Source : The Business Times, August 13, 2008
ONE week may be a long time in politics, but on the economic front, a sea change in prospects in a matter of weeks is unusual. But we live in unusual times.
Less than a month ago, it seemed as though global inflation would be the issue of the year. While the surge in grain and food prices had abated, oil prices hit another new high in July (but have since backed down). The seemingly relentless spike in commodity prices earlier in the year looks to have ended, though prices are still at levels markedly higher than a year ago. Some of the inflationary effects may still be spiralling their way into consumer prices in many economies, but there is a sense that global inflation is peaking, if not past its peak.
At the same time, there is mounting evidence of economies heading toward recession, one after another. For some exporters and business people, the US economy is, for all intents and purposes, already in recession, even if this is not official. Singapore manufacturers and exporters suffered big falls in demand for their products from the American and European markets in the second quarter. And analysts see no quick turnaround in the big economies - which suggests that monetary policies will be increasingly oriented to battling a slowdown rather than curbing inflation. In Singapore too, there are calls to back off, if not reverse, the currency appreciation stance the government has adopted since October 2007. However, while a strong currency may be unwelcome to exporters in a downturn, it's far from clear that the inflation beast is even close to being snuffed out in Singapore. Targeted fiscal assistance for businesses, such as tax cuts or reliefs, is probably a more effective option than a change in monetary policy, which would have wide (and possibly adverse) effects across the economy.
For now, the global slowdown is reflected most starkly in Singapore's trade figures. The latest Q2 GDP growth number has tanked too, though not entirely from poor external demand. More interestingly, the fact that the low Q2 growth stemmed largely from a pharmaceutical slump - due not to demand woes but industry-peculiar features like product changes and production scheduling - suggests that Singapore's slowdown has been exaggerated by pharma volatility, even if the rest of the economy is still healthy.
Finally, what of the job market? While there may be a change in sentiment compared to a year ago, the jobs pipeline is still strong, with the two integrated resorts and other projects coming on-stream next year. A prolonged slowdown may lead to job cuts in some sectors - particularly manufacturing - but new jobs will still be created in other sectors. This points to a greater need for retraining and flexibility on the part of workers - as well as the need to expand workforce development programmes.
As to how long the global slowdown will last, and how deep it will be, it is still too early to foretell. However, for now, there is every indication that the Singapore economy can weather the storm, albeit at the cost of temporarily lower growth.
Wednesday, August 13, 2008
US Economic Slide To Continue Into Next Year: Survey
Source : The Business Times, August 13, 2008
(WASHINGTON) Economists have soured on the US economy's prospects for the second half of 2008 and have cut growth forecasts for next year as well, a closely watched survey released on Monday showed.
While government stimulus payments helped the economy expand at a reasonable annual rate of 1.9 per cent in the second quarter, economists polled by the Blue Chip Economic Indicators newsletter expect the air to go out of the economy as the temporary lift to consumer spending fades.
Economists expect US gross domestic product to grow at a 1.2 per cent annualised rate in the third quarter, down 0.1 percentage point from the consensus July forecast, it said.
In the fourth quarter, the economy is now seen expanding at a pace of just 0.3 per cent - a drop of 0.3 percentage point from July.
While the Blue Chip forecast for 2008 growth as a whole held at 1.6 per cent, the projection for 2009 dropped to 1.5 per cent from July's forecast of 1.7 per cent.
The cut in the growth forecasts follows data showing mounting job losses, a stalled factory sector and a housing market that has yet to reach bottom.
The panel of 50 economists polled during Aug 6-7 predicts the sluggish economy will push the jobless rate to 6 per cent in December and to 6.1 per cent by the end of next year. The last time the unemployment rate was as high as 6 per cent was in October 2003. In July, it stood at 5.7 per cent.
Of the panellists polled, 78.3 per cent expect the Federal Reserve to hold interest rates steady through the end of this year, while a strong majority - 88.6 per cent - see the next rate move as up.
Separate forecasts for Treasury bill rates suggest panellists expect no rate increases until the second quarter of 2009, the newsletter said.
At their last meeting on Aug 5, Fed policy-makers left the benchmark federal funds rate at 2 per cent, where it has been since the end of April.
The percentage of economists who believe the US economy is in, or will be in, a recession this year moved up to 55.8 per cent from 54.5 per cent in July, but was still below the May peak of 60 per cent. -- Reuters
(WASHINGTON) Economists have soured on the US economy's prospects for the second half of 2008 and have cut growth forecasts for next year as well, a closely watched survey released on Monday showed.
While government stimulus payments helped the economy expand at a reasonable annual rate of 1.9 per cent in the second quarter, economists polled by the Blue Chip Economic Indicators newsletter expect the air to go out of the economy as the temporary lift to consumer spending fades.
Economists expect US gross domestic product to grow at a 1.2 per cent annualised rate in the third quarter, down 0.1 percentage point from the consensus July forecast, it said.
In the fourth quarter, the economy is now seen expanding at a pace of just 0.3 per cent - a drop of 0.3 percentage point from July.
While the Blue Chip forecast for 2008 growth as a whole held at 1.6 per cent, the projection for 2009 dropped to 1.5 per cent from July's forecast of 1.7 per cent.
The cut in the growth forecasts follows data showing mounting job losses, a stalled factory sector and a housing market that has yet to reach bottom.
The panel of 50 economists polled during Aug 6-7 predicts the sluggish economy will push the jobless rate to 6 per cent in December and to 6.1 per cent by the end of next year. The last time the unemployment rate was as high as 6 per cent was in October 2003. In July, it stood at 5.7 per cent.
Of the panellists polled, 78.3 per cent expect the Federal Reserve to hold interest rates steady through the end of this year, while a strong majority - 88.6 per cent - see the next rate move as up.
Separate forecasts for Treasury bill rates suggest panellists expect no rate increases until the second quarter of 2009, the newsletter said.
At their last meeting on Aug 5, Fed policy-makers left the benchmark federal funds rate at 2 per cent, where it has been since the end of April.
The percentage of economists who believe the US economy is in, or will be in, a recession this year moved up to 55.8 per cent from 54.5 per cent in July, but was still below the May peak of 60 per cent. -- Reuters
US Banks Raising Loan Standards: Fed Survey
Source : The Business Times, August 13, 2008
Tight credit also driven by broader economic weakness
(WASHINGTON) Banks in the United States further tightened lending standards in all major categories, especially for consumer loans, in the past three months amid a weakening economic outlook, according to a Federal Reserve survey released on Monday.
The July survey of senior loan officers at 52 domestic banks and 21 branches and agencies of foreign banks also showed that demand for loans by both businesses and households had weakened since the last survey in April.
The survey added to evidence that a year-long credit crunch sparked initially by sub-prime mortgage defaults is far from easing as banks hoard capital and make it harder to borrow.
The tightness in credit is now being driven by broader weakness in the US economy and is defying efforts by the Fed to boost liquidity in the banking system and keep interest rates low.
Gary Thayer, senior economist at Wachovia Securities in St Louis said the tighter lending standards was typical in a weakening economy, and creates headwinds that will help delay recovery, along with a worsening housing slump and still-high fuel prices.
The tightening of credit was particularly pronounced in the consumer sector, where banks increased minimum credit scores required on credit cards and reduced card balance limits.
The survey found 65 per cent of US domestic banks tightened standards on credit cards and other consumer loans, considerably higher than the 30 per cent that tightened card standards in the previous survey.
On commercial and industrial loans, 60 per cent of domestic banks reported tightening credit standards and 80 per cent of banks noted they had increased the spreads of loan rates over their cost of funds on loans to large- and middle-market firms.
The housing sector got no relief in the past three months, as lenders further tightened standards for all mortgage categories.
The Fed said that about 75 per cent of US banks tightened lending standards on prime mortgages - those given to customers with better credit histories - versus about 60 per cent who said they tightened in April.
In a special question on larger so-called jumbo mortgages, the Fed said about 30 per cent of domestic banks said they had securitised or sold loans that meet new, higher conforming loan amounts to mortgage finance giants Fannie Mae and Freddie Mac.
However, 50 per cent of the respondents said there was a lack of demand for such loans and 40 per cent said there was a limited number of mortgage applicants at their bank who meet the Fannie Mae and Freddie Mac underwriting criteria for conforming jumbo loans, which require better credit scores and higher down payments.
The Fed survey also revealed that both domestic and foreign banks expected to continue tightening standards on most loans through the end of 2008 and into 2009. -- Reuters
Tight credit also driven by broader economic weakness
(WASHINGTON) Banks in the United States further tightened lending standards in all major categories, especially for consumer loans, in the past three months amid a weakening economic outlook, according to a Federal Reserve survey released on Monday.
The July survey of senior loan officers at 52 domestic banks and 21 branches and agencies of foreign banks also showed that demand for loans by both businesses and households had weakened since the last survey in April.
The survey added to evidence that a year-long credit crunch sparked initially by sub-prime mortgage defaults is far from easing as banks hoard capital and make it harder to borrow.
The tightness in credit is now being driven by broader weakness in the US economy and is defying efforts by the Fed to boost liquidity in the banking system and keep interest rates low.
Gary Thayer, senior economist at Wachovia Securities in St Louis said the tighter lending standards was typical in a weakening economy, and creates headwinds that will help delay recovery, along with a worsening housing slump and still-high fuel prices.
The tightening of credit was particularly pronounced in the consumer sector, where banks increased minimum credit scores required on credit cards and reduced card balance limits.
The survey found 65 per cent of US domestic banks tightened standards on credit cards and other consumer loans, considerably higher than the 30 per cent that tightened card standards in the previous survey.
On commercial and industrial loans, 60 per cent of domestic banks reported tightening credit standards and 80 per cent of banks noted they had increased the spreads of loan rates over their cost of funds on loans to large- and middle-market firms.
The housing sector got no relief in the past three months, as lenders further tightened standards for all mortgage categories.
The Fed said that about 75 per cent of US banks tightened lending standards on prime mortgages - those given to customers with better credit histories - versus about 60 per cent who said they tightened in April.
In a special question on larger so-called jumbo mortgages, the Fed said about 30 per cent of domestic banks said they had securitised or sold loans that meet new, higher conforming loan amounts to mortgage finance giants Fannie Mae and Freddie Mac.
However, 50 per cent of the respondents said there was a lack of demand for such loans and 40 per cent said there was a limited number of mortgage applicants at their bank who meet the Fannie Mae and Freddie Mac underwriting criteria for conforming jumbo loans, which require better credit scores and higher down payments.
The Fed survey also revealed that both domestic and foreign banks expected to continue tightening standards on most loans through the end of 2008 and into 2009. -- Reuters
UOL Q2 Profit Dives As Fair-Value Gains Fall
Source : The Business Times, August 13, 2008
Its listed subsidiary Hotel Plaza posts 5% rise in net profit to $16.3m
UOL Group's second-quarter net profit fell 49 per cent to $145 million, from $286.3 million a year ago, as the property group saw lower fair-value gains from its investment properties.
Selling well: Sales at UOL's projects, including Nassim Park Residences, launched in Q2 exceed expectations
Revenue for the three months ended June 30, 2008 rose 4 per cent to $209.3 million, from $201.6 million in Q2 2007.
