 hopefuls for each unit.

Cheaper homes in less central areas were in even more demand, with applications streaming in at a rate of 20 per new flat in some districts.

HDB's balloting exercise on Friday attracted a total of 4,463 applications for 992 flats on sale in Ang Mo Kio, Queenstown, Jurong West, Kallang/ Whampoa and Tanjong Pagar as of 5pm yesterday.

The 111 five-roomers at the Pinnacle start at $545,000 and hit $645,800 for a 49th storey unit - the most expensive new HDB flats - yet there were still 372 applicants.

Demand for those flats paled in comparison with the 762 applications for just 39 four-room flats in Kallang/Whampoa, priced at between $364,000 and $435,000.

Property analysts said the response was not surprising, considering the underlying demand for new flats from first-time buyers and the preference for cheaper units.

Still, the fact that the Pinnacle racked up more than three times more applications than flats available proves there is strong demand, said PropNex chief executive Mohamed Ismail.

'Buyers have to expect to pay a premium for the prime location of city flats,' said Mr Ismail.

The HDB said the prices of Pinnacle flats were still lower than those of resale flats in the area. HDB figures show five-room flats in Tiong Bahru's Jalan Membina recently selling for $670,000 above the 20th floor. The average price of a five-room flat sold in Jalan Membina and Cantonment Close over the last three months was $624,000.

The response to the ballot also highlighted another emerging hot spot - Jurong, an area once spurned by buyers for being too far from the city.

Five-room flats here were about 11 times oversubscribed - 335 applications for the 30 flats.

ERA Asia-Pacific's assistant vice-president Eugene Lim said new flats here are now more attractive after a masterplan to rejuvenate the area was announced recently.

'It's also currently one of the cheapest housing spots in Singapore. It's not surprising it's moving now,' said Mr Lim.

He also feels those priced at $650,000 are at the top end of what buyers can afford.

'With two incomes, it's still manageable,' he said. In many cases, these flats are cheaper than buying from the resale market, where buyers usually need to pay a cash component upfront to sellers. This is not required for new flats, he added.

Still, HDB 'should be conscious that such pricing of flats are affordable only to a small cross-section of HDB home buyers,' said Mr Ismail.

But the true popularity of the flats has yet to be seen as the number of applications might not reflect the actual take-up rate. Applications for the new flats close on Oct 9.

Concorde Hotel Checking In Again

Source : The Straits Times, Sep 30, 2008

THE hotel arm of Singapore-listed HPL Properties has taken over an Orchard Road hotel and will make it part of its Concorde chain.

HPL Hotels and Resorts Group will take over the management of Le Meridien Singapore from tomorrow and turn it into Concorde Hotel Singapore.

The multimillion-dollar rebranding and 'major refurbishment' works will make the Concorde a four-star business hotel.

Updated suites and rooms will boast 'more spacious lodgings, larger desk space and upgraded amenities', complete with a sleeker and more chic design, said HPL.

HPL added that the revamp, which will be completed in early 2010, will cause only 'minimal inconvenience' to guests.

The hotel, which is on the main shopping belt and a stone's throw away from the Istana, will be the fourth Concorde managed by the group. The other three are in Malaysia.

The 417-room Le Meridien was managed by Starwood Hotel and Resorts Worldwide, whose management contract ends today.

HPL said in a statement that it will be 'taking this opportunity to re-establish the Concorde brand in Singapore', with 'plans of possibly bringing the brand name to countries such as Thailand, Indonesia and India'.

The first Concorde Hotel here was in Havelock Road and owned by HPL managing director Ong Beng Seng through his privately held company Avant Hotels.

But in January 2005, it was renamed the Holiday Inn Atrium and managed by InterContinental Hotels Group Asia Pacific.

HPL also said it has appointed Mr Andrew Khoo as general manager of the new Concorde.

HPL Unit To Manage Le Meridien

Source : The Business Times, September 30, 2008

HOTEL Properties Ltd (HPL), through wholly owned HPL Hotels & Resorts, is taking over management of the Le Meridien Singapore hotel tomorrow and rebranding it Concorde Hotel Singapore, in line with plans to establish the brand in more markets.

This is HPL Hotels & Resorts' fourth Concorde hotel but its first in Singapore, as the other three are in Malaysia. The company is looking to expand the brand in other markets such as Thailand, Indonesia and India.

Le Meridien's management contract with Starwood Hotel & Resorts Worldwide ends today and the four-star business hotel will carry the Concorde name from tomorrow.

When contacted, a spokesman for HPL Hotels & Resorts declined to comment on the value of the deal, saying only that it was a 'substantial amount'.

The 417-room hotel will undergo renovations in several phases, to minimise disturbance to its guests, starting from November.

The refurbishment works are slated for completion in the first quarter of 2010.

Andrew Khoo, newly appointed general manager, said: 'These will be exciting and challenging times for the Concorde brand and the HPL group as a whole as we move forward with our plans to expand the brand in Singapore and the region. Guests familiar with the Concorde brand have always associated it with quality and good service.'

HPL Hotels & Resorts is headquartered in Singapore.

Grade A Office Rents In CBD Slide For First Time In Years

Source : The Business Times, September 29, 2008

Average monthly rent at Raffles Place slips 1.4% to $17.64 psf in Q3

Grade A office rents in Singapore's Central Business District (CBD) have declined for the first time since the office market troughed in 2004.

The average gross monthly Grade A rental value for the Raffles Place area slipped 1.4 per cent to $17.64 per square foot (psf) in the third quarter, from $17.89 psf in the preceding quarter, according to the latest data from Knight Frank.



























The Suntec/Marina Centre/City Hall area led the declines in Grade A office rentals in Q3, with a 6.2 per cent quarter-on-quarter fall to $15.13 psf. In the Shenton Way/ Robinson Rd/Tanjong Pagar area, the drop was 2.8 per cent, followed by a 2.7 per cent decline along Orchard Road.

Knight Frank director (research and consultancy) Nicholas Mak said that he expects office rentals to continue declining by 14-19 per cent islandwide in the next 12 months (from current levels) as the global financial turmoil and possible mergers and acquisitions contribute to consolidation and reduction in office demand.

Giving her take on weakening office demand, DTZ executive director Ong Choon Fah said: 'Most companies are in cost containment mode and would be looking for ways to manage the increase in their accommodation costs. There has also been quite a lot of leakage of CBD office demand to business parks and vacant state properties converted to offices.'

Mrs Ong reckoned that headline office rents may not come down much but noted that leasing incentives like rent-free periods have started to reappear. Agreeing, an analyst said: 'Major landlords will try to maintain headline rents, because once rents come down, it affects their whole portfolio.'

Besides weaker demand for office space amid the financial turmoil, Knight Frank's Mr Mak attributed the softening rentals in Q3 to the government's efforts to increase office supply (including transitional office sites). 'In addition, landlords are more cognisant of the substantial supply of office space that will be completed from 2010 and have become more realistic and flexible in their rental expectation when it comes to lease negotiations; they want to hold on to their tenants and maintain their buildings' occupancy rates,' Mr Mak said.

The fall in the average Grade A Raffles Place rental value in Q3 marks the first quarterly decline since Q2 2004. This incipient weakening follows a rapid escalation in office rentals over the past two years on the back of tightening supply and strong demand from occupiers, including global financial institutions expanding their operations in Singapore. Average Grade A Raffles Place rents surged 82 per cent last year and that was on top of the 67 per cent gain posted in 2006, according to Knight Frank.

