Wednesday, December 26, 2007

Trend In Luxury Hotels To Continue Upward Climb: Industry Experts

Source : Channel NewsAsia, 26 December 2007

There may be worries about the world economy – especially with the ongoing subprime crisis and rising standards of living – but that hasn't stopped interest in luxury hotels from making a steady comeback.

With the recent entry of a new player in Singapore's luxury hotel industry, the exclusive St Regis, competition looks set to heat up.

St Regis opened the Saturday before Christmas, but even before it officially commenced business, the hotel has already sold out almost all its year-end dinner parties.

Singapore's hospitality sector is experiencing one of its strongest recoveries in over a decade despite the US subprime setback.

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In November, the average room rate (ARR) set a new milestone of S$226 per night, the highest ever in any month and up 29.8 per cent over last year, according to figures from the Singapore Tourism Board (STB).

The city-state's hotels also generated record room revenues of an estimated S$175.4 million, representing an increase of 23.8 per cent from last year.

The rise was likely due to an increase in the number of visitors in Singapore – 837,000 in November, representing a growth of 4.6 per cent as compared to a year ago.

In fact, analysts believe this is just the take-off for the industry. Industry players expect the ARR to continue growing due to upcoming high-impact tourism projects set to be unveiled, starting from next year.

The average occupancy rate is also expected to test the 90 per cent level, industry players say.

Next year, the Singapore Flyer, complete with its signature cocktail (both alcoholic and non-alcoholic) will set its wheel turning from February. Following that, the Formula One (F1) Singapore Grand Prix will roar off in September, expected to draw in F1 lovers from around the world.

Also coming up are the Integrated Resorts – Marina Bay Sands and Resorts World at Sentosa – both of which are expected to boost the tourism rate.

Yngvar Stray, General Manager of the St Regis Singapore, said the city-state is an ideal market for luxury hotels like St Regis to step into "at this point of time in Asia".

"Singapore is stepping up to the plate in Asia... competing in a very high level. And the economy in Singapore is fantastic and seeing a lot of growth; I think the high-end market in Singapore is also showing substantial growth," said Stray.

"You can look at the occupancy levels in the city – the demand for this level of hotel is clearly present. So for us, (Singapore) is a starting point."

He also said that the travel and tourism industry looks positive in the year 2008, despite the overhanging shadow of the subprime crisis.

"I think there is a lot of optimism in 2008 for the travel sector and the travel industry," said Stray. "Of course, the subprime crisis causes some jitters in the market, but the demand within Asia is by far stronger and more independent than it was ten years ago, when similar trends were showing.

"And we see a market within Asia where about over 60 per cent of ... our clientèle... (in Singapore are more financially) independent. There's stronger economy in this region than before so it won't cause any dramatic changes for the trend in travel and luxury hotels for the time being. - CNA/yb

Interest In Luxury Property Market Rises By 70% In Last 2 Years

Source : Channel NewsAsia, 26 December 2007

With the high-end luxury segment leading the residential sector in price increases this year, Singapore developers have been roping in global names to give their projects that extra touch of distinction.

A growing number of partnerships are being formed, especially with companies in branded home furnishings.

Reflections at Keppel Bay is among the high-end residential projects set to be completed in Singapore soon.

Developer Keppel Land spared no expense in roping in world-renowned architect Daniel Libeskind for the project, with the aim of putting Singapore on the world prime real estate map.

It has also gone one step further by working with other international names to give its units that touch of distinction. These include luxury furniture brands such as Minotti and Giorgetti.

Agustine Tan, Director, Keppel Land, said: "I think with globalisation and international exposure, buyers have actually become more sophisticated... they look at it is as a prestige lifestyle, an entire package of getting into a house that they enjoy.

"70 percent of our buyers are in fact foreigners, if you include the PRs - the PRs will actually account for about 28 percent... locals (account for) 33 percent, and the rest are foreigners, so I think we have attracted a good foreign crowd - a good following who are believers in our lifestyle; when they come and see the quality... and the ability to deliver, that's the most important thing."

The kitchens are designed by Germany's Miele - which has made a name for itself in the luxury kitchen market.

Markus Miele, Managing Director, Miele, said: "I think that the world is getting richer everyday, and we see a growing demand in the high-end (sector); we see a lot of consumers who will pay for quality, who want luxury goods, and this is the case all over the world..."

While top furnishings have helped to woo buyers, property watchers have said that demand next year will hinge on the big picture.

Donald Han, Managing Director, Cushman and Wakefield, said: "We've seen very strong growth for the luxury market rising over 70 percent in last two years. The market is taking a breather now.

"Moving forward, next year we expect the market to be dominated by the mid as well as mass market. We expect investors to start moving (the) market upwards for the luxury market in the next year depending on the economy in Singapore as well as the global economy.

"Whatever happens to sub-prime will have an impact on the luxury market. The economy, luxury market are driven by foreign demand so their perception of economic growth in Singapore would be one of the main criteria for them to invest more or less in Singapore."

Some 70 percent of the buyers at Reflections are foreigners. They include the Al-Nibras Islamic Estate Fund (Al-Nibras Fund) which bought two blocks of 56 waterfront units for S$286 million. - CNA/ms

HDB To Launch Sale Of Residential Site At Bishan St 24

Source : Channel NewsAsia, 26 December 2007

HDB will launch the sale of a site at Bishan Street 24 for tender under the Design, Build and Sell Scheme (DBSS) on Thursday.

This is the fourth site to be offered under the Scheme.

Under DBSS, the developer tenders for the land and designs, builds and sells the flats as public housing.

Flats sold under DBSS come with a 99-year lease and will be offered to buyers under similar HDB eligibility conditions like flats developed by HDB.

Upon completion of the building, the developer will hand over the entire development site to HDB for lease administration, and to the town council for maintenance of the common areas and car parks.

The site is located in a middle-aged estate with a wide array of facilities.