The increase in revenue came largely from UOL's hotel operations, with hotels in Singapore, Australia and Vietnam performing better.
Revenue from property investments also improved due to higher average rental and occupancy rates in investment properties, UOL said.
Earnings per share for Q2 2008 fell to 18.21 cents, from 36.01 cents a year ago.
For the first half of 2008, UOL's net profit attributable to equity-holders fell 48 per cent to $187.8 million. Turnover for the six months rose 7 per cent to $371.1 million.
UOL's listed subsidiary Hotel Plaza posted a net profit of $16.3 million for the second quarter - 5 per cent up from the year-ago period's $15.5 million.
Revenue rose 16 per cent to $79.9 million, from $69.2 million a year ago, as the company's hotels did better.
Earnings per share fell to 2.71 cents, from 3.89 cents a year ago.
For H1 2008, Hotel Plaza's net profit rose 18 per cent to $30.8 million. Revenue for the six months rose 16 per cent to $156.6 million.
Commenting on its group's results, UOL observed that the sub-prime crisis, tight credit environment and global inflation had led to a slowdown in global economic growth.
UOL said the buying sentiment in the Singapore residential property market is likely to remain soft and cautious. It, however, said that it launched three projects in the second quarter and sales 'exceeded expectations'.
In Singapore, Nassim Park Residences is over 60 per cent sold with the latest median price at around $3,000 per square foot (psf).
Breeze by the East, a boutique 88-unit project along Upper East Coast, is 50 per cent sold with the latest median price at around $979 psf.
And in Malaysia, Panorama, a freehold 223-unit luxury condominium in Kuala Lumpur, is more than 90 per cent sold at an average price of about RM980 (S$414.8) psf.
Both UOL and Hotel Plaza are also cautiously optimistic that the demand for hotel rooms will remain fairly strong in Singapore and the Asia-Pacific region, even with the weaker economic outlook.
UOL gained five cents to close at $3.26 yesterday. Hotel Plaza lost three cents to close at a 52-week low of $1.49.
Its listed subsidiary Hotel Plaza posts 5% rise in net profit to $16.3m
UOL Group's second-quarter net profit fell 49 per cent to $145 million, from $286.3 million a year ago, as the property group saw lower fair-value gains from its investment properties.
Selling well: Sales at UOL's projects, including Nassim Park Residences, launched in Q2 exceed expectationsRevenue for the three months ended June 30, 2008 rose 4 per cent to $209.3 million, from $201.6 million in Q2 2007.
The increase in revenue came largely from UOL's hotel operations, with hotels in Singapore, Australia and Vietnam performing better.
Revenue from property investments also improved due to higher average rental and occupancy rates in investment properties, UOL said.
Earnings per share for Q2 2008 fell to 18.21 cents, from 36.01 cents a year ago.
For the first half of 2008, UOL's net profit attributable to equity-holders fell 48 per cent to $187.8 million. Turnover for the six months rose 7 per cent to $371.1 million.
UOL's listed subsidiary Hotel Plaza posted a net profit of $16.3 million for the second quarter - 5 per cent up from the year-ago period's $15.5 million.
Revenue rose 16 per cent to $79.9 million, from $69.2 million a year ago, as the company's hotels did better.
Earnings per share fell to 2.71 cents, from 3.89 cents a year ago.
For H1 2008, Hotel Plaza's net profit rose 18 per cent to $30.8 million. Revenue for the six months rose 16 per cent to $156.6 million.
Commenting on its group's results, UOL observed that the sub-prime crisis, tight credit environment and global inflation had led to a slowdown in global economic growth.
UOL said the buying sentiment in the Singapore residential property market is likely to remain soft and cautious. It, however, said that it launched three projects in the second quarter and sales 'exceeded expectations'.
In Singapore, Nassim Park Residences is over 60 per cent sold with the latest median price at around $3,000 per square foot (psf).
Breeze by the East, a boutique 88-unit project along Upper East Coast, is 50 per cent sold with the latest median price at around $979 psf.
And in Malaysia, Panorama, a freehold 223-unit luxury condominium in Kuala Lumpur, is more than 90 per cent sold at an average price of about RM980 (S$414.8) psf.
Both UOL and Hotel Plaza are also cautiously optimistic that the demand for hotel rooms will remain fairly strong in Singapore and the Asia-Pacific region, even with the weaker economic outlook.
UOL gained five cents to close at $3.26 yesterday. Hotel Plaza lost three cents to close at a 52-week low of $1.49.
Er...What Is A Reverse Mortgage?
Source : The Sunday Times, Aug 10, 2008
FINANCIAL QUOTIENT
Where do you see this?
In articles on property and retirement planning.
What does it mean?
A reverse mortgage is a financial scheme that allows a property owner to use his home to obtain a sum of cash. Like a line of credit, it provides a regular stream of income.
It is the opposite of a mortgage, in which the property owner pays a monthly instalment to the financial institution in return for a loan with which to buy his home.
With a reverse mortgage, the financial institution pays the borrower, referred to as the mortgagor. The latter is charged interest on the amount he receives.
Why is it important?
A reverse mortgage is an option for those who need additional income, in particular to meet retirement needs.
To qualify, the mortgagor must own a home and attain a certain age; usually, he has to be at least 60. In addition, his home must be fully paid up.
The reverse mortgage is granted based on the age of the borrower, the prevailing value of the property, the projected property appreciation rate and the interest rate. The loan is repayable only when the property is sold, usually upon the death of the borrower, or upon the expiry of the loan term.
In the event of death, the financial institution will sell the property for the estate of the deceased. However, it may allow the children to keep the house if they can repay the loan.
In Singapore, such services are offered by NTUC Income and OCBC Bank.
So you want to use the term. Just say...
My retired uncle, who has no children, has taken out a reverse mortgage on his flat so that he can have an additional stream of income.
FINANCIAL QUOTIENT
Where do you see this?
In articles on property and retirement planning.
What does it mean?
A reverse mortgage is a financial scheme that allows a property owner to use his home to obtain a sum of cash. Like a line of credit, it provides a regular stream of income.
It is the opposite of a mortgage, in which the property owner pays a monthly instalment to the financial institution in return for a loan with which to buy his home.
With a reverse mortgage, the financial institution pays the borrower, referred to as the mortgagor. The latter is charged interest on the amount he receives.
Why is it important?
A reverse mortgage is an option for those who need additional income, in particular to meet retirement needs.
To qualify, the mortgagor must own a home and attain a certain age; usually, he has to be at least 60. In addition, his home must be fully paid up.
The reverse mortgage is granted based on the age of the borrower, the prevailing value of the property, the projected property appreciation rate and the interest rate. The loan is repayable only when the property is sold, usually upon the death of the borrower, or upon the expiry of the loan term.
In the event of death, the financial institution will sell the property for the estate of the deceased. However, it may allow the children to keep the house if they can repay the loan.
In Singapore, such services are offered by NTUC Income and OCBC Bank.
So you want to use the term. Just say...
My retired uncle, who has no children, has taken out a reverse mortgage on his flat so that he can have an additional stream of income.
Private Home Prices Starting To Dip
Source : The Straits Times, August 11, 2008
Experts expect gradual downtrend, but not lows of financial crisis days
IT IS a bit like the dog that didn't bark in the night: Economic growth is slowing, shares are crashing and property sales have slowed, yet private home prices have refused to take the hint and fall.
Indeed, they have barely budged since the slowdown began about nine months ago, despite conventional wisdom saying they should be plunging.
But property experts see increasing signs that a price fall is coming, and while no one knows by how much, few believe a crash is on the cards.
Anyone waiting for bargain basement deals might be out of luck, with the local market trading at a higher range based on the country's rosier long-term prospects.
Prices are being kept up partly by low mortgage rates and the ability of developers flush from last year's bumper returns to hold off launching new flats.
A seasoned market watcher said the impression that Singapore was not dramatically hit by the United States' sub-prime woes has helped keep prices stable.
However, new sales have slowed significantly, and prices are starting to reflect this. The Urban Redevelopment Authority showed that private home prices inched up just 0.17 per cent in the second quarter - the least in four years and well below the 3.8 per cent in the first quarter.
With price growth disappearing amid sluggish demand, a downtrend - with a bigger blip seen for the luxury sector - seems inevitable, said market watchers.
Private home prices are still beyond the reach of most owner-occupiers, said Chesterton International's head of research and consultancy, Mr Colin Tan.
But any correction is likely to be gradual, with experts tipping a timeframe of a year or more. It will not be steep at this point as interest rates are low and the economic outlook is not that bad.
Mr Tan said home prices will take a long time to fall because the decline is being led by individual investors. They will be forced to sell when their rentals cannot meet mortgage payments, a situation that will become increasingly apparent as more units go on market.
These will mostly be the flats bought at the market's peak around the middle of last year, said the market watcher.
Investors who bought low under the deferred payment scheme will be able to sell below developers' asking prices and still make a profit. When they do, their deals will weigh on the market, he said.
'The decline will not be led by developers as they have profited immensely from the price run-up in 2006 and 2007,' added Mr Tan. 'At the moment, they only have to sell enough units to keep revenue streams flowing.'
If the market remains weak in the next six months, prices could easily fall 20 per cent to 30 per cent on average over a period of time to levels seen in 2006, with the high-end sector bearing the brunt.
Still, the lows seen in the post-Asian financial crisis days or the Sars period are gone forever unless Singapore is hit by a major catastrophe, experts say.
'We do not see a repeat of the prices in 1997 or 2003 because those were big shocks,' said National University of Singapore associate professor, real estate, Mr Sin Tien Foo. 'There is no bubble effect.'
Besides, prices hinge on quality. 'Nowadays, people are looking for better designs and materials, which would increase developers' costs,' he said.
Jones Lang LaSalle's head of research for South-east Asia, Dr Chua Yang Liang, said: 'Theoretically, property values appreciate over time.'
While poor fundamentals can send prices below the replacement cost level, this is an unlikely scenario here as fundamentals have been good and look to remain stable, he said.
Singapore's employment rate is still strong and income growth stable. As the director of Savills Residential, Mr Ku Swee Yong put it: 'The sellers are not losing their jobs.'
Experts expect gradual downtrend, but not lows of financial crisis days
IT IS a bit like the dog that didn't bark in the night: Economic growth is slowing, shares are crashing and property sales have slowed, yet private home prices have refused to take the hint and fall.
Indeed, they have barely budged since the slowdown began about nine months ago, despite conventional wisdom saying they should be plunging.
But property experts see increasing signs that a price fall is coming, and while no one knows by how much, few believe a crash is on the cards.
Anyone waiting for bargain basement deals might be out of luck, with the local market trading at a higher range based on the country's rosier long-term prospects.
Prices are being kept up partly by low mortgage rates and the ability of developers flush from last year's bumper returns to hold off launching new flats.
A seasoned market watcher said the impression that Singapore was not dramatically hit by the United States' sub-prime woes has helped keep prices stable.
