Sunday, September 16, 2007

Still Looming Large, Greenspan Issues Memoirs As Economy Wavers

Source : Channel NewsAsia, 16 September 2007

WASHINGTON : A year and a half after leaving the Federal Reserve, Alan Greenspan is back in the limelight with the release of his memoirs just as the economy is at a crossroads and ahead of a critical Fed meeting.

The former Fed chairman's new book, "The Age of Turbulence" hits bookstores Monday, allowing the man dubbed "the Oracle" to tell his own tale of nearly two decades at the helm of one of the world's most powerful financial institutions.

According to The Wall Street Journal, Greenspan, who calls himself a lifelong Republican, writes that he advised the White House to veto some bills to curb "out-of-control" spending while the Republicans controlled Congress.

He says, according to the paper, President George W. Bush's failure to do so "was a major mistake."

Republicans in Congress, he writes, "swapped principle for power. They ended up with neither. They deserved to lose" in the 2006 congressional elections.

Greenspan puts his own spin on the events surrounding the 1987 stock market crash, the bursting of the Internet bubble as well as the recession on the heels of the September 11 terror strikes.

In a blog opened for him by online bookstore, Greenspan says he will share details of his childhood in New York, his years as a jazz musician and his friendship with US presidents.

"After years of talking 'Fedspeak' in carefully calibrated congressional testimony I could finally use my own voice!" Green says with uncharacteristic verve. He was best known for his careful if cryptic comments on any issue that might affect interest rates.

"I tackled the personal part first, but then started unraveling the detective story about the economy," says Greenspan in his blog. "What did all the economic shifts we began to detect in the late nineties mean?"

His memoirs are due out just as the institution he led for so many years holds its most anticipated meeting in years.

On Tuesday, investors around the world will be closely watching the Fed awaiting some sign that might help counter the effects of the sub-prime mortgage crisis that has rattled markets and led to a squeeze in credit.

The stakes are great: in August the US economy lost jobs for the first time in four years and economists are increasing their talk about recession.

That as Greenspan increasingly is being blamed by some for the crisis. By keeping interest rates so low for so long, some argue, he helped foster the real estate bubble behind much of the current woes.

The former Wall Street guru defended himself in an interview with CBS television, portions of which were released Thursday.

"They are mistaken," Greenspan said in the interview on critics who argue he kept rates too low. "It was our job to unfreeze the American banking system if we wanted the economy to function. This required that we keep rates modestly low."

In the interview, Greenspan paid homage to his successor, Ben Bernanke, saying he is doing an excellent job and that he would probably not have handled matters differently.

Greenspan also said he failed to realize the importance of the subprime loan problems "until very late in 2005 and 2006," as he was preparing to step down as Fed chairman, but that in any case he could not have stopped them.

The 81-year-old Greenspan ironically may be more publicly accessible than when he was Fed chairman. He operates a consulting firm Greenspan Associates and has been making numerous speaking engagements. He also has agreed to advise investment firm Pimco and Deutsche Bank.

And he has demonstrated that even as a private citizen, he can roil markets.

When he uttered the word "recession' in a speech in late February it helped send Wall Street on its steepest slide since September 2001.

Earlier in the month, when he compared the current crises to the market woes of 1987 or 1998, Wall Street fell by almost two percent.

Back in 1996, he rattled markets by speaking of their "irrational exuberance."

For some, he ought to be more cautious.

"He should say less," said Hugh Johnson, an analyst at Johnson Illington Advisors. "He's widely respected and has a tendency to move investors, so someone who's that important to investors needs to be very careful about what he or she says." - AFP/ir

Bayshore Park Home Owners Organise To Oppose En Bloc Sale Move

Source : Channel NewsAsia, 16 September 2007

SINGAPORE: Life at Bayshore Park, a 21-year-old estate with over 1000 apartments, was pretty quiet until a notice went up in June this year, saying some home owners are interested in exploring the potential of an en bloc sale.

This was followed by a presentation on the en bloc process at the condo in August.

In her debut episode as the new host for “Get Rea!”, Cheryl Fox learns that those opposing any en bloc sale have already organised themselves to defend their homes from those pushing for it, even before a formal sales committee has been appointed.