But it's a different story now. 'Since Q1 2008, there appears to be a crack in the growth momentum for office demand in the Downtown Core area due to external factors such as the US sub-prime crisis that began in the second half of last year,' said Mr Mak.

The slowdown in demand in the Downtown Core area - which includes the key office districts like Raffles Place/Marina Bay, Shenton Way and Marina Centre - and tapering off in rentals in Q3 does not come as a surprise, he adds. 'The tenants in this area are primarily financial institutions, many of which had already completed their expansion or consolidation plans over the last 24 months and some are adopting a more cautious approach by putting any further expansion plans on hold,' Mr Mak observed.

Knight Frank's data showed that Grade B offices in Singapore also experienced downward pressure on rentals in Q3. The biggest fall was in the Orchard Road location, where the average rent decreased 7.8 per cent quarter-on-quarter to $10.70 psf a month in Q3. Raffles Place and Shenton Way/ Robinson Rd/Tanjong Pagar Grade B offices were less impacted by easing office rentals and dipped by 1.8 per cent and 2 per cent quarter-on-quarter respectively.

As a whole, offices in non-CBD locations also mirrored the general slowdown in rental in Q3. Rentals continued to weaken for the Beach Road/Middle Road area, with a 3.4 per cent quarter-on-quarter drop. Suburban areas too met a similar fate with quarter-on-quarter rental decreases ranging from 1-8 per cent.

Looking ahead, Knight Frank said that in the short term, the beleaguered financial markets are expected to lead to many firms either postponing their expansion plans or consolidating their space usage. Restructuring at some organisations could lead to sub-letting of excess space to ease cashflow problems.

Sunday, September 28, 2008

Cheap Properties Galore In Geylang

Source : The Sunday Times, Sep 28, 2008

This is the third in a four-part series on the property scene in or around 'colourful' spots of Singapore

These days, even with the property market in the doldrums, it is almost impossible to buy a condominium for less than $500 per sq ft (psf).

Almost impossible, that is, except in Geylang.






















To the ordinary homebuyer, it is not hard to see why. Even on a weekday afternoon, the red-light district is peppered with young girls wearing skin-tight skirts and the men who crowd around them.

Temples on one side of the road face dimly lit terrace houses with blatantly displayed 'open' signs on the other. Famous food outlets are tucked between rows of cheap, rundown hotels.

But get past the sleaze and you will find some of Singapore's best condo buys lining the streets off Geylang Road. Many are freehold and a handful, such as Atrium Residences, are even brand new.

Properties come at a song partly because of the area's still-squalid reputation, and partly because some banks do not offer loans to buy homes in Geylang, agents say.

But savvy buyers with cash in hand, or who are willing to pay the higher interest rates offered by some financing firms, can often pick up a good deal, they add. Firms that offer loans for Geylang properties include Hong Leong Finance and Singapura Finance.

'Many buyers are open-minded enough to know that there is a lot of investment potential in the area. Geylang is near the city, but even cheaper than the heartland,' said Ms Natalie Maia Indra, an agent with DTZ Debenham Tie Leung, who has been selling homes in the area for almost a year.

The low prices mean that rental yields, calculated by dividing a property's total rents for a year over its purchase price, can 'easily hit 7 per cent', especially for the newer properties. This compares with an average of 2 per cent to 4 per cent for most homes in Singapore.

Geylang is also drawing more interest from homebuyers these days because of its growing reputation as a bona fide food paradise. This has not only helped Singaporeans get a taste of the more savoury parts of the red-light district, but also spawned foodie crowds that make the area feel less dangerous.

Of course, even within Geylang, not all properties are equal. The traditional wisdom is that odd-numbered lorongs are 'safe', while even-numbered ones are shunned.

A better guide, however, is that the area above Lorong 25 is generally quieter. Below that, a large cluster of cheap hotels and coffee shops gives rise to ribald revelry that often continues into the wee hours of the morning.

The more popular homes are those further removed from Geylang Road: nearer Aljunied MRT Station to the north, and around Guillemard Road to the south. These areas are favoured by big-name developers such as CapitaLand and Far East Organization, which jointly developed Central Grove near Aljunied MRT Station.

Between desirable streets and less preferred ones, prices can differ markedly.

Along Lorong 20, the newly completed Sunflower Regency is fetching around $550 psf. Down the road, Cosmo in Guillemard Crescent, lying just outside Geylang proper, was sold out at an average price of about $1,100 psf when it was launched in April.

A few streets west of that, Wing Fong Court and Wing Fong Mansions are hovering at about $400 psf. They are located at the heart of seedy Geylang, where the streets are dirty, the buildings old, and the noise of raucous foodies extends late into the night.

Still, potential buyers such as entrepreneur Sebastian Lim, 27, are not deterred by such details.

'Geylang properties are really cheap and I think they will appreciate in time because the area is not too far from town,' he said.

Pinnacle Flats On Offer

Source : TODAY, Weekend, September 27, 2008

HDB BALLOTING

FOR those waiting to snap up a public flat in the iconic 50-storey integrated housing development, the good news: Some 428 four- and five-room units at The Pinnacle@Duxton are among 992 available under the Housing and Development Board’s (HDB) latest balloting exercise launched on Friday.















The much-hyped flats in the Cantonment Road area are among some of the most expensive new units — with a four-room S1-type priced between $457,000 and $555,000, while the bigger S2 units cost between $545,000 and $646,000.

Even so, the board pointed out, these new flats which come with the HDB discount are priced lower than what resale units in the area have recently sold for. Resale HDB prices have been climbing, showing a4.4-per-cent growth in the second quarter.

The Pinnacle@Duxton is based on an award-winning design, and boasts special features such as skybridges and sky gardens at the 26th and 50th storeys. Apartments will be provided with a varied combination of balconies, bay windows and planter boxes, to suit the preferences of flat buyers.

The balloting exercise also includes surplus units from Selective En bloc Redevelopment Schemes in Ang Mo Kio, Kallang/Whampoa, Queenstown and Jurong West.

There are 128 studio units, priced between $80,000 and $115,000, for sale in Ang Mo Kio, while Jurong West has 285 three-, four- and five-room flats, starting at $142,000. Kallang/Whampoa has 39 four-room and64 five-room units, while there are 48 five-room flats in Queenstown.

@ hdb.gov.sg - Submit applications online by Oct 9

Saturday, September 27, 2008

$645K HDB's Priciest Flats Go On Sale

Source : The Straits Times, Sep 27, 2008

Pinnacle@Duxton units are among 992 released for sale yesterday

FOR sale: the most expensive flats ever released by the HDB.

They are the remaining 111 five-room units at the iconic 50-storey Pinnacle@Duxton in Tanjong Pagar, which is due to be completed this year.

The seven blocks of Pinnacle@Duxton dominates the Tanjong Pagar skylin. Forty-four units cost more than $600, 000. -- ST PHOTO: STEPHANIE YEOW

Prices start at $545,000 and go up to an eye-popping $645,800 for a 49th storey unit, making them Singapore's costliest new flats by a long shot. Forty-four cost more than $600,000.

The current record for a new HDB flat is held by a five-room unit at Toa Payoh, which was released for sale in February at $531,500. This excludes the premium flats built by private developers under the Design, Build and Sell Scheme (DBSS).

Pinnacle@Duxton also has 317 four-room units still unsold, which were made available at prices ranging from $457,000 to $555,000. These units are left over from when the development was launched in 2004. The flats were then priced between $289,200 and $439,400 and met with overwhelming response.

But not all the units were eventually sold, and some were returned to HDB after the buyers withdrew from their planned purchases.

