Wednesday, February 20, 2008

Parkway Reit To Relook Record $1.25b Novena Bid

Source : TODAY, Wednesday, 20 February 2008

Parkway Life Reit, which derives its revenue from the rental of healthcare space, will make its own independent assessment whether to acquire a new hospital whose site its parent company Parkway Holdings made a record bid for.

The $1.25 billion bid by Parkway Holdings - about five times that of rival Raffles Medical - for the Novena site on which the hospital will be built has raised concerns among investors that it is paying too much for the land.

“We will look at it no different from any third-party acquisitions,” said Mr Yong Yean Chau, chief financial officer of Parkway Trust Management, which manages the Reit.

Any acquisition will have to be yield-accretive, added Parkway Life Reit chief executive Justine Wingrove.

Parkway Life Reit is looking to boost its portfolio that currently comprises of Mount Elizabeth Hospital, Gleneagles Hospital, East Shore Hospital and associated medical facilities.

The Reit is interested in acquiring healthcare assets such as hospitals, medical offices, pharmaceutical warehouses and nursing homes in Singapore and the region, said Ms Wingrove.

Parkway Life Reit announced yesterday a distributable income of $13.64 million for period of Aug 23 to Dec 31, which translated to a dividend of 2.27 cents per unit. Its gross revenue for the period was $16.9 million.

Macquarie May Exit MMP Reit Under Strategic Review

Source : The Business Times, February 20, 2008

MACQUARIE MEAG Prime (MMP) Reit will undergo a strategic review that may see the Macquarie Group sell its stake in the fund.

In a statement, the Reit’s manager - Macquarie Pacific Star Prime Reit Management - said that the exercise aims to enhance the value for all unitholders. It may consider options like merger & acquisitions, full-privatisation or sale of assets, chief executive officer Franklin Heng told BT.

The announcement confirms an earlier BT report that the Macquarie Group, which owns 26 per cent of the Reit, is prepared to exit from the fund under a proposed strategic review.

Indeed, Macquarie Pacific Star said that the move came after the ‘receipt of a number of unsolicited approaches’ made to Macquarie Real Estate, part of the Macquarie Group.

Macquarie Real Estate also has an associated entity that owns a 50 per cent stake in the Reit’s manager.

The key shareholder said it will cooperate with the directors of Macquarie Pacific Star in order to maximise value for all unitholders. The strategic review will be undertaken in the context of strong underlying property fundamentals in the Singapore market.

‘The quality of MMP Reit’s portfolio of real estate assets is supported by MMP Reit’s recent announcement of an increase in its net asset value to $1.61 per unit as at December 31, 2007.’

MMP Reit last traded at $1.08 - a 32.9 per cent discount to its NTA (net tangible asset) and the strategic review will explore options to ‘close this value gap’.

Macquarie Pacific Star intends to appoint Macquarie Securities (Asia) Pte Limited of Singapore to advise it on the strategic review. The entire exercise is expected to be completed by June this year.

Yesterday, the Reit’s manager also cautioned that there is no assurance that the strategic review will result in any specific transaction.

MMP Reit reported a 15.7 per cent year-on-year rise in distributable income to $16.2 million for the fourth quarter ended Dec 31, 2007. The Q4 distribution brought 2007 full year’s distributable income to $59 million, up 7.5 per cent.

Going Private Among Options For MMP Reit

Source : The Straits Times, Feb 20, 2008

MACQUARIE Meag Prime real estate investment trust (MMP Reit) will undertake a strategic review that may result in it selling all its units and going private.

If MMP Reit, which owns stakes in Wisma Atria and Ngee Ann City, eventually decides to go private, it would be a first for a Reit in Singapore. In a statement yesterday, the Reit said the review would consider strategies such as allowing unitholders to buy all its units.

Macquarie Real Estate has a 26 per cent interest in the Reit. An associated entity has a 50 per cent indirect stake in the Reit’s manager, Macquarie Pacific Star Prime Reit Management.

Market watchers say going private makes sense, as some Reits are trading at levels below their net asset value per unit.

MMP Reit said the move followed a number of unsolicited offers to Macquarie Real Estate for its stake in the Reit.

‘MMP Reit is trading at a substantial discount to its net asset value, and the strategic review will be designed to explore the means by which this gap may potentially be closed.’

The Reit’s net asset value stood at $1.61 per unit as at Dec 31. Its shares, which were halted from trading yesterday, last traded at $1.08.

OCBC Should Keep Options Open On Straits Trading

Source : The Straits Times, Feb 20, 2008

MOST of the attention so far in the escalating battle for The Straits Trading Company has centred on the two prominent business families slugging it out for one of Singapore’s oldest companies.

But there is another player with a pivotal role in the unfolding drama which has so far stayed largely under the radar: OCBC Bank.

Last week OCBC announced it would not accept either of the competing offers for Straits Trading, in which it has a 6.2 per cent stake, as it sees greater value by staying put and taking an active role in the company’s affairs. That decision demands close scrutiny from OCBC’s shareholders.

Last month, Ms Chew Gek Khim, the grand-daughter of the late Tan Chin Tuan - chairman of OCBC between 1966 and 1983, made what many consider to be an audacious bid to gain control of Straits Trading via investment vehicle Tecity.

In doing so, she pitted herself against the bank’s biggest shareholder and founder, the Lee family, which seems determined to stop her with a competing bid.

The sums involved are not trifling. Buying up the rest of Straits Trading would cost Tecity $1.7 billion, after it raised its offer to $6.70 a share on Monday.

For the Lees, the sum involved is equally daunting. Excluding OCBC’s 6.2 per cent stake, they may have to pay nearly $2 billion - not a petty sum even if they are one of Singapore’s richest families.

Both the Lees and Ms Chew have stayed largely out of the media spotlight so far.

The Tan family, like the Lees, had seemed content to let professionals run a company linked to OCBC as long as anyone can remember. Until now, Ms Chew was best known for the ruckus she kicked up over the manner in which the Indonesian Lippo Group booted out the then chairman of Robinson & Co, Mr Michael Wong Pakshong, nearly two years ago. She later resigned from the board.

Many believe that calamitous event marked a turning point for her - shattering a belief that her family’s interests would always be aligned with that of OCBC, Robinson’s former controlling shareholder.

