Tuesday, November 27, 2007

URA To Sell Two Transitional Office Space Sites In The East

Source : Today, Tuesday, November 27, 2007

The URA yesterday announced the sale of two transitional office sites at Mountbatten Road and Aljunied Road/Geylang East Avenue 1 to ease the office space supply crunch in the short to medium term.

With a site area of 2.12 ha, the land parcel at Mountbatten Road can yield a maximum gross floor area of 20,000 sq m.

It is situated beside the site of the future Mountbatten MRT station on the Circle Line, expected to be completed by 2010.

The second land parcel at Aljunied Road/Geylang East Avenue 1 sits on a 1.88-ha site adjacent to the Aljunied MRT station. It can yield a maximum permissible gross floor area of 18,885 sq m.

Both sites are available on 15-year leases.

The office buildings that can be developed on these two sites are subjected to three-storey height restrictions.

The tender for the Mountbatten Road site closes at noon on Jan 9, 2008, while the tender for the Aljunied Road/Geylang East Avenue 1 land parcel closes at noon on Jan 16.

The successful tenders will be based on tendered land price only.

Tap S’pore Reit Market, Aussie Investors Urged

Source : The Business Times, November 27, 2007

AUSTRALIAN fund managers have been encouraged to tap the opportunities in Singapore’s real estate investment trust (Reit) market.

A recent seminar at the Sydney Opera House highlighted to Australian investors the burgeoning Singapore Reit market and the opportunities available.

The seminar was co-hosted by Australian companies Freehills, nabCapital and Trust. These companies said they are leveraging on the strong working relationship between Australia and Singapore to help Australian fund managers understand the legal and regulatory requirements and to take advantage of the opportunities provided by the Reits market in the Republic.

Keynote speakers included Singapore High Commissioner to Australia Eddie Teo, Monetary Authority of Singapore financial markets strategy executive director Kola Luu and Singapore Exchange senior director Kevin Gin.

According to Trust, the Singapore Reit market has grown around 90 per cent per year since commencing in 2002.

‘While Australia has extensive expertise in this asset class, Australian fund managers are few on the ground in Singapore.

‘As a result of this seminar, I am aware of approximately 20 companies looking to leverage their local strengths and expertise in the Australian listed property trust market to take advantage of the phenomenal growth and future potential in Singapore,’ said Trust’s executive general manager for institutional services Vicki Allen.

Sub-Prime Crisis Takes Its Toll On European Markets

Source : The Business Times, November 27, 2007

But stability can be expected if the US avoids recession: DTZ

Shockwaves from the US sub-prime mortgage crisis a few months ago are reverberating through the real estate markets of the UK and Europe, with deals shelved or abandoned.

In its European Quarterly 2007 report, DTZ says the volume of transactions could fall at least 15-20 per cent in the third and fourth quarters this year, from record volumes of 48 billion euros (S$102.7 billion) and 53 billion euros in the first and second quarters respectively.

However, if the US avoids recession, stability can be expected.

DTZ group chief executive Mark Struckett says that in the UK other than central London, a price correction in commercial estate market has been underway since the second half of 2006, so the sub-prime fallout is less of a shock.

The current situation is also being 'accepted by vendors', he says.

DTZ says the effect so far is not so much the delaying of deals but renegotiation of price with the re-pricing of risk as providers of debt capital become much more risk-averse.

Given upward pressure on yields in many locations, DTZ believes property returns will be heavily dependent on sound occupier fundamentals and effective asset management.

Making a comparison between current market conditions and the period following the Sept 11, 2001 terrorist attacks in the United States, Mr Struckett says that unlike five years ago, 'occupational demand still looks good'.

In general, DTZ does not expect rental prospects to be substantially undermined by recent developments, though there may be increased downside risk for areas such as London's West End, where hedge funds and private equity firms are important players.

There could be wider adverse repercussions in the City of London and in Canary Wharf if reduced profitability affects the expansion plans of some banking sector firms.

Even so, Mr Struckett says a slowdown in new developments could lead to a supply shortage in 2010-2011, possibly curtailing any prolonged crisis.

So while debt-driven investors will find it more difficult to make deals add up, DTZ believes a correction in yields in some markets could present attractive opportunities for equity buyers such as life insurance and pension funds which to some extent may have been priced out of the market by highly leverage investors.