The tender will close on Tuesday, 19 February 2008 at noon. - CNA

Ex-Condo Managing Agent Believed To Have Made Off With $200,000

Source : Channel NewsAsia, 26 December 2007

Police are looking for a former condominium managing agent, who is believed to be on the run with over S$200,000 worth in sinking funds from four condominiums.

It was understood that the woman is in her early 30s, but police have declined to confirm her name.

Condo residents, however, said the woman's name is Amutha Perumal and she is likely to have fled Singapore for over a year now.

She was alleged to have got away by forging cheques and falsifying financial accounts between 2003 and 2007.

Earlier this month, residents of one of the four condos, Adis Villa near Selegie Road, received a police report.

The report dated 9 April 2007 said the agent will be charged with 205 counts of forgery, upon her arrest.

The report was addressed to the chairman of the management council, but it was also sent to residents ahead of their final annual general meeting (AGM) on December 29.

Besides the police report, Adis Villa residents also received an AGM agenda asking that they consider, among other things, that the amount misappropriated be written off.

Apart from Adis Villa, she also managed Sophia Apartments, Mount Sophia Apartments and Pelikat Mansions in Hougang. - 938LIVE

Tiong Bahru Flats Given Facelift Before Being Rented Out

Source : Channel NewsAsia, 26 December 2007

Five blocks of flats in Tiong Bahru have been given a facelift, and they will be rented out to expatriates and foreign students.

The rental for the units can cost up to S$4,500 a month.

The flats are over 50 years old and are believed to be among the first to be built in Singapore.

Katong Hostel successfully won the HDB tender to rent out the 120 available units.

It invested S$3 million to renovate them with a contemporary design, but it decided to preserve the exterior by using just a fresh coat of paint.

The original tenants have moved out under a redevelopment scheme.

The flats will be ready by March next year.

Half of them are three-room flats while the rest are four-room units.

Katong Hostel said it is charging a high rental rate because it is providing better services such as housekeeping, full security and free wireless services.

Joyce Sim, General Manager, Katong Hostel, said, "We will have our maintenance personnel and operation personnel over here… so basically within the whole premises...cleanliness, hygiene or even the basic kind of operation will be all done by our operation team, and we have actually set up a 24-hour office, and our security checkpoint." - CNA/ms

Floridian @ Bukit Timah

Location : Bukit Timah Road (Next to Nexus)
Tenure : Freehold
Expected Completion : 2013
Architect : DP Architect Pte Ltd
Site Area : 21,441m2
Car Park Lots : 355
Total Units : 336 (11 Towers of 10 Storeys)

Unit Types:
2 bedrooms ~ 840 to 947sqft
2+1 bedrooms ~ 893 to 1001sqft
3 bedrooms ~ 1281 to1432sqft
3+1 bedrooms ~ 1658 to 2034sqft
4 bedrooms ~ 1830 to 2347sqft
4+1 bedrooms ~ 2357 to 2852sqft

Facilities :-
- Swimming Pool,
- Tennis Court,
- Squash Court,
- Barbecue Area,
- Clubhouse,
- Fitness Area,
- Gymnasium,
- Jacuzzi,
- Landscaped Garden,
- Multi-Purpose Hall,
- Children's Playground,
- 24 Hours Securities,
- Car Park

The Cascadia @ Bukit Timah

Centrally located along Bukit Timah Road, The Cascadia is a freehold modern architectural masterpiece that sits on almost 300,000 sq ft of land. Comprising a total of 536 units, this upcoming development mimics the upscale resort-style living.

The Cascadia is situated close to numerous prestigious schools and tertiary institutions such as Hwa Chong High, Henry Park Primary, Raffles Junior College, Nanyang Girl's High, National Junior College, Raffles Girls Primary, Ngee Ann Polytechnic, National University of Singapore (Bt Timah Campus).

Location : 947 Bukit Timah Road
Tenure : Freehold
Expected Completion : 2011
Site Area : 27,570.90sqm / 296,773sq ft
Total Units : 536 in13 blocks of 10-storey condominium development
Unit Types : 2-4 bedrooms, Penthouses

Features & Facilities: -
- 50m Lap Pool,
- Children's Pool,
- Fun Pool,
- Jacuzzi,
- Jacuzzi Lounge,
- In-Water Lounge,
- Pool Deck,
- Eco-Koi Pond,
- Water Features,
- Children's Playground,
- Garden Pavilions,
- Barbeque Arbor,
- Fitness Corner,
- Basketball Courte,
- Badminton Court,
- Tennis Court,
- Jogging Path,
- Waiting Shelter,
- Porte cochere,
- Feature Arbor,
- Clubhouse/Multi-Function Room
- Gymnasium,
- Male/Female Changing Rooms,
- 567 Carpark Lots

The wide array of unit types ranging from studio, 2-, 3-, 4-bedroom units and penthouses would appeal to the DINK or family-oriented homebuyers. Most units enjoy a North-South orientation, so you'll always enjoy the natural breeze flowing through your home.

These luxurious 3/4 bedroom units are approximately 170 to 200 sqm each. And with units designed with the family in mind, indulge in maximum space and layout efficiency to accommodate the whole family's needs for ultimate luxury living.

Be it a warm meal for the family or a dinner party for friends, you will always find contentment in the spacious kitchen. It's where sophistication meets functional practicality. And fitted with top designer Miele appliances, the sleek design of the kitchen is the perfect place to showcase your culinary skills.

Strategically nested amongst nature parks and surrounded by its accompanying flora and fauna, The Cascadia is definitely the nature lovers' ultimate paradise.

Tourist Arrivals, Hotel Rates At Record Highs In Singapore

Source : The Straits Times, Dec 26, 2007

SINGAPORE received a record number of visitors last month and hotel rates were also at fresh highs, the tourism authorities said on Wednesday.

The Singapore Tourism Board said 837,000 visitors arrived in November, the largest number ever for that month.

Average room rates for hotels also set a new milestone of $226 a night, the highest ever in any month and up almost 30 per cent over last year, the board said.