Indeed, it might have prompted Ms Chew to take a hard look at the inheritance left by her grandfather. This could have led to the battle for Straits Trading.

Ms Chew has little to lose. She either gains control of a listed vehicle with a big land bank, or walks off with $480 million or more, if the Lees call her bluff and make her an offer she cannot refuse.

Her offer also comes at an opportune time for Straits Trading shareholders. While other property firms like City Developments and CapitaLand are trading 30 per cent below their peaks last year, Straits Trading is being valued at a 42 per cent premium over its average price of $4.70 last year.

But OCBC shareholders must be wondering why the bank rejected both offers for its stake. Isn’t it better if the bank keeps its options open until the final wash-up?

At a time when cash is king and global banks are struggling to raise funds to re-capitalise their battered capital base after suffering big losses in the United States, OCBC is in an enviable position - getting fabulous offers for its non-core assets such as Straits Trading and Robinson. Tecity’s latest offer of $6.70 values the tin smelting company above independent financial adviser CIMB-GK’s break-up value of $6.52 per share.

It also begs the question whether there is much more value to be unlocked out of a company, where the share price had hovered between $2 and $3 for much of the past 10 years.

Surely, if the bidding continues at a furious pace, OCBC and its unit Great Eastern Holdings should consider throwing in the towel as well. This will help to further unravel the intimate cross- holdings of shares in companies held by the bank and its biggest shareholder, started four years ago when the Lees sold their Great Eastern stake to OCBC.

With fewer non-core assets to distract, OCBC’s management will have more time - and more resources - to build a banking empire by buying up distressed banking assets overseas when they are going cheap. That would definitely win accolades from investors.

Asian Real Estate Securities Now Offered To Retail Investors

Source : The Straits Times, Feb 20, 2008

REAL estate has been the hottest investment topic in Singapore over the last year or so, and now retail investors have a new avenue for investing in Asia’s property market.

An arm of Deutsche Bank - RREEF - on Monday launched three new funds investing in property , backed by a belief that the sector has plenty of upside in Asia.

Asian real estate is at an ‘early stage of a long-term structural uplift’, said RREEF Asia Pacific real estate securities head Daniel Ekins.

RREEF said these new funds - previously exclusive to institutional and wealthy investors - are now offered to local retail investors. A minimum investment of US$1,000 (S$1,400) is needed.

‘Asia’s rising prosperity and consistent high economic growth have driven greater demand for residential and commercial real estate, creating exceptional growth potential for real estate securities in the region,’ said Mr Ekins.

Asia-listed real estate developers and real estate investment trusts (Reits) look set to deliver as much as a 20 per cent profit growth this year, he added. Global real estate securities have outperformed global stocks by 12.5 per cent and bonds by 24.6 per cent over a five-year period, the bank said.

One of the funds, the Asia-Pacific Real Estate Securities Fund, has a pure Asian focus, and will add to a growing crop of similar products, including the Barclays Asian Real Estate Income Fund and the Henderson Asia-Pacific Property Equity Fund.

Mr Ekins expects yearly returns of 12 per cent to 17 per cent in about five years.

Reits will comprise 20 per cent of the fund’s investment, while the remaining consists of publicly traded firms that own, develop or manage real estate.

RREEF has 65.2 billion euros (S$135 billion) in assets under management worldwide, with 10 billion euros in the Asia-Pacific.

荷兰山公寓Holland Hill Mansions业主 指赔偿不公遭驳回

《联合早报》Feb 20, 2008

荷兰山公寓(Holland Hill Mansions)集体出售上诉案下判。最高法院上诉庭驳回一业主提出有关赔偿分配不公平和交易缺乏诚信的上诉。

有一间五楼单位的Dynamic投资(Dynamic Investments)公司虽然不反对集体出售和其2亿9200万元的集体出售价格,但却提出以50%份额,以及50%面积来计算赔偿额的方式有欠公平,而且缺乏诚信。在现有算法下,公司所获得的赔偿额是625万元。


这个单位的分层地契份额(share value)为6,是所有单位中最高的,最小的份额是3。







荷兰山公寓的集体出售交易其实已在去年12月17日完成。公寓是由和美集团(Ho Bee)与MCL地产联手以2亿9200万元,即以容积率每平方英尺750元买下。


昨天在另一起集体出售个案中,分层地契局也批准了宝石中心(Ruby Plaza)的集体出售申请,并否决了四名反对集体出售的少数业主的反对诉求。这四名业主提出反对的理由是,赔偿分配不公平以及在取得80%业主签名同意的过程出现瑕疵。

碧山24街私人组屋地段 青岛建设集团公司标价最高

《联合早报》Feb 20, 2008

新加坡建屋发展局在碧山24街推出的由私人发展商设计、兴建和销售(Design, Build and Sell)的组屋地段,共有三方人马竞标。

根据建屋局昨天所发文告,青岛建设集团公司新加坡分公司(Qingdao Construction Group Corporation Singapore Branch)以1亿3589万元(即容积率每平方英尺237元),成为出价最高的财团。

其他财团是出价1亿1600万元的森联置地(Sim Lian Land)和出价1亿72万元、联手竞标的海峡实业(Hoi Hup Realty)和Sunway Concrete Product。








MMP REIT To Conduct Review To Maximise Value For Unitholders

Source : Channel NewsAsia, 19 February 2008

Macquarie Pacific Star, the manager of Macquarie MEAG Prime REIT, is conducting a strategic review of the trust to maximise value for its unitholders.

The move comes after unsolicited offers were received for Macquarie Real Estate's 26 percent beneficial interest in MMP REIT.

The review will consider proposals on both the corporate and asset levels, including proposals to acquire 100 percent of the units in MMP REIT.

It also aims to close the gap between MMP REIT's net asset value and its traded unit price.

MMP REIT has been trading at a substantial discount to its net asset value of S$1.61 a unit.

But Macquarie Pacific Star has cautioned that there is no assurance that the review will result in any specific transaction.

MMP REIT owns nearly three-quarters of the Wisma Atria Shopping Centre and a quarter of Ngee Ann City.

The trust has been listed on the Singapore Exchange since September 2005. - CNA/ls/so

Snazzy Water Taxis To Liven Up The River

Source : The Straits Times, Feb 20, 2008

$7m fleet of 20 electric boats is part of major revamp of S'pore River and surrounding areas to boost businesses there

A SLEEK fleet of electric water taxis will start plying the Singapore River from April.