Quality assets in prime locations could benefit in a generally more risk-averse market.

DTZ believes a flight to quality is likely to put deals involving secondary locations or older stock most at risk, with investors increasingly willing to pay a premium for covenant strength and reliable rental income.

Riverwalk, Cairnhill Mansion And Site Next Door Up For Sale

Source : The Business Times, November 27, 2007

Three prime sites - one zoned for commercial use and two for residential use - went on the market yesterday.

On the block: The guide price for Cairnhill Mansion (above) and the adjoining site is $443.6 million and $139.4 million respectively, or $2,800 psf per plot ratio

The Riverwalk near Clarke Quay is offered through a collective sale, said property firm Jones Lang LaSalle (JLL) which is marketing the project.

Market watchers reckon that the project could fetch about $700 million or $1,735 per square foot (psf). The 82,317 sq ft site has a 4.9 plot ratio. It can be redeveloped into a commercial building with a gross floor area of 403,351 sq ft, subject to approval and payment of development charge (DC) of about $3 million and premium for topping up the lease.

The Riverwalk is now zoned for residential and commercial use. It comprises 181 commercial units ranging from 54 sq ft to 20,161 sq ft, 118 apartments ranging from 818 sq ft to 3,821 sq ft and 290 parking lots.

'The potential purchaser may redevelop the property into a part commercial/part residential development or a Soho development,' said JLL regional director Lui Seng Fatt. 'The options available for this site are extensive.'

Elsewhere, Cairnhill Mansion and a separate adjoining site are being offered for sale. Cairnhill Mansion is being offered through a collective sale and the adjoining site is being offered by an individual owner, said Knight Frank, which is marketing both sites.

The guide price for Cairnhill Mansion is $443.6 million. As there is no DC payable, the price works out to $2,800 psf per plot ratio (ppr). The guide price for the adjoining site is $139.4 million. Including a DC of about $16 million, this works out to $2,800 psf ppr. Together, the sites add up to 62,903 sq ft.

The successful developer of the combined sites could build 100 units averaging 2,000 sq ft each, Knight Frank said.

'Strong demand for high-end, luxury condominium developments coupled with the rosy outlook for the property market, should increase the site's attractiveness to developers.'

The Cairnhill area, being a stone's throw from Orchard Road, is attracting super-luxury developments like The Hamilton and Ritz Carlton Residences.

Selling prices for these projects are expected to start from at least $4,000 to $4,500 psf, said Knight Frank. Recent launches like Hilltops are already achieving prices in the mid to high $4,000s psf, it said.

The tenders for both sites closes at 4pm on Jan 15 next year. The tender for The Riverwalk closes at 3pm on Jan 22.

Cairnhill Mansion Up For Collective Sale

Source : The Straits Times, Nov 27, 2007

THE Cairnhill Mansion apartment block near the Goodwood Park Hotel, plus an adjoining site, have been put up for collective sale - a transaction that could total nearly $600 million.

The owners of Cairnhill Mansion, which is about 40 years old, want at least $443.6 million for their estate, comprising 60 apartments of 2,024 sq ft each and an 8,525 sq ft penthouse. The freehold block is on a site of 43,103 sq ft.

The adjoining site of 1,800 sq m has a guide price of about $139.4 million.

These price the land at about $2,800 per sq ft (psf) per plot ratio, inclusive of development charge, a level market observers feel may be too high for the area.

It suggests a break-even price of $3,500 psf to $3,600 psf. Last month, units at the luxury development Hilltops at Cairnhill Circle went for a median price of $3,711 psf.

Marketing agent Knight Frank said yesterday that Cairnhill Mansion, which has a plot ratio of 2.8, was earlier granted permission from the Government to raise the ratio to 3.675.

The adjoining site also has a plot ratio of 2.8.

Both sites will be sold by separate tenders, which will close on the same day - Jan 15.

Knight Frank said a developer buying both plots could expect to build about 100 apartments, each of about 2,000 sq ft. Future development there can go up to 36 storeys.

HSBC Forecasts 7.3% Growth Next Year

Source : The Business Times, November 27, 2007

EVEN with rising inflation, the Singapore economy will grow 7.3 per cent in 2008, HSBC forecasts.