“Get Rea!” learned that prices of between S$1.8m and S$3m per unit were quoted, depending on the floor area.

But some homeowners are not biting.

"At our age, what do you want that kind of money for? We just want to retire and enjoy our few years of life here," said homeowner Stephen Seow.

That was one of the messages homeowners at Bayshore Park hope to get across to the Protem Sales Committee.

Some have organised themselves into the Love Bayshore Park group to fight any en bloc sale.

According to Bayshore Park resident Vincent Bockaert, a check of the caveats lodged for Bayshore Park showed some members of the Protem Sales Committee bought their apartments only a few months ago.

"These people have a short-term perspective. They went in this year. If they make hundred thousand dollars, they make a profit. They move on."

An extra-ordinary general meeting is slated for September 29, and members of En Bloc Sales Committee for the condo will be elected.

The new season of “Get Rea!” returns on Monday, September 17, at 8.30pm Singapore time (12:30 GMT). - CNA/ac

CapitaLand Sells 45% Stake In HK's AIG Tower For S$710m

Source : Channel NewsAsia, 16 September 2007

Picture : HK's AIG Tower

SINGAPORE: Property developer CapitaLand says it has sold its effective 45 per cent stake in Hong Kong's AIG Tower for some S$710 million in cash and debt.

The buyer, American International Assurance Company, will pay S$355 million for the shares that CapitaLand owns in AIG Tower. Another S$355 million will go towards repaying the loans granted by CapitaLand's units for the development of the project.

All in, the transaction values AIG Tower at about S$1.58 billion.

CapitaLand will book nearly S$261 million in gains from the sale, which is due to be completed at the end of November.

AIG Tower is a prime Grade A office building in Hong Kong's Central business district.

It was built in April 2005 on the former Furama Hotel site at 1 Connaught Road.

The 26-storey building is fully occupied with prominent tenants including American International Group, Bank of Tokyo Mitsubishi UFJ, CapitaLand, Kohlberg Kravis Roberts & Company, Lai Sun Group, Oaktree Capital, Royal Bank of Scotland and Wachovia Bank.

The latest deal is seen as CapitaLand's ongoing efforts to achieve better returns from its property portfolio.

In March this year, CapitaLand sold its stake in Temasek Tower in Singapore's central business district for S$1.04 billion to Macquarie Global Property Advisors.

The deal was one of the biggest office transactions in Singapore. - CNA/ac

Expat Couple Go Hunting For Home Amid Soaring Rents. Their Verdict? ‘It’s Just Insane’

Source : The Sunday Times, 16 Sept 2007

MR AND MRS OLIVRY began their search for a new home after their landlord raised the rent of their 1,800 sq ft Jervois Road apartment by three times, from $2,400 to $7,200, in July. The couple are seen here with their son Luca unpacking in their new rental apartment in Tanjong Rhu. -- ST PHOTO: WANG HUI FEN

STANDING in the yellow-tiled kitchen of a corner terrace house in Upper Bukit Timah Road, the Olivrys thought their arduous search for a home had finally ended.

They had just signed a letter of intent and handed over a cheque for a month’s rent to two property agents.

Walking through the unit, they excitedly went through curtain choices and colour schemes for the walls.

But their happiness was shortlived.

As the couple stepped out of the lush, palm-tree filled garden, a Caucasian man walked in.

Another potential tenant perhaps, thought American housewife Laura Thornton-Olivry, shrugging it off. It was 10am.

True enough, the agents called back three hours later. Instead of the agreed $4,300 rent, the unit was now going for $2,000 more.

The Olivrys, both in their 30s, were furious. Refusing to enter into a bidding war, they called the agent for an apartment in Upper East Coast Road that they had viewed earlier.

Good news, it was still available.

At 2pm, with their nine-month-old baby in tow, they zipped across the island and reached the condominium.

The moment they walked through the door, deja vu set in: ‘Sorry, it’s going for $2,000 more now.’

A livid Mrs Thornton-Olivry asked: ‘Couldn’t you have picked up the phone to tell us before we came here?’

‘Sorry,’ came the nonchalant reply from the agent.