The Republic's hotels earned record room revenues of $175.4 million, an increase of almost 24 per cent from last year, it said.

Visitor arrivals were 4.6 per cent higher than a year earlier, fuelled by strong arrivals from China, India and Australia, the board said.

'In November 2007, Singapore welcomed 837,000 visitors... this sets a new record for the month of November,' it said.

Singapore also hosted the annual Association of Southeast Asian Nations (Asean) summit and its related regional meetings which likely boosted November's figures, as official delegations occupied several city hotels.

Lacking natural attractions, Singapore has embarked on a major campaign to spruce up its tourist appeal.

It has plans for new attractions including two casino resorts, expected to open by 2010, and is trying to become an arts and entertainment centre. It is to host its first Formula One Grand Prix late next year. -- AFP

New Bus Service For Private Estate Residents In Yio Chu Kang

Source : Channel NewsAsia, 25 December 2007

A shuttle bus service has been launched on Tuesday to ferry residents living in private estates at Springside and Springleaf in Yio Chu Kang to the nearest MRT station and bus interchange.

The move came after feedback from residents about the lack of transport in the area.

MP for Ang Mo Kio GRC Lee Bee Wah, who approached SMRT to provide the service, joined residents in taking the first ride on Tuesday.

The shuttle, which runs every 20 minutes during peak periods and at 35-minutes intervals during non-peak periods, costs $1.30 per ride.

The shuttle service will not run on weekends and public holidays.

The service is on trial for three months, after which SMRT will decide if it's feasible to continue the service.

"I would think, initially, it'll be at a loss. We hope that residents who requested for this bus will come forward and use this bus service. SMRT has told me that as long as they breakeven, they will continue to provide this service... So hopefully at the end of 3 months, there'll be sufficient riders to breakeven," said MP Lee. - CNA /ls

Number Of F&B Outlets On Sentosa Tripled In Last Two Years

Source : Channel NewsAsia, 25 December 2007

The number of food and beverage (F&B) outlets has tripled on Sentosa in the past two years.

But it's not just the upcoming integrated resort that's attracting restaurants to start up on the island.

Emily Liu and Joe Ou Yang got married in Beijing in February 2007. But the couple never found time to take their wedding pictures, till Joe got posted to work in Singapore recently.

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"My wife and I worked outside China and we don't live together. This August, I came to Singapore to work for couple of months. Then in September, I asked my wife to come to Singapore to visit me and we took the photographs here," said Ou Yang.

The couple had their pictures taken at Sentosa.

Sentosa said at least three couples have their wedding pictures taken at the island resort each day.

Some even believe that a 150-year-old Ficus tree on the island is a symbol of fertility, which is why Sentosa is the best location for couples to say 'I do'.

A 4 metre by 5metre floating pavilion in the centre of the lake is the place for wedding solemnisations.

It can take the weight of a bridal couple, a Justice of Peace and two witnesses for a wedding solemnisation.

There will also be another "corner of love" for couples to do their wedding solemnisations, hold receptions by the lake or just across the road at nearby restaurants.

For foreigners like Liu and Ou Yang, the idea has potential spin-offs for wedding tourism.

"If everything is done in one place, it's more convenient for me. I don't have to bring all my wedding gowns from Hong Kong to Singapore and I don't have to go to many places to hunt for venue to hold my wedding banquet. It's more convenient if they can do everything in one place," said Liu.

The "I Do" corner is expected to be ready by mid 2008.

And such developments have attracted more food & beverage outlets to start up on Sentosa - from just three in 2005 to nine outlets today.

Said Thomas Teo, Managing Director Wine Network: "Before this, a lot of (F&Bs) went into Sentosa and didn't quite make it; they were struggling. With the new setting and the new policies, and the IR (integrated resort) coming in, it's a whole new ball game altogether.

"Within the next three years, when the IR comes in with the mega hotels with the casinos, we believe the traffic is going to grow by many, many times. We believe we can tap on that."

Wine Network spent nearly S$2 million to convert the old Ficus Monorail Station into a new restaurant and bar called "Suburbia".

It took Sentosa and the company two years of talks before the restaurant was set up.

The company hopes to recoup its investment within the next two years.

Sentosa attracted nearly 6 million visitors in 2006. - CNA /ls

Marginal Increase In Births, Record Number Of New Citizens In 2007

Source : Channel NewsAsia, 25 December 2007

There were 30,168 resident births in the first 10 months of 2007. According to the National Population Secretariat, this was just 1 percent higher compared to the same period the year before.

However, the shortfall in resident births is being compensated by a record number of foreigners who are calling Singapore home.

The whole of last year saw 13,209 foreigners taking up Singapore citizenship and 57,310 taking up permanent residency.

In the first 10 months of this year, Singapore attracted 13,969 new citizens - much higher than the average of 9,600 in the past five years - and 53,011 new permanent residents (PRs), a 21 percent rise compared to the average of 43,600 in the last five years.

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"A City of Possibilities" was the theme of the 2007 National Day Parade.

By witnessing the events performed on the world's largest floating platform at Marina for the first time, Singaporeans got a glimpse of the sea of possibilities that lie ahead.

On August 19, Prime Minister Lee Hsien Loong had said, "Over the next decade, we have a unique opportunity to transform Singapore. Together, let us make this truly a City of Possibilities and a home for all of us!"

That includes more foreigners; about 14,000 of them took up the invitation to call Singapore home.

At the first-ever national ceremony on August 17, 155 foreigners swore allegiance to Singapore as they received their citizenship from Deputy Prime Minister Wong Kan Seng.

The National Population Secretariat told Channel NewsAsia that it does not set targets on new PRs and citizens.

Source : Channel NewsAsia, 25 December 2007

It added that "the high number of new PRs and SCs (Singapore citizenship) granted could be due to the broadening of the criteria for citizenship applications in 2004, as well as the many economic opportunities that Singapore offers".

This influx of immigrants is likely to continue in the coming years.

So there is no let up in efforts to integrate them into the community.

