Tuesday, March 11, 2008

Motorists Will Travel On Brand New Road Into Sentosa

Source : Channel NewsAsia, 10 March 2008

Motorists driving into Sentosa from Tuesday will be travelling on a brand new road.

It will replace the current Gateway Avenue which will be closed to make way for the development of Universal Studios Singapore, a part of the Resorts World at Sentosa.

Sentosa Leisure Group said the 730-metre, four-lane road (marked out in red) will help improve traffic on the island.

The Resorts World at Sentosa is bearing the S$60 million construction cost for the road, along with new ramps that will lead to its future 4,100-lot basement car park.

For now, ticketing will continue at Sentosa Gateway before drivers cross the bridge to the island.

However, admission booths will be located further inland on the new road starting the second quarter of this year.

This relocation is expected to cost some S$3 million. - CNA/ac

Economists Expect GDP To Rise By 5.7% In Q1 2008

Source : Channel NewsAsia, 10 March 2008

Singapore's economy will grow 5.7 percent in the first quarter from a year ago, picking up slightly from a 5.4 percent expansion in the fourth quarter, a central bank survey showed on Monday.

However, growth in the full year will slow from last year’s pace of 7.7 percent to 5.6 percent, the Monetary Authority of Singapore's (MAS) quarterly survey of 19 economists showed.

In a statement, MAS added that the prediction also marks a downgrade from the 6.3 percent growth forecast in the December survey.

Analysts have recently lowered growth targets for economies across Asia that may suffer from weak demand for manufactured goods as the United States nears recession.

The government expects Singapore's economy to grow by between 4 and 6 percent in 2008.

Singapore's manufacturing sector, which contributes about one third of annual gross domestic product, is expected to grow 5.0 percent in 2008, slower than the projected rate of 6.8 percent in the last survey.

Meanwhile, the construction sector is seen to be leading growth in 2008, expanding 15.9 percent from a year ago, while the financial services sector is expected to grow 9.5 percent.

The survey forecasts that inflation will increase sharply in 2008, likely adding to pressure on the central bank to appreciate the currency.

The survey also forecasts that non-oil domestic exports will grow 5 percent in 2008, at the center of the government forecast for 4 to 6 percent growth.

Due to the sharp increase in food and energy costs compounded with rising real estate expenses, the MAS put the local dollar on a "slightly" faster appreciation path in October.

Singapore dollar interest rates are forecast to fall, reflecting the likelihood of further monetary easing by the U.S. Federal Reserve this year. - CNA/vm

Economists See Singapore Q1 Growth At 5.7%

Source : The Business Times, March 10, 2008

Singapore's economy will grow 5.7 per cent in the first quarter from a year ago, picking up slightly from a 5.4 per cent expansion in the fourth quarter, a central bank survey showed on Monday.

However, growth in the full year will slow to 5.6 per cent from last year's blistering 7.7 per cent, the Monetary Authority of Singapore's (MAS) quarterly survey of 19 private sector economists showed.

The government expects the economy to grow by between 4-6 per cent this year.

The 2008 economic growth forecast was cut from 6.3 per cent in the MAS's December survey, on a worsening economic outlook in key export market to the United States.

The construction sector is seen to be leading growth in 2008, expanding 15.9 per cent from a year ago, while the financial services sector is expected to grow 9.5 per cent.

Economic growth in 2008 is seen to be the weakest in the second quarter at a median 4.4 per cent, before picking up to peak in the fourth quarter at a median 6.8 per cent.

Reflecting 25-year high inflation in the Southeast Asian city, economists expect inflation this year to more than double to 5.0 per cent from last year's 2.1 per cent.

The Singapore economy, which shrank in the October-December period from the previous quarter for the first time since 2003, is expected to slow this year, dragged by a struggling US economy.

However, rising consumer prices in the republic are limiting the central bank's ability to loosen monetary policy to boost economic growth. -- REUTERS

Singapore Says Has Enough Land To Meet Office Demand

Source : The Business Times, March 10, 2008

Singapore will provide more land for offices as part of a strategy to strengthen its position as an Asian financial centre, the government's real estate planning agency said on Monday.

'The new growth area set aside for the seamless extension of the existing financial district ... will be more than twice the size of London's Canary Wharf,' the republic's Urban Redevelopment Authority (URA) said in a statement.

'Over a span of more than 15 years, the development of the 85 hectare site identified for extension of the existing financial district will see the addition of around 2.82 million square metres of office space,' it added.