Operated by tour company Singapore Ducktours, the 20 vessels, costing $7 million in all, will be part of the changes that will transform the riverfront into a dining, nightlife and tourism destination.

The new boats will replace those operated by tourism and leisure company Singapore Explorer, which began its service in 1995 and ended it on Dec 31 last year.

Another company, Singapore River Cruises & Leisure, will continue running its bumboat service on the river.

Players in the nightlife industry were all for a spruced-up river taxi service.

Mr Bernard Lim, executive vice-president of LifeBrandz, which runs the Ministry Of Sound and Lunar at Clarke Quay, said: 'The river links all the hubs of the nightlife scene and we should make full use of that.'

He added that newer, snazzier boats would encourage more people to hop onto river taxis to get from quay to quay, which 'would be a brilliant start'.

News of the changes to the river taxi service come ahead of an announcement by the Singapore Tourism Board (STB) of a major revamp of the river and its neighbourhoods.

It has been speculated that renovations will begin at Boat Quay, Empress Place and Clarke Quay in April, ahead of September's Formula One race. Improvements to Robertson Quay and the Zouk vicinity will follow.

The Straits Times understands that meetings about the revamp, involving STB, business owners and venue operators have been taking place over the past year.

Mr Colin Goh, 40, general manager of performing arts venue The Arts House said the consultations were rigorous and stirred up enthusiasm among industry players.

'These upcoming changes will potentially change the entire complexion of the Singapore River,' he said.

The revamp will entail 'infrastructure enhancements' and 'the staging of signature events', STB and the Urban Redevelopment Authority said in a statement last year. The year before, the URA announced plans to light up the promenades along the river and the water itself.

The revamp is expected to go some way towards drawing 10.8 million visitors here and getting them to spend $15.5 billion this year.

The riverside neighbourhoods have attracted tourists and Singaporeans since businesses were allowed into the area in the late 1980s, but a magic formula for sustained success has proved elusive. The area has been renovated many times with mixed results.

Boat Quay, for instance, has lost considerable lustre in recent years; Clarke Quay's current success has come only after several less-than-successful makeovers over the years.

Most business owners The Straits Times spoke to said it is time something is done; some are also willing to spend money to renovate their interiors.

Mr Andy Ashok Vaswani, the director of Bollywood nightclub Khazana at Boat Quay, noted that STB has been promoting Clarke Quay in the last five or six years at Boat Quay's expense.

He said: 'It'll be a good thing if they put the changes in place. Boat Quay used to be in the tourist belt. But when you say 'tourist belt', you have to be promoting something for the tourists in the first place.'

Mr Mohan Mulani, chief executive of Harry's Holdings, which runs a chain of pubs, agreed.

'These changes are long overdue. The river is the gem of Singapore, but it has become a little worn out. Re-invigorating these areas is a great idea.

'Historically, the river has been where all the action happens.'

China Firm Puts In Top Bid For Bishan HDB Site

Source : The Business Times, February 20, 2008

Qingdao Construction offers $135.9 million for Design, Build and Sell Scheme plot

CHINA-BASED builder Qingdao Construction Group Corporation has put in the top bid of $135,888,777 or $237 per square per plot ratio (psf ppr) for a Housing and Development Board (HDB) Design, Build and Sell Scheme (DBSS) site in Bishan.

The tender for the site closed yesterday, and HDB is expected to award the site within two weeks. Qingdao, which has been in Singapore for nine years, is now the third China-based company to have ventured into property development here.

In December 2007, Ximeng Land paid $216 million or $1,350 psf ppr for a landed plot on Pearl Island at Sentosa Cove.

Earlier, in November, another unnamed Chinese developer together with a Singaporean partner was reported to have paid $61 million for 15 terrace houses in Balestier.

Zuo Hai Bin, general manager of Qingdao here, said that it had been planning to enter the property market and decided that the time was right with the Bishan DBSS site.

He said: 'The demand for HDB premier flats is high for the near future in Singapore. It is a good time to enter HDB property market.'

Mr Zuo said Qingdao's business activities in Singapore are financially backed by China Development Bank and the Export-Import Bank of China.

Savills Singapore director (marketing and business development) Ku Swee Yong also noted that the Chinese government is seen to be seeking more overseas investments. 'I expect to see more Chinese developers and construction firms looking for investment opportunities here,' he said.

Qingdao will build a 400-unit development and will release the launch prices and date of the launch later.

Demand for DBSS flats has been high. At the recent launch of City View @ Boon Keng in January, about 1,100 people applied for 714 units on the first day alone.

The developer, Hoi Hup Sunway Development, paid $233.74 psf ppr for its site in May 2007, and units were sold at an average of $520 psf.

Mr Ku estimates that at Qingdao's bid price of $237 psf ppr, the eventual launch price of the Bishan development could be around $550 psf. While rising construction costs are a concern of many developers, Mr Ku said that Qingdao, being a construction company, will probably benefit from 'rolling two profit margins into one'.

'Construction companies now have an edge over developers,' he added.

Indeed, the tender for the Bishan DBSS site attracted not one but three construction-based companies, with Sim Lian Land and Hoi Hup Realty/Sunway Concrete Product putting in bids of $202 and $179.20 psf ppr respectively.

China Contractor Wins DBSS Plot Bid In Bishan

Source : The Straits Times, Feb 19, 2008

THE results of the most recent tender for a Bishan plot illustrates how foreign players are increasingly making inroads into privately-developed public housing here.

China's Qingdao Construction Group Corporation emerged as the top contender for a 1.5ha plot in Bishan Street 24 with a bid of $135.9 million, almost $20 million more than the next bidder.

The Housing Board will evaluate the tender, which closed on Tuesday, and is expected to announce its award in the next two weeks.

Qingdao, which has been building in Singapore for the past nine years, out-bid homegrown Sim Lian Land and a local-foreign joint venture comprising Hoi Hup Realty and Malaysia's Sunway Concrete Products.

Sim Lian's bid of $116 million was second highest.

Read the full story in Wednesday's edition of The Straits Times.

Holland Hills En Bloc Sale Will Go Ahead

Source : The Business Times, February 20, 2008

A last-ditch attempt by Dynamic Investments to thwart the Holland Hills Mansion en bloc sale was over in less than 20 minutes yesterday.