Favourable economic conditions have been cited for the increase in the number of foreigners here.

The economy has been on an upswing, unemployment has fallen to record lows, and many employees - including those in the public service sector - have been rewarded with a pay rise and record bonuses.

Meanwhile, perhaps buoyed by the upbeat mood, Singaporeans gave generously.

Some fundraising events pulled in record donations.

Charities which had been taken to task for poor book-keeping and management practices are getting back on their feet.

Youth Challenge spent months tightening operations and got the all clear from the Commissioner of Charities.

The new National Kidney Foundation raked in S$270million in reserves and it has promised to plough it back to help the needy.

However, just as public confidence was slowly being restored in some organisations, suspicion was raised about a few big charities.

In June, the superintendent at St John's Home for Elderly Persons went missing, along with almost S$4 million from the Home's bank accounts.

Five months later, RenCi Hospital and Medical Centre was probed by the Health Ministry for financial irregularities.

According to the Charity Council, RenCi's former Chairman and CEO Venerable Shi Ming Yi ran foul of three guidelines in the finalised Code of Governance, when he made interest-free loans to external parties.

But as pointed out by veteran in the charity scene, Gerard Ee, even with clearly spelt out practices, there is no guarantee that the charity sector, which is worth billions of dollars, will be scandal-free.

Mr Ee, who is the Chairman of the National Kidney Foundation, said, "You'll continue to have scandals from time to time. It is the human factor - so things can go wrong. But if (you) don't have corporate governance, rules and regulations, things can (get) worse...I think it's to minimise the risk of things going wrong - a combination of educating your stakeholders, your donors, of how to look for facts, of how to discern...who to support - as well as basic environment where there basic checks and balances that are put in place."

The Code of Governance will serve as a good checklist for charities big and small, on areas where they have met industry standards, and where they need to improve management and controls.

For donors, the checklist makes it transparent which are the charities worthy of support.

These requirements are meant to help the charity sector to grow, using many helping hands, to make sure that no one is left behind in what should be a city of possibilities. - CNA/ms

Quick Flip Success

Source : TODAY, Wednesday, December 26, 2007

More investors pump money into office property as reselling them could reap huge gains

IT WAS probably the most profitable "flip" in the property market.

In a deal announced last week, GE Real Estate made a whopping 73 per cent profit on its initial $75-million investment, when it sold Anson House for $129.5 million, a year after purchasing it.

The 13-storey building, located at Anson Road, is now owned by a private property fund managed by Australia's Macquarie Bank.

Analysts told Today the sale is a sign that in the booming local property market, price flipping — the practice of buying assets and quickly reselling them for a tidy profit — is expected to be the norm.

Mr Donald Han of property consultants Cushman and Wakefield said he is seeing scores of investors putting their money in prime spaces in the Shenton Way area because the potential gain from a sale could be huge.

"Many investors we know have the intention of keeping their assets for a minimum of two to five years because the Singapore office property market has climbed 90 per cent rental-wise and capital values have almost doubled," said the managing director.

Foreign financiers eyeing office space in the financial district have no qualms paying anywhere between $1,800 and $3,000 per sq ft in rentals, he added.

The new owners of Anson House, for instance, are paying about $1,701 per sq ft for a net lettable area of 76,127 sq ft.

As Singapore's economy grows, so will property prices, said Ms Ong Choon Fah, executive director of global estate advisers Debenham Tie Leung.

And these escalating prices could be a godsend to developers, she added. "As these new owners take over, these older sites may also be given a chance to rejuvenate through renovations and the like," said Ms Ong.

Even though a supply glut is expected by 2010, it is unlikely to affect "high-grade buildings" in the financial district.

"Investors are buying into quality and location, so, if there is going to be an oversupply, they can still rent them out without much of an issue," said Mr Han.

But one analyst disagreed.

"That really depends on how fast the economy is growing, but when the oversupply cover comes, we believe rents could face downward pressures," said Mr Nicholas Mak, the director of research and consultancy at Knight Frank.

It may look like a quick way to make a profit, but Mr Colin Tan of Chesterton International argued that these big investors usually come into a market armed with an exit plan.

"These include things such as the number of years they've been holding the property, and once their targets have been realised, they would seriously consider selling their properties."

Such was the case with the Anson House sale, said Savills Singapore's director of marketing and business development, Mr Ku Swee Yong.

"But, we can't use the word 'flipping' for the Anson sale because funds like GE Real Estate are in for the long haul. They had only one asset here, so, they couldn't say no when the right price was offered to them," he explained.

Flipping prices or not, will this constant buying and selling ultimately affect rents in the long run?

"In the next 30 months, right up to mid-2010, you can be sure that rentals would continue to go up at a higher rate," said Mr Ku.

Brothers To 'Fight All The Way' In Court Over Parents' Assets

Source : TODAY, Wednesday, December 26, 2007

A DEFAMATION case between the estranged sons of artificial limbs pioneer, the late Mr S Rajaratnam, may have simmered down but it has now brought to light a tale of sibling rivalry in which brother battles brother over their parents' assets.

Melbourne-based Kumar Rajaratnam (picture), 49 — a trained prosthetist like his father — contends that the assets as stipulated in their father's will were to be bequeathed to the grandchildren and various charities.

But he fears this will not materialise as his elder brother, 50-year-old Bala S Rajatnam, a physiotherapy lecturer with Nanyang Polytechnic, had allegedly got the ailing patriarch to change his will.

In yet another civil suit filed against Mr Bala, Mr Kumar said he wants to find "the whereabouts of the various bank accounts belonging to my late mother including sums of monies received by her as the surviving beneficial owner of my late father".

To bolster his suit, he claimed the Tribunal of Maintenance of Parents has begun an investigation into the resources of his late mother. However, a spokesperson from the tribunal declined to comment, as "they are unable to give information on individual cases due to legal restrictions".

The family quarrels began even before the death of the father in 2005. Two years earlier, in August 2003, Mr Kumar claimed through a court affidavit that their father — then in his 70s and suffering from dementia — had called him to say he was "signing documents he didn't understand that Bala was bringing to him".