In a report on Asean inflation published last Friday, the bank's Asia economist, Robert Prior-Wandesforde, seems fairly optimistic about the impact of rising prices on the Singapore economy.

Energy price inflation is unlikely to explode, and probably neither will food prices, he says.

'Our guess is that inflation is more likely to come in at the lower half of the new range than the top half,' he adds, referring to the Monetary Authority of Singapore's revised inflation estimate of 3.5 - 4.5 per cent more for 2008.

The inflation rate accelerated to 3.6 per cent in October, and now averages 1.6 per cent for the first 10 months of 2007.

But MAS would be hard put not to further tighten monetary policy next April if the rise in the consumer price index does hit or breach 5 per cent in the first half of next year, Mr Prior-Wandesforde says. The worry is if wage growth - which averaged 8.5 per cent in the second quarter - picks up and creates big second-round inflationary effects.

This could be averted only 'if export growth and the economy as a whole weakens much more sharply than the government or anyone expects, perhaps as a result of a US recession', he says. Still, his forecast sees the Singapore economy growing 7.3 per cent next year - above the official estimate of 4.5-6.5 per cent.

Across Asean, higher currencies and falling metal prices will not blunt the impact of soaring oil and food prices, Mr Prior-Wandesforde says.

He reckons Indonesia faces the biggest risks, with headline inflation expected to run close to 10 per cent by end-2008. At the other end, Thailand seems 'safest' because consumption has slowed.

Two More Transitional Sites Up For Tender

Source : The Business Times, November 27, 2007

Mountbatten and Aljunied sites follow those at Scotts Rd and Tampines

The Urban Redevelopment Authority has launched two transitional office sites at Mountbatten Road and Aljunied Road/Geylang East Avenue 1 for sale by tender.

This follows the recent sale of two transitional office sites at Scotts Road and Tampines for $219 per square foot per plot ratio (psf ppr) and $80.65 psf ppr respectively.

The land parcel at Mountbatten Road has a site area of about 2.12 hectares and can yield a maximum gross floor area (GFA) of 20,000 square metres. It is also next to the future Mountbatten MRT station.

The Aljunied Road/Geylang East Avenue 1 land parcel has a site area of about 1.88 ha and a maximum permissible GFA of 18,885 sq m. The site is adjacent to the Aljunied MRT station. Both sites will be sold on short-term leases of 15 years and are expected to be low-rise developments of about three storeys.

On estimated land prices, Cushman & Wakefield managing director Donald Han said: 'We are likely to see developers taking a defensive play in terms of pricing.'

He added that this strategy was adopted by developers resulting in lower than expected prices for Tampines Concourse transitional site and the Marina View parcel B tender plot.

Given the Mountbatten site's attributes, including a regular shape and the prospect of the future Sports Hub nearby, Mr Han expects bids to fall in the range of $140-150 psf ppr.

The Aljunied site is next to the MRT but the site is elongated and Mr Han believes this could be a constraint in terms of building design.

Noting that the neighbourhood is also relatively mixed, he said that bids for the Aljunied site could come to $120-130 psf ppr.

On likely bidders, CBRE Research executive director Li Hiaw Ho said: 'Given the short tenure and rapidly rising construction costs today, such parcels would appeal to owner occupiers or a tie-up between an investor and an end-user.'

He also pointed out that there could be keen interest in the Aljunied Road/Geylang East Ave 1 parcel due to the existing MRT station and offices in the Paya Lebar micro-market.

Knight Frank director (research and consultancy) Nicholas Mak also highlighted that although the Mountbatten site was closer to the city, the Mountbatten MRT station may only be open between 2010 and 2012.

Adding that there is lack of amenities such as F&B premises, he estimates that the site could attract bids of about $27-28 million while the Aljunied Road site, which is in a relatively more established residential and light industrial area, could attract bids of $30.5-32.5 million.

Expat Cost Of Living In S'pore Gaining On HK's

Source : The Business Times, November 27, 2007

S'pore and Chinese cities move up the ranks due to strong currencies, inflation

The Republic is catching up with Asia's leading cities in one area it probably does not wish to make strides in - expatriate cost of living.