In a Court of Appeal hearing, three judges, including Chief Justice Chan Sek Keong, upheld last October's High Court ruling that the Strata Titles Board had approved the $292-million sale in good faith.

The issue in contention was the board's approval of the sale proceeds distribution by the 50:50 method — 50 per cent based on share value and 50 per cent on floor area.

Dynamic, which owned the largest unit in the block, had wanted the distribution to be based solely on floor area, or it would stand to lose about $2.4 million. The 642-square-metre penthouse it owned had a share value of six while the smallest unit, measuring about 57 sq m, had a share value of three.

Noting that no fresh evidence was adduced in the appeal hearing, Dynamic's lawyer Clarence Tan told Today the hearing lasted "all of 17 minutes". He added: "My clients have no more avenues to appeal. Obviously, the judges found that I couldn't prove the 'bad faith' element." — LOH CHEE KONG

Investment Growth In Asia Marches Through US Recession Concerns

Source : Channel NewsAsia, 19 February 2008

Asia will continue to attract strong investments this year despite the uncertain global economic outlook, according to some participants at the 9th Annual Investment Management Association Singapore Conference on Tuesday.

They expect investment vehicles such as venture funds and private equity to pick up in 2008.

Asia has seen a sharp change - from a positive global economic outlook in 2007 to one of uncertainty this year.

Amid the market volatility, clouds are hanging over the direction of Asian financial markets. But some say Asia may be able to ride out the US storm if it is short-lived.

Heng Swee Keat, Managing Director of the Monetary Authority of Singapore, said: "At this point there is a risk of being caught in a negative spiral. Tightening credit standards and reduced credit availability will be mutually reinforced with the slowing of the macro economy.

"The extent to which the spiral takes hold determines the extent of the US slowdown. What we are likely to see, however, is the weak synchronisation of business cycles. The underlying momentum in the Asian economies will allow Asia to ride out the slowdown in the US if it is mild and short-lived."

The Asian economy, excluding Japan, is still forecast to grow at around 7.8% in 2008. The region is seen as an attractive destination for investments.

Asian markets are still seen as an attractive investment destination, with foreign inflows of direct investment into East Asia more than doubling to US$200 billion over four years - from US$84 billion in 2002 to nearly US$200 billion in 2006.

Kirk West, Managing Director of Principal Global Investors said: "The longer term opportunities exist in the Asian corporates. They have been impacted by what has happened to the corporates in the US but there are some significant differences.

"The balance sheets of a lot of Asian corporates are very strong. They've got fully funded CAPEX programmes and from a operational perspective, a lot look very strong.

"So at the moment, they are being impacted by sentiment and that may well continue for the short to medium term. But longer term, I think some of these corporates with stronger balance sheet, good cash flows and fully funded CAPEX position will be very attractive investments."

Within Asia itself, investment choices are also changing because of the rapidly ageing population. There is growing interest in products such as retirement planning and healthcare financing. By 2050, Asia's population above 60 years old is expected to quadruple to 1.2 billion people.

Wealth is also being transferred to the next generation - leading to a younger group of investors.

"I believe that 2008 is going to be a very challenging year for investors and for Asia... We are going to start seeing the generational transfer of wealth, which means we are going to see a younger and more sophisticated group of owners of wealth. They will drive investment decisions slightly differently from their parent," said Yeong Phick Fui, Managing Director of UBS Wealth Management.

Industry experts say investment vehicles such as venture funds, private equity, real estate and commodities are expected to pick up in the next year. - CNA /ls

Unsolicited Offers For MMP REIT; Trust Manager To Conduct Review

Source : Channel NewsAsia, 19 February 2008

There has been a number of unsolicited offers for Macquarie MEAG Prime (MMP) REIT, and one of them involves buying 100 percent of MMP REIT units and taking the trust private.

The trust's manager, Macquarie Pacific Star, says it will now conduct a strategic review of the trust to maximise value for its unit-holders.

MMP REIT has been trading at a substantial discount to its net asset value of S$1.61 a unit. The review will try to narrow the gap.

Macquarie Pacific Star says it will consider both corporate and asset level strategies. But it has cautioned that there is no assurance that the review will result in any specific transaction.

The trust has been listed on the Singapore Exchange since September 2005. - CNA /ls

S'pore Still Competitive Compared To HK Despite Higher Personal Taxes

Source : Channel NewsAsia, 19 February 2008

Singapore remains competitive in attracting key top talent despite the government's decision to keep personal income tax rates unchanged, according to tax experts.

However, they say Singapore may be losing ground on the non-tax advantages it has been banking on, such as housing and education.

The persistent air pollution in Hong Kong has sent expatriates to Singapore's shores. That is despite Hong Kong having a lower top personal tax rate of 16%, which is 4 percentage points lower than Singapore's.

"I think when a foreigner chooses between whether to base themselves in Hong Kong or Singapore, taxation is not the only consideration, especially for families. They will choose Singapore because it's a much better place to bring up (their children), in terms of security and the environment," says Wu Soo Mee, Director of Human Capital, Ernst & Young.

But with rising rents and longer waiting lists at international schools, some market watchers say the edge may be eroding. Others warn that Singapore should not overlook the impact that income tax rates have on a company's decision to locate its staff.

B.J. Ooi, Executive Director of International Executive Services at KPMG, said: "A multi-national with sophisticated expatriate programmes sends their expatriates all over the world. And in order to motivate these people to go wherever the company wants them to go, companies will usually say they'll equalise your taxes.

"That means if you incur any tax over and above what you would have incurred if you had remained home, the company will pay for your personal tax. That's to say it's a tax cost to the company even though it's a personal tax."

Experts say what is at stake is Singapore's bid to be the financial hub in the region, where top talent is critical.

In the recent Budget, the Singapore government gave a 20% tax rebate on personal income taxes, capped at S$2,000. This means those earning between S$100,000 and S$400,000 will pay less tax, compared to those in Hong Kong.

But without the rebate, tax will still be higher in Singapore for foreign middle income and high earners who do not enjoy CPF and other reliefs, compared to Hong Kong.

Tax experts say they expect Singapore to cut the top personal income tax rate by one or two percentage points in the next two years.