But Mr Bala claims there is no truth in the allegations: Documents obtained by Today from Mr Bala showed that their parents had granted Mr Kumar the power of attorney in August 2003, which means only the younger brother could execute all matters relating to their parents' properties and bank accounts.

Said Mr Kumar: "I'm not a beneficiary of their will, neither is this a vendetta against my brother. I just want to do the right thing and donate whatever assets they have to the charities, as my parents originally wanted."

Repeated attempts at mediation have failed and the brothers have taken their grievances to court. They've decided to "fight the matter all the way now", said Mr Kumar's lawyer Manoj Nandwani. Both parties will attend a pre-trial conference tomorrow.

The escalating dispute came into the public spotlight when Today ran an exclusive report on Nov 23, detailing how an email row between them resulted in a lawsuit filed in July last year. Mr Kumar had then sued his brother for ostensibly defaming him to family members in Singapore, Malaysia and Australia via emails sent last April.

Mr Kumar, who challenged Mr Bala's guardianship of their mother after their father died two years ago, said: "At the time I started the (defamation) case, my mother was still alive and I needed family support in Singapore and Malaysia.

"Bala was sending out disparaging emails clearly to prevent any family support for me to care for my mother in the future."

But Mr Kumar has decided to drop the $300,000 libel case. "We found that there was limited circulation of the offending email," said Mr Nandwani.

With the recent death of their mother, Mrs Parameswari Rajaratnam, "the defamation suit is now academic", said Mr Kumar, director of several companies in Australia and inventor behind the "tatami chair" in the 1990s.

But Mr Bala plans to proceed with counterclaims for loss and damages amounting to more than $900,000 until he is given assurance "by some kind of mediation or written agreement that they not bring up further cases".

"I also want to be assured by the Court that, in future, if Kumar lodges more complaints, the Court will scrutinise them and suggest mediation immediately," he said.

CapitaLand Suffers Another Rough Week

Source : The Straits Times, Dec 22, 2007

CAPITALAND shares have endured a turbulent journey of late, and this week was no different.

The property stock plunged from $7.05 on Tuesday last week to as low as $5.85 during intra-day trade this week amid heavy volume.

Unlike in the previous week, when the daily volume never exceeded 17 million units, the daily volume remained above 21 million this week.

The stock closed five cents up at $6.15 yesterday - down 45 cents for the week.

Real estate investment trusts, or Reits, associated with CapitaLand also went south this week.

CapitaMall Trust fell to as low as $3.10 on Tuesday before it rebounded to end flat for the week at $3.30, while CapitaCommercial Trust dropped seven cents to $2.36.

Shares of CapitaLand were worst-hit on Monday, when they fell 50 cents to $6.10 - their lowest close so far this year.

Strong selling pressure triggered by an 11 per cent fall in Australia’s property trust index caused that day’s plunge.

That came amid news that Centro Properties, an Australian property trust that owns 700 United States shopping malls, had problems refinancing its debts.

Centro shares plunged 76 per cent on Monday after the firm said it was struggling to refinance $1A.3 billion ($1S.9 billion) worth of maturing debts because of the collapse in the US sub-prime housing market.

There are, however, signs that the worst might be over for CapitaLand.

An AmFraser Securities report on Tuesday said: ‘These two days could well mark the selling climax for CapitaLand, which lost 17 per cent in the past week, falling from $7.05 to a new 2007 low of $5.85 today.’

That seems true, with the shares staying above $6 since Tuesday.

In a show of confidence, UBS maintained its ‘buy’ call, while keeping its target price of $10.60 that same day.

A UBS report says CapitaLand still enjoys strong access to capital. It also doubts whether the property firm will face the same debt problems as Centro since ‘it has not overextended itself’.

But OCBC Investment Research kept its ‘hold’ rating, while slashing its price forecast from $7.83 to $6.94.

It noted: ‘As for its recent results, though headline numbers were strong, this was due mainly to one-off items.

‘Excluding these one-off items, we estimate that its profit after tax and minority interests would have been more modest at about $34 million.’

Singapore Developers Build On Vietnam’s Growth

Source : TODAY Weekend, December 22, 2007

A growing middle class seeking property in Vietnam will keep Singapore property developers there busy, even as its government plans a tax on capital gains.

Last month, the national assembly of the socialist country passed new regulations to tax capital gains - 20 per cent on stock trade gains, and 25 per cent on property profits - from January 2009.

“With regard to the recent proposal of introducing a capital gains tax for Vietnam in 2009, we believe it is unlikely to affect the buying sentiments of our homebuyers now,” said a CapitaLand spokesperson.

“There is a large pool of genuine homebuyers looking to purchase homes for themselves and their families.”

CapitaLand, which in October launched its first residential development in Ho Chi Minh City, pricing its units between US$1,200 ($1,750) and US$3,200 per square metre, plans to sell 2,800 more homes for mid- to high-end consumers in the next few years.

A spokesperson at Keppel Land, which has the largest exposure to Vietnam among Singapore developers, said: “The capital gains tax does not affect Keppel directly as it is a tax on the profit made by purchasers who on-sell their units.”

Indeed, the recent measures to cool the market, the spokesperson said, “will serve to provide greater stability and sustained demand in the future”.

Yesterday, KepLand closed at $7.25, after falling 45 cents between Nov 20 and Nov 30. CapitaLand closed at $6.15.

Vietnam, regarded by many as “the next China”, began adopting market practices in the 1990s; in January this year, it joined the World Trade Organisation. Its economy has grown at 8-9 per cent a year since 2004, with foreign direct investments reaching US$12 billion ($17.5 billion) last year. More than 200 stocks are listed on the Vietnam Stock Exchange worth a capitalisation of about $27 billion.

Vietnam has a sizeable middle class, estimated at 23 million people, or 27 per cent of the population.