However, new sales have slowed significantly, and prices are starting to reflect this. The Urban Redevelopment Authority showed that private home prices inched up just 0.17 per cent in the second quarter - the least in four years and well below the 3.8 per cent in the first quarter.
With price growth disappearing amid sluggish demand, a downtrend - with a bigger blip seen for the luxury sector - seems inevitable, said market watchers.
Private home prices are still beyond the reach of most owner-occupiers, said Chesterton International's head of research and consultancy, Mr Colin Tan.
But any correction is likely to be gradual, with experts tipping a timeframe of a year or more. It will not be steep at this point as interest rates are low and the economic outlook is not that bad.
Mr Tan said home prices will take a long time to fall because the decline is being led by individual investors. They will be forced to sell when their rentals cannot meet mortgage payments, a situation that will become increasingly apparent as more units go on market.
These will mostly be the flats bought at the market's peak around the middle of last year, said the market watcher.
Investors who bought low under the deferred payment scheme will be able to sell below developers' asking prices and still make a profit. When they do, their deals will weigh on the market, he said.
'The decline will not be led by developers as they have profited immensely from the price run-up in 2006 and 2007,' added Mr Tan. 'At the moment, they only have to sell enough units to keep revenue streams flowing.'
If the market remains weak in the next six months, prices could easily fall 20 per cent to 30 per cent on average over a period of time to levels seen in 2006, with the high-end sector bearing the brunt.
Still, the lows seen in the post-Asian financial crisis days or the Sars period are gone forever unless Singapore is hit by a major catastrophe, experts say.
'We do not see a repeat of the prices in 1997 or 2003 because those were big shocks,' said National University of Singapore associate professor, real estate, Mr Sin Tien Foo. 'There is no bubble effect.'
Besides, prices hinge on quality. 'Nowadays, people are looking for better designs and materials, which would increase developers' costs,' he said.
Jones Lang LaSalle's head of research for South-east Asia, Dr Chua Yang Liang, said: 'Theoretically, property values appreciate over time.'
While poor fundamentals can send prices below the replacement cost level, this is an unlikely scenario here as fundamentals have been good and look to remain stable, he said.
Singapore's employment rate is still strong and income growth stable. As the director of Savills Residential, Mr Ku Swee Yong put it: 'The sellers are not losing their jobs.'
Hope For Owners Fighting En Bloc
Source : The Straits Times, August 11, 2008
A website with information on the laws and processes in collective sales is aimed at helping minority owners
THE name of the website - www.hope4stayers.com - says it all. It is a forum for, and set up by, people who are worried about losing their homes in a collective sale.
Its opening words are a call to arms.
'We need to share our experiences to get us through this nightmare,' it reads.
'We hope that our daily lives can be free from the constant worries of losing our homes to those who see home as a mere financial tool for wealth.'
Cosmetics distributor Tan Keng Ann started the site when his neighbours wanted their condominium along Toh Tuck Road sold en bloc last year.
The 60-year-old said there had been a dearth of information online about collective sales.
'We want this to be an educational site, for people to learn more about en bloc sales.'
And so the Hope website was born. (It is an acronym for Home Owners' Protecting Entitlements.)
The site started in February with about five or six members from estates on the chopping block. Today, it has a core group of 25 flat owners scattered in 15 estates that are going through the sale process, some for the second time.
They include Bayshore Park, Green Lodge and Pine Grove, some of which made waves in the media by forming an anti-sales brigade.
The Hope group's objective is to equip stayers, also called minority owners, with information about the en bloc process so they can fight to keep their homes.
The website is expansive. It includes a compilation of the collective sales law, legal tips for minority owners and a list of confirmed, on-going and failed en bloc deals.
One member, who declined to be named, joined after some new faces at her condominium tried to get elected to the management committee.
She said: 'I didn't know what these people were up to.'
She learnt soon after when a collective sales order was tabled.
For those who opposed the sale, information about the en bloc law was key, she said. They were facing an uphill battle against a majority of owners who had professional consultants to guide them through the legal minefield.
One minority owner in Rainbow Gardens along Toh Tuck Road wishes he had known earlier how to navigate the en bloc landscape.
The resident, who declined to be named, protested against the sale even though it had the requisite 80 per cent support to go through.
His appeal to the Strata Title Board, a government authority that rules on en bloc sales, was turned down. He took the case to the High Court but, the sale went through before it was heard.
Disappointed, the man said he is considering writing about his ordeal for the Hope website.
He said: 'My advice to minority owners is pray hard you don't get the 80 per cent.'
Meanwhile, the Hope group is cobbling together a list of proposals for the Law Ministry to consider.
A ministry spokesman said it will 'continue to monitor the effect of the changes in practice, and review the feedback to see if further amendments to the en bloc rules are necessary'.
Not everyone is supportive of the Hope website, though.
Mr Issac Chin, an investor who sits on the sales committee of Pearl Bank Apartments at Outram Park, which is trying to go en bloc, does not see the need for such a group.
He said the law is clear: if 80 per cent of the owners want to sell, the sale will go through.
A website with information on the laws and processes in collective sales is aimed at helping minority owners
THE name of the website - www.hope4stayers.com - says it all. It is a forum for, and set up by, people who are worried about losing their homes in a collective sale.
Its opening words are a call to arms.
'We need to share our experiences to get us through this nightmare,' it reads.
'We hope that our daily lives can be free from the constant worries of losing our homes to those who see home as a mere financial tool for wealth.'
Cosmetics distributor Tan Keng Ann started the site when his neighbours wanted their condominium along Toh Tuck Road sold en bloc last year.
The 60-year-old said there had been a dearth of information online about collective sales.
'We want this to be an educational site, for people to learn more about en bloc sales.'
And so the Hope website was born. (It is an acronym for Home Owners' Protecting Entitlements.)
The site started in February with about five or six members from estates on the chopping block. Today, it has a core group of 25 flat owners scattered in 15 estates that are going through the sale process, some for the second time.
They include Bayshore Park, Green Lodge and Pine Grove, some of which made waves in the media by forming an anti-sales brigade.
The Hope group's objective is to equip stayers, also called minority owners, with information about the en bloc process so they can fight to keep their homes.
The website is expansive. It includes a compilation of the collective sales law, legal tips for minority owners and a list of confirmed, on-going and failed en bloc deals.
One member, who declined to be named, joined after some new faces at her condominium tried to get elected to the management committee.
She said: 'I didn't know what these people were up to.'
She learnt soon after when a collective sales order was tabled.
For those who opposed the sale, information about the en bloc law was key, she said. They were facing an uphill battle against a majority of owners who had professional consultants to guide them through the legal minefield.
One minority owner in Rainbow Gardens along Toh Tuck Road wishes he had known earlier how to navigate the en bloc landscape.
The resident, who declined to be named, protested against the sale even though it had the requisite 80 per cent support to go through.
His appeal to the Strata Title Board, a government authority that rules on en bloc sales, was turned down. He took the case to the High Court but, the sale went through before it was heard.
Disappointed, the man said he is considering writing about his ordeal for the Hope website.
He said: 'My advice to minority owners is pray hard you don't get the 80 per cent.'
Meanwhile, the Hope group is cobbling together a list of proposals for the Law Ministry to consider.
A ministry spokesman said it will 'continue to monitor the effect of the changes in practice, and review the feedback to see if further amendments to the en bloc rules are necessary'.
Not everyone is supportive of the Hope website, though.
Mr Issac Chin, an investor who sits on the sales committee of Pearl Bank Apartments at Outram Park, which is trying to go en bloc, does not see the need for such a group.
He said the law is clear: if 80 per cent of the owners want to sell, the sale will go through.
A View To Thrill
Source : The Straits Times, August 13, 2008
What gives condos a selling edge?
Buyers are willing to pay premiums of up to 10% for properties that come with good views
WHAT do home buyers look for in their dream home?
No doubt, it is a combination of an affordable price, the perfect location and other sought-after attributes.
But if there is one factor that often makes or breaks a sale, it is the view.
Hong Fok Corp's upcoming condo will offer views of Kallang River and the new Sports Hub.
Property agents agree that all things being equal, a great vista helps to seal the deal for many home buyers.
In fact, in the current softer property market, a captivating outlook might give a home that vital edge to ensure it sells, they add.
Buyers are willing to fork out a premium of anything up to 10 per cent for a home with a great view. For well-heeled home seekers, price is no issue if the outlook is stunning, they say.
As a rule of thumb, analysts say flat prices increase up to 1.5 per cent for each floor in high-rise properties - so a 15th- floor unit might be 15 per cent more expensive than a comparable fifth-storey unit.
Securing that room with a view is particularly relevant for a built-up city such as Singapore.
Recent developments such as The Sail @ Marina Bay - which has two towers, one of which is 70 storeys high - have increasingly catered to Singaporeans' growing appetite for high-rise apartments with stunning views.
Depending on what type of view you get on the higher floors, another premium of 3 per cent can be added, said Mr Colin Tan, head of research and consultancy at Chesterton International.
To pin down exactly how much a view is worth, a 'hedonic regression model' can be used, said Mr Nicholas Mak, Knight Frank's director of research and consultancy. This method breaks down individual aspects of a home and estimates the value of each characteristic.
'This is mostly used by academics who want precise values. Developers tend to decide on the value of a view based on experience, or from valuers,' said Mr Mak. With the model, value is calculated based on past transactions, he added.
A view can change a property's worth as much as 10 per cent, said Mr Mak. What is difficult, though, is guessing a buyer's preference.
'One man's meat may be another man's poison. It's hard to isolate the price difference between, say, a city view and a greenery one,' he said.
A buyer's willingness to cough up money for a view depends on individual tastes.
Home buyer Victoria Ho, 25, prefers a city view over a green one any day. 'I'll pay up to 10 per cent more for a view, but not much more, because the location matters more than, say, if I were facing barren land or another block.'
But for 26-year-old Hoe Qing An, who is hunting for his dream home, greenery is of the utmost importance.
'We already live in an urban jungle; a home needs to have that green element and I won't mind paying for it,' he said.
So where are the spectacular views in Singapore and how affordable are they?
Property agents told The Straits Times buyers generally look for views such as an ocean outlook, the Central Business District skyline and expansive natural vistas.
The obvious favourites are those from properties on the East Coast, and city homes that provide a bird's-eye view of prime districts 9, 10 or 11.
For buyers who cannot get a high-floor unit, condos such as The Pier at Robertson allow all owners a view at least part of the time.
They can gaze at the Singapore River against the city skyline while at the gym or during a swim.
Property developer Hong Fok Corp has an upcoming residential project in Beach Road - still unnamed - that offers a stunning view of both the sea and the city.
The two towers, of 40 and 28 storeys and with 360 units, will offer panoramic views of Marina Bay, the sea, the city skyline or the Kallang River, depending on the direction the unit faces.
Prices have not been revealed, but in the vicinity, Southbank in North Bridge Road and Citylights at Lavender have been sold at about $1,000 to $1,200 psf recently.
Then there are homes that offer alternative views such as those near the island's nature reserves - which can be easier on the pocket.