Demand for office space in Singapore has grown strongly in the past three years, spurred by the growth in financial services, in particular private banking.

According to URA data, office rents soared 56 per cent last year as demand for office space rose by an average of 260,000 square metres per annum over the last three years - a 60 per cent increase from the historical average of 160,000 square metres a year.

Foreign direct investment in Singapore's real estate was $14.4 billion (US$10.40 billion) in 2007, compared to $6.7 billion in 2006, the agency said.

Singapore is currently developing the Marina Bay Financial Centre on reclaimed land south of the existing central business district. It has also offered sites to the east and west of the business district.

The republic, with a population of 4.6 million, has expanded its land area by more than 10 per cent since independence in 1965 through reclamation from the sea.

Developers involved in the Marina Bay project include Hong Kong developers Cheung Kong and Hongkong Land, as well as Singapore-based Keppel Land. -- REUTERS

New Version Of Deferred Payment Now On Offer

Source : The Straits Times, Mar 10, 2008

IN A bid to tempt home buyers back into the cooling property market, banks are teaming up with developers to bring back deferred payments - or something like it.

They are resurrecting an older scheme known as interest absorption, which also allows buyers to postpone the bulk of their payments on new homes.

This decade-old plan had been phased out over the last few years in favour of the more popular deferred payments. But it is now making a comeback after the Government pulled the plug on deferred payment plans in October, saying they encouraged speculation in the then red-hot property market.

Interest absorption works like this: a buyer makes a down payment, typically 20 per cent, and can then defer the rest of the payments until the property is completed.

It may sound like deferred payment, but here's the catch: The homebuyer has to take up a bank loan at the point of purchase, with a specific bank that has tied up with the developer to offer the scheme.

This means that if the homebuyer wants to resell the property before completion, he will have to pay a penalty to redeem or cancel the loan.

In contrast, the deferred payment scheme did not require a buyer to take a loan until the home was fully built. This was thought to encourage speculation, as a potential speculator could buy and resell many unbuilt homes without taking a single loan.

Loan aside, interest absorption plans offer two extra deal sweeteners. First, the project developer will absorb the interest payments on the home loan until completion - hence the name of the plan.

Depending on the loan amount and tenure, this could work out to a few tens of thousands of dollars.

Another perk is that most units sold under interest absorption schemes do not cost more than those sold under normal payment plans. Developers used to charge slightly more for units that were sold with deferred payment.

Industry experts say interest absorption plans were introduced in the late 1990s to spur home buying in the downturn. Back then, not all the plans had a deferred payment component - in some, developers simply absorbed interest until completion.

Read the full report in Tuesday's edition of The Straits Times.

KFH Allows Options For 97 Goodwood Residence Units To Lapse

Source : Channel NewsAsia, 10 March 2008

Kuwait Finance House (KFH) has allowed options to acquire 97 units of the high-end Goodwood Residence to lapse.

The deal would have been worth S$818 million for developer GuocoLand, which has said that Singapore's property market appears to be cautious.

The developer had granted Kuwait Finance House the options back in December.

In a filing to the Singapore Exchange, GuocoLand said the two parties are in talks about fresh options for the units in the development.

Goodwood Residence, located near the Orchard Road shopping belt, is a high-end residential development with 210 units in two towers. - CNA/ac

Construction Sector Seen To Lead This Year's Growth

Source : Channel NewsAsia, 10 March 2008

The construction industry is expected to lead Singapore's economic growth this year, according to 19 economists polled in the latest quarterly survey by the Monetary Authority of Singapore (MAS).

They projected an expansion of 15.9 per cent for the construction sector this year, up 2.4 percentage points from the forecast in the previous MAS survey in December.

Analysts Channel NewsAsia spoke to, shared their optimism.

OCBC Bank's vice-president for treasury research and strategy, Emmanuel Ng, said: "There are still certain sectors expected to exhibit resilience this year - those that are largely less exposed to external weakening. We look to construction, financial services, as well as wholesale and retail."

UOB's economist, Ho Woei Chen, said: "There's still building on the IRs (integrated resorts), Marina Bay Financial Centre, Sports Hub in Kallang. There's still a lot of road projects going on, this will keep the construction sector growing by double digits this year."

The construction sector grew 20.3 per cent last year.

In the MAS survey, economists also revised upwards their growth expectations for the financial sector, to 9.5 per cent, due to support from strong loans growth in January.