The remaining flats were among 992 new flats released for sale yesterday under HDB's latest balloting exercise, which also included surplus units from the Selective En bloc Redevelopment Scheme (Sers) in Ang Mo Kio, Jurong West, Kallang/ Whampoa and Queenstown.

While the prices for the Pinnacle@Duxton flats seem steep, the HDB said they were still lower than the prices of resale flats in the area.

'Despite their pricing, units at the Pinnacle@Duxton are especially attractive as they are priced below the market prices of similar flats in the resale market,' a spokesman said.

'Their high prices are supported by recent open market resale prices of comparable flat types in the vicinity, for example at Cantonment Close, Tanjong Pagar and Jalan Membina. Overall resale prices in these areas have gone up in recent years.'

HDB provided figures showing that prices for five-room flats in Jalan Membina recently hit $670,000 for a unit above the 20th floor. The average price of a five-room flat sold in Jalan Membina and Cantonment Close over the last three months was $624,000.

Still, whether buyers will respond well to these prices remains to be seen.

Housewife Lily Lee, who is in her 30s, said the prices for the Pinnacle@Duxton units were 'very high'.

'I wouldn't pay $600,000 for a five-room flat, I don't think any HDB flat is worth that value,' she said.

But Mr Zhao Bing Yao, 29, thought the price seemed 'reasonable in this market'.

'My friend just spent about $400,000 for a four-room flat in Clementi that is 30 years old, so I think it's okay to pay up to $600,000 for a brand-new five-room flat near town,' said the director of an IT company.

Mr Mohamed Ismail, the chief executive of property agency PropNex, said that HDB 'has no alternative but to price at market norms'.

'If they price too low, it will have an impact on resale prices in the area,' he said, adding that private homes in Tanjong Pagar cost mostly above $1,000 psf.

Still, he noted that the target group of buyers for the Pinnacle@Duxton flats will be 'very small', given the $8,000 monthly household income ceiling. Buyers of the five-room flats would be paying almost $3,000 in monthly mortgage instalments, he said.

For 'young couples and those who are not ready to pay the higher prices for flats in Pinnacle@Duxton', HDB suggested applying for the other types of flats released in yesterday's balloting exercise.

These include 285 flats in Jurong West along Corporation Drive, with three- room flats starting at $142,000, four- room flats starting at $213,000, and five- room flats starting at $270,000.

There are also four- and five-room flats in the Kallang/Whampoa area next to Kallang MRT, and 128 studio apartments in Ang Mo Kio that elderly buyers can opt for.

As at 5pm yesterday, 1,271 applications had been received for the 992 flats.


On the market

# Pinnacle@Duxton, Tanjong Pagar Units: 428 (317 four-room, 111 five-room)

Prices: $457,000 to $645,800

# Ang Mo Kio Units: 128 studio apartments

Prices: $80,000 to $115,000

# Kallang/Whampoa Units: 103 (39 four-room, 64 five-room)

Prices: $364,000 to $554,000

# Queenstown Units: 48 five-room flats

Prices: $481,000 to $539,000

# Jurong West Units: 285 (91 three-room, 164 four-room, 30 five-room)

Prices: $142,000 to $306,000


NOT WORTH PAYING FOR

'I wouldn't pay $600,000 for a five-room flat, I don't think any HDB flat is worth that value.'

Housewife Lily Lee, who is in her 30s and looking for a new flat

PRICES REASONABLE

'My friend just spent about $400,000 for a four-room flat in Clementi that is 30 years old, so I think it's okay to pay up to $600,000 for a brand-new five-room flat near town.'

Mr Zhao Bing Yao, 29, director of an IT company

S'pore Property Still An Investment Choice

Source : My Paper, Wed, Sep 24, 2008

DESPITE an uncertain economic outlook, Singapore property is still being viewed as an attractive investment option, according to a survey by the iProperty.com Group, a network of property portals.

Some of the factors contributing to this sentiment include the potential profit from capital appreciation and the potential rental income.

The survey studied the buying habits and trends of 949 people - both Singaporeans and foreigners - who visited iProperty's Singapore website last month.

With Singapore property prices stabilising in recent months, respondents said they are open to buying a property in the next 12 months - almost 85 per cent said they intend to or may purchase one.

They are most interested in completed condominiums (25 per cent), followed by uncompleted condos (18 per cent), completed landed properties (16 per cent) and resale Housing Board flats (12 per cent).

Among those polled, 42 per cent expect prices to rise, with almost the same number (41 per cent) expecting them to fall.

Given the slowing down of the economy, a majority of respondents (48 per cent) are looking at properties from US$110,000 (S$155,700) to US$500,000. Only 4 per cent are looking for a property in the price range of US$1.1 million to US$3 million.

'Even though people are keen on investing in property, we can see that the bearish economic outlook has resulted in investors looking at more conservative property choices,' said iProperty.com Group executive chairman Patrick Grove.

However, some things about buying a property, such as the emphasis on location, remain unchanged. Whether the property is for personal use or for investment, location is the most important factor, said 51 per cent of the respondents.

The other factors are price (36 per cent) and potential capital appreciation (20 per cent).

992 HDB Flats Go On Sale

Source : AsiaOne, Fri, Sep 26, 2008

HDB is launching the sale of 992 flats under the Balloting Exercise today.

They include surplus flats available from the Selective En bloc Redevelopment Scheme (SERS) in Ang Mo Kio, Kallang/Whampoa, Queenstown and Jurong West and balance flats in The Pinnacle@Duxton (TP@D).

The flat supply comprises 128 Studio Apartments in Ang Mo Kio, 91 units of 3-room flats, 203 units of 4-room flats and 142 units of 5-room flats in Kallang/Whampoa, Queenstown and Jurong West.

428 units from Singapore's first iconic 50-storey public housing project, TP@D, will also be offered under this exercise. TP@D boasts an internationally award-winning design, with sky bridges linking its seven tower blocks and sky gardens at the 26th and 50th storeys and plug-ins like planters, balconies, bay windows and extended bays. The flat prices range from $457,000 to $555,000 for S1 flats and $545,000 to $646,000 for S2 flats.

"This is in line with the project's prevailing market value, reflecting its prime location in the city, its accessibility, and design attributes," according to a press statement from the HDB.

For those with a smaller budget, HDB suggests looking for more affordable options at other locations, such as Jurong West, where prices of 3-room and 4-room flats range from $142,000 to $160,000 and $213,000 to $253,000 respectively.

Buyers who do not find a flat of their choice in this balloting exercise can consider applying for a new flat under the Build-to-Order (BTO) exercises in future. The BTO is the mainstay of HDB's new flat supply.

Alternatively, they can also consider buying a resale flat where there is a range of choices in terms of budget and location.

Eligible first time flat buyers can enjoy CPF Housing Grant of up to $40,000 to buy a resale flat.

Applications for the new flats can be submitted online from Sep 26 to Oct 9.

For enquiries, the public can:

# Email hdbsales@hdb.gov.sg;
# Call the Sales/Resale Customer Service Line at 1800-866 3066 on weekdays from 8 am to 5 pm; or
# Visit the HDB Sales Office to speak with our Customer Service Officers during office hours (Mon to Fri: 8 am to 5 pm, Saturday: 8 am to 1 pm).

Property Prices, Rents Set To Fall In Asian Cities

Source : The Straits Times, Sep 26, 2008

HONG KONG: Property prices and rents in Asia's financial centres of Hong Kong, Singapore and Tokyo are set to fall as banks scale back hiring and investments in the global financial turmoil.