While some of the region's most pricey cities became relatively less expensive in the past year, Singapore, along with Beijing and Shanghai, have climbed the rungs in the latest cost of living survey by ECA International.

Singapore is listed as the ninth most expensive city in Asia - behind Seoul, Tokyo, Yokohama and Kobe, as well as Hong Kong, Taipei, Beijing and Shanghai. Worldwide, Singapore ranks 122nd, but that is 10 spots higher than in the 2006 survey.

In comparison, the Japanese cities and Taipei have all dropped in the global rankings in the past year, primarily due to a weaker currency, while Hong Kong stayed put at its 79th spot. This means that the gap is closing between the two 'traditionally competitive' locations, Singapore and Hong Kong, says ECA.

Conducted every March and September, the cost of living survey by the Hong Kong-based HR consultancy tracks a basket of 128 consumer goods and services commonly consumed by expatriates in more than 300 locations worldwide.

Multinational firms use the findings as a guide in determining expatriate remuneration packages and allowances. But the survey excludes significant items such as housing, utilities, car purchases and school fees because, ECA says, expatriate packages usually include separate compensation for these.

Apart from the two-percentage-point hike in the Goods and Services Tax in July and overall rising inflation, the appreciating Singapore dollar is also driving up costs in Singapore 'in a significant manner', says Lee Quane, general manager of ECA.

'While this is good news when sending international assignees from Singapore, those companies who need to send employees into Singapore will now have to apply higher cost of living indices to salaries to guarantee their personnel's spending power when in Singapore.'

Seoul, Asia's most expensive city, has climbed one rung in the global rankings to seventh in the latest findings. Tokyo, on the other hand, has dropped out of the top 10 for the first time, moving from 10th to 13th.

A strengthening yuan against the US dollar, along with soaring oil, food and grain prices, have added to living costs in the Chinese cities, including 'second-tier' ones. According to ECA, living costs for foreigners in Chongqing, for instance, have risen by 12 per cent, or twice as much as in Beijing.

Luanda in Angola emerged as the world's most expensive city for expatriates. Two other African cities - Kinshasa and Libreville - also feature in the top 10. European cities, led by Oslo and Moscow, make up most of the top spots.

S'pore Launches Pushed Back As Developers Gauge Sentiment

Source : The Business Times, November 27, 2007

Some projects being launched overseas first, others struggle to finish showflats

Developers here are holding back residential launches due to poor market sentiment - and in some cases are choosing to launch their projects overseas first as they wait for market sentiment here to recover.

Launches are also being held back as showflats are being delayed amidst a construction squeeze, market watchers said.

Major launches that can be expected over the next few months include City Developments's Wilkie Studio and The Quayside Collection, Far East Organization's Floridian and Cairnhill View, GuocoLand's Goodwood Residences, the Lippo Group's Marina Collection and Wing Tai's Belle Vue and L'VIV.

While several upcoming projects have most of the necessary approvals to launch in place, some of them are being held back in anticipation of a market recovery, BT understands.

'Currently, we don't know if Singaporeans will be willing to fork out that kind of money,' said one developer who has yet to start selling the company's project in Singapore. However, the luxury condominium in question is already being marketed abroad, with about half of the units sold to foreigners at prices exceeding $2,500 per square foot (psf).

In a recent report, UBS Investment Research also noted that several projects have obtained permission to launch in the past three months, but the launches were delayed due to the weak market sentiment.

'Some projects with permits to launch in August and September have been held back due to weak sentiments,' said the investment bank's research unit in a recent note. 'We expect these to be launched in late November or early 2008.'

Others point out that while some of the delays can be attributed to the poor market sentiment, showflats for some of the projects are not yet ready.

'Sentiment is one reason for the quiet market,' said Ku Swee Yong, director of marketing and business development at Savills Singapore. 'But even if the market sentiment is good, some developers still can't launch their projects because the showflats aren't ready.'

One example is Lippo's Marina Collection, Mr Ku said. The showflat for the 124-unit project is yet to be completed, he said. The project was supposed to have been launched last month.