Orange Tee property agent Vincent Loke, 36, for example, is selling a 13th-floor unit at Parc Oasis in Jurong which offers an expansive view of Jurong Lake. The 1,507 sq ft apartment is selling for about $930,000 - up to $80,000 more than a similar unit with no view.
In densely populated Singapore, greenery is highly sought after by home owners, said agents. Take, for example, the calming landscapes of Bukit Batok's Little Guilin, from Guilin View.
Property agent Simon Tan, 46, said a 29th-floor unit with a lake view sells for about $850,000. Units in the same block without the view cost about $780,000.
Some HDB flats in Marsiling enjoy an unblocked view of Johor Baru across the strait.
Malaysia can even be glimpsed from as far inland as former HUDC estate Braddell View. Its owners also enjoy panoramic views of MacRitchie Reservoir.
Mr Alan Lim, who owns a unit on a high floor, said he can even spot fireworks set off across the Causeway sometimes. Latest data shows homes at the estate selling for about $500 to $600 psf, or slightly under $1 million.
More affordable sights can also be found in the heartlands.
At Sengkang's Rivervale Drive, for example, high floor unit owners can look onto the meandering Sungei Serangoon for soothing greenery.
Mr Steven Koh, 48, who is one such owner, bought his five-
room flat for $310,000 in 2000. He reckons it is now worth more than $400,000 and that his view adds at least a few tens of thousands to the value of his flat.
'But I'm not looking to sell. I consider myself lucky to have such a beautiful view to gaze on every day. You can't put a value on that feeling,' he said.
What gives condos a selling edge?
Buyers are willing to pay premiums of up to 10% for properties that come with good views
WHAT do home buyers look for in their dream home?
No doubt, it is a combination of an affordable price, the perfect location and other sought-after attributes.
But if there is one factor that often makes or breaks a sale, it is the view.
Hong Fok Corp's upcoming condo will offer views of Kallang River and the new Sports Hub.Property agents agree that all things being equal, a great vista helps to seal the deal for many home buyers.
In fact, in the current softer property market, a captivating outlook might give a home that vital edge to ensure it sells, they add.
Buyers are willing to fork out a premium of anything up to 10 per cent for a home with a great view. For well-heeled home seekers, price is no issue if the outlook is stunning, they say.
As a rule of thumb, analysts say flat prices increase up to 1.5 per cent for each floor in high-rise properties - so a 15th- floor unit might be 15 per cent more expensive than a comparable fifth-storey unit.
Securing that room with a view is particularly relevant for a built-up city such as Singapore.
Recent developments such as The Sail @ Marina Bay - which has two towers, one of which is 70 storeys high - have increasingly catered to Singaporeans' growing appetite for high-rise apartments with stunning views.
Depending on what type of view you get on the higher floors, another premium of 3 per cent can be added, said Mr Colin Tan, head of research and consultancy at Chesterton International.
To pin down exactly how much a view is worth, a 'hedonic regression model' can be used, said Mr Nicholas Mak, Knight Frank's director of research and consultancy. This method breaks down individual aspects of a home and estimates the value of each characteristic.
'This is mostly used by academics who want precise values. Developers tend to decide on the value of a view based on experience, or from valuers,' said Mr Mak. With the model, value is calculated based on past transactions, he added.
A view can change a property's worth as much as 10 per cent, said Mr Mak. What is difficult, though, is guessing a buyer's preference.
'One man's meat may be another man's poison. It's hard to isolate the price difference between, say, a city view and a greenery one,' he said.
A buyer's willingness to cough up money for a view depends on individual tastes.
Home buyer Victoria Ho, 25, prefers a city view over a green one any day. 'I'll pay up to 10 per cent more for a view, but not much more, because the location matters more than, say, if I were facing barren land or another block.'
But for 26-year-old Hoe Qing An, who is hunting for his dream home, greenery is of the utmost importance.
'We already live in an urban jungle; a home needs to have that green element and I won't mind paying for it,' he said.
So where are the spectacular views in Singapore and how affordable are they?
Property agents told The Straits Times buyers generally look for views such as an ocean outlook, the Central Business District skyline and expansive natural vistas.
The obvious favourites are those from properties on the East Coast, and city homes that provide a bird's-eye view of prime districts 9, 10 or 11.
For buyers who cannot get a high-floor unit, condos such as The Pier at Robertson allow all owners a view at least part of the time.
They can gaze at the Singapore River against the city skyline while at the gym or during a swim.
Property developer Hong Fok Corp has an upcoming residential project in Beach Road - still unnamed - that offers a stunning view of both the sea and the city.
The two towers, of 40 and 28 storeys and with 360 units, will offer panoramic views of Marina Bay, the sea, the city skyline or the Kallang River, depending on the direction the unit faces.
Prices have not been revealed, but in the vicinity, Southbank in North Bridge Road and Citylights at Lavender have been sold at about $1,000 to $1,200 psf recently.
Then there are homes that offer alternative views such as those near the island's nature reserves - which can be easier on the pocket.
Orange Tee property agent Vincent Loke, 36, for example, is selling a 13th-floor unit at Parc Oasis in Jurong which offers an expansive view of Jurong Lake. The 1,507 sq ft apartment is selling for about $930,000 - up to $80,000 more than a similar unit with no view.
In densely populated Singapore, greenery is highly sought after by home owners, said agents. Take, for example, the calming landscapes of Bukit Batok's Little Guilin, from Guilin View.
Property agent Simon Tan, 46, said a 29th-floor unit with a lake view sells for about $850,000. Units in the same block without the view cost about $780,000.
Some HDB flats in Marsiling enjoy an unblocked view of Johor Baru across the strait.
Malaysia can even be glimpsed from as far inland as former HUDC estate Braddell View. Its owners also enjoy panoramic views of MacRitchie Reservoir.
Mr Alan Lim, who owns a unit on a high floor, said he can even spot fireworks set off across the Causeway sometimes. Latest data shows homes at the estate selling for about $500 to $600 psf, or slightly under $1 million.
More affordable sights can also be found in the heartlands.
At Sengkang's Rivervale Drive, for example, high floor unit owners can look onto the meandering Sungei Serangoon for soothing greenery.
Mr Steven Koh, 48, who is one such owner, bought his five-
room flat for $310,000 in 2000. He reckons it is now worth more than $400,000 and that his view adds at least a few tens of thousands to the value of his flat.
'But I'm not looking to sell. I consider myself lucky to have such a beautiful view to gaze on every day. You can't put a value on that feeling,' he said.
New SC Global Building May Have Car Showroom
Source : The Business Times, August 13, 2008
A high-end car showroom could very well open its doors in the unlikely Newton area by year-end if SC Global Developments Ltd's plans zoom off.
Newton 200: SC Global has been marketing the ground floor of the soon-to-be- completed nine-storey luxurious office building as being suitable for showcasing an exclusive make of automobiles
The upmarket property developer has been marketing the ground floor of its soon-to-be-completed Newton 200 office building as being suitable for showcasing an exclusive make of automobiles.
'Newton 200, with its vantage location and visibility to passing vehicular traffic, would make a great site for a car showroom,' explains an SC Global spokeswoman.
But she adds that while the mainboard-listed company is 'making the necessary provisions to cater for a potential car showroom, there is also extremely strong interest from other types of retail tenants attracted by the prominent space and location.
'We will be evaluating all the potential options and proposals,' she says. 'Therefore, it could end up being something else.'
Newton 200 is a nine-storey luxurious office building located at 200 Newton Road, beside the junction with Thomson Road. Directly linked to the nearby MRT station, it has an 'avant-garde floating glass box design' with an 'asymmetric prismatic facade' and 'faceted glass blades'. TOP (Temporary Occupation Permit) is in the fourth quarter of 2008.
As the plot size is relatively small, there will only be one 2,200 sq ft unit on the ground floor, while each of the seven office floors will be tenanted out on a floor by floor basis only. The rates are generally around $12 to $13 psf, according to the spokeswoman, who says they reflect the current market rates in that area.
SC Global decided that rental would be the most suitable option since selling the units on a floor by floor basis 'may compromise the overall concept of the building design'.
'We are also looking at the possibility of moving our offices into the building, so at this juncture it makes sense not to sell the units,' says the spokeswoman.
This is not the luxury property developer's first foray into the automotive arena. In March, it announced that it would field a car in this year's Porsche Carrera Cup Asia series and become the title sponsor of the Singapore round of the race.
As a result, the September event will be officially named 'Porsche SC Global Carrera Cup Asia - Singapore 2008' and run as an official support race to the inaugural 2008 Formula 1 SingTel Singapore Grand Prix.
Newton 200 is SC Global's first commercial development. The developer is best known for its prime residential properties such as The Ladyhill, BLVD, The Tomlinson, Thr3e Thre3 Robin and The Lincoln Modern. Other projects include The Marq on Paterson Hill and Hilltops.
Most car showrooms in Singapore are located in the main Leng Kee Road motor belt and the Ubi industrial area. Although unusual, it will not be the first time that the Newton area will host a car showroom. Some years ago, there was a Volkswagen dealer in the shops along Thomson Road opposite Novena Church.
One high-end sports car distributor says the Newton 200 location is 'very nice' and suitable for an exclusive brand like his, 'which does not have to be in Leng Kee Road'.
'But with rental of about $30,000 a month, I have to think carefully before I decide to open a branch there,' he adds.
A high-end car showroom could very well open its doors in the unlikely Newton area by year-end if SC Global Developments Ltd's plans zoom off.
Newton 200: SC Global has been marketing the ground floor of the soon-to-be- completed nine-storey luxurious office building as being suitable for showcasing an exclusive make of automobilesThe upmarket property developer has been marketing the ground floor of its soon-to-be-completed Newton 200 office building as being suitable for showcasing an exclusive make of automobiles.
'Newton 200, with its vantage location and visibility to passing vehicular traffic, would make a great site for a car showroom,' explains an SC Global spokeswoman.
But she adds that while the mainboard-listed company is 'making the necessary provisions to cater for a potential car showroom, there is also extremely strong interest from other types of retail tenants attracted by the prominent space and location.
'We will be evaluating all the potential options and proposals,' she says. 'Therefore, it could end up being something else.'
Newton 200 is a nine-storey luxurious office building located at 200 Newton Road, beside the junction with Thomson Road. Directly linked to the nearby MRT station, it has an 'avant-garde floating glass box design' with an 'asymmetric prismatic facade' and 'faceted glass blades'. TOP (Temporary Occupation Permit) is in the fourth quarter of 2008.
As the plot size is relatively small, there will only be one 2,200 sq ft unit on the ground floor, while each of the seven office floors will be tenanted out on a floor by floor basis only. The rates are generally around $12 to $13 psf, according to the spokeswoman, who says they reflect the current market rates in that area.
SC Global decided that rental would be the most suitable option since selling the units on a floor by floor basis 'may compromise the overall concept of the building design'.
'We are also looking at the possibility of moving our offices into the building, so at this juncture it makes sense not to sell the units,' says the spokeswoman.
This is not the luxury property developer's first foray into the automotive arena. In March, it announced that it would field a car in this year's Porsche Carrera Cup Asia series and become the title sponsor of the Singapore round of the race.
