Monday, July 7, 2008

ERP - Expect To See More Of These Gantries In Coming Months

Source : The Straits Times, July 7, 2008

New KPE will have 16, taking grand total from 60 to more than 80

EVEN as motorists cope with five fresh electronic road-pricing (ERP) gantries along the Singapore River and extended operating hours at others in the city from this week, more gantries are set to come onstream.

Besides the half dozen announced for spots along roads such as Commonwealth Avenue, Alexandra Road and Serangoon Road - to go up by November - 16 more are planned for the new Kallang-Paya Lebar Expressway (KPE), which will run 12km from East Coast Parkway in the south to Tampines Expressway in the north. Three quarters of it will run underground.

When it opens fully on Sept 20, it will have the most ERP gantries among all roads here.

According to a Land Transport Authority (LTA) spokesman, however, they will not all be switched on at the same time, unless the average speed dips below 45kmh in the tunnels.

The new gantries form part of a massive ERP project the LTA recently awarded to MHI Engine System Asia, a subsidiary of Mitsubishi Heavy Industries.

Worth $83 million, the contract includes 27 new gantries, all to be up by this year, the replacement of some older gantries and maintenance works.

The cost is higher than the $80 million spent on Singapore's 60 existing gantries, the first of which went up 10 years ago.

Asked about the huge expenditure, the LTA said construction and materials costs had risen over the years. Each three-lane gantry now costs $1.5 million, compared to $1 million before, said the spokesman.

The expansion of the ERP network will see almost 90 gantries here by the end of the year.

Five gantries went up in areas such as Toa Payoh Lorong 6 and Geylang Bahru in April. Like those for the future KPE, it was decided they would only be switched on if traffic speeds dipped below the 45kmh threshold for expressway speeds. All have since been switched on.

The 45kmh threshold will be adjusted over the next few months. To stave off ERP, 85 per cent of vehicles will have to attain the optimum speed, instead of half the vehicles now.

'For safety reasons, it is essential that we keep traffic in the tunnel smooth-flowing,' the LTA spokesman said of the KPE.

Asked if that meant ERP on the KPE may be operational over weekends as well, the spokesman said no decision on that had been made.

But retired traffic planner Joseph Yee expects the KPE gantries to be switched on before long. He explained that when the LTA conducted traffic forecasts using computer simulations, it found that without congestion pricing, 'the KPE would be jammed quite soon after it opened'.

Mr Yee expects the Marina Coastal Expressway (MCE) now being built to have ERP too. The $2.5 billion MCE is a 5km underground road connecting the KPE and ECP to the Ayer Rajah Expressway. It is due to be completed by the end of 2013.

Motorists are not looking forward to the fast-expanding gantry network.

Said housewife Beverly Wong, 38: 'That is terrible. Food and fuel prices are increasing. This isn't helping.'

To ease the pain, a 15 per cent cut in road tax will kick in this month; public transport services have also been beefed up to make buses and trains a more viable alternative.

Editor of Torque motoring magazine Lee Nian Tjoe, 30, expects some drivers to be priced out, but he says the majority will continue driving into ERP areas.

Aircraft sales engineer Ng Tzong Sheng, 30, says he does not need to drive into ERP zones, but he wonders whether 'average speeds' could be improved by better synchronising traffic lights and carrying out roadworks only during off-peak periods.

New ones activated today along Singapore River

FIVE new Electronic Road Pricing gantries along the Singapore River will go live this evening.

They are at Eu Tong Sen Street, New Bridge Road, South Bridge Road and Fullerton Road in both directions.

The new gantries, which will bring the number here to 65, will charge $2 from 6pm to 7.30pm, and $1 from 7.30pm to 8pm on weekdays.

The Land Transport Authority says the intention of the gantries is to reduce the number of vehicles passing through the City Hall and Marina Centre areas to get to other places.

Two of the five gantries - the one in Eu Tong Sen Street, and the one in Fullerton Road in the direction of Suntec City - will also operate on Saturday from 12.30pm to 8pm.

They will charge $2.