UOB's Ho Woei Chen said: "Financial sector is another bright spot, based on survey results. The sector will continue to see strong growth this year, but will be lower than 17 per cent we saw last year. There's support from loans growth, which we saw coming in quite strongly in (the) month of January."

However, analysts expect growth in the manufacturing and hotels & restaurants sectors to slow due to rising oil prices and a slowdown in the US economy.

OCBC Bank's Emmanuel Ng said: "Between the last survey in December and now, I think the situation in the US macro picture has deteriorated significantly, especially from the non-farm numbers last Friday. As a result, I think markets have revised down their expectations for US growth profile."

On inflation in Singapore, economists surveyed said they expect consumer prices to rise to a median 5 per cent this year, against last year's 2.1 per cent.

They also expect the central bank to keep to its current monetary policy of allowing the Singapore dollar to appreciate gradually.

UOB's Ho Woei Chen said: "There's some speculation of Singdollar tightening in April. We see some possibility of that, but we have to take into account growth risk, going forward. It may not be a good idea to have Singdollar strengthening too excessively given that we are seeing some slowdown in external growth... this could hurt export sector further."

The Singapore economy is expected to grow by between 4 and 6 percent this year, based on official forecasts. - CNA/ir

URA Plans To Promote Ophir-Rochor Corridor At MIPIM, Cannes

Source : Channel NewsAsia, 10 March 2008

The Urban Redevelopment Authority has announced its plans for the Ophir-Rochor corridor.

The project is expected to be developed over the next ten to 15 years as part of plans to rejuvenate the Central Business District.

It will feature a mix of offices, hotels and other complementary facilities in a park-like environment.

The first land parcel in the new Ophir-Rochor corridor will be launched for sale in June via the Confirmed List of the Government Land Sales Programme.

This 2.74 hectare site is adjacent to Parkview Square, which is located between Rochor Road and Ophir Road. It will include a requirement to develop a minimum quantum for office and hotel use.

This will help boost the tourism industry and cater to the growth of Singapore's financial and business services sector.

URA said that this Ophir-Rochor corridor will be "the catalyst for future development and growth in the area".

Plans for development of the Ophir-Rochor corridor and sale site will be exhibited and promoted at the Singapore Pavilion during the "Marche International des Professionals de L'Immobilier" (MIPIM) between 11 and 14 March 2008.

MIPIM is a premier international property event in Cannes. The Singapore Pavilion will see a mix of public-private companies, led by URA.

This is part of URA's continuing efforts to attract foreign investors to property development and investment opportunities in Singapore.

Singapore's real estate investment opportunities in Ophir-Rochor and Marina Bay will be jointly promoted at MIPIM Cannes.

The Singapore Pavilion will also promote Singapore's key recent and upcoming developments. - CNA/vm

URA To Market First Sale Site At Ophir Rochor District In June

Source : Channel NewsAsia, 11 March 2008

The Ophir Rochor area is undergoing a revamp.

And a landmark development has been planned for this new office district.

The Ophir Rochor district has been slated to be a new growth extension from the Marina Bay area.

An artist's impression of Ophir Rochor district.

The first plot next to Parkview Square will be released for sale in June as part of the government land sales programme.

Analysts expect the 2.74-hectare site to provide some 1.6 million square feet of space for a range of uses.

Mr Donald Han, Managing Director of Cushman & Wakefield (Singapore), said: "The proportion will be something like close to 500 rooms for hotel. That's probably suitable for a 4-star hotel, potentially even 5-star, and if you look into the office component, it would be slightly in access of 1.3 or maybe 1.4 million gross floor area."

Industry watchers expect the development to be completed in two to three years, with rentals going at about half of that in prime financial districts, at between 8 and 10 dollars per square foot.

The URA will be marketing the Ophir Rochor site at an international real estate exhibition in Cannes on March 11-14.

Analysts say the opening up of the Rochor Ophir corridor will become a catalyst for more sites to be developed in the area.

They also expect to see some collective sales in the near future, as older buildings in the vicinity get a makeover, to keep up with the times.

Mr Han added: "If you look at Rochor Road, Beach Road, it's quite a mix bag of new and old. Particularly the old ones, there are a lot of strata title developments where there is really not much incentives among owners wanting to upgrade.

"The fact that there is now a landmark development coming in, land values will be recognised at the end of the day and when there is an increase in terms of land value, there will be an increase in desire to redevelop."

The URA will continue to release more land in the Ophir Rochor area over the next five to 10 years, in tandem with market demand. - CNA/de