As a result, the September event will be officially named 'Porsche SC Global Carrera Cup Asia - Singapore 2008' and run as an official support race to the inaugural 2008 Formula 1 SingTel Singapore Grand Prix.
Newton 200 is SC Global's first commercial development. The developer is best known for its prime residential properties such as The Ladyhill, BLVD, The Tomlinson, Thr3e Thre3 Robin and The Lincoln Modern. Other projects include The Marq on Paterson Hill and Hilltops.
Most car showrooms in Singapore are located in the main Leng Kee Road motor belt and the Ubi industrial area. Although unusual, it will not be the first time that the Newton area will host a car showroom. Some years ago, there was a Volkswagen dealer in the shops along Thomson Road opposite Novena Church.
One high-end sports car distributor says the Newton 200 location is 'very nice' and suitable for an exclusive brand like his, 'which does not have to be in Leng Kee Road'.
'But with rental of about $30,000 a month, I have to think carefully before I decide to open a branch there,' he adds.
SC Global Offers NY-Warehouse Living At Martin Rd
Source : The Straits Times, August 13, 2008
SC GLOBAL is introducing New York-style warehouse living to Martin Road - a first for Singapore - with prices that will be set above the market average.
The warehouse flats will boast a more rugged design. -- SC GLOBAL
Like warehouse lofts in Lower Manhattan, the flats will feature high ceilings and seamless interior spaces that can be separated at will, using walls that slide and hide away.
And unlike traditional high-end developments here, Martin No. 38, as the project is called, will have a more rugged design of raw concrete, base metal finishes and unvarnished timbers.
Australian architect Kerry Hill is designing the project, which is on the site of a former warehouse near the Singapore River.
The freehold development, which will be launched later this year, will be 15 storeys high with 91 units, including four penthouses with pools.
Most of the units will be small - from 969 to 1,130 sq ft each - but there will be some larger ones of 1,335 to 1,495 sq ft each.
SC Global is aiming to sell the units at an average of $2,000 per sq ft (psf).
Prices of projects in the same area are around $1,200 to $1,850 psf, according to Knight Frank. Newer projects like 8 Rodyk cost more - a 721 sq ft apartment sold at $1,800 psf last month.
But market sentiment remains weak, with buyers staying away, especially from the high-end sector, which surged dramatically last year.
Prices have since slipped while activity has slowed considerably. But there is always room for the right product, said SC Global chairman and chief executive Simon Cheong, who is confident Martin No. 38 will be well-received.
SC Global bought the site in 1999 but said it deferred development until the area was rejuvenated and the concept of warehouse lofts became viable.
SC GLOBAL is introducing New York-style warehouse living to Martin Road - a first for Singapore - with prices that will be set above the market average.
The warehouse flats will boast a more rugged design. -- SC GLOBALLike warehouse lofts in Lower Manhattan, the flats will feature high ceilings and seamless interior spaces that can be separated at will, using walls that slide and hide away.
And unlike traditional high-end developments here, Martin No. 38, as the project is called, will have a more rugged design of raw concrete, base metal finishes and unvarnished timbers.
Australian architect Kerry Hill is designing the project, which is on the site of a former warehouse near the Singapore River.
The freehold development, which will be launched later this year, will be 15 storeys high with 91 units, including four penthouses with pools.
Most of the units will be small - from 969 to 1,130 sq ft each - but there will be some larger ones of 1,335 to 1,495 sq ft each.
SC Global is aiming to sell the units at an average of $2,000 per sq ft (psf).
Prices of projects in the same area are around $1,200 to $1,850 psf, according to Knight Frank. Newer projects like 8 Rodyk cost more - a 721 sq ft apartment sold at $1,800 psf last month.
But market sentiment remains weak, with buyers staying away, especially from the high-end sector, which surged dramatically last year.
Prices have since slipped while activity has slowed considerably. But there is always room for the right product, said SC Global chairman and chief executive Simon Cheong, who is confident Martin No. 38 will be well-received.
SC Global bought the site in 1999 but said it deferred development until the area was rejuvenated and the concept of warehouse lofts became viable.
SC Global To Launch Martin No38
Source : The Business Times, August 13, 2008
SC GLOBAL will launch Martin No 38 next month at an average price close to $2,000 per square foot.
Sleek beauty: Artist's impression of the development, designed by award-winning architect Kerry Hill. It will launch at an average price close to $2,000 psf.
The company said in a statement yesterday that the 91-unit development in Martin Road, near Mohammed Sultan Road and Clarke Quay, will mostly comprise one-plus-one bedroom and two-bedroom apartments ranging from 969-1,130 sq ft. There will be a limited number of larger two-plus-one and three-bedroom apartments, ranging from 1,335-1,485 sq ft.
Knight Frank director (research and consultancy) Nicholas Mak said the pricing appears a little 'bullish' but the developer may feel the project's 'design' merits this.
A unit in nearby Robertson Blue sold recently for around $1,800 psf, he said.
And in March, it was reported that about 30 units at Martin Place Residences in Kim Yam Road sold for an average price of of about $1,800 psf after discounts.
SC Global is best known for developing high-end niche projects. And according to its chairman and chief executive officer Simon Cheong: 'There is always room for the right product. Martin No 38, with the SC Global reputation for quality, will be unique and original. We are confident it will be well received.'
The development is designed by award-winning architect Kerry Hill. It is based on warehouse lofts in New York and London and features high ceilings and seamless interior spaces.
SC Global says: 'An austere and beguiling industrial aestheticism pervades the details of this development, from the blackened tap fittings to the sheet-metal panels in the bathrooms, with their exposed bolt heads, unplastered interior concrete walls, exposed plywood edges of the cabinetry and acres of unvarnished timber.'
SC Global bought the site in 1999 but deferred development until the area had 'rejuvenated itself and the context for this housing concept became ripe'.
SC Global projects under construction include The Marq on Paterson Hill and Hilltops at Cairnhill. The group has a landbank of more than 1.1 million sq ft of gross floor area in the Orchard Road and at Sentosa Cove.
SC GLOBAL will launch Martin No 38 next month at an average price close to $2,000 per square foot.
Sleek beauty: Artist's impression of the development, designed by award-winning architect Kerry Hill. It will launch at an average price close to $2,000 psf.The company said in a statement yesterday that the 91-unit development in Martin Road, near Mohammed Sultan Road and Clarke Quay, will mostly comprise one-plus-one bedroom and two-bedroom apartments ranging from 969-1,130 sq ft. There will be a limited number of larger two-plus-one and three-bedroom apartments, ranging from 1,335-1,485 sq ft.
Knight Frank director (research and consultancy) Nicholas Mak said the pricing appears a little 'bullish' but the developer may feel the project's 'design' merits this.
A unit in nearby Robertson Blue sold recently for around $1,800 psf, he said.
And in March, it was reported that about 30 units at Martin Place Residences in Kim Yam Road sold for an average price of of about $1,800 psf after discounts.
SC Global is best known for developing high-end niche projects. And according to its chairman and chief executive officer Simon Cheong: 'There is always room for the right product. Martin No 38, with the SC Global reputation for quality, will be unique and original. We are confident it will be well received.'
The development is designed by award-winning architect Kerry Hill. It is based on warehouse lofts in New York and London and features high ceilings and seamless interior spaces.
SC Global says: 'An austere and beguiling industrial aestheticism pervades the details of this development, from the blackened tap fittings to the sheet-metal panels in the bathrooms, with their exposed bolt heads, unplastered interior concrete walls, exposed plywood edges of the cabinetry and acres of unvarnished timber.'
SC Global bought the site in 1999 but deferred development until the area had 'rejuvenated itself and the context for this housing concept became ripe'.
SC Global projects under construction include The Marq on Paterson Hill and Hilltops at Cairnhill. The group has a landbank of more than 1.1 million sq ft of gross floor area in the Orchard Road and at Sentosa Cove.
Economy Seen Slowing More Sharply: Philly Fed
Source : The Business Times, August 13, 2008
NEW YORK - US economic growth is expected to slow more sharply in the coming months than previously forecast with employers shedding staff into next year, according to a Philadelphia Federal Reserve survey released on Tuesday.
Economists lowered their forecasts for third-quarter gross domestic product growth to a 1.2 per cent annual rate from the previous 1.7 per cent estimate, according to the bank's quarterly Survey of Professional Forecasters.
'Growth in US real output over the next few quarters looks slower now than it did just three months ago,' the Philadelphia Fed said on its Web site.
In the fourth quarter, the US GDP growth forecast was slashed to 0.7 per cent growth, from the previous 1.8 per cent forecast.
US GDP grew 1.9 per cent in the second quarter, according to a first estimate from the government. The Fed's survey in May had pegged that quarter's growth at 0.2 per cent.
The current survey also forecast the US unemployment rate would be 5.7 per cent in the third quarter, above its previous 5.4 per cent forecast, then rising to 5.8 per cent in the fourth quarter.
'A weaker near-term outlook for the labour market accompanies the outlook for slower output growth,' the Philadelphia Fed said.
US non-farm payrolls are forecast to shrink by an average 46,500 per month in the third quarter, above the previous forecast loss of 4,800 per month. In the fourth quarter, payrolls are expected to shrink an average of 45,400 per month in the fourth quarter, versus the previous forecast gain of 26,500 per month.
The US unemployment rate rose to a four-year high of 5.7 per cent in July, when 51,000 non-farm jobs were lost, according to government data.
Economists expect employers to shed jobs at a slower rate in the first three months of next year before adding workers in the second quarter of 2009.
US core PCE inflation, a gauge the Federal Reserve watches closely, is estimated at 2.2 per cent in the third quarter and 2.1 per cent in the fourth quarter.
US core consumer prices, which exclude food and energy, were forecast at 2.5 per cent in the third quarter and at 2.3 per cent in the fourth quarter. -- REUTERS
NEW YORK - US economic growth is expected to slow more sharply in the coming months than previously forecast with employers shedding staff into next year, according to a Philadelphia Federal Reserve survey released on Tuesday.
Economists lowered their forecasts for third-quarter gross domestic product growth to a 1.2 per cent annual rate from the previous 1.7 per cent estimate, according to the bank's quarterly Survey of Professional Forecasters.
'Growth in US real output over the next few quarters looks slower now than it did just three months ago,' the Philadelphia Fed said on its Web site.
In the fourth quarter, the US GDP growth forecast was slashed to 0.7 per cent growth, from the previous 1.8 per cent forecast.
US GDP grew 1.9 per cent in the second quarter, according to a first estimate from the government. The Fed's survey in May had pegged that quarter's growth at 0.2 per cent.
The current survey also forecast the US unemployment rate would be 5.7 per cent in the third quarter, above its previous 5.4 per cent forecast, then rising to 5.8 per cent in the fourth quarter.
'A weaker near-term outlook for the labour market accompanies the outlook for slower output growth,' the Philadelphia Fed said.
US non-farm payrolls are forecast to shrink by an average 46,500 per month in the third quarter, above the previous forecast loss of 4,800 per month. In the fourth quarter, payrolls are expected to shrink an average of 45,400 per month in the fourth quarter, versus the previous forecast gain of 26,500 per month.