But while banks lay off tens of thousands in the United States, in Asia they are more likely to step back from ambitious expansion plans, so property markets will slip rather than slide.

In Hong Kong, property agents were scrapping to clinch a deal to put new tenants into three floors at the IFC2 building occupied by Lehman Brothers, which could have won them as much as US$2million (S$2.8 million) in commission.

But with Nomura Holdings snapping up Lehman's Asia operations, the Japanese bank will probably keep most of the space as its own Hong Kong office is in the same building.

However, a reshuffling of tenants in the city is still likely.

Although the Central district, dominated by landlord Hongkong Land, is chock-a-block, rents will probably fall by 25 per cent by the end of next year as cheaper new offices across the harbour hit the market, says Macquarie Securities.

'There's a lot of supply coming on to the market,' said Mr Richard Pyvis, chairman of CLSA Capital Partners, which runs private equity property funds. 'Just look at that big joint out there,' he added, pointing across Hong Kong's harbour to the 118-storey International Commerce Centre (ICC) built by Sun Hung Kai Properties.

With prime Hong Kong office rents almost quadrupling since Sars ravaged the economy in 2003, the likes of Morgan Stanley, Credit Suisse and Deutsche Bank have agreed to move to the ICC building.

But now they could choose not to take up options for more space, or even off-load some.

'Lots of banks are committed to long leases but some tenants could look to sub-lease space like they did after the dot.com bubble burst,' said a property agent who works with several global banks but asked not to be identified because of commercial sensitivity.

'That will put pressure on rents.'

The situation is similar in Singapore.

A whole new office project called the Marina Bay Financial Centre (MBFC) is under construction, spurred by the creation of 50,000 jobs since 2004 as hedge funds and banks lapped up incentives to expand in the city-state.

A loss of a fifth of those new jobs would cause monthly office rents to fall 47 per cent and capital values to drop 34 per cent by 2012, according to UBS analyst Regina Lim. It would hit landlords such as City Developments and CapitaCommercial Trust.

Mr Wilson Kwong, general manager of the management firm for MBFC, said two-thirds of the 150,000 sq m of office space in the project's first phase had been pre-leased, but conceded that some tenants might choose to sub-let space if they could not fill it.

The US$2 billion development, built by a venture between Cheung Kong Holdings, Hongkong Land and Keppel Land, will eventually provide over 300,000 sq m of office space.

'Given the current uncertainty in the global economy, we expect some caution from larger corporations with their leasing commitments,' Mr Kwong said.

'But many international companies still see Asia as an engine of growth and are confident of Singapore's role as a key hub in the regional and global financial systems.'

In Tokyo, more gloom will fall on the property market because Morgan Stanley and Goldman Sachs will probably scale back their Japanese property investments, said Credit Suisse analyst Yoji Otani.

As they switch to commercial banks regulated by the US Federal Reserve, the two investment banks are expected to sell high-risk assets such as properties and unlock equity in real estate funds to meet capital adequacy requirements.

Mr Otani predicted falling values will be accompanied by a 5 per cent fall in average Tokyo office rents next year and a 10 per cent drop for grade-B buildings.

Spoilt For Choice

Source : The Business Times, September 26, 2008

Home buyers have a wide range of projects to choose from that will match their lifestyles

PROPERTY investment requires substantial capital outlay and it takes a longer time to dispose of it compared to other assets like shares, especially in a soft market. Important factors to consider before making a purchase therefore include:

# Purpose of purchase, ie whether for owner-occupation or investment;

# Your budget and the price of the property;

# Surrounding environment;

# Proximity to amenities such as MRT stations, schools, and shopping centres;

# Rental and resale values (especially if you are buying for investment);

# and Reputation of the developer.























Many of these factors are related to location, which is often cited as the most important criterion in property purchase. Besides the traditional prime districts 9, 10 and 11, there are other areas worth considering.

The east coast has always been a favourite among Singaporeans, being close to the city and beach, easily accessible to the airport, and with many amenities like shopping, food and beverage, and the Marina Bay golf course. Faced with high rents in the prime districts, the East Coast has also become a popular alternative with many expatriates.

Joo Chiat and Katong are rich in the culture of Eurasian and Peranakan communities, and their food and architecture. Residents in the East Coast will also enjoy proximity to the Sports Hub when it is completed in a few years' time. Besides Parkway Parade and Kallang Leisure Park, the Sports Hub will offer 441,000 sq ft of commercial space and the redevelopment of Katong Mall is expected to have about 185 retail units.

There are ample choices of developments to suit different budgets. Developments with sea views such as The Belvedere, Water Place and Sanctuary Green enjoy strong leasing interest with monthly median rentals ranging from $3.80 to $4.50 per sq ft.

The last three years have seen other areas getting popular as they offer alternative quality lifestyle living.























Waterfront living, which in the past had been mostly confined to the east and by the Singapore River, gathered momentum in the last few years with areas like Sentosa Cove, Keppel Bay and Marina Bay coming up.

Sentosa Cove offers luxurious houses and condominiums with sea or canal views, and more than 50 per cent of the buyers are foreigners. Many of the properties are bought as weekend or holiday homes. Keppel Bay offers exhilarating views of Sentosa, ships cruising in and out of the harbour front and pleasure boats berthed at Marina at Keppel Bay.

Since the completion of Caribbean at Keppel Bay in 2004, the Harbourfront area has livened up with many lifestyle amenities such as VivoCity, St James Power Station, Marina at Keppel Bay and Jewel Box at Mount Faber.

Future developments that residents in Sentosa Cove and Keppel Bay can look forward to are the integrated resort at Sentosa and the government's development of the Southern Ridges and waterfront.

The Southern Ridges, Labrador area and Keppel waterfront will collectively form a major recreational and leisure destination at the southern part of Singapore. Already bridge connections have been made to link the 9km chain of green, open spaces across Mount Faber Park, Telok Blangah Hill Park and Kent Ridge Park. Soon, an elevated boardwalk over the sea will be built skirting the foothills of Bukit Chermin, and connect eastwards to the future promenade at The Reflections at Keppel Bay condominium project and westwards to Labrador Park.

According to URA statistics, Caribbean at Keppel Bay consistently enjoys one of the highest rentals among condominiums islandwide. Its median rent was $6.40 per sq ft in 2Q 2008. The potential supply in the area is fairly limited. Besides the uncompleted The Reflections at Keppel Bay, with 507 units available out of a total 1,129 units as at end 2Q 2008, the only other projects in the pipeline in the area are 307 units on a parcel next to Caribbean at Keppel Bay and 94 units on Keppel Island.

At Marina Bay, there will be plenty of buzz from the Marina Bay Sands integrated resort, Marina Bay Shoppes, and events and activities that are being/will be held in the bay. Marina Bay Shoppes will provide 800,000 sq ft of retail space, close to the one million sq ft in VivoCity. Nearby is the uncompleted Gardens at Marina South which will provide nature relief from the hustle and bustle.

Tiong Bahru, with its MRT station, Tiong Bahru Plaza, conserved buildings, Tiong Bahru market and hawker centre and freehold condominiums like Twin Regency, Regency Suites and The Regency at Tiong Bahru, has a strong following for its convenience of transport and amenities. The area is attractive with many expatriates and working professionals who like the quaint living environment near their workplaces. Monthly rents of Twin Regency, which was completed in 2007, are generally above $4.50 per sq ft.

Other growing fringe city areas are at Selegie and Beach Road/Kallang area. Both are near the Bras Basah/Bugis area which is developing nicely into a bustling arts, cultural, entertainment and education hub. The rich history and conserved shophouses at Beach Road and Kampong Glam offer a variety of experiences with their traditional trades, interesting shops and food outlets. Nearby at Bugis, Illuma will be completed soon by end of the year.