In a market of rapidly rising rents, trying to find a dream home can be a nightmare. In July, their landlord raised the rent of their 1,800 sq ft Jervois Road apartment from $2,400 to $7,200.

‘The rent went up three times; that’s just insane,’ said Mr Nicolas Olivry, who is French and runs his own marketing business here.

The hunt then began: At 7pm every night, he would sit at his desk and go through the newspaper classifieds, with highlighter pens in hand.

Pink for the good apartments. Blue for the average ones.

Then it was another hour of non-stop calling to arrange viewings for the next day. The pair checked out apartments separately so they could cover more, Mr Olivry squeezing the viewings into his work schedule and his wife, in between baby feeds and baby naps.

This went on for the better part of a month.

It became even more stressful when their Filipino maid went home and baby Luca had to join his mother in the search.

They covered nearly 15 apartments a week together.

Racing against time to find a home before their lease ended this month, the Olivrys found that they had to lower their expectations and raise their budget.

Their $3,200 budget had to climb up to $4,200 before they were shown anything near decent, they said. They were prepared to live farther from town but wanted the same living space as in their previous apartment.

Things were different in 2002. Mrs Thornton-Olivry found her first home in Singapore - a shophouse in Everton Road - during a four-hour transit in Singapore then.

She was on her way from Timor Leste to Bangkok. The 3,500 sq ft house was beautifully furnished and the rent was $4,500 a month.

‘It was the sort featured in magazines,’ she said wistfully.

Five years on and she had to settle for an unfurnished apartment that was half the size, in much poorer condition and in a less central location - for the same amount of money.

Some of the apartments she saw had peeling paint and shabby kitchen equipment. One even had what Mrs Thornton-Olivry described as a ‘burner’ in place of a proper stove.

And if quality apartments were a rare find, well-informed housing agents were even harder to come by.

Mr Olivry said agents were often clueless about the homes they were marketing, unable to answer basic questions such as the colour of floor tiles or the number of bathrooms.

Some marketed homes which they had not even seen.

Once, he ended up seeing the same unit twice because the second agent would not tell him the unit number until he got to the condominium.

They found their present apartment - about the same size as their previous one - in Tanjong Rhu through the classifieds three weeks ago.

But Mrs Thornton-Olivry has had to say goodbye to her morning jogs in the Botanic Gardens, a ‘mothers club'’ which meets in the Bukit Timah area and the convenience of walking to Tanglin Mall for groceries.

‘Am I happy?’

She paused.

‘It’s not as nice. But it’s okay.’

Rents here still lower than other cities: URA

DESPITE rising rents, the Urban Redevelopment Authority (URA) said Singapore’s private housing rents were still much lower than those in other global cities.

Figures released by the URA in July showed that rents are 31.2 per cent higher compared to a year ago.

They jumped 10.4 per cent in the second quarter of this year, compared to the 7.6 per cent rise in the first three months.

But URA said Singapore was less expensive than cities such as Hong Kong, Tokyo, Seoul and Mumbai.

Trade and Industry Minister Lim Hng Kiang said last month in Parliament that Singapore must ‘maintain vigilance’ over its costs, as excessive cost increases will dampen growth prospects.

Data from property consultant Savills showed that rents for luxury residential apartments in prime areas in Singapore were lower than those in Hong Kong and Tokyo.

Here, tenants could expect to pay $5.56 per sq ft, or $5,560 a month, for a 1,000 sq ft apartment.

A similar apartment in Hong Kong would cost $6.43 psf and $6.20 psf in Tokyo.

But Singapore was more expensive than Shanghai and Beijing.

Global editor of financial careers website Sarah Butcher said that with rising accommodation costs, among other things, finance professionals will consider pursuing their careers in less expensive financial hubs.

But URA pointed out that there was ample supply in the pipeline. As at end-June, there were 56,182 uncompleted private apartment units. This supply would help to moderate the increase in rents and housing prices, it said.

HDB flats formed another pool of rental homes. More HDB owners were now able to sublet their entire flats after HDB relaxed the rules in March this year.

This has expanded the overall rental housing market to about 658,000 HDB flats.