They add that other tax incentives like deductions for those who travel and work out of Singapore for more than 90 days a year, as well as the recent employee stock option incentive schemes, may help mitigate the higher tax factor. - CNA /ls

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Estate Duty Removal Will Draw Foreign And Local Funds Into S'pore

Source : Channel NewsAsia, 19 February 2008

Wealthy people aside, fund managers and the financial sector have welcomed the Government's decision at last Friday's Budget sitting to remove the Estate Duty with immediate effect.

They said this will attract the super rich to not only invest in Singapore, but also relocate here.

Estate duty affects those with properties worth over S$9 million as well as those with over S$600,000 in non-property based assets like cash, stocks and even expensive cars.

Surviving family members of the deceased must also bear the annoyance of having the authorities carry out checks on whether the estate should be taxed. However, this will not happen anymore.

Finance Minister Mr Tharman Shanmugaratnam revealed at the Budget 2008 that on average, Singapore collected about S$75 million per year from estate duty.

However, experts think its removal could potentially bring in funds worth 1,000 times that.

Philip Overmyer, Chief Executive of Singapore International Chamber of Commerce, said: "It's not a huge tax revenue for the government, and we think it makes things much simpler and easier and more predictable for people with a lot of money that want to come here and bring some of it with them.

"We think it'll attract more people with larger wealth, and we think it's more equitable for the companies and people with high assets which are not property-based."

International wealth management experts, like UBS, have started receiving calls from foreign investors on possible fund relocation to Singapore.

Bill Lexmond, Managing Director of Wealth Planning Consultant, UBS, said: "It's not just to get people's money into Singapore, but to get them here as well. You can say that there's one less reason for anyone to have concern about coming to Singapore."

Associate Professor Eugene Tan from the School of Law at the Singapore Management University, said: "It's not just about removing estate duty that we'll have wealthy people coming here to park their money, to set up philanthropic foundations and all."

"This is the place that values your investment and because society has been receptive towards wealthy people parking their money here. The idea is that we hope these wealthy individuals will then share some of the wealth that they have and so the whole idea of trying to get people to feel for the community that they're in," he added.

The removal of estate duty may be getting a lot of attention, but wealth managers said the announcement of a new tax incentive scheme for family-owned investment holding companies is more significant.

The scheme will allow such companies to enjoy the same scope of exemptions that individuals currently enjoy on Singapore and foreign-sourced investment income.

This is because rich Singapore family enterprises which have been investing their money overseas to avoid paying taxes, like the estate duty, may now relocate their funds back home to be managed here.

Mr Lexmond said it will take up to two years before such policy changes can result in a huge inflow of funds. - CNA/vm

Owner Who Objected To Holland Hills Mansion En Bloc Sale Loses Appeal

Source : Channel NewsAsia, 19 February 2008

Dynamic Investments, which owned the largest unit of Holland Hills Mansion, had tried to appeal against the Strata Titles Boards' (STB) approval of the S$292 million sale, but its case was dismissed by the Court of Appeal on Tuesday.

Dynamic Investments had argued that although the sales committee followed the guidelines set down by the Singapore Institute of Surveyors and Valuers, it did not assess if the result was fair.

In its decision in July, STB acknowledged that Dynamic Investments would have been paid more if a different method of apportionment of proceeds was used.

STB, however, maintained that the method chosen was not made in bad faith.

The three appeal judges agreed and turned down Dynamic Investments' appeal because they found "no elements of bad faith in determining the distribution of sale proceeds".

Dynamic Investments wanted the share of proceeds to be determined solely by floor area instead of the 50:50 method, which is 50 per cent based on the property's share value and 50 per cent based on the floor area.

Using the 50:50 method, Dynamic Investment received S$6.4 million from the sale. But if the sale was based solely on floor area, it would have received about S$2.4 million more. - CNA/ac

S'pore Central Bank Says Challenge To Stop Credit Crisis Spiral

Source : The Straits Times, Feb 19, 2008

SINGAPORE'S central bank on Tuesday warned that the global credit crisis may spread and said the main challenge was to stop it from bleeding the real economy.

'At this point there is a risk of being caught in a negative spiral. Tightening credit standards and reduced credit availability will be mutually reinforcing with the slowing of the macro economy,' Heng Swee Keat, managing director of the Monetary Authority of Singapore, said in a speech.

'The immediate challenge for policy makers is to contain the spread of the credit crisis to the real economy, to prevent this spiral,' he said at the IMAS investment conference.

Mr Heng said that limiting the scope of the crisis was difficult as the level of exposure to risky debt was unclear, and because central bankers faced different degrees of slowing growth and inflationary pressures in their economies.

'This time last year, the global economic outlook was positive. Today, it has become a lot more uncertain.'

Swiss bank Credit Suisse became the latest casualty of the credit crisis on Tuesday, when said it wrote $2.85 billion off the value of its asset-backed investments and found mismarking and pricing errors on its books, sending its shares plummeting.

Mr Heng said that while only a few investment funds had experienced withdrawals of funds but that this could change if markets carried on falling.

'If asset prices continue to decline, investors may react differently.This is a risk we need to watch.'

'In this state of flux, central banks and financial regulators need to be on heightened alert and respond decisively to developments that might further threaten global growth or financial stability.' -- REUTERS

Jurong Lake Area: Big Changes Planned

Source : The Straits Times, Feb 20, 2008

URA in talks with stakeholders about plans for tourism, retail and entertainment centre

A WAVE of changes has been planned for Jurong Lake.
Government officials and industry captains have met and discussed the area's potential as a commercial, retail and entertainment centre.

Preliminary discussions centred on developing office space, a commercial centre with retail shops, four to five hotels and a resort or theme park for Singaporeans and tourists alike - all clustered around the Chinese and Japanese gardens on the shores of Jurong Lake.

The site will also take in the 12ha area occupied by the now-defunct Tang Dynasty City theme park. Built at a cost of $100 million in 1991, it was forced to shut down in 1999 when it failed to pull in enough visitors.

When news broke last year that Tang Dynasty City was to be demolished, landlord Jurong Town Council and the Singapore Tourism Board said then that they were 'evaluating the area for redevelopment' into an attraction.

Multiple sources confirmed - on condition of anonymity - that a feedback session with more than 100 stakeholders was held last month on developing the area. At the session, the Urban Redevelopment Authority (URA) shared its proposed plans and sought reactions to it.