Some developers are choosing to launch their projects overseas first. United Engineers, which is developing the 40-unit Sui Generis in the Balmoral area through a joint venture with Japan-based Kajima Corporation, recently said that it has sold 17 apartments via overseas previews in Indonesia and Hong Kong over the past two months.

The Singapore launch, on the other hand, is only planned for next year although the showflat is ready, BT understands.

Similarly, other developers are also waiting for next year to market their projects.

The weaker market sentiment also means that fewer projects are applying for permits to launch.

In October, for example, just three new projects received permits to launch, UBS said - City Developments's Shelford Suites, Hayden Properties' Ritz-Carlton Residences and a condominium at Kim Yam Road by Frasers Centrepoint.

However, industry players are confident that the market will recover soon - bringing with it a whole slew of project launches in the new year.

Some projects that went ahead with their planned launches recently did well. At Ritz-Carlton Residences, which started selling over the weekend, take-up was good and prices hit $5,000 psf, sources said.

Ex-U.S. Treasury Head Summers Says Recession Likely: Report

Source : The Straits Times, Nov 26, 2007

The odds now point to a U.S. economic recession that slows global growth significantly even if necessary policy changes are implemented, former U.S. Treasury secretary Larry Summers said.

Summers, who served in the Democratic administration of former president Bill Clinton, said the U.S. authorities needed to act urgently in avert long-lasting economic damage from the global credit crunch.

"Without stronger policy responses than have been observed to date ... there is the risk that the adverse impacts will be felt for the rest of the decade and beyond," Summers wrote in a column in the Financial Times on Monday.

Summers said the U.S. Federal Reserve should recognize that "levels of the fed funds rate that were neutral when the financial system was working normally are quite contractionary today."

The Fed has already cut the policy rate to 4.5 percent from 5.25 percent since the global crisis was triggered in August by defaults on U.S. mortgages, and financial markets expect further easing.

Summers said fiscal policy needed to be "on stand-by" to provide immediate temporary stimulus through spending or tax benefits for low and middle income families if the situation worsens.

The authorities also had to respond urgently to the contraction in credit, said Summers. "The time for worrying about imprudent lending is past. The priority has to be maintaining the flow of credit."

Summers said a "super conduit" promoted by the U.S. Treasury to take on assets of troubled structured investment vehicles (SIVs) had never been publicly explained in any detail by the Treasury. "Perhaps there is a strong case for it but that case has yet to be made," he added.

He urged the authorities "to assure that there is a continuous flow of reasonably priced loans to creditworthy home purchasers."

Summers said forward-looking indicators suggested the U.S. housing sector may be in freefall.

"It is hard to believe declines of anything like this magnitude will not lead to a dramatic slowdown in the consumer spending that has driven the economy in recent years," he said.

He also said only a small part of the financial distress that must be worked through by financial institutions had yet been faced, and warned of the potential damage to confidence from a sharply falling dollar.

"In such an environment, economic policy needs to be governed by the clear and public recognition that restoring the normal functioning of the financial system and containing any damage its breakdown may do the real economy is the central macro-economic and financial challenge facing the U.S."

Prospects Here Brighter Than Overseas: Poll

Source : The Business Times, November 26, 2007

Vietnamese market also seen as highly attractive in latest BT-UniSIM survey

Despite weaker business sentiments, firms are generally more optimistic about prospects in Singapore than overseas, a survey has shown.

Also, business prospects in Vietnam appeared bright, particularly in the construction sector, according to the latest BT-UniSIM Business Climate Survey.

The survey polled 137 local and foreign firms, 72 per cent of which had some form of overseas business.

It found that the overall business prospects net balance - the difference between the percentage of companies that expect better times and those that expect things to turn for the worse in the coming six months - was 39 per cent, higher than the 34 per cent figure for overseas business prospects.

This means that 'firms are slightly more optimistic over business prospects in Singapore than abroad in the next six months,' said survey director Chow Kit Boey.

This is particularly true for foreign firms which reported 35 per cent in overall business prospect net balance - higher than its 26 per cent for business prospects overseas.

In contrast, local firms view overseas business climate more favourably with a 45 per cent net balance, compared with 42 per cent overall.

The most recent survey also asked respondents to name a country with the best business prospects in their businesses over the next six months.