The US unemployment rate rose to a four-year high of 5.7 per cent in July, when 51,000 non-farm jobs were lost, according to government data.
Economists expect employers to shed jobs at a slower rate in the first three months of next year before adding workers in the second quarter of 2009.
US core PCE inflation, a gauge the Federal Reserve watches closely, is estimated at 2.2 per cent in the third quarter and 2.1 per cent in the fourth quarter.
US core consumer prices, which exclude food and energy, were forecast at 2.5 per cent in the third quarter and at 2.3 per cent in the fourth quarter. -- REUTERS
Japanese Economy Shrinks, Adding To Recession Fears
Source : The Business Times, August 13, 2008
TOKYO - Japan's economy contracted in the second quarter, as expected, reinforcing views that the world's No 2 economy has slipped into recession after its longest expansion since World War Two.
Private consumption, which accounts for some 55 per cent of GDP, fell 0.5 per cent from the previous quarter
Crumbling exports, weak consumption and declines in public and private investment spending led to 0.6 per cent contraction, the first fall in a year, as high energy and raw material costs bite and the impact of a US slowdown spread to emerging nations.
'The data gave an impression that the economy has entered a recession and I think it is in a recession,' said Takahide Kiuchi, chief economist at Nomura Securities.
Economists are divided on whether the economy will shrink further in the current quarter - matching a widely used definition of a recession - but they agree that any return to growth will be soft and depend heavily on the direction of oil prices and how quickly a global slowdown ends.
'There are still some possibilities that GDP will return to a positive territory in the July-September quarter, but the downturn trend is likely to continue,' said Yoshikiyo Shimamine, chief economist at Dai-ichi Life Research Institute.
Yields on five-year Japanese government bonds fell to a four-month low below 1 per cent as weak GDP reaffirmed expectations that the Bank of Japan would keep interest rates on hold for several months.
Many economists and government officials say Japan is either falling into a recession or is already in one, ending a growth cycle that began in early 2002, the longest in six decades.
Japan measures a recession as a downturn in the economic cycle, which varies from the more widely used definition of two straight quarters of economic contraction.
The annnualised contraction of 2.4 per cent in Japan compared with 1.9 per cent annual growth in the same quarter in the United States, where government stimulus supported the economy.
No rate move for a while
Many economists say the Japanese economy is in much better shape than when it went through slumps in 1998 or 2001, with companies having cleaned up their balance sheets after the collapse of an asset bubble in the 1990s.
Economics Minister Kaoru Yosano said that the economy was weakening, hurt mainly by external factors such as high oil prices, but added that it won't keep falling.
'Even though the economy contracted in April-June, it would be more accurate to think that it won't last long.'
Caught between gloom and rising grocery prices in an economy where deflation was common for most of the past decade, the Bank of Japan has been expected to keep the key interest rates at an already low 0.5 per cent for a while, and the quarterly contraction did not change that view.
'We can't expect export growth to accelerate any time soon, so the economy will remain in an adjustment phase for the rest of this year,' said Takumi Tsunoda, a senior economist at Shinkin Central Bank Research.
'But we can probably avoid a full-fledged recession, as in several straight quarters of GDP contraction. We still expect the Bank of Japan's next policy move to be a rate hike, but it won't come for the rest of this year.'
Private consumption, which accounts for some 55 per cent of Japan's economy, fell 0.5 per cent in the second quarter, after recent rises in food and gasoline prices hurt consumer sentiment and weak wages prompted shoppers to keep their purses tightly closed. That was the first drop in almost two years.
Another culprit in the downturn is weakening exports.
Shipments to the United States have already faltered, and now those to emerging Asia have begun to sputter after maintaining growth through the first year of the global credit crisis.
Corporate capital spending, another driver of Japan's growth in recent years, fell 0.2 per cent, marking a second straight quarter of decline. -- REUTERS
TOKYO - Japan's economy contracted in the second quarter, as expected, reinforcing views that the world's No 2 economy has slipped into recession after its longest expansion since World War Two.
Private consumption, which accounts for some 55 per cent of GDP, fell 0.5 per cent from the previous quarterCrumbling exports, weak consumption and declines in public and private investment spending led to 0.6 per cent contraction, the first fall in a year, as high energy and raw material costs bite and the impact of a US slowdown spread to emerging nations.
'The data gave an impression that the economy has entered a recession and I think it is in a recession,' said Takahide Kiuchi, chief economist at Nomura Securities.
Economists are divided on whether the economy will shrink further in the current quarter - matching a widely used definition of a recession - but they agree that any return to growth will be soft and depend heavily on the direction of oil prices and how quickly a global slowdown ends.
'There are still some possibilities that GDP will return to a positive territory in the July-September quarter, but the downturn trend is likely to continue,' said Yoshikiyo Shimamine, chief economist at Dai-ichi Life Research Institute.
Yields on five-year Japanese government bonds fell to a four-month low below 1 per cent as weak GDP reaffirmed expectations that the Bank of Japan would keep interest rates on hold for several months.
Many economists and government officials say Japan is either falling into a recession or is already in one, ending a growth cycle that began in early 2002, the longest in six decades.
Japan measures a recession as a downturn in the economic cycle, which varies from the more widely used definition of two straight quarters of economic contraction.
The annnualised contraction of 2.4 per cent in Japan compared with 1.9 per cent annual growth in the same quarter in the United States, where government stimulus supported the economy.
No rate move for a while
Many economists say the Japanese economy is in much better shape than when it went through slumps in 1998 or 2001, with companies having cleaned up their balance sheets after the collapse of an asset bubble in the 1990s.
Economics Minister Kaoru Yosano said that the economy was weakening, hurt mainly by external factors such as high oil prices, but added that it won't keep falling.
'Even though the economy contracted in April-June, it would be more accurate to think that it won't last long.'
Caught between gloom and rising grocery prices in an economy where deflation was common for most of the past decade, the Bank of Japan has been expected to keep the key interest rates at an already low 0.5 per cent for a while, and the quarterly contraction did not change that view.
'We can't expect export growth to accelerate any time soon, so the economy will remain in an adjustment phase for the rest of this year,' said Takumi Tsunoda, a senior economist at Shinkin Central Bank Research.
'But we can probably avoid a full-fledged recession, as in several straight quarters of GDP contraction. We still expect the Bank of Japan's next policy move to be a rate hike, but it won't come for the rest of this year.'
Private consumption, which accounts for some 55 per cent of Japan's economy, fell 0.5 per cent in the second quarter, after recent rises in food and gasoline prices hurt consumer sentiment and weak wages prompted shoppers to keep their purses tightly closed. That was the first drop in almost two years.
Another culprit in the downturn is weakening exports.
Shipments to the United States have already faltered, and now those to emerging Asia have begun to sputter after maintaining growth through the first year of the global credit crisis.
Corporate capital spending, another driver of Japan's growth in recent years, fell 0.2 per cent, marking a second straight quarter of decline. -- REUTERS
Solitary, Low Bid For Tampines Site
Source : The Business Times, August 13, 2008
At $118 psf ppr it is below expectations, but analyst says site is not plum anyway
Cautious sentiment, soaring construction costs and a not-so-hot site all combined to yield just one bid at a state tender yesterday for a 99-year leasehold condo site at Tampines Ave 1/Ave 10 facing Bedok Reservoir.
The sole bid of about $118 per square foot per plot ratio (psf ppr) was below general market expectations which ranged from $150 to $230 psf ppr.
The sole bidder at yesterday's tender was Boon Keng Development, a unit of Midview group, which is involved in the construction and property businesses.
Most property consultants reckon there's only a slim chance of the site being awarded.
Looking at the $118 psf ppr sole bid at yesterday's tender, property consultants told BT that no 99- year leasehold condo/ apartment site has been sold at a lower price than this since 1991.
Yesterday's top bid, which was for a private condominium site, was also below the $137 psf ppr at which the government sold a Design, Build and Sell Scheme site in Simei for development into Housing & Development Board flats in June.
'This outcome is negative for property market sentiment. It may be even worse for sentiment if the government actually awards the site as that could affect land valuations for other residential sites too,' Knight Frank director (research and consultancy) Nicholas Mak said.
However, Savills Singapore director (marketing and business development) Ku Swee Yong noted that the Tampines site was not a plum one to begin with.
'It does not have good attributes in terms of transportation links. Neither is it near major amenities,' he said.
'Generally, developers already have good landbanks, so unless a very good site comes along, we'll not see too much participation,' Mr Ku said.
'But if a site with solid transportation connection and amenities comes up, like the Ophir Road white site or the condo plot next to Tanah Merah MRT station, these will be attention grabbers,' he added.
The tender for the Tanah Merah plot closes on Sept 9 while that for the Ophir Road plot closes in December.
The $118 psf ppr bid for the Tampines plot, plus construction costs of about $320-350 psf of gross floor area, reflects a breakeven cost of about $500-550 psf for a new condo project.
Units in completed condos around the Bedok Reservoir area have been selling at between $550 psf and $680 psf, although the new Waterfront Waves condo which is being built on a choice spot along the reservoir has achieved average prices of about $750 psf for pool-facing units and $800 psf for reservoir-facing units.
The latest plot on Tampines Ave 1/Ave 10 can be built into a condo with about 650 units. It was offered through the confirmed list of the Government Land Sales Programme.
Debating the likelihood of the plot being awarded, a property consultant who declined to be named said: 'There was just one bid. But I hope the government will award this site if it wants to show foreign investors that Singapore is a competitive place to invest in.'
Knight Frank's Mr Mak said that the government will gradually lower reserve prices for sites offered through the Government Land Sales Programme, to take into account rising construction costs and weak property market sentiment.
'It's walking on a tight rope. The government can't trim reserve prices too much as that may send a negative signal to the market; besides it also has to protect the nation's reserves. But on the other hand, if the reserve prices are maintained too high and sites can't be awarded at state tenders, the government may not be able to ensure a steady state of supply to avoid busts and booms in the property market,' Mr Mak said.
At $118 psf ppr it is below expectations, but analyst says site is not plum anyway
Cautious sentiment, soaring construction costs and a not-so-hot site all combined to yield just one bid at a state tender yesterday for a 99-year leasehold condo site at Tampines Ave 1/Ave 10 facing Bedok Reservoir.
The sole bid of about $118 per square foot per plot ratio (psf ppr) was below general market expectations which ranged from $150 to $230 psf ppr.
The sole bidder at yesterday's tender was Boon Keng Development, a unit of Midview group, which is involved in the construction and property businesses.
Most property consultants reckon there's only a slim chance of the site being awarded.
Looking at the $118 psf ppr sole bid at yesterday's tender, property consultants told BT that no 99- year leasehold condo/ apartment site has been sold at a lower price than this since 1991.
Yesterday's top bid, which was for a private condominium site, was also below the $137 psf ppr at which the government sold a Design, Build and Sell Scheme site in Simei for development into Housing & Development Board flats in June.
'This outcome is negative for property market sentiment. It may be even worse for sentiment if the government actually awards the site as that could affect land valuations for other residential sites too,' Knight Frank director (research and consultancy) Nicholas Mak said.