At Selegie, there are upcoming malls like Wilkie Edge, while Tekka Mall is being re-positioned and re-named The Verge. New residential developments include Parc Emily and Parc Mackenzie. Monthly rents of Parc Emily are at least $4.50 per sq ft while some units were recently sold for about $1,100 to $1,200 per sq ft. Projects currently available for sale include Parc Sophia and Mount Sophia Suites, with the latter not fully released.

At the Beach Road/Kallang area, the government plans to develop the Ophir-Rochor corridor into a vibrant office cluster for financial and business institutions that will complement the financial district at Marina Bay and Raffles Place. The Circle Line will further enhance the accessibility and connectivity of the vicinity.

Further up at Kallang Riverside, plans are announced in the draft Master Plan 2008 to develop it into a commercial hub with a residential enclave capitalising on the beach and waterfront. Launched at about $1,400 per sq ft last year, The Riverine by the Park, a 96-unit development at Kallang Road, was well-received and fully sold in weeks. A more recent launch is Concourse Skyline with selling price of $1,500-$1,800 per sq ft, which will be able to take advantage of an area that is anticipated to grow into a sought-after mixed commercial and residential area at the city fringe and with waterfront views of the Kallang River and the sea.

Property buyers are now spoilt for choice, as more areas take off, backed by the government's plan to introduce city living and develop different parts of the island to provide for varied lifestyle needs. Understanding the attractions and potential of each area is therefore important so that it will be easier to sell or rent the property that is purchased and to ensure that there is better capital protection or appreciation.

Chua Chor Hoon is senior director, while Ong Kah Seng is assistant manager, DTZ Research Singapore

4年价涨20万 达士岭卖剩组屋再推出供选购

Source : 《联合早报》September 27, 2008

建屋发展局昨天在抽签选购制度下,推出达士岭(The Pinnacle@Duxton)卖剩的428个摩天组屋单位。其中最引人注目的是,一个约五房式大小的新组屋要价64万6000元,比四年前首次推出时高出20多万元。

这相信是建屋局历来推出的最贵公共组屋。

达士岭卖剩的428个摩天单位是建屋局在抽签选购制度下推出的922个单位的一部分。

达士岭组屋位于丹戎巴葛达士敦坪,楼高50层,共有1848个单位。它将是全国最高的公共住屋,预计2010年落成。

达士岭组屋单位分S1(约等于四房式)和S2型(约等于五房式),三分之二是S1型,在2004年首次推出时售价28万9200元到38万零900元;S2型则卖34万5100元到43万9400元。

现在,S1型组屋要价45万7000元至55万5000元;S2型则售价54万5000元至64万6000元,比四年前的高出50%左右。

公众反应仍相当热烈

尽管售价高出许多,公众反应仍相当热烈。根据建屋局网站公布的数字显示,截至昨天下午5时,建屋局在第一天便收到351份申请。

建屋局受询时说,达士岭组屋较高的售价除了说明它地点非常优越,靠近中央商业区,也反映了它“较特别的设施”。比如,达士岭的50楼会有顶层公园,26楼则有半空公园和围绕着7座组屋而建的跑道。

建屋局说:“达士岭组屋的价格其实比附近组屋的转售价来得低。比如位于广东民弄、丹戎巴葛及惹兰孟比那的四房式转售组屋售价46万5000元至56万元,五房式则要价59万3000元至67万元。”

房地产经纪公司ERA助理副总裁林东荣受访时说:“达士岭组屋靠近市区,也曾得过国际设计奖项,所以65万元其实合理,而且这一带的屋价在过去半年也上涨不少。”

“屋价如果是70或80万元,那就无法接受。”

他说,建屋局近年来推出的组屋大多远离市区,主要集中在盛港和榜鹅,因此达士岭能吸引很多公众前来购买。

至于屋价会不会继续上涨,林东荣说:“屋价很难下滑,如果市场有需求,屋价是会继续上扬的。”

卢向敏(31岁,公关顾问)四年前以36万8000元预购达士岭六楼的S2型组屋。

当她从记者口中得知现在同楼同型组屋要价48万元左右,她表示惊讶:“我预计屋价会上涨,但万万没想到屋价会涨这么多。”

卢向敏开玩笑说:“现在我可发达了!”

她接着说:“但我购买达士岭组屋的真正目的是希望和父母住得较靠近,并不是想从中牟利。”

其他供公众抽签认购的组屋包括位于裕廊西、加冷/黄埔和女皇镇的三、四和五房式组屋,以及位于宏茂桥的小型公寓。

这些组屋是选择性整体重建计划卖剩的组屋,其中地点适中的女皇镇及加冷/黄埔的五房式组屋售价最高,介于48万元至55万4000元。

这也是建屋局在今年4月推出最后一批双月组屋销售计划后,首次推出992个组屋单位供公众抽签认购。

公众可通过建屋局网站www.hdb.gov.sg申请组屋,并可到建屋局中心三楼展示厅参观及索取销售资料。公众也可电邮hdbsales@hdb.gov.sg,或在办公时间拨1800-8663066询问详情。

申请截止日期是下月9日,申请者将在今年11月底知道申请结果,抽签活动明年1月举行。

“子承父业”设计 莱佛士坊一号紧贴华联

Source :《联合早报》September 26, 2008

大华银行将耗资5亿4000万元,与华联中心有限公司联手发展莱佛士坊一号(One Raffles Place)。

这栋38层楼高的办公大楼将紧贴现有的华联中心大厦(OUB Centre)而建,可以说是华联中心的第二大厦。

60层楼高的华联银行中心是由已故建筑师丹下健三在1988年设计的。20年后的今天,他的儿子丹下宪孝(右)设计了隔邻的莱佛士一号,与父亲的遗作相辉映。

受委负责这项工程的建筑师丹下宪孝(Paul Tange)说:“对我来说,(莱佛士坊一号)是一个很特别的项目,因为原来的华联中心大厦是我父亲在20多年前设计的。这是他设计的首几栋摩天大楼之一,一直到20年后的今天它仍是全世界首100栋摩天大楼之一。”

丹下宪孝是已故建筑师丹下健三(Kenzo Tange)的儿子。丹下健三曾经获得建筑界的诺贝尔奖Pritzer奖,属于殿堂级的国际建筑大师。丹下健三在1988年设计的华联中心大厦,高280公尺共60层,这不但是当时新加坡最高建筑物,也是美国以外世界最高建筑物。

根据《连瀛洲传》,占地7530平方公尺、拥有六层购物垫楼的华联银行中心,耗资4亿6500万元建造。在80年代中期,这是个天文数字。

丹下宪孝所设计的莱佛士坊一号将拥有三层的购物垫楼,以及35万平方英尺的甲级办公楼面。最大的建筑特色是由多个对角(diagonal)玻璃片拼凑而成的屋身,以及三角形屋顶。

他说:“莱佛士坊一号的建筑非常忠于华联中心大厦的比率,对角的玻璃片跟华联中心大厦的窗口的距离是对称的,而且三角形的屋顶也跟华联中心大厦的低层楼面同等高度。”

莱佛士坊一号预计在2011年完工。瑞士银行前天发表的一份房地产报告预测,新加坡的办公楼需求已经在今年上半年下跌了62%,再加上最近的全球金融危机,本地的甲级办公楼租金很可能在2012年下跌47%。