HDB To Construct A 5.5 km Man-Made River In Punggol

Source : Channel NewsAsia, 15 September 2007

(Picture) Punggol 21 + Flats will offer Water Views

Residents of Punggol can look forward to more water activities in the future.

The Housing and Development Board (HDB) is set to build a man-made river in Punggol from 2009.

The 5.5-kilometre Punggol Waterway will run through stepped-up homes, the Punggol MRT station and an upcoming town centre.

Residential units, both private and public, will be built just 10 metres away from each side of the river.

Related Video Link -
HDB to construct a 5.5 km man-made river in Punggol

One of the key icons along the waterway will be a commercial and residential development.

The site for this is expected to be sold within the next five years. It will sit next to the widest stretch of the man-made river, and will be home to residential units, al fresco dining and shops.

Besides being next to the MRT station, it might even be served by river taxis.

The Punggol Waterway will connect two rivers - Sungei Serangoon and Sungei Punggol - and discharge excess water out of the area.

PUB is already constructing dams at the mouths of the rivers for two new reservoirs expected to be up and running by 2009.

Punggol Waterway will be about 3-9 metres deep and 20-50 metres wide.

To build it, HDB will dig deep into the existing land, but retain the soil to construct a man-made natural water bed.

Chua Kok Eng, principal engineer at the Building Tech Department at HDB says: "We have built many canals previously, and their function is to drain away water as fast as possible. For this case, we want to retain the water because it forms part of the reservoir, so we're looking for more environmentally-friendly and green form of construction.

"We're going to re-use the soil. The river bank will be planted with landscaping and plants for a greener environment and residents will be able to enjoy waterfront living."

Punggol Waterway is expected to be completed by 2014.

Once finished, it will be managed by PUB.

HDB is currently studying the costs and technical details of building the waterway. - CNA /ls

Dawson Estate To Get Boost In Value

Source : The Sunday Times, Sep 16, 2007

Prices expected to rise as new generation of public housing will replace HDB blocks

THE laid-back feel of the old Dawson estate in Queenstown will give way to a lot more hustle and bustle when new, designer-looking HDB flats go up in several years' time.

Property experts say the estate's impending transformation will give the wider area an added premium. Property values there already benefit from the fairly central location and proximity to the Queenstown MRT station.

'The estate is dated, but prices in and around the area should rise as the whole environment will improve with the transformation,' said ERA Singapore assistant vice-president Eugene Lim.

The 60ha estate was cited by Prime Minister Lee Hsien Loong in his National Day Rally speech as an old estate with great redevelopment potential.

The Government has since displayed designs for three precincts in the estate by leading local architectural firms - Surbana International Consulants, Woha Architects and SCDA Architects - and is inviting public feedback.

Construction of this new generation of public housing is expected to begin within the next three to four years, said HDB.

Some new flats have already been put up in the estate, under the Selective En bloc Redevelopment Scheme, which allows residents to be resettled in new flats after their old blocks are torn down for redevelopment.

As at July, about 2,970 flats had been completed, while another 794 flats are being constructed in the Strathmore Avenue area.

Nearby flats in the Stirling Road and Mei Ling Heights areas command a premium for their location, property agents say. Some buyers like Mei Ling Heights as it sits on higher ground.

Two low-floor, five-room flats on Mei Ling Street were sold last month: one for $570,000 and the other for $600,000.

In the Queenstown area in the second quarter, the average cash amount over valuation recorded for a five-room flat was relatively high at about $42,000. The average for Ang Mo Kio was $25,000; for Seng Kang, $5,000.

Prices in and around Dawson could rise by 20 per cent once plans for the estate are firmed up, said Mr Ku Swee Yong of property consultancy Savills Singapore.

The area might get a boost in value if the Government turns the entire Singapore River stretch, all the way to Alexandra Canal, into a family-friendly recreational area, said an industry observer.

Dawson does not have any private housing now, but the Government has plans to change this. Its projection of 10,000 dwelling units for the estate includes both public and private housing.

In the neighbouring Redhill area, which has a cluster of private housing, sub-sale prices have moved up in the past year.

Two 1,109 sq ft units at Tanglin Regency were sold for $884 per sq ft (psf) last month. At The Metropolitan Condominium, deals done in July and August ranged from $677 psf (for a 1,033 sq ft unit) to $1,119 psf (for a 2,680 sq ft unit).