One source said: 'The plan is to try and do something similar to what was done in Tampines - to have a commercial centre, but also to add leisure elements.'

Another source said Jurong Lake was at the heart of the proposed development, and the viability of a water theme park was discussed.

The Singapore Science Centre, in Jurong Town Hall Road since 1977, will also be moving, but it is unclear when this will happen or where it will move to.

Also unclear is the fate of Snow City. The Straits Times understands that Singapore's first permanent indoor snow centre has a three-year lease and recently started turning in profits.

URA declined comment, but industry players who have heard about it are excited. A lakeside site, served by the East-West MRT line and near industrial parks and residential areas, is suitable for a mixed development, some said.

HDB Flats In Toa Payoh, Tampines Tops

Source : TODAY, Tuesday, February 19, 2008

Nearly 10,000 applications have been received by the Housing and Development Board (HDB) for 278 four-room and bigger flats in its latest bi-monthly sale.

The flats are in popular, mature towns such as Toa Payoh and Tampines, where land is limited for new public housing.

The HDB advised prospective buyers with immediate housing needs to look to the resale market, where flats are available “across a wide range of location, design and price”. While resale prices have surged 17.4 per cent last year, there is a wide range of affordable flats, said the HDB, which noted that 25 per cent of resale transactions completed last month did not exceed $10,000 above valuation.

Flats in some Build-To-Order (BTO) projects, for those who can wait a few years, are also not taken up fully. The take-up rate is 94 per cent for Treelodge@Punggol, 66 per cent for Punggol Vista, 65 per cent for Fernvale Vista in Sengkang and 70 per cent for Coral Spring, also in Sengkang.

Take It Or Leave It

Source : TODAY, Tuesday, February 19, 2008

$6.70 a share: Tecity makes its final bid for STC

The fight for Straits Trading appears to be reaching its end-game as one party of a 6-week bidding war said it was raising its offer for the second - and last - time.

Yesterday, the family of the late Mr Tan Chin Tuan - through investment company Tecity Group - said it would now offer $6.70 a share for the tin-smelting and property firm, 20 cents higher than its previous offer and 15 cents more than its rival’s. The offer, which ends March 6, would be its last.

“There will be no further revisions to our offer,” said Ms Chew Gek Khim, executive chairman and grand-daughter of the late Mr Tan. She added: “the price now reflects what we believe to be a reasonable valuation of Straits Trading, while presenting an attractive exit for shareholders”.

Tecity has also drawn interest from the family of late rubber tycoon, Mr Lee Kong Chian. The Lees - through Lee Latex - have upped the Tans’ bids twice, each time by a small margin.

Sources told Today the Lees could continue to up the ante. The surprise in Tecity’s statement was not so much that it continued to push the offer higher, but that it called an end to the game. “This gives the other side a lot of leeway to counterbid,” a source familiar with the negotiations said.

The Lees can now just offer a few cents above Tecity’s latest bid with the assurance that they will win the bidding war, he added. The Lees declined comment.

The Lees have added 5-to-6 cents to Tecity’s bids in the last rounds, while Tecity replied to the Lees’ threats by increasing its offer by 74 cents and now, 15 cents.

The new offer values Straits Trading at $2.18 billion. Shares of Straits Trading resumed trading yesterday afternoon and closed at $6.70.

Mr Gabriel Yap, a senior dealing director at DMG and Partners Securities, reckons the firm’s assets are worth around $2.2 billion at current market prices. “The Lees tend to hold investments long term, so it would not be surprising if they up the bid,” said Mr Yap.

1.68% Fixed Rate Mortgage: Maybank

Source : TODAY, Tuesday, February 19, 2008

Malayan Banking (Maybank) is offering a 3-year fixed-rate home loan package, with a 1.68 per cent for the first year.

It said the rate is close to the current three-month interbank rate, which was 1.44 per cent as of Feb 15. The rates for the second and third years are 2.68 per cent and 3.38 per cent, respectively.

“Against a backdrop of potential rising interest rates, home loan customers who take up this fixed-rate package will enjoy the prevailing low rates and are protected from future interest rate increases for the next three years,” Maybank Consumer Banking head Helen Neo said. She said that while interbank rates have softened over the past few months, they are expected to rebound with higher inflation forecast.

Parkway Wins Bid For URA Site, Shares Drop 8.3%

Source : TODAY, Tuesday, February 19, 2008

Parkway Holdings had its steepest decline in more than six years on concern the company’s $1.25 billion bid for a new hospital site was too high. The bid by Parkway, Singapore’s largest private hospital operator, is as much as five times the price offered by rival Raffles Medical Management, the Urban Redevelopment Authority said.

Parkway will be able to build a hospital on the 1.7-hectare site in central Singapore and own it for 99 years, the URA said.

Shares of Parkway tumbled 30 cents, or 8.3 per cent, to $3.30 at the close of trading, its biggest drop since Sept 12, 2001. The benchmark Straits Times Index fell 0.2 per cent.

“Excluding construction cost, Parkway’s gearing could rise to 180 per cent and we will look to revise our estimates when we receive further details,”said Credit Suisse analysts, led by Mr Su Tye Chua, in a report. “For now, management will have to convince the market they did not over-bid for the site, which could dampen near term share price performance.”

Parkway, which reported net income for the three months ended Sept 30 rose to $224.6 million compared with a restated $18.5 million, is marketing treatments of chronic conditions, including cancer and liver failure, to patients in South-east Asia. In August, it said it will build more hospitals in Singapore, upgrade its facilities and add operations in countries including Vietnam and China.

Two More Govt Agencies To Vacate Downtown Offices

Source : The Straits Times, Feb 19, 2008
IDA, SLA making room for private businesses to ease office shortage.

MORE help is on the way to ease Singapore’s office shortage, which has led to soaring rents.

At least two government agencies will give up their downtown offices to make room for private businesses that need more space.

The Infocomm Development Authority (IDA) will relinquish about a third of its 11,300 sq m office in Suntec City by moving some divisions to the Mica building in Hill Street by the end of the year.

Although it will still be close to town, IDA plans to move again in a few years to a ‘more appropriate location outside the central business area’ that can accommodate all its headquarters staff.