华联中心有限公司总经理郭慕容说:“这个项目是个长期投资。我们对它的地点很有信心,我们对新加坡的经济也很有信心。”

华联中心有限公司已委任仲量联行和世邦魏理仕为莱佛士一号的房地产代理,负责该办公楼的招租活动。仲量联行(新加坡与东南亚地区)董事经理傅司克(Chris Fossick)说,2010年后新加坡虽然会增添一些新的办公楼供应量,但位于莱佛士坊的不多,除了莱佛士一号,只有海峡商行大楼(Straits Trading Building)和海洋金融中心(Ocean Financial Centre)。

莱佛士一号的楼盘每层约11万平方英尺,适合一些较小型的金融公司租用。他透露,尽管最近的股市动荡,本地的金融公司仍没有缩小业务的迹象,相反的,一些金融公司反而开始将美国的业务迁移到新加坡来。

据了解,目前莱佛士坊一带的甲级办公大楼,租金叫价介于每平方英尺17.50元至20元之间。

华联中心有限公司在莱佛士一号这个发展项目,持有81.54%股份,其余18.46%由大华银行持有。

Thursday, September 25, 2008

S'pore Is No 4 For SME Financing: Poll

Source : The Business Times, September 25, 2008

SME sector here can develop new revenue streams, help to advance the economy

SINGAPORE is ranked the No 4 city for profitable small and medium-sized enterprise (SME) financing globally, according to a new research by MasterCard.

Emerging top centres of commerce for SME financing are Paris, Tokyo and Munich in MasterCard Research's ranking of 53 global cities. The global revenue opportunity for financial institutions from SME financing is estimated at $5 trillion.

The study looked at the size of the unmet SME financing need, potential for profit for banks in providing financing and the relative ease of market penetration within each city.

Cities such as Paris where there are dense concentrations of SMEs with limited access to financing from local banking systems, show the greatest profit potential.

Traditional world banking centres, such as New York, may be less ideal candidates for market expansion because there is already an abundance of existing credit providers and highly accessible credit markets. the study shows.

In the Asia-Pacific, Middle East and Africa (APMEA) region, Tokyo and Singapore emerged first and second respectively. They are among frontrunners in the potential size of its SME financing market, said Kelvin Mellyn, global solutions leader of payment strategy at MasterCard Advisors LLC, who headed the study.

Tokyo is in a sweet spot, with its total SME market valued at $628.6 billion, he noted. The SME sector in Singapore - valued at $176.46 billion - also presents an opportunity in developing new revenue streams and helping to advance the economy.

'Despite Tokyo's well-developed financial economy, its high ranking in the index can be attributed to the fact that SMEs currently have limited access to financing from the local banking system,' Mr Mellyn said.

Despite the current challenging conditions, there are still sizeable and profitable business opportunities available in the global SME financing sector for financial institutions, said Walt Macnee, president of global markets at MasterCard Worldwide.

Banks that can navigate the challenges and complexities of these cities may enjoy tremendous upside, he added.

Allgreen Consortium Wins Nanjing Commercial Site

Source : The Business Times, September 25, 2008

Its unit teams up with subsidiaries of Kerry Prop and Shangri-La Asia for 200m yuan purchase

A THREE-PARTY consortium, which includes Singapore-listed Allgreen Properties, has won the bid for a commercial site in China's Nanjing City.

Allgreen, which participated in the tender exercise through wholly owned subsidiary Belfin Investments, said the 17,014 square metre site is designated for hotel, commercial and office use.

The purchase price is 200 million yuan (S$41.6 million).

The other members in the consortium are subsidiaries of Kerry Properties and Shangri-la Asia.

To undertake the acquisition and development, the consortium will set up a foreign-owned enterprise in China. Allgreen, Kerry Properties and Shangri-La will have respective stakes of 15, 45 and 40 per cent.

Allgreen said in its announcement yesterday that it would benefit from the joint venture because of the partners' expertise in and understanding of China's property market.

Kerry Properties will provide project development, construction management and project consultancy services, while the Shangri-La group will provide hotel management services.

Allgreen has other joint investments with the two partners in Shanghai, Tianjin and Tangshan and more joint projects with Kerry in Chengdu, Shenyang and Qinhuangdao.

The maximum total investment cost for this latest Nanjing site is about 1.5 billion yuan.

Allgreen's share works out to about 225 million yuan, which it will finance this through internal funds and/or external borrowings.

Including this latest investment, Allgreen's total transactions with Kerry Properties and Shangri-la Asia amount to some $407.9 million, or 18.3 per cent of its latest audited net tangible assets as at Dec 31, 2007.

The investment is not expected to have any material impact on the earnings per share and net tangible assets per share of the Allgreen group for the current financial year.

Allgreen's net profit for the second quarter ended June 30 fell 36.5 per cent to $17.19 million, as revenue for the quarter fell 39 per cent to $74.12 million.

The company's shares closed unchanged at 67 cents yesterday.

Financial Crisis Impact Could Worsen: Wen

Source : The Business Times, September 25, 2008

UNITED NATIONS - Cash-rich China weighed in on the US financial crisis on Wednesday, with Premier Wen Jiabao warning that its international impact could become 'more serious' and stressing the need for concerted efforts to contain the turmoil.

He indicated that China, the world's biggest holder of foreign reserves and second biggest holder of US treasury bills, was ready to help in an international bid to defuse the turmoil that has rocked financial markets across the globe.

'The ongoing financial volatility, in particular, has affected many countries and its impact is likely to become more serious,' Mr Wen told the UN General Assembly.

'To tackle the challenge, we must all make concerted efforts,' Mr Wen told the UN meeting at the tail end of his address, which touched on various issues, including a pledge to push ahead with reforms to fuel growth in the world's most populous nations.

US President George W. Bush, who is also attending the UN General Assembly, had telephoned Chinese President Hu Jintao on Monday to brief him about the financial turmoil and his administration's bid to stage a US$700 billion Wall Street bailout to stem the crisis.

Mr Hu told Mr Bush that China welcomed Washington's efforts to stabilise the US financial markets and hoped they succeed, according to Beijing's state media.

But as Mr Wen spoke on Wednesday at the United Nations, the Bush administration remained locked in a dispute with the US Congress over the massive bailout package aimed at buying distressed mortgages and mortgage-related securities from financial institutions.

Financial markets, including in China, have been volatile since the US crisis peaked this month, triggered by the bankruptcy of Lehman Brothers and a Federal Reserve rescue of insurance and financial giant AIG last week.

Mr Wen hinted that China would help in any international bid to defuse financial contagion arising from the US crisis, saying this was not the time for 'hostility' or 'prejudice'.

'So long as people of all countries, especially their leaders, can do away with hostility, estrangement and prejudice, treat each other with sincerity and an open mind, and forge ahead hand in hand, mankind will overcome all difficulties and embrace a brighter and better future,' he said.

'China, as a responsible major developing country, is ready to work with other members of the international community to strengthen cooperation, share opportunities, meet challenges and contribute to the harmonious and sustainable development of the world,' he said.

China has emerged as the world's largest and fastest growing holder of foreign exchange reserves, which totalled US$1.8 trillion as of June 2008, according to its central bank.

It has invested a large share of its reserves in US securities, which include Treasury debt, US agency debt, US corporate debt and US equities.

A Congressional Research Service report in January said China may be holding nearly US$700 billion in US securities as of June 2006, making it the second largest foreign holder of American securities after Japan.

Mr Wen said given the global nature of issues threatening the world, including environmental problems, terrorism, diseases, natural disasters and financial troubles, 'no county can expect to stay away from the difficulties or handle the problems all by itself'.