'In Dawson, most of the private housing is likely to be targeted at upgraders in the estate,' said Mr Ku.

Thus, while the estate's value is expected to climb, the rise should be limited because it is essentially an HDB area, he said.

The area has upside potential but the extent of any price climb will depend on the market situation down the road, said Mr Lim.

Why Church Inked Buona Vista Mega-Property Deal

Source : The Sunday Times, Sep 16, 2007

60-year rental: $343m
A place of its own: $280m

AN ARTIST'S IMPRESSION of the $660m complex with its distinctive shape which is likely to be achieved using titanium. When the complex is ready in 2011, church services would be held at the 5,000-seat auditorium. -- PHOTO: NEW CREATION CHURCH

TO HEAR Deacon Matthew Kang talk, it makes sense for a church to go into property development.

MR MATTHEW KANG refers to the parable about the servant who buried Jesus' money instead of investing it: 'In today's context, that is like keeping money under your mattress.'

The church in question is the 23-year-old charismatic New Creation Church. Its Sunday services at Suntec City Mall draw long lines of worshippers that snake round the block.

The property in question, announced last week, is a $660-million lifestyle hub in Buona Vista. The church's business arm, Rock Productions, is partnering property giant CapitaLand to develop the site.

In an interview with The Sunday Times, Mr Kang, one of the directors of Rock Productions, explained why the church decided to turn property developer in such a big way - the company's investment in the project comes up to $280 million.

Every month, the church pays Suntec City $477,000 to rent the 1,400-seat auditorium, where it holds its services, and a convention hall to accommodate the spillover of worshippers. Its congregation is 16,000-strong.

Mr Kang, a full-time director of financial services at insurance company Manulife Financial, said the rental would add up to $343 million in 60 years' time.

It thus makes economic sense to invest $280 million in developing its share of the 60-year lease Buona Vista site, which consists of an auditorium, an amphitheatre, an outdoor theatre, two ballrooms and a rooftop function area.

The restaurants, shops, wine bars and dance clubs will be developed by CapitaLand.

When the complex is ready in 2011, services would be held at the 5,000-seat auditorium.

The amount involved is no small sum but Mr Kang, 47, said the church would have no problems ponying up the money.

Even before the foundation has been laid, it already has $100 million in cash to cover 35 per cent of the project cost.

Since the company is projected to make about $60million in profit over the next three years, it is left with $120 million to raise.

Mr Kang, who is married with three children, said: 'Of course it is possible to raise $120 million. We have faith that people will give.'

According to the church's financial statements, it received $39.3 million in tithe and offerings in its 2007 financial year.

Rock Productions, set up in 1998 with a paid-up capital of $8 million, is fully funded by the church.

The company is run by a six-member board chaired by church pastor Joseph Prince, 44, who started preaching from a four-room flat in Holland Road.

The board members, who do not receive any salary or dividends from the company, make all the business decisions.

One of its shrewdest was the 2001 purchase of Marine Cove at East Coast Park for $10 million, $4 million below its valuation price, after the previous owner had to sell off assets to pay creditors.

Mr Kang, who readily quotes from the Bible to illustrate the virtues of investing, said: 'Marine Cove was a great investment. It came with ready, popular tenants such as McDonald's and the place is always crowded. Even the carpark is making money.'

Profit from Marine Cove came up to $425,388 in the last financial year.

Other religious organisations are also actively involved in business. Sultan Mosque, in Bussorah Street, collects rent from 11 shophouses that were donated to the mosque by members of the public. The Kong Meng San Phor Kark See Monastery earns income from its crematorium.

In 2002, the Methodist Church leased out a 173,800 sqft piece of land in Mount Sophia to Centrepoint Properties for a reported sum of $50 million.

In 2003, the Seventh-Day Adventist Church sold a 13-storey condominium in Irrawady Road for an estimated $21 million.

Mr Kang, referring to the parable about the servant who buried Jesus' money instead of investing it, said: 'In today's context, that is like keeping money under your mattress. Putting money in the bank and earning interest is the last resort.'