The Singapore Land Authority (SLA) is also planning to give up its seven floors at 8 Shenton Way, formerly Temasek Tower, although it has yet to find a new home. This is a considerably larger office space than the one IDA is vacating this year.

Other state departments may follow suit.

Finance Minister Tharman Shanmugaratnam said on Friday that the Government would move several agencies out of the central area by the first quarter of next year.

This will free up 20,000 sq m of precious prime office space for the private sector - equivalent to about 20 floors of a Suntec City office tower, Mr Tharman said in his Budget speech.

Although office space in the Republic is still cheaper on average than in Hong Kong or Tokyo, he said, the rate at which rents have risen has been ‘rapid and unsettling for businesses’.

Prime office rents shot up by 78 per cent on average last year, catapulting Singapore into the world’s top 10 most expensive office markets for the first time. The Republic jumped 10 spots to seventh place in the latest rankings, according to a report last week.

The Government has taken several steps to address the situation, including releasing temporary office sites and state properties , but these have had little noticeable effect so far.

Meanwhile, surging rents are also acting as a push factor for agencies that are relocating, especially those whose leases will expire soon.

The Economic Development Board (EDB), for example, is said to be firming up plans to move to Fusionopolis when its lease at Raffles City Tower is up next year.

Asking rents at Raffles City, where the EDB has been since 1985, have doubled in the last 15 months to about $17 per sq ft per month.

But other statutory boards that have ongoing leases - such as IE Singapore in Bugis Junction, whose lease extends to 2011 - will stay put.

Experts said this latest move would help relieve some of the immediate supply crunch, ahead of a slew of building completions expected in 2010 and beyond.

In particular, it will make things easier for firms already located in Suntec City or 8 Shenton Way that are looking to expand, said Ms Tay Huey Ying, director of research and consultancy at property firm Colliers International.

She added more agencies could jump onto the bandwagon.

‘Even those who own their own buildings could move out and lease out the offices, thereby releasing some space for the market and, at the same time, earning rental returns,’ she said.

Government offices still located downtown include the Ministries of Finance, Law, and Trade and Industry, all within the Treasury building in Hill Street next to Funan DigitaLife Mall.

There is ‘no real need’ for some of these departments to be in the central business district, and they could free up space for other occupiers who need the location more, said Mr Chua Yang Liang, head of research (South Asia) at Jones Lang LaSalle.

9,901 Applications Pour In For Just 278 Flats

Source : The Straits Times, Feb 19, 2008

ALMOST 10,000 people have applied for just 278 surplus flats being offered for sale by the Housing Board in keenly sought-after mature estates such as Toa Payoh, Tampines and Bedok.

By 5pm yesterday, ahead of the midnight deadline, 9,901 applications had been lodged - or 36 homeseekers for every flat available. This is the highest subscription rate recorded so far for such sales exercises.

A computer ballot will determine the order in which applicants get to pick a flat. The results will be out on Feb 21.

Most of the surplus flats offered in this batch are already completed, with the rest expected to be ready by 2011. Property consultants had expected a flood of applicants as buyers are increasingly being turned off by high asking prices in the HDB resale market.

Resale prices of HDB flats rose 17.5 per cent last year, while the median cash-over- valuation (COV) amount paid in transactions rose to $22,000 in the October to December quarter last year, compared with $17,000 in the previous quarter.

The surplus flats also appeal to buyers not wanting to wait three to four years for the HDB’s build-to-order flats, which are being offered in great numbers this year. About 4,500 will be offered from January to June alone.

The 278 surplus flats offered in this launch are located in highly coveted mature towns surrounded by amenities. Most are four-room flats, while 84 are five-room and executive units.

With its latest offer, the HDB’s stock of surplus flats will be whittled down to about 2,000.

In a statement yesterday, the HDB urged unsuccessful applicants to book a unit under its build-to-order scheme. Given that the take-up rates for the past four build-to- order exercises in Punggol and Sengkang have ranged from 65 per cent to 94 per cent, there was still a selection of flats left over.

It said: ‘On average, only one in two applicants invited on the first day of the selection exercises actually booked a flat, despite having a wide range to choose from.’

It also suggested that couples book their flats before getting married under the fiance-fiancee scheme to reduce the waiting time for their flats. Those already married can consider living with their parents or renting a room of a flat on the open market while waiting for their flats to be completed, it said.

Resale flats, meanwhile, were still ‘affordable’. The HDB said that a quarter of transactions last month were completed at prices not exceeding $10,000 above the flats’ valuations. These includes flats sold in established towns such as Ang Mo Kio, Bedok and Tampines.

According to Mr Eric Cheng, executive director of HSR property group, sellers are asking for about 10 per cent less in COV amounts compared with the fourth quarter of last year. Buyers, he said, were adopting a wait and see attitude.

The HDB said earlier this month that it was conducting a review of its year-old sales exercises. Chairman of the Government Parliamentary Committee on National Development and Environment, Mr Charles Chong, suggested that the board fine-tune the system to allay fears of young homebuyers who continually fail to get a flat in ballots.

‘There should be some predictability - for example, if I apply (for a unit) now, I can get my flat one or two years down the road,’ he said.

RMG ‘Happy To Lose’ Tender For Novena Site

Source : The Business Times, February 19, 2008

RAFFLES Medical Group (RMG) executive chairman Loo Choon Yong says he is ‘happy to lose’ the tender for a hospital site at Novena, seeing the record bid of $1,600 psf per plot ratio (ppr) by Parkway Holdings makes the site one of the most expensive commercial land buys in recent times.

‘This is one tender we are quite happy to lose,’ said Dr Loo. ‘As you can see, it’s a different risk appraisal, I suppose.’ Related links: Click here for Raffles Medical’s press release Financial statement

The tender for the Novena site closed last Friday. At $344.1 psf ppr, RMG’s bid fell a long way short of even the $694.5 psf ppr put in by second-highest bidder Napier Medical. The site was awarded to Parkway yesterday afternoon.

Although it missed out, RMG intends to keep looking for opportunities to grow locally. ‘We can of course move out backroom services,’ said Dr Loo. ‘We can move out even my office and use every square inch to serve patients.’

At the rate business is growing, it may not be long before that happens. RMG announced yesterday its full-year net profit more than doubled to $35.9 million, from $15.7 million in FY2006. This was helped by a 46.9 per cent or $9 million rise in operating profit to $28.2 million and a one-time gain of $12.5 million from its 50 per cent interest in Raffles Hospital Properties . The gain resulted from a revaluation of the Raffles Hospital building, which RMG previously co-owned with a CapitaLand unit.