However, Savills Singapore director (marketing and business development) Ku Swee Yong noted that the Tampines site was not a plum one to begin with.
'It does not have good attributes in terms of transportation links. Neither is it near major amenities,' he said.
'Generally, developers already have good landbanks, so unless a very good site comes along, we'll not see too much participation,' Mr Ku said.
'But if a site with solid transportation connection and amenities comes up, like the Ophir Road white site or the condo plot next to Tanah Merah MRT station, these will be attention grabbers,' he added.
The tender for the Tanah Merah plot closes on Sept 9 while that for the Ophir Road plot closes in December.
The $118 psf ppr bid for the Tampines plot, plus construction costs of about $320-350 psf of gross floor area, reflects a breakeven cost of about $500-550 psf for a new condo project.
Units in completed condos around the Bedok Reservoir area have been selling at between $550 psf and $680 psf, although the new Waterfront Waves condo which is being built on a choice spot along the reservoir has achieved average prices of about $750 psf for pool-facing units and $800 psf for reservoir-facing units.
The latest plot on Tampines Ave 1/Ave 10 can be built into a condo with about 650 units. It was offered through the confirmed list of the Government Land Sales Programme.
Debating the likelihood of the plot being awarded, a property consultant who declined to be named said: 'There was just one bid. But I hope the government will award this site if it wants to show foreign investors that Singapore is a competitive place to invest in.'
Knight Frank's Mr Mak said that the government will gradually lower reserve prices for sites offered through the Government Land Sales Programme, to take into account rising construction costs and weak property market sentiment.
'It's walking on a tight rope. The government can't trim reserve prices too much as that may send a negative signal to the market; besides it also has to protect the nation's reserves. But on the other hand, if the reserve prices are maintained too high and sites can't be awarded at state tenders, the government may not be able to ensure a steady state of supply to avoid busts and booms in the property market,' Mr Mak said.
SC Global's Net Profit Rises 117%
Source : The Business Times, August 13, 2008
SC Global Developments has reported a net profit of $11.47 million for Q2 2008, an increase of 117 per cent compared to $5.28 million for the corresponding period a year ago.
Revenue for the quarter was $32.4 million, marginally lower compared to $34 million in Q2 2007. This was attributed to revenue recognition from residential units sold in its Singapore development projects namely, The Marq on Paterson Hill and Hilltops. SC Global said that this was the first quarter of revenue recognition for Hilltops.
It also said that the group's development project under its Kairong brand in Shenyang, China, named Kairong International Gardens also made a positive contribution for the quarter as construction progressed.
Gross Profit for the quarter increased 116 per cent to $16.5 million compared to $7.7 million a year ago. This was attributed to higher selling prices achieved for its Singapore development projects. Gross margins were 51 per cent for the quarter as compared to 23 per cent in 2007.
Contribution from the group's associate company in Australia, AVJennings Ltd, was $1.5 million as compared to $2.9 million in the same corresponding period last year.
Earnings per share for the period is 2.90 cents, up from 1.65 cents (adjusted) a year ago.
SC Global Developments has reported a net profit of $11.47 million for Q2 2008, an increase of 117 per cent compared to $5.28 million for the corresponding period a year ago.
Revenue for the quarter was $32.4 million, marginally lower compared to $34 million in Q2 2007. This was attributed to revenue recognition from residential units sold in its Singapore development projects namely, The Marq on Paterson Hill and Hilltops. SC Global said that this was the first quarter of revenue recognition for Hilltops.It also said that the group's development project under its Kairong brand in Shenyang, China, named Kairong International Gardens also made a positive contribution for the quarter as construction progressed.
Gross Profit for the quarter increased 116 per cent to $16.5 million compared to $7.7 million a year ago. This was attributed to higher selling prices achieved for its Singapore development projects. Gross margins were 51 per cent for the quarter as compared to 23 per cent in 2007.
Contribution from the group's associate company in Australia, AVJennings Ltd, was $1.5 million as compared to $2.9 million in the same corresponding period last year.
Earnings per share for the period is 2.90 cents, up from 1.65 cents (adjusted) a year ago.
Koh Brothers Sees H1 Earnings Dive To $0.5m
Source : The Business Times, August 13, 2008
PROPERTY and construction company Koh Brothers on Wednesday said that net profit for its first half ended June 30, 2008 dove to S$528,000 - from S$30.2 million a year ago - as it saw lower sales and smaller revaluation gains from its investment properties.
Revenue declined 14.0 per cent to S$118.2 million, from S$137.1 million a year ago. The decrease in turnover was mainly due to the completion of some projects in 2007.
Earnings per share for H1 2008 fell to 0.11 Singapore cents, from 6.29 Singapore cents for the same six months in 2007.
The group will continue to selectively bid for more large-scale public sector projects that generate higher return and better profit margin in the future, Koh Brothers said. It also expects its building materials business to continue to contribute positively to results.
But on the property front, Koh Brothers is cautious on the outlook of the property market and will continue to monitor the market closely as it considers releasing new projects at the opportune time, it said.
Koh Brothers' stock closed unchanged at 19.5 Singapore cents on Wednesday.
PROPERTY and construction company Koh Brothers on Wednesday said that net profit for its first half ended June 30, 2008 dove to S$528,000 - from S$30.2 million a year ago - as it saw lower sales and smaller revaluation gains from its investment properties.
Revenue declined 14.0 per cent to S$118.2 million, from S$137.1 million a year ago. The decrease in turnover was mainly due to the completion of some projects in 2007.Earnings per share for H1 2008 fell to 0.11 Singapore cents, from 6.29 Singapore cents for the same six months in 2007.
The group will continue to selectively bid for more large-scale public sector projects that generate higher return and better profit margin in the future, Koh Brothers said. It also expects its building materials business to continue to contribute positively to results.
But on the property front, Koh Brothers is cautious on the outlook of the property market and will continue to monitor the market closely as it considers releasing new projects at the opportune time, it said.
Koh Brothers' stock closed unchanged at 19.5 Singapore cents on Wednesday.
Just One Bid For Tampines Condo Site
Source : The Straits Times, August 13, 2008
THE property slowdown was clear for all to see yesterday when the tender for a condo site overlooking Bedok Reservoir closed with just one bid - and at a price well below expectations.
The Urban Redevelopment Authority (URA) will likely refuse to award the 3.2ha site, given the poor offer, consultants said.
Boon Keng Development bid $84.6 million, or $118 per sq ft (psf), for the 99-year leasehold site but consultants had expected anything from $150 to $230 psf.
Apartments on the site could sell for up to $700 psf, they said.
If Boon Keng does secure the site at the junction of Tampines Avenues 1 and 10, its break-even would be about $480 to $500 psf. It would then be able to sell the apartments for around $600 psf, said Knight Frank's director of research and consultancy, Mr Nicholas Mak. But he does not expect the URA to sell the land at such a low price.
The increasingly cautious mood among developers explains why the site drew only one bid.
'If this site was not on the confirmed list, it may not be triggered for tender,' said Mr Mak.
Confirmed list sites are tendered out at pre-determined dates regardless of whether developers have shown interest.
'If confirmed list sites were launched for tender in an increasingly uncertain market, they would attract opportunistic bids, such as the one we witnessed today,' said Mr Mak.
Savills Singapore's director of business development and marketing, Mr Ku Swee Yong, who had tipped bids of $150 to $180 psf for the site, said: 'Most developers have ample land, so unless a choice plot is available, they won't bid.'
Rising building costs are forcing developers to look for cheaper land. In such a climate, the Government has to decide whether to lower reserve prices to ensure a steady supply of mass-market private housing, or maintain the value of plots on the sales list as they form part of the nation's reserve, said Mr Mak.
He does not expect any residential site on the government sales list to be triggered for tender unless reserve prices are lowered. If not, there could be a sharp drop in the sale of residential land from the Government this year.
Singapore tenders out land on the reserve list if developers indicate interest by committing to a minimum bid acceptable to them.
THE property slowdown was clear for all to see yesterday when the tender for a condo site overlooking Bedok Reservoir closed with just one bid - and at a price well below expectations.
The Urban Redevelopment Authority (URA) will likely refuse to award the 3.2ha site, given the poor offer, consultants said.
Boon Keng Development bid $84.6 million, or $118 per sq ft (psf), for the 99-year leasehold site but consultants had expected anything from $150 to $230 psf.
Apartments on the site could sell for up to $700 psf, they said.
If Boon Keng does secure the site at the junction of Tampines Avenues 1 and 10, its break-even would be about $480 to $500 psf. It would then be able to sell the apartments for around $600 psf, said Knight Frank's director of research and consultancy, Mr Nicholas Mak. But he does not expect the URA to sell the land at such a low price.
The increasingly cautious mood among developers explains why the site drew only one bid.
'If this site was not on the confirmed list, it may not be triggered for tender,' said Mr Mak.
Confirmed list sites are tendered out at pre-determined dates regardless of whether developers have shown interest.
'If confirmed list sites were launched for tender in an increasingly uncertain market, they would attract opportunistic bids, such as the one we witnessed today,' said Mr Mak.
Savills Singapore's director of business development and marketing, Mr Ku Swee Yong, who had tipped bids of $150 to $180 psf for the site, said: 'Most developers have ample land, so unless a choice plot is available, they won't bid.'
Rising building costs are forcing developers to look for cheaper land. In such a climate, the Government has to decide whether to lower reserve prices to ensure a steady supply of mass-market private housing, or maintain the value of plots on the sales list as they form part of the nation's reserve, said Mr Mak.
He does not expect any residential site on the government sales list to be triggered for tender unless reserve prices are lowered. If not, there could be a sharp drop in the sale of residential land from the Government this year.
Singapore tenders out land on the reserve list if developers indicate interest by committing to a minimum bid acceptable to them.
Japan On Brink Of Recession As Economy Shrinks
Source : The Straits Times, August 13, 2008
TOKYO - JAPAN said on Wednesday its economy contracted in the second quarter as falling exports and weak consumer spending sent Asia's largest economy hurtling toward its first recession in six years.
The slump reflects the rapidly deteriorating global economic climate, with fears of a recession in the eurozone also mounting as the fallout from the US financial crisis ripples around the world.
Japan's gross domestic product (GDP) shrank by 0.6 per cent in the three months to June from the previous quarter, the Cabinet Office said, marking the first time in a year that the world's second-biggest economy has contracted.
The economy shrank by 2.4 per cent on an annualised basis, matching market expectations.
The slump put Japan on the cusp of outright recession, which is usually defined as two or more straight quarters of economic contraction. The last time that happened in Japan was in 2001, when the recession lasted for three quarters.
Tokyo share prices slumped 2.1 per cent as the weak growth figures added to jitters about problems in the US banking sector.
GDP growth for the first quarter of 2008 was also revised down to 0.8 per cent quarter-on-quarter from 1.0 per cent previously.
Economic growth 'will remain very weak throughout this fiscal year,' said Mamoru Yamazaki, chief economist for Japan at RBS Securities.
'The increase in oil and commodity prices is damaging corporate profits,' while rising inflation is hurting households, he said.