Mr Gary Evans, head of HSBC’s Asia-Pacific equity strategy team, said Vietnam could experience a prolonged real estate market boom. “In the long term, Vietnam still looks to be short of most types of property, so it should stay a strong market in the foreseeable future.”

In Ho Chi Minh City, the supply of new homes will reach 20,000 in the near term but demand is forecast to reach 60,000 units by 2011, said property adviser Savills.

Some of the demand may be speculative, especially at the high end. Property consultants said an “overwhelming majority” of these buyers are locals, said Pacific Star analyst Mark Ho. The low GDP per capita of US$809 “raises questions on how much of the perceived demand is real”, he added.

Legal Issues Every Homebuyer Should Know

Source : The Sunday Times, Nov 18, 2007

Don't just leave it to your lawyers and agents. Let's go through six legal aspects of buying property.

Figuring out your options

THE option to purchase is the right to buy a property at a specified price within a specified period of time.

To secure this, the buyer must pay an option or booking fee to the property's developer.

This usually amounts to 5 to 10 per cent of the purchase price for private homes.

If a buyer is granted an option to purchase, the developer has to deliver to the buyer or his lawyer the sale and purchase agreement and title deed within 14 days. The option is valid for three weeks from the date of delivery of these documents.

To exercise the option, the buyer must sign the sale and purchase agreement, and pay the balance of the down payment.

The usual down payment for private homes - comprising the option fee and option exercise fee - is 20 per cent of the purchase price.

If the buyer does not exercise his option, he loses 25 per cent of his option fee.

The developer can sell the property to another party after he refunds to the first buyer 75 per cent of the option fee.

Those buying resale Housing Board flats will use a standard option to purchase form issued by the HDB.

The buyer in this case gets 14 days to consider his purchase after paying the seller a non-refundable option fee of up to $1,000.

This fee is forfeited if the buyer decides not to go ahead with the purchase.

If he does decide to go ahead with the purchase, he signs the same form and pays another fee to the seller to exercise the option. This option exercise fee, together with the option fee, cannot exceed $5,000.

If the buyer abandons the purchase after exercising his option, the owner of the flat can claim damages against him.

Lawyers' role

LAWYERS play a key role in the homebuying process, and they come into the picture once the buyer decides on a property.

A conveyancing lawyer is responsible for doing all the relevant searches on the title deed to a property, to ensure that the seller does not owe any debt to the Government.

Such debts could range from unpaid property tax to money that is owed to the Government over road improvement works nearby, said the head of conveyancing at Lawhub, Ms Winnie Tan.

The lawyer also needs to check to see if there is a road reserve on the property, which would allow part of the property to be acquired by the Government in the future for roads to be built.

This is important as it may affect the value of the property, which may in turn reduce the loan amount you can get to finance it.

If a buyer is taking out a bank loan, the lawyer has to ensure that the relevant documents are ready.

Usually, said Ms Tan, a lawyer is hired after the buyer puts down an option fee or booking fee for the property.

She suggests that buyers could look for a lawyer even before that stage, if they want to avoid forfeiting the option fee should the property turn out to have problems and they have to let the option lapse.

The lawyer's role ends when the title deed is handed over to the buyer.

For uncompleted properties, this could take up to three years. Resale transactions, however, are usually completed within three or four months.

Ms Tan estimates that the legal fees for a typical home costing not more than $1 million, and paid for with Central Provident Fund savings and bank loans, will range from $2,500 to $3,000.

This does not include the $800 to $1,000 usually charged for searches on the property and other associated costs.

Fees and taxes

THERE are various charges you need to take note of when buying property: property tax, stamp duty and agents' commissions.

Commission structures are not fixed under the law, though there are market norms for the different segments such as private homes and resale Housing Board flats.

Buyers of private homes typically do not pay anything to agents, as the agents collect a 2 per cent commission from the sellers.

Buyers of resale HDB flats, however, are charged a 1 per cent commission if they hire the agent. Most sellers' agents also charge buyers a 1 per cent fee if they are not represented by a broker.

This practice has been called into question by the Consumers Association of Singapore because of a possible conflict of interests.

Many agents for sellers, however, refuse to show a flat to independent buyers unless a fee is promised. They argue that an independent buyer would have a higher chance of tripping up in a transaction if he did not have the help of a broker.

Buyers also need to take note of the stamp duty. This is a tax on commercial and legal documents that record and give effect to certain transactions. The duty is payable even if the transaction is aborted.

The stamp duty for the purchase of property is calculated at 1 per cent of the first $180,000 of the purchase price or market value of the unit, whichever is higher.

The rate goes up to 2 per cent for the next $180,000, and 3 per cent for the remainder if the value exceeds $360,000.

Finally, the buyer has to remember the property tax payable for his new home. This is calculated based on the annual value of his home, which is the estimated annual rent it can fetch if it is let out.

This amount, which excludes the rent for furniture and fittings, is determined by analysing rents for comparable buildings and other data, so it changes with market trends.

The property tax on owner-occupied homes is charged at 4 per cent of the annual value. This concession is applicable to only one property at any one time.

If the property is not owner-occupied, the tax rate is 10 per cent of the property's annual value.

This year's Budget included a one-off property tax rebate of up to$100 per year for 2008 as well as 2009. The rebates apply to owner-occupied residential properties.

If you are not Singaporean...

FOREIGNERS can buy condominiums and private apartments in buildings that have six or more storeys, but face restrictions in buying landed homes.

To buy landed property, they need to submit an application to the Government.

They will get the go-ahead only if they are deemed to have made a significant economic contribution to Singapore.

Those buying plots of land in Sentosa Cove, however, were recently allowed to submit a shorter application form and granted fast-track approval.

For public housing, only foreigners who are permanent residents (PRs) may apply for a new flat directly from the Housing Board (HDB) but they have to do this with their Singaporean spouse, child or parent.

PRs are free to buy resale HDB flats on the open market.

Those who choose to buy an HDB flat need to be aware of the Board's ethnic integration policy. This limits the proportion of each ethnic group represented within a block and precinct, to encourage various groups to interact with each other on a daily basis.