The premier also touched on global concerns about China's direction after hosting the Olympics last month, saying Beijing would remain committed to 'peaceful development' and 'unswervingly pursue reform and opening-up.'

He said 'only continued economic and political restructuring, and reform in other fields can lead to sustained economic growth and social progress, and only continued opening up in an all-round way can lead the country to greater national strength and prosperity.' -- AFP

Property Transactions With Contract Dates Between Sept 8th - 13th, 2008

China Developers Cave In To Price Cuts

Source : The Business Times, September 25, 2008

But move will do little to boost sales as sentiment still bearish: analysts

(BEIJING) After months of steely resistance, Chinese property developers have finally thrown in the towel and slashed prices as sales fall.

Decline: China's housing market, which had boomed for over a decade, has been faltering since late 2007

Whether the move succeeds in putting a floor under the market will help determine the fate of the economy over the coming year, especially because China needs to spur domestic demand to counter weakening exports as the global credit crunch intensifies.

'Property firms have to rely on themselves, sacrificing prices to boost transactions,' said Chen Sheng, deputy head of China Index Academy, which is affiliated with SouFun.com, a top real estate website.

Real estate accounts for 24 per cent of China's fixed-asset investment and is crucial not only for domestic steel makers but also for global producers of myriad construction inputs such as aluminium and copper.

'So the property sector matters - a great deal,' said Jonathan Anderson, a UBS economist in Hong Kong.

Mr Anderson expects property and construction activity to stabilise and rebound in the first half of next year.

But many developers, harried by declining sales and financing constraints, are less optimistic.

China's housing market, which had boomed for more than a decade, has been faltering since late 2007. Prices in major cities such as Shenzhen have plunged by up to 40 per cent, demolishing the myth that prices would never fall while China was urbanising.

Average property price inflation in 70 large Chinese cities slowed to 5.3 per cent in the year to August from 11.3 per cent in the year to January.

Property sales fell 11 per cent in the first seven months from a year earlier, adding to the squeeze on cash flow confronting most developers after Beijing intensified its credit tightening late last year.

So for some developers, selling unsold homes at a discount is their last hope to survive.

However, some analysts say price cuts will do little to boost sales as consumer sentiment has turned bearish. They worry China could be in for a protracted housing downturn.

'When market prices start to fall, there'll be fewer buyers as people are not sure where the bottom is,' said Hou Liying, a professor at Shenzhen University.

More importantly, apartments are clearly unaffordable at current prices for most city dwellers, she added.

In Beijing, the average price of an apartment in August is 13,584 yuan (S$2,830) per square metre, higher than the average income of local residents for the first six months of 2008 - 12,547 yuan, according to the National Bureau of Statistics.

Vanke, China's biggest listed developer, took the lead and slashed prices by up to 27 per cent since late August in a handful of big cities, including Shenzhen, Shanghai, Hangzhou, Nanjing and Beijing. Many peers, such as Shenzhen- based Gemdale Corp, have followed suit.

An index of the largest mainland developers quoted in Hong Kong has tumbled 44 per cent so far this year. Vanke is down almost 80 per cent since peaking last November, while Gemdale has plunged more than 85 per cent.

'Most developers expect the market to remain sluggish for another year or longer,' Deutsche Bank economist Jun Ma said in a note to clients after a trip around China this month.

In their heightened anxiety, property executives are clamouring for the government to relax its restrictions on bank lending to the sector.

'The market right now is in an autumn chill, with some small firms failing,' Ren Zhiqiang, president of Beijing Huayuan Property Co, told a forum last week. 'If the government doesn't do something to snap the financing constraints on developers, then a deep winter is coming.'

However, Beijing seems to be in no hurry to halt the correction in the real estate market and is unlikely to resort to the sort of rescue package that it rolled out last week for the sagging stock market.

Bank regulators reiterated in late August that banks must not lend to developers for land purchases, a sign taken by the market that the government would not loosen its grip any time soon.

With an industry-wide profit margin of more than 30 per cent, many of the developers have scope to cut prices, at least for now. -- Reuters

Bangkok To See 'Lehman Effect', But No Fire Sale

Source : The Business Times, September 25, 2008

AMERICA'S financial crisis and the Lehman Brothers bankruptcy will dampen Bangkok property prices, a leading economist said yesterday.

Lehman's went bankrupt on Sept 15 with 50 billion baht (S$2.1 billion) of assets in Thailand, 80 per cent of which was in property.

Any related sell-off of its assets is likely to devalue the market, which - combined with the drying up of global credit and foreign capital - will cause prices to drop, economists say.

'Lehman has invested a lot of money in the property sector and it will now have to sell those assets, indirectly causing a decline in prices here,' said Chulalongkorn University development economist Sompop Manarungsan. 'Prices may drop 20-30 per cent in Bangkok.'

International investment funds active in Bangkok property have driven prices out of the reach of most Thais, he said, but prices will drop as developers are forced to sell locally as foreign investment dries up.

'Luxury developments will be the first to be affected because so much of their investment comes from outside the country,' said Dr Sompop. 'If they are overpriced, they will have to be adjusted.'

While delays in selling Lehman's local assets could drive down property prices, any negative effect is likely to be temporary, said Thailand Development and Research Institute research director Somchai Jitsuchon.

'If these (Lehman's investment) projects need to slow down, or their values are suppressed as a consequence of a 'fire sale', the general property prices might also be affected,' he said.

'These things depend on whether there will be new buyers, and when the buyout is complete. If Nomura really takes over all of Lehman's assets in Asia, that might prevent serious negative consequences.'

Thai property prices are also exposed to a potential 'second round' effect of the global liquidity dry-up, which could restrict foreign capital inflows into the market, he said.

However, KGI Securities (Thailand) property analyst Thaninee Satirareungchai said a fire sale is unlikely as Lehman Brothers invested in high-quality projects.

'It won't affect prices here that much,' she said. 'If there is a sell-off, it won't be a fire sale. Most developers that have enough cash (to buy the assets) are interested in taking over the property themselves.'

While super-luxury developments are more exposed to the crisis due to the strong reliance on foreign investment, the impact will not be significant, she added.

One property developer, which Lehman is directly invested in, said it faced no exposure to the crisis.

'Lehman Brothers did have a 25 per cent stake in The River development but it has already been fully paid up,' said Raimon Land CEO Nigel Cornick.

Economists Turn Bearish On Outlook For Singapore

Source : The Straits Times, Sep 25, 2008

Some of those polled downgrade predictions; pharmaceutical sector remains the wild card

PRIVATE sector economists are turning bearish on Singapore's economic outlook this year, amid the recent deluge of bad news from Wall Street and weaker- than-expected showings in exports and tourism.

Most of those polled by The Straits Times now believe growth will come in under 4 per cent, with some downgrading their predictions to as low as 2.8 per cent.













The official forecast is still a 4 to 5 per cent expansion, but Trade and Industry Minister Lim Hng Kiang has already said full-year growth may dip below that.

What the final number hinges on is the highly unpredictable pharmaceutical industry, which could still swing things either way in the last quarter, said economists. Always a wild card, this sector - which accounts for about 6 per cent of gross domestic product - has now become pivotal, especially since they cannot put a figure to it.

Mr Leong Wai Ho at Barclays, for instance, is banking on a 'significant pharma-led bounce' in the fourth quarter to ring in full-year growth at just over 4 per cent, the highest prediction among those polled.