While China took the top position overall - cited by 25.8 per cent of the firms, the report found the Vietnamese market to be highly attractive overall as it is among the top three countries with the best prospects across all types of firms.

For example, the country captured the second most mentions overall, among large, local and foreign firms, and also in the commerce, transport & communications and financial & business services sectors.

For small firms and firms in the manufacturing sector, Vietnam is the third most cited for best business prospects.

In contrast, China is not among the top three in the financial & business services sector.

Malaysia is the second most cited country for business prospects among small firms and firms in the manufacturing and financial & business services sectors.

It ranks third overall, among large and local firms, and among firms in construction and transport & communications.

In fourth position is Indonesia, which is seen as offering the best business prospects in the commerce sector.

Together with Malaysia, it is the second most popular country of best business prospects for financial & business services firms.

The United States came in fifth overall, but is ranked third among small, foreign and manufacturing firms.

Critics Snipe In Wake Of Mega Penang Project

Source : The Business Times, November 23, 2007

IT COULD possibly be the largest single urban development in Malaysia. But disquiet is mounting over the mammoth RM20 billion (S$8.6 billion) project in Penang amid fears that it would make the north-eastern island less livable and give rise to environmental, traffic, and property oversupply problems.

The project, called the Penang Global City Centre (PGCC), aims to create a 'city of the future' on the current site of the 260-acre Penang Turf Club. The Turf Club is to be relocated to Batu Kawan on the mainland of Peninsular Malaysia and near the site where a second bridge to the island will be constructed.

The man at the centre of the slowly developing firestorm is Patrick Lim Soon Kit, who emerged from relative obscurity in 2003 to beat such established tycoons as T Ananda Krishnan - who conceived and began the Kuala Lumpur City Centre - to land the plum project.

Through his family-owned Equine Capital, Mr Lim, who has Indian, Chinese, Scottish and German roots, holds 25 per cent of Abad Naluri, a private company that won a tender to redevelop the turf club in 2003. The project was finally launched by Prime Minister Abdullah Ahmad Badawi in August despite having not received full approval from the state authorities.

Now, opposition is gathering steam. Even former premier Mahathir Mohamad singled Mr Lim out for criticism, dubbing him 'Patrick Badawi', an apparent reference to his closeness to the premier's family.

That could be a bit unfair where the Penang project is concerned. Mr Lim had begun looking to expand out of the Kuala Lumpur area and, in 2002, bought an interest in Abad Naluri after the latter had secured the development rights to a 750-acre piece of land in Batu Kawan. Only after that did Abad tender for the Turf Club land. He clinched the deal in 2003, while Dr Mahathir was still the prime minister. Moreover, the Turf Club land was only rezoned for commercial use in 2007, four years after Mr Lim won the tender.

It isn't clear if the dissatisfaction is widespread or confined only to a select group of 10 non-government organisations and a coterie of moneyed islanders whose homes in Jesselton Heights border the Turf Club. An October 'public forum' over the PGCC attracted a scant 350 people, all of whom were opposed to it. But the project's detractors have been given little, or no, coverage by the mainstream media and at least one state official said that even Penang Chief Minister Koh Tsu Koon was 'uneasy' about the development ahead of a snap general election that could be called by March next year.

Mr Lim is unrepentant about the fuss and insisted that he had been open about the project from the start, even holding a symposium on the matter. 'Let's face it, there isn't any one issue that has come up that hasn't been raised earlier in any other major development,' the Penang-born businessman told BT. 'Most big developments will have some sort of spillover.'

His critics have charged that Mr Lim's project is too dense: at its end, it would have 37 high-rise towers. 'What's allowed by the law is 30 units per acre but the area's carrying capacity is easily double that,' said the businessman. 'Certainly, 30 units an acre in places like Mon Kiara and Puchong in Kuala Lumpur is a luxury and, here, we are an island.'

Mr Lim has unveiled the first phase of his project which includes two fantastically shaped, futuristic towers of steel and glass that his critics have mockingly dubbed 'twisted snakes'. Mr Lim looks disbelieving. 'What are people talking about?' he asked. 'They are gorgeous and they cost a lot to design. I have shown everything, I have clearly outlined how the land will be used. Millions have been spent just to come up with the plan.'