After suffering a series of on-off recessions in the 1990s following the bursting of the economic bubble, Japan had been slowly recovering on the back of brisk exports and business investment.
Japan's government, however, last week effectively declared an end to the country's longest period of economic expansion in postwar times.
Even so, the economy is considered to be in much better shape than it was during previous downturns, particularly the corporate sector which has benefitted from several years of bumper earnings.
'The fundamentals of the economy are much better than in the previous post-bubble cycles,' Lehman Brothers chief Japan economist Kenichi Kawasaki wrote in a note to clients.
'The downside risks remain elevated, but we expect that this cyclical downturn will be a relatively mild one.' Japan is not the only major industrialised nation to have suffered an economic contraction this year - Canada's economy shrank in the first quarter and Italy suffered negative growth in the second quarter.
The US economy also shrank slightly in the fourth quarter last year but has since been bolstered by stimulus measures.
While Japan's contraction was partly a hangover from the robust first-quarter growth, the slowing global economy took a heavy toll on exports, which tumbled 2.3 per cent.
While Japan's contraction was partly a hangover from the robust first-quarter growth, the slowing global economy took a heavy toll on exports, which tumbled 2.3 per cent.
Household spending fell 0.5 per cent as soaring commodity and food prices, coupled with sluggish wages, prompted consumers to tighten their purse strings.
Business investment was another weak spot, dropping 0.2 percent as cautious companies spent less on new equipment and factories.
Reflecting a slowing global economy, Japan's current account surplus plunged 67.4 per cent in June from a year earlier to 493.9 billion yen (S$6.3 billion) as exports to the United States and Europe fell, official data showed on Wednesday.
The trade surplus alone tumbled 81.3 per cent to 252.1 billion yen.
Given the gloomy economic situation, analysts do not expect the Bank of Japan to raise its super-low interest rates from the current level of 0.5 per cent any time soon, despite the highest inflation in a decade.
'It's very hard for the BoJ to move despite the increase in prices,' RBS Securities' Yamazaki said. -- AFP
TOKYO - JAPAN said on Wednesday its economy contracted in the second quarter as falling exports and weak consumer spending sent Asia's largest economy hurtling toward its first recession in six years.
The slump reflects the rapidly deteriorating global economic climate, with fears of a recession in the eurozone also mounting as the fallout from the US financial crisis ripples around the world.
Japan's gross domestic product (GDP) shrank by 0.6 per cent in the three months to June from the previous quarter, the Cabinet Office said, marking the first time in a year that the world's second-biggest economy has contracted.
The economy shrank by 2.4 per cent on an annualised basis, matching market expectations.
The slump put Japan on the cusp of outright recession, which is usually defined as two or more straight quarters of economic contraction. The last time that happened in Japan was in 2001, when the recession lasted for three quarters.
Tokyo share prices slumped 2.1 per cent as the weak growth figures added to jitters about problems in the US banking sector.
GDP growth for the first quarter of 2008 was also revised down to 0.8 per cent quarter-on-quarter from 1.0 per cent previously.
Economic growth 'will remain very weak throughout this fiscal year,' said Mamoru Yamazaki, chief economist for Japan at RBS Securities.
'The increase in oil and commodity prices is damaging corporate profits,' while rising inflation is hurting households, he said.
After suffering a series of on-off recessions in the 1990s following the bursting of the economic bubble, Japan had been slowly recovering on the back of brisk exports and business investment.
Japan's government, however, last week effectively declared an end to the country's longest period of economic expansion in postwar times.
Even so, the economy is considered to be in much better shape than it was during previous downturns, particularly the corporate sector which has benefitted from several years of bumper earnings.
'The fundamentals of the economy are much better than in the previous post-bubble cycles,' Lehman Brothers chief Japan economist Kenichi Kawasaki wrote in a note to clients.
'The downside risks remain elevated, but we expect that this cyclical downturn will be a relatively mild one.' Japan is not the only major industrialised nation to have suffered an economic contraction this year - Canada's economy shrank in the first quarter and Italy suffered negative growth in the second quarter.
The US economy also shrank slightly in the fourth quarter last year but has since been bolstered by stimulus measures.
While Japan's contraction was partly a hangover from the robust first-quarter growth, the slowing global economy took a heavy toll on exports, which tumbled 2.3 per cent.
While Japan's contraction was partly a hangover from the robust first-quarter growth, the slowing global economy took a heavy toll on exports, which tumbled 2.3 per cent.
Household spending fell 0.5 per cent as soaring commodity and food prices, coupled with sluggish wages, prompted consumers to tighten their purse strings.
Business investment was another weak spot, dropping 0.2 percent as cautious companies spent less on new equipment and factories.
Reflecting a slowing global economy, Japan's current account surplus plunged 67.4 per cent in June from a year earlier to 493.9 billion yen (S$6.3 billion) as exports to the United States and Europe fell, official data showed on Wednesday.
The trade surplus alone tumbled 81.3 per cent to 252.1 billion yen.
Given the gloomy economic situation, analysts do not expect the Bank of Japan to raise its super-low interest rates from the current level of 0.5 per cent any time soon, despite the highest inflation in a decade.
'It's very hard for the BoJ to move despite the increase in prices,' RBS Securities' Yamazaki said. -- AFP
Property Developer In Japan's Biggest Bankruptcy This Year
Source : The Straits Times, August 13, 2008
TOKYO - JAPANESE property developer Urban Corp. collapsed on Wednesday with debts of 2.4 billion dollars (S$3.37 billion) due to a slump in the housing market, the biggest bankruptcy in Japan this year.
The company said it had filed with the Tokyo District Court for protection from creditors following a slump in the nation's real estate market.
'Our company gave up self-resuscitation and decided to rebuild itself under the Civil Rehabilitation Law,' a company statement said.
Debts totalled 255.83 billion yen, making it this year's biggest bankruptcy yet in Japan, ahead of another troubled developer, Kei-r Co., which collapsed in April owing 167.7 billion yen.
The number of Japanese real estate firms going bankrupt has increased since the US 'subprime' mortgage crisis erupted last year, triggering a global credit crunch and weighing on Japan's economy. -- AFP
TOKYO - JAPANESE property developer Urban Corp. collapsed on Wednesday with debts of 2.4 billion dollars (S$3.37 billion) due to a slump in the housing market, the biggest bankruptcy in Japan this year.
The company said it had filed with the Tokyo District Court for protection from creditors following a slump in the nation's real estate market.
'Our company gave up self-resuscitation and decided to rebuild itself under the Civil Rehabilitation Law,' a company statement said.
Debts totalled 255.83 billion yen, making it this year's biggest bankruptcy yet in Japan, ahead of another troubled developer, Kei-r Co., which collapsed in April owing 167.7 billion yen.
The number of Japanese real estate firms going bankrupt has increased since the US 'subprime' mortgage crisis erupted last year, triggering a global credit crunch and weighing on Japan's economy. -- AFP
'Rougher Ride' Ahead: MM
Source : The Straits Times, August 13, 2008
PREPARE for a 'rougher ride' as the economy slows, but the Government will ensure that low income Singaporeans can cope with the bumps.
Minister Mentor Lee Kuan Yew gave this assurance on Wednesday night, pointing out that the Government is paying close attention to the plight of the needy.
Minister Mentor Lee Kuan Yew gave this assurance on Thursday night, pointing out that the Government is paying close attention to the plight of the needy. -- ST PHOTO
'We cannot protect our people completely from the high oil and food prices. But we will make sure that they can manage,' he said at the annual National Day dinner at his Tanjong Pagar constituency.
He referred to the slew of relief measures this year, costing the Government over $3 billion, with many of them targeted at low wage workers such as the Workfare Supplement Scheme.
His message comes amid a backdrop of global economic meltdown, with Singapore starting to feel the heat.
The Government had recently revised this year's growth forecast, narrowing the range to between 4 and 5 per cent, from the earlier projection of 4 to 6 per cent.
'We have to be ready for rougher times ahead,' said Mr Lee.
'Singapore could grow at 5 to 6 per cent, even 7 to 8 per cent in some years, if there is no long recession in the United States and European Union.'
'If they go into recession, then we may grow less at 3 to 5 per cent.'
But MM Lee believes it looks 'increasingly likely' that the US credit crunch will cause a downturn when the new US President takes over in January.
This, he added, may lead to a prolonged slowdown in the US that will affect Europe, Japan and Asean.
The result: Job losses.
'There will be retrenchments in those industries whose exports to America and Europe are affected,' he warned.
But foreign workers will take the brunt of the retrenchments, 'saving many Singaporeans their jobs'.
The dark clouds looming over the horizon, however, did not dampen Mr Lee's optimism over the future.
His confidence stems from the 'shock absorbers' that Singapore has to buffer these setbacks.
'There are massive investments with long term implementation periods. There is a construction boom,' he said.
'When the buildings are complete, there will be demand for workers from the integrated resorts, new plants producing solar panels, petrochemicals and pharmaceuticals.'
These new demands for labour, he added, will soften the impact of retrenchments.
Singapore and Southeast Asia also have two new growth engines: China and India, he added.
PREPARE for a 'rougher ride' as the economy slows, but the Government will ensure that low income Singaporeans can cope with the bumps.
Minister Mentor Lee Kuan Yew gave this assurance on Wednesday night, pointing out that the Government is paying close attention to the plight of the needy.
Minister Mentor Lee Kuan Yew gave this assurance on Thursday night, pointing out that the Government is paying close attention to the plight of the needy. -- ST PHOTO'We cannot protect our people completely from the high oil and food prices. But we will make sure that they can manage,' he said at the annual National Day dinner at his Tanjong Pagar constituency.
He referred to the slew of relief measures this year, costing the Government over $3 billion, with many of them targeted at low wage workers such as the Workfare Supplement Scheme.
His message comes amid a backdrop of global economic meltdown, with Singapore starting to feel the heat.
The Government had recently revised this year's growth forecast, narrowing the range to between 4 and 5 per cent, from the earlier projection of 4 to 6 per cent.
'We have to be ready for rougher times ahead,' said Mr Lee.
'Singapore could grow at 5 to 6 per cent, even 7 to 8 per cent in some years, if there is no long recession in the United States and European Union.'
'If they go into recession, then we may grow less at 3 to 5 per cent.'
But MM Lee believes it looks 'increasingly likely' that the US credit crunch will cause a downturn when the new US President takes over in January.
This, he added, may lead to a prolonged slowdown in the US that will affect Europe, Japan and Asean.
The result: Job losses.
'There will be retrenchments in those industries whose exports to America and Europe are affected,' he warned.
But foreign workers will take the brunt of the retrenchments, 'saving many Singaporeans their jobs'.
The dark clouds looming over the horizon, however, did not dampen Mr Lee's optimism over the future.
His confidence stems from the 'shock absorbers' that Singapore has to buffer these setbacks.
'There are massive investments with long term implementation periods. There is a construction boom,' he said.
'When the buildings are complete, there will be demand for workers from the integrated resorts, new plants producing solar panels, petrochemicals and pharmaceuticals.'
These new demands for labour, he added, will soften the impact of retrenchments.
Singapore and Southeast Asia also have two new growth engines: China and India, he added.