Barring this rebound, Citigroup economist Kit Wei Zheng has cut his growth forecast to 2.8 per cent this year and 2.5 per cent next year, as 'ripples from the credit crunch hit home' and trigger a longer and deeper downturn that had been expected earlier this year.

'Beyond the third quarter, key leading indicators are all flashing red over the next six to 12 months,' he said, adding that the effects of slowing external demand and the housing market correction will likely be intensified by the ongoing financial crisis.

The latest round of upheaval in the financial markets, triggered by Lehman Brothers' collapse last week, has sharply increased the risks for a small and open economy like Singapore, added DBS Bank economist Irvin Seah.

'We are rather exposed to external volatility and will certainly not be spared; in fact, we will probably be one of the worst hit in the region,' he said.

Exports fell last month by the most in 20 months, plunging 13.8 per cent over the previous year in its fourth straight month of decline.

Tourist arrivals also dropped for the third consecutive month last month, hit by the global economic slowdown.

These figures have made economists increasingly convinced of the possibility of a technical recession in the third quarter, defined as two consecutive quarters of negative growth.

Tomorrow's manufacturing output numbers for last month could firm up technical recession predictions and may trigger another flurry of growth forecast revisions, depending on whether they continue July's dramatic 21.9 per cent contraction.

'If the third quarter is another write- off and you have a technical recession in Europe, Japan, New Zealand, and even some of the Asian economies including Singapore, what we're looking at is a little bit like a mini-Great Depression,' said OCBC Bank's head of treasury research and strategy Selena Ling.

But even if a technical recession does happen, it could just be a 'numbers game' rather than a major slowdown, said United Overseas Bank economist Jimmy Koh. In the first place, the second-quarter numbers were dragged down by pharmaceuticals, which 'aggravated the situation'.

Economists also say there are still some bright spots in the services sector, which is more diversified and has new, independent growth engines such as the F1 race and the integrated resorts, which will create new jobs and new industries.

Other plus points for the economy include still-stable employment rates and a healthy construction sector, added Action Economics economist David Cohen.

Whether next year will be any cheerier is an issue over which economists are divided. Some believe the financial uncertainty will take its full toll on the economy next year, delaying a recovery previously expected in the second half.

CIMB-GK economist Song Seng Wun said his outlook is 'diminishing by the day'. With a recession looming in the United States, the outlook is cloudy for the rest of the world, he said.

Others, like OCBC's Ms Ling, are 'not that bearish'. She predicts 4 to 5 per cent growth for now.

'Of course a lot depends on how the US crisis pans out in the coming quarters, but assuming we see some light at the end of the tunnel by June next year, we can hope for some sort of recovery in the second half of the year.'

Monaco Now Has The Costliest Luxury Homes

Source : The Business Times, September 25, 2008

It overtook London with an average price increase of 30% to £3,762 psf

(LONDON) London was overtaken by Monaco as the world's most expensive location for luxury homes as job cuts by banks and the prospect of lower bonuses discouraged buyers.

Cooling demand: Average prices for houses and apartments in London's nine most expensive neighbourhoods fell for the first time in five years in August

The average price of London's most expensive houses and apartments rose 1.8 per cent to £3,291 a square foot in the second quarter from a year earlier, according to an index compiled by Knight Frank LLP.

In Monaco, the average increase was 30 per cent to £3,762, the property broker said on Tuesday in a statement.

'The prime residential market is weakening across the world, due to the fallout from the credit crunch and declining economic conditions in western markets,' said Liam Bailey, Knight Frank's head of residential research.

Demand from the 300,000 people who work in financial services, which has underpinned London's luxury-housing market, has dropped as companies in the industry slash personnel costs.

Lehman Brothers Holdings Inc, which filed the biggest bankruptcy in history, employed about 4,500 here.

Average prices for houses and apartments in London's nine most expensive neighbourhoods fell for the first time in five years in August, as the prospect of a recession weighed on demand, a separate index compiled by Knight Frank showed last month.

The City of London Corporation, the municipal authority for London's main financial district, estimates that 42,000 jobs will be lost during the next year.

Alongside the financial centres of London and New York in Knight Frank's index come homes on the French Riviera and chalets in the French Alps, reflecting demand from high net worth individuals, notably from Russia, who are also buyers of 'super prime' properties here and in New York.

In London, Monaco and New York, prices of properties worth at least £10 million (S$26 million) have continued to climb, with some newly constructed or refurbished homes fetching in excess of £7,000 a square foot, Mr Bailey said.

'Demand is not going to evaporate,' he said. 'Wealth creation and accumulation in emerging economies and in specific high-end service sector activities will continue.' - Bloomberg

Wing Tai Picks Top Architects For 2 Projects

Source : The Business Times, September 25, 2008

Pritzker Prize winner Jean Nouvel to design his first project in S'pore

FEW cities can claim to have buildings designed by 10 Pritzker Prize winning architects, and Singapore is now one of them.

To date there are only about 30 winners of the prestigious Pritzker Prize - the architectural equivalent of the Pulitzer Prize - and thanks to Wing Tai Holdings, Jean Nouvel, the latest recipient, will be the 10th winner to design a building here.

Belle Vue Residence: Wing Tai has upped the ante in the race for big names by commissioning eminent Japanese architect Toyo Ito for its luxury development in Oxley Walk. Mr Ito is well known here for designing Vivocity

Mr Nouvel, who follows in the footsteps of architects like Philip Johnson, Kenzo Tange and James Stirling, will design his first project here - a luxury 43-unit apartment building in District 9 to be called Le Nouvel Ardmore.

On the choice of architect, Wing Tai deputy chairman Edmund Cheng said: 'Architecture influences who we are by defining how we live. That is why we set high standards for the architecture in our developments - to provide timeless elegant designs and thoughtful functional spaces.'

For Le Nouvel Ardmore, Mr Nouvel has created a 33-storey tower derived from the concept of a rotating Rubik's cube.

While the tower will not actually 'rotate', automated screens will be incorporated into the facade so homeowners can 'frame their own views' and create unique living spaces.

Mr Nouvel's design also calls for an outer structural lattice in the form of a grid detached from the living spaces to create an buffer of greenery and layering of spaces.

Besides giving the tower a distinctive look, the buffer space will be planted at certain levels to correspond to the villas-in-the-sky ambience of the development.

Internally, units will have high ceilings bathed in light from big windows that will provide 270 degree views.

'We know who our buyers are, we understand their needs and lifestyle requirements,' said Mr Cheng. 'They have keen appreciation for differentiation and seek sophistication in their properties.'

As homebuyers become more discerning, developers here are increasingly commissioning big-name architects.

'Discerning homebuyers and investors are increasingly drawn to good architecture,' said Mr Cheng. 'They have a higher sensitivity towards good design and are willing to spend not only on the interior of their apartments but also the exterior. Projects equated with quality are likely to attract higher premiums for their uniqueness and beauty.'

Wing Tai seems to have upped the ante in the race for big names by commissioning eminent Japanese architect Toyo Ito for its other luxury development, Belle Vue Residences in Oxley Walk.

Mr Ito, who received the 2002 Gold Lion Award at the International Architecture Exhibition of Venice Biennale, is already well known here for designing Vivocity.

For Belle Vue Residences, he has pushed the boundaries by coming up with a floor plan inspired by the branches of a tree and setting a distinctly organic tone.

The 176-unit development will have intimate pockets of space designed to mimic nature's branching pattern, integrating interior and exterior spaces.

The organic branching effect also results in more exposed wall surfaces and windows for more natural light and better ventilation.

As a result of organic planning, there are about 160 unit types, with most responding to the landscape in unique ways.