He is resolutely bullish about the development. 'It's a rare thing to get an opportunity like this,' said the businessman. 'It will take 20 years to materialise. It will have high-end retail outlets, condos, medical centres, public places, and convention centres.

'Penang is already a brand name,' he continued. 'We think that it (the PGCC) will attract others and regional offices will spring up there. It will stand scrutiny and I am proud to be associated with it. We are going to create at least 20,000 jobs. The PGCC is an economic entity by itself and it will make Penang's economy more robust.'

Ultimately, however, the PGCC's fate will depend on whether Mr Lim can manage its funding. His flagship Equine Capital has a modest balance sheet and although Mr Lim insisted that he will do it with partners amid land sales, the funding of the gigantic project remains an issue.

The Kuala Lumpur City Centre did not founder during the Asian crisis only because it was bankrolled by Petronas, Malaysia's richest corporation, and Mr Krishnan, one of the country's wealthiest tycoons. And, even then, Mr Krishnan sold off his interest in the project to Petronas in 2001.

But Mr Lim remains supremely optimistic. 'The project is so attractive that it will fund itself,' he told BT.

The showpiece

# The project is estimated to cost RM20 billion.
# It will come up on a 260-acre site in Penang.
# It will include 37 highrise towers, including futuristic structures.
# It promises to create 20,000 jobs.

Short-Term Office Sites Put Up For Sale To Ease Crunch

Source : The Straits Times, Nov 27, 2007

Plots in Aljunied and Mountbatten roads come with 15-year leases

GOOD news for office tenants struggling to find affordable office space in the Central Business District (CBD).

The Government yesterday launched for sale two short-term office sites along Aljunied and Mountbatten roads to ease the office space crunch.

Both plots come with 15-year leases and can house developments of up to three storeys.

The first plot - a 2.12ha site along Mountbatten Road next to the Singapore Association for the Deaf - can take up to 215,278 sq ft of office space.

The other - a 1.89ha site along Aljunied Road just behind the Aljunied MRT station - can house up to 203,276 sq ft of office space.
Consultants expect both sites to draw a good response.

Savills Singapore's director of marketing and business development, Mr Ku Swee Yong, said the sites would appeal to firms keen to move back-room operations to cheaper spots outside the CBD.

Prime office rents have grown faster in Singapore than anywhere else in the world over the past year, according to a recent report by CB Richard Ellis.

Monthly prime office rental and associated costs shot up 82.6 per cent to $12.60 per sq ft in the 12 months ended Sept 30, it said.

Reacting to the crunch, the Government earlier released two short-term sites along Scotts Road and in Tampines. The first tender was hotly contested, but the other drew just one bid.

Mr Ku blamed the cool response to the Tampines plot on its distance from the CBD.

The two latest sites should get at least five bids each, he predicted.

The tender for the Mountbatten site will close on Jan 9; the Aljunied site, on Jan 16.

Mr Ku estimated the Mountbatten plot could fetch $28 million to $33 million, while the Aljunied site could net $25 million to $28 million.

Mr Nicholas Mak, the head of research and consultancy at Knight Frank, put his estimates at $27 million to $28 million for the Mountbatten plot and $30.5 million to $32.5 million for the Aljunied site.

Meanwhile, mixed development The Riverwalk in the CBD area has been put up for collective sale by tender.

The 0.76ha site, which houses 181 commercial units and 118 apartments, can be redeveloped into a commercial building with a gross floor area of about 403,351 sq ft, said its marketing agent, Jones Lang LaSalle.

This is subject to the authorities' approval and payment of a development charge - estimated at $3 million - as well as a premium to top up its lease from the existing 72 years to 99 years. This may cost $60 million to $75 million.

S'pore Ranked 9th Most Costly Asian City For Expatriates

Source : The Straits Times, Nov 27, 2007

SINGAPORE has risen 10 places in a new global survey of the most expensive places for expatriates to live.

The Republic is closing the gap on higher-priced Hong Kong, which stayed at No. 79 in the survey, conducted by human resources firm ECA International.

Despite the jump, Singapore, at No. 122, is still significantly cheaper for expats than Hong Kong and other key global centres, such as London at No. 10 and New York at No. 48.