Besides the new gantries, higher rates and extended operating hours will also kick in at gantries in the Central Business District from today.



Where the five are

1. Eu Tong Sen Street

2. New Bridge Road

3. South Bridge Road

4. Fullerton Road (towards Esplanade Drive)

5. Fullerton Road (towards Collyer Quay)

IRs To Stoke Housing Demand, Say Analysts

Source : TODAY, Monday, July 7, 2008

Property analysts say prices are likely to fall further in the third quarter, but experts rule out massive declines because of the multiplier effect from Singapore’s two multi-billion-dollar integrated resorts (IR) now under construction.

Housing demand is expected to pick up when the first IR in Marina Bay opens next year employing thousands of workers, said Mr Chua Yang Liang, Jones Lang LaSalle’s head of South-east Asia research.

Some of the workforce for the resorts will likely come from foreign countries. “To staff these people, you need housing so there will be a potential effect,” he said.

Foreigners currently make up more than 20 per cent of Singapore’s 4.6 million population, but going forward the proportion is expected to grow as the country’s headcount expands.

The Marina Bay Financial Centre, a new financial district under construction which will also feature luxury apartments, should also underpin the market in the longer term, analysts said.

Colliers International real estate consultants director for research Tan Huey Ying thinks prices are not about to spiral downwards even though second-quarter figures indicate the residential property market may have peaked.

“Singapore’s positive mid-term prospects on the back of the completion of the two integrated resorts and the Marina Bay Financial Centre will help to prop prices up,” said Mr Tan.

Values may hold or decline by no more than 3 per cent in the third quarter, but overall, for this year, home prices could still rise 4 to 8 per cent, he added.

Analysts from DTZ real estate consultancy said buyers are still interested in project launches.

“Some residential projects are enjoying sell-out status while others are being well received,” said Margaret Thean, DTZ’s executive director for residential.

Last year, Singapore’s housing market was described by real estate giant Jones Lang LaSalle as the world’s hottest in 2007, when prices surged 31 per cent overall.

Government approval for the two IRs in 2005 was one of the major factors behind the revival of Singapore’s property market, which had been stuck in a rut stemming from the 1997 Asian financial crisis.

Efforts to woo wealthy foreigners to take up residence in Singapore, along with an all-out bid to attract skilled foreign migrants, also drove the property market revival, analysts said.

However, the rebound has left many expatriates and locals alike struggling to cope with soaring rents which in some cases doubled over the past year.

Private home prices rose 0.4 per cent in the second quarter, the slowest increase in four years, the government’s preliminary figures showed last week.

Developers Ponder Tricky Math Before New Launches

Source : The Business Times, July 7, 2008

Apart from pricing, a host of factors are critical in their launch decision

The recent spurt of purchases at projects like Nassim Park Residences, Dakota Residences and Clover By The Park, has got many industry players preparing for possible launches to ride the current buying wave.

Studying the extent of competition from secondary market deals is a vital part of the homework developers have to do before deciding on any launch.

The decision on whether to launch a project now is a tricky one. A host of factors have to be weighed - not just pricing, location and the product, but assessing the depth of demand in the particular neighbourhood or micro-market where a condo is located, how many projects have been launched in the area over the past few years, and even the buyer profile in earlier projects.

The ability to price projects attractively - from 7 to 25 per cent lower than market expectations 12 months ago - has been a critical factor in drawing buyers at recent launches.

An increasingly important factor is the prices at which earlier projects in the area had been sold in the past couple of years. Given the run-up in prices, some buyers in earlier projects may unload their units at prices below what the developer of the latest project in the area may be gunning for.

In fact, in at least one project in the Newton area, the developer is said to have started facing competition from earlier buyers in the same condo seeking to unload their units.

Keppel Land is still marketing the remaining units at Park Infinia at Wee Nam and its asking price is understood to be $1,400 to $1,800 psf. Earlier buyers in the same project are offering their units just a tad lower. KepLand first released the project in 2005 at prices well below $1,000 psf on average. So when the project received Temporary Occupation Permit a few months ago, earlier buyers were in a position to undercut the current price and still reap a nice profit.