If the limit has been reached for a particular area, the owner can sell his flat only to someone of the same ethnic group as him.

Meanwhile, executive condominiums are available to foreigners after 10 years.

These developments usually have the same facilities as condominiums, such as swimming pools and gymnasiums. PRs may buy a new executive condominium with their Singaporean spouse, child or parent.

Insuring your home adequately

BUYING a home is a major purchase for many people.

To make sure that things don't go wrong after your major purchase, you may want to insure your home.

Apart from the standard fire policy that covers losses caused by fire, lightning and explosion, you can also take a home insurance policy that covers destruction to a building, home contents and any renovations carried out.

If your property is mortgaged, the mortgagee will require you to have a fire insurance policy on the outstanding loan amount.

When taking out home insurance, make sure that the sum insured is adequate.

The sum should reflect the total cost of rebuilding or reinstating your insured property to its original state, plus professional fees and the cost for removal of debris, says the General Insurance Association of Singapore.

Market value is normally not used as the sum insured.

To estimate replacement cost, you need to know your property's gross floor area.

As a rough guide, the replacement cost of a medium-quality condominium could fall between $137 per sq ft (psf) and $182 psf, while that for landed cluster housing could range between $152 psf and $182 psf.

You should note that the total claim amount is limited to the total cost of the property or reinstatement.

Valuation matters

A PROPERTY'S valuation determines how much a buyer can borrow to pay for it.

Banks can grant a loan of up to 90 per cent of a home's purchase price, or valuation, whichever is lower.

This means that if the price of a property exceeds its valuation, the buyer has to come up with cash to cover the shortfall.

A buyer can get an indicative valuation for a property before committing to the purchase. This does not involve a detailed inspection.

The bank's offer is subject to the formal valuation confirming the indicative valuation. This figure is usually derived from the bank's own panel of private valuers.

When valuing a property, these professionals consider the current value of comparable projects in the area. Other factors taken into account include the property's location, size, layout, age and condition, as well as its orientation.

Valuers usually take about two to three weeks to complete the assessment.

Mr Eugene Tham, a director of property consultancy Chesterton International, estimates it would cost about $400 to $500 to value a home worth about $1 million.

For resale Housing Board flats, buyers need only to submit a request for a valuation report, which would cost about $200 for three-room or larger flats. The HDB will then randomly assign a private valuer to assess the property.

About two years ago, it was common for buyers and sellers to inflate the price of the flat so the buyer could get a bigger housing loan than he would otherwise be allowed. Such illegal "cashback" arrangements were supported by inflated valuations from the colluding valuers.

The Government, however, clamped down on this practice in 2005, by requiring flat purchases involving withdrawal of Central Provident Fund savings to be supported by valuations carried out through the HDB system.

Such cashback arrangements largely fizzled out after the curbs. Those caught can be fined $5,000 and jailed for six months for giving false information to the HDB.

Going Abroad To Shop

Source : The Sunday Times, Nov 18, 2007

If you've been priced out of the Singapore property market, don't despair. You can find good value for money abroad, even in upscale markets like Japan.

THERE is no denying that the boom in Singapore's property market, which has risen to frantic heights during the past six months, is taking a bit of a breather.

But for those whose appetite for properties has been whetted in the recent months, don't fret, there is a veritable ocean of real estate out there and plenty that can give you a bigger bang for your buck.

Global statistics show that Asia-Pacific markets are leading the boom in housing prices worldwide. In contrast, prices in Europe are growing at only a moderate pace.

Singapore, Hong Kong and Japan

ALL three of these markets have enjoyed strong surges in property prices.

Online research house Global Property Guide said home prices in Singapore shot up 21.05 per cent for the 12 months to June, up from 6.08 per cent in the previous year.

In Hong Kong, they rose 8.78 per cent during the same period, after suffering a decline of 0.65 per cent in the year before.

Land prices in Japan's six major cities increased by 7.75 per cent over the period.

In fact, prices have hit record highs in all three markets.

Condos have been sold in Singapore for $5,000 per sq ft (psf) while Tokyo units average around $3,400 psf. Hong Kong's luxury apartments average $3,100 psf, although those at the very top of the range have fetched more than $7,800 psf.

To track down investment homes that are easier on the pocket, investors have been flocking to emerging markets such as Malaysia, Thailand and Vietnam.

Opportunities even in developed markets

EMERGING markets might seem like an obvious choice for home-seekers, but even in developed markets, there are investment opportunities.

As Mr Tim Murphy, the managing director of Hong Kong-based investment firm Intellectual Property, puts it: "Some markets will give you growth because they are emerging. Others will give you growth because of where they are in their property cycles."

He points to Japan, generally considered a mature market with not much price growth. Recently, prices have swelled, especially outside Tokyo. On the outskirts of the city, it is possible to find good properties that are likely to appreciate in value.

Australia, in contrast, has enjoyed several years of solid appreciation.

Homes in Melbourne and Sydney have become very expensive and rental yields have dropped.

The market in Perth in Western Australia has been even more frenetic, with prices climbing 30 per cent on average over the past 12 months.

Thus, even though analysts expect further price increases, growth might moderate, with less potential for upside.

For foreigners, who are allowed to buy only new developments from developers, the relatively high interest rates and rising Australian dollar will make Australian homes more costly.

"Whichever market you're interested in, look for cheap interest rates and high rental yields," advised Mr Murphy, whose company has transacted properties worth more than US$85 million (S$123.5 million).

Tips for overseas homebuyers

IF YOU are keen to invest in foreign properties, note the following points:

- Do your research, understand the market and do not jump on the bandwagon to follow current trends as these might change.

- Remember these key words when researching a market: legals, borrowing, liquidity, yields, tax and currency.

- Buy homes from established developers with good track records.

- Look for properties that the local people will want to rent as these will offer higher rental yields.

- Always look through all legal documents and hire a trustworthy lawyer.