Singapore's rise up the table from No. 132 was the result of rising expat costs such as higher rents, coupled with a stronger Singapore dollar.

In contrast, the Hong Kong dollar, which is pegged to the US dollar, is weakening - offsetting a rise in expat costs.
Singapore is the ninth most expensive Asian city, the survey found. Seoul is the most expensive, at No. 7 in the world. Tokyo dropped from 10th to 13th place, partly due to a decline in the yen.

Top spot went to the African city of Luanda in Angola. Places like this, which are off the beaten track, are more expensive because some expat consumer items are hard to get, and those who want them have to pay top dollar.

The survey compares a basket of 128 consumer goods and services such as groceries, drinks and tobacco, clothing and electrical goods that are commonly purchased by expatriates in more than 300 locations worldwide.

Multinational firms use the survey's results to help determine how much to pay their staff working overseas.

Living costs for expats are affected by factors such as inflation, availability of goods and exchange rates.

Singapore has seen higher inflation, partly due to a 2 percentage point hike in the goods and services tax to 7 per cent.

Mr Sebastien Barnard, 32, at the British Chamber of Commerce, said living expenses, especially food, have risen. 'A year ago, lunch for two adults and two children cost about $70, including drinks. But now it's over $95.'

But the surge in property rents is still the biggest bugbear of expats here.

Mr Mark Brider, 43, head of international personal banking for the Royal Bank of Scotland in Singapore, said: 'There is a growing number of international people living in Singapore, so the demand drives up rental. My landlord just told me my rent will be raised 80 per cent in March next year.'

Nonetheless, he added, Singapore's cost of living is still 'competitive' and 'has still not reached the level of Hong Kong'.

The rising Singapore dollar has also pushed up expat living costs, said Mr Lee Quane, general manager of ECA International Hong Kong.

He said Singapore's rising cost of living is 'bad news' for global companies, which have to adjust their expat employees' pay and allowances to help them maintain their spending power here.

3 Wives, Daughter Battle Over $2m House

Source : The Straits Times, Nov 26, 2007

THREE elderly wives of a retired policeman who died in 2005 are fighting in court with the daughter of the fourth wife over a $2.05-million house in Serangoon.

The trio, aged 79 to 81, say that Ms Seah Min Wai, 46, who practised as a lawyer until 2000, should return $2.04 million to the old man's estate.

The reason: She bought the house from her father in 1995 but paid only $10,000 for it.

Hearing into the lawsuit, fixed for five days, opened in the High Court on Monday.

The patriarch, Mr Seah Wee Tuan, was a police sub-inspector until his retirement in 1969. He took four wives, all of whom he wed through customary rites, and had 14 children.

He built a pair of semi-detached houses on a plot of land on Sommerville Road belonging to his mother.

He lived in one with his fourth wife and their two daughters and transferred the other to his nephew.

He died in May 2005 at the age of 80.

In his 1989 will, he left specific sums, totalling $55,000, to eight of his children, daughters-in-law, sons-in-law, nephews, nieces and grandchildren.

The rest of his estate was to be split among his wives, with the first three each getting 20 per cent and the fourth, Madam Cheng Boa Yee, 70, inheriting 40 per cent.

Now, the three wives - Madam Cheah Lee Kheng, Madam Wong Kang Choy and Madam Wong Siew Tian - are claiming $2.04 million from Ms Seah, who is Madam Cheng's younger daughter.

They are represented by Senior Counsel Molly Lim and Mr Roland Tong, while Ms Seah is defending herself.

Madam Cheng is not a party to the case, although she was in court with her daughter.

In her opening statement, Ms Lim told the court that witnesses will testify that the patriarch had always intended to leave the property for the four wives.

She argued that Ms Seah is holding the property on trust for the patriarch's estate.

Ms Seah disputes this.

She noted in her opening statement that the plaintiffs have never stayed in the house and that there was an absence of evidence of her father's oral declaration of trust.

She insisted that her father had waived payment when he transferred the house to her.

But this claim was questioned by Ms Lim.

She noted that Ms Seah had initially claimed that she was not indebted to her father's estate because she had paid for the house in full.

Ms Lim said that it was only after the plaintiffs filed a court application compelling her to answer their questions, that Ms Seah admitted she had paid only $10,000.