So studying the extent of competition from secondary market deals is a vital part of the homework developers and agents have to do before deciding on any launch. 'Supposing you're a developer and your upcoming condo launch will be the fourth project to have been released in a particular location in the past two years and buyers in the earlier projects bought their units for, say, $800 psf average and your breakeven cost is around $900 psf, you could be in a difficult position if you need to launch today,' a seasoned industry player says.

'If a substantial number of buyers in the earlier projects bought for investment rather than owner occupation, they may consider leasing the units when the project is completed - and rental yields could be pretty attractive today based on the investors' purchase price - or they may decide to cash in their units for a profit. That could spell competition for the developer launching a new project in the area,' he added.

Frasers Centrepoint Homes chief operating officer Cheang Kok Kheong says: 'The supply-demand pattern in the particular micro-market must be suitable for the project a developer is targeting to launch.'

'There may be pent-up demand in a location that has not seen any new projects launched in the past few years,' he adds.

A case in point would be Sim Lian's Clover by The Park condo in the popular Bishan area, near Catholic High School, which has sold over 200 units since it was released on June 25 at an average price of $750 psf. By some agents' reckoning, a project like that could have been priced at $800-850 psf on average about 12 months ago.

While many in the industry have lauded Clover's 'success', Credit Suisse's property analyst Tricia Song finds the response wanting. 'Given that the pricing is relatively attractive for a popular suburb that has not seen any new projects in years, we think the take-up is disappointing and is reflective of the cautious sentiment even among upgraders,' she said in a June 30 research note. 'If we exclude the 100 units that were sold during a private preview (on June 25) take-up has visibly slowed...'

Perhaps this reflects a smaller demand pool these days, in the absence of speculators and fewer foreign buyers.

As Knight Frank managing director Tan Tiong Cheng says: 'I think everybody's very cautious about whether they should or should not launch - and at what price levels. You don't want to start something that will run out of steam because it's priced too high or the demand pool just isn't big enough.'

DTZ executive director Ong Choon Fah notes that the recent home-buying spurt was created by developers releasing new projects in attractive locations at lower prices than initially expected. 'However, once a developer has started selling a project at a certain price, it becomes trickier to reduce the price as this then creates a problem of dealing with earlier buyers who paid the higher price.' The stakes are indeed high for developers to get the timing and price right for their launch.

Property Yield Spreads Widen But Investors Wary

Source : The Business Times, July 7, 2008

Optimistic outlook for Asia-Pac market, says DTZ report

Institutional investors are seeing some property yield spreads over 10-year bond rates widen globally but DTZ Research believes the correction in real estate markets has some way to go.

According to a recent DTZ Research report, Money Into Property, the yield spread over the local 10-year bond rate in Singapore increased by about one percentage point in the first quarter of this year on a year-on-year (yoy) basis to just under 4 per cent, and is higher than that in China and Japan, which both have yield spreads of under 3 per cent.

While the high yield spread implies growth potential and profitability in the real estate investment market, DTZ Research did add, however, that Singapore is not immune from the weakening global financial market outlook, with investors becoming increasingly cautious.

DTZ executive director and regional head for consulting and research Ong Choon Fah said: 'With prospects for capital growth limited, investor focus has returned to occupier fundamentals.'

In Singapore, DTZ says that rentals for prime office space in Raffles Place grew 1.1 per cent quarter-on- quarter (qoq) to $19 per square foot per month in the second quarter of this year.

In the Shenton Way/ Robinson Road/Cecil Street area, average rentals in Q2 increased 2.6 per cent (qoq) to $11.80 psf per month. In the HarbourFront area it's up 5.3 per cent (qoq) to $10 psf per month.

Rentals in Marina Centre and Orchard Road were flat at $15.50 and $13.50 psf per month respectively.

DTZ said that the supply crunch in the Central Business District will ease from 2010 with potential supply of new office space from the second half of this year to 2013 estimated to be 12.1 million sq ft.

Already, the average islandwide occupancy in the second quarter of this year has dipped slightly by 0.2 percentage point (qoq) to 96.