- Be an early bird. Invest early if you can, to take advantage of launch prices, which are typically lower.

Guide To Getting A Home Loan

Source : The Sunday Times, Nov 18, 2007

It's easy to get carried away by swish showflats and glossy brochures but when it comes to the nitty-gritty of financing that dream home or money-spinning condo, it's best to keep your feet on the ground.

Let's take a walk through the top seven questions that you should consider when shopping for a mortgage.

1. How much can I borrow?

This is the first question you need to ask before you sign the purchase contract for that ideal flat with the pool view and auspicious unit number.

There are essentially two factors that banks consider when determining how big a loan they can grant you.

First, they are allowed to lend you no more than 90 per cent of the property's purchase price or valuation - whichever is lower.

So if the valuation is less than the purchase price, be prepared to cough up more cash to meet the difference.

Take note also that interest rates are usually higher, between 0.5 and 1 percentage point, for loans larger than 80 per cent of the property's value.

Next, banks will also want to make sure you can afford the monthly instalments of the mortgage.

The rule of thumb is that all your monthly financial commitments, such as car loans, should not exceed half your monthly income.

Online loan calculators found on bank websites can help you estimate the monthly repayments of the potential mortgage you are considering.

Alternatively, just walk into your favourite bank branch and get advice from the officers there.

Some banks, such as Standard Chartered Bank (Stanchart), do offer "in-principle approvals" for existing customers. While a final go-ahead is still needed, it does give an indication of how much you can borrow.

2. Where should I start shopping?

The most obvious way to find out about interest rates and loan packages is to visit the various banks.

The Internet and the phone may help with some initial inquiries, but a face-to-face consultation is often still needed to get details and the latest information.

If DIY is not your thing, you can seek advice from mortgage brokers who will do all the legwork for you - for free.

"What we offer is a "one-stop shop" where we hope to help clients weigh up the various packages objectively," says Mr Geoffrey Ying, mortgage division head of financial advisory New Independent.

Beyond finding out the rates and terms of various loan packages on the market, they can sometimes even offer you special packages with lower rates.

3. How long should I stretch the mortgage?

A longer tenure will mean smaller monthly instalments. So to minimise the immediate pain, most borrowers tend to stretch their loans for as long as possible.

Most banks typically assume borrowers will be able to keep up with monthly repayments up to age 70. Hence, a 35-year-old can get a 35-year loan.

But a protracted loan may not always be a good idea, as you will end up paying a lot more interest.

Take, for example, a $500,000 mortgage with an average annual interest rate of 4 per cent.

A 30-year loan translates into monthly repayments of $2,387 and accumulated interest of $359,288.

If you can stump up $642 more each month, you can finish paying up the loan 10 years earlier and save $132,162 in interest charges.

4. How do I want my interest rates determined?

Standard mortgages are charged according to reference rates set by banks, which they may change over the tenure of the loan.

While based loosely on benchmark interbank rates, each bank's reference rate is different and may be affected by a bank's business and its funding costs.

Recently, loans with rates pegged directly to benchmark rates such as the Singapore interbank offered rate, or Sibor, have hit the market for borrowers who want greater transparency about how their interest rates are determined.

These mortgages tend to be slightly more expensive than plain-vanilla variable rate loans and will usually expose borrowers to market fluctuations fully.

For transparency with stability, POSB's Ideal Home package may appeal to many as its rates are pegged to the Central Provident Fund Ordinary Account rate, which has not changed in the past eight years.

5. Should I opt for fixed rates?

For peace of mind, rates can be fixed, usually for the first one to three years.

Mr Bryan Ong, a senior associate manager at real estate firm PropNex, recommends fixed rates to busy people who could well do with one less thing in life to monitor.

Moreover, locking in a low interest rate may well be financially prudent if rates are expected to go up. Stanchart mortgages head Elaine Heng says borrowers who chose fixed rate loans in 2005 have been enjoying big savings. Rates were as low as 1 per cent two years back but have since risen, going above 3 per cent in June.

But hindsight is always 20/20.

Also, fixed-rate loans are charged at a small premium over flexible rate loans. This means any potential savings is likely to kick in only after the first three to six months, says OCBC Bank consumer secured lending head Gregory Chan.

"Fixing rates for one year doesn't make sense unless you think rates are going to spike up."

He added that keen competition is keeping rates low anyway.

For those who want to hedge their bets, most banks offer "combo" or "hybrid" loans where a part of the mortgage has its rate fixed, while the remainder is kept variable.

6. What about lock-in periods, early repayment penalties?

Banks typically stipulate that borrowers cannot accelerate their loan repayments in the first one to three years.

Any early redemption often carries penalties equivalent to between 1 per cent and 1.5 per cent of the principal.

Each bank has its own rules and, even then, these differ between products, and special promotional exemptions are available from time to time.

In general, fixed-rate loans usually come with a lock-in period because the lender would have already incurred hedging costs.

Flexibility can, however, be bought by paying 0.5 per cent to 0.75 per cent more interest, says DBS home loans head Koh Kar Siong.

But what is almost unavoidable when redeeming a loan early is the return of legal and insurance subsidies that the bank may have given initially. Mr Koh says this question is more pertinent for speculators who hope to flip their properties for a quick buck.

Still, longer-term buyers may want more flexibility to refinance their homes to take advantage of better mortgage deals that may come up.

And then, there's always the possibility - however remote - of striking lottery.

7. What else is in the market?

There are a few innovations in the mortgage market that may benefit those with some extra cash in their hands.

Products such as Stanchart's MortgageOne and HSBC's SmartMortgage pay borrowers the same interest rate on some of their deposits as their loans.

This effectively means that the higher interest earned from deposits can help offset some of the borrower's mortgage costs.

Another product that tries to help borrowers pay off their loans more quickly is OCBC's QuickOwn mortgage.

Instead of giving a special rate for deposits, borrowers need to set aside regular savings over 12 years that will go into an endowment policy.

Payouts from the savings plan will go towards paying off the mortgage, reducing the loan's tenure.