Revenue for the 12 months ended Dec 31, 2007, jumped 25.6 per cent to $168.7 million. This was driven largely by hospital services which saw revenue surging 34.3 per cent to $106.3 million. The increasing complexity of cases resulted in more intensive use of facilities and higher value-added services.

According to Dr Loo, the hospital is operating at 40-60 per cent capacity, with some of the bed space making way for outpatient operations.

The healthcare services segment, which encompasses the clinics business, grew 14.4 per cent to $69.7 million. During the year, the group opened three new clinics - at Science Park, TechPark, TechPlace and a 24-hour medical centre in Terminal 3 of Changi Airport.

Basic earnings per share for the year went up to 7.36 cents, from a restated 3.50 cents the year before. Net asset value per share was 38.98 cents at Dec 31, up from 24.87 cents at end-2006. The group is proposing a final dividend of 1.5 cents a share, bringing the payout for the year to 2.5 cents a share.

Dr Loo is optimistic about the group’s prospects in 2008 but says the state of the global economy is important. ‘Because we are actually serving regional patients, if they do less well, they may be less inclined to come,’ he said. ‘Singaporeans will always have the option of going to government hospitals.’

More than one-third of RMG’s patients are from overseas, with the top sources being Indonesians, Malaysians and expatriates living in the region.

278 HDB Flats Swamped By 9,900 Applications

Source : The Business Times, February 19, 2008

Unsuccessful buyers urged to consider build-to-order flats.

THE Housing and Development Board received 9,900 applications for 278 flats offered in its February bi-monthly sale.

Most of the units offered are four-room flats, plus 64 five-room units and 20 executive flats in 13 estates.

There are 119 units in Toa Payoh and 39 in Tampines.

HDB said the strong demand was ‘because the flats offered are in established HDB towns which are popular with buyers, but the supply of new flats is tight as there is limited land available’.

HDB advised unsuccessful applicants to consider booking a flat under its build-to-order (BTO) scheme. About 4,500 flats will be launched under this scheme in the first half of the year.

More than 500 are still available from recent BTO launches at Punggol and Sengkang, such as Treelodge@Punggol, Fernvale Vista, Punggol Vista and Coral Spring.

HDB also suggested that buyers also consider resale flats, which it said still remain largely affordable. It said that in January, 25 per cent of resale transactions were completed at prices no more than $10,000 above valuation.

The recently closed sale is HDB ’s fifth bi-monthly sale exercise for four-room and larger flats in the combined balloting/walk-in system. HDB is currently reviewing the scheme.

R&D Carrot May Be Ideal Diet For Some Outfits

Source : The Business Times, February 19, 2008

Estate duty abolition may also help banks and push up property prices.

It was a Budget that failed to excite the stock market very much, but analysts said that some of the initiatives announced could benefit research-intensive firms and companies in the healthcare, technology, finance and property sectors - mostly in the longer term.

Shrugging off Friday’s Budget announcement, the benchmark Straits Times Index fell 5.34 points - or 0.2 per cent - to close at 3,083.3 points yesterday.

As UOB Kay Hian predicted at the start of the day: ‘Concerns over a slower earnings growth and higher inflation will limit any euphoric market rally.’

But contrary to what was suggested by the market, some listed companies here will be better off due to the Budget, analysts said. Singapore’s bid to move up the R&D value chain could perhaps have the most impact, the analysts added.

OCBC Investment Research said that Biosensors International, LMA NV and ST Engineering could benefit as Singapore increases its yearly R&D spending to $7.5 billion, or 3 per cent of GDP, by 2010.

The firm also said that Venture Corporation and Chartered Semiconductor - both of which spent a substantial proportion of their operating expenses in R&D - stand to benefit in particular as the R&D tax deduction is increased from 100 per cent to 150 per cent and an R&D tax allowance of up to 50 per cent of the first $300,000 of taxable income is given.

‘Both Venture Corporation and Chartered Semiconductor spent a substantial proportion of their operating expenses in R&D,’ OCBC’s research unit said in a note yesterday. ‘Venture spent about $29.6 million on R&D in FY07, while Chartered spent about $159.8 million. We can expect both companies to see significant tax reductions in the coming years.’

UOB Kay Hian similarly identified Creative Technology, Venture Corp and Biosensors as listed companies that could gain from the R&D push.

Also expected to have a major impact is the abolition of estate duty, which analysts said could boost Singapore’s competitiveness as the region’s wealth management hub and attract more foreign investment.

‘We think the removal of estate duty is good news for the Singapore property market, as real estate is a natural choice for some of this money to be invested, especially with high inflation and negative real returns,’ said Lehman Brothers in a note yesterday.

The research firm noted that property prices generally gain in the 12 months following the removal of estate duty. The note said: ‘Malaysia abolished the estate duty in late 1991 and home prices rose 12 per cent on average in the ensuing 12 months. More recently, Hong Kong abolished the estate duty in early 2006 and property prices were up 6 per cent on average in the following 12 months. We think this could be more than coincidence.’

UOB Kay Hian, on the other hand, said that the clearest beneficiaries from the removal of estate duty would be financial institutions. The firm reiterated its ‘buy’ calls on DBS, OCBC and Hong Leong Finance in view of this.

UOB Kay Hian also said that listed medical plays such as Raffles Medical Group and Parkway Holdings will benefit from the government’s commitment to implementing means testing - which allows for a gradual shift of high-income patients from government hospitals to private hospitals.

However, there is a consensus among analysts that any boost from this Budget is expected to kick in only in the longer term.

‘The business-related Budget initiatives are part of the government’s ongoing efforts to transform the Singapore economy into a knowledge-based economy and grow the services sector, in our view,’ Deutsche Bank summed up in a note. ‘While positive in the long term, these moves are unlikely to have a tangible impact in the near term.’

马来亚银行推出 最低房贷利率

《联合早报》Feb 19, 2008


马来亚银行推出此促销之前,其特准全面银行(Qualifying Full Bank)的3年利率都是3.58%。



业内人士认为, 马来亚银行的3年低息房贷, 不会直接刺激本地总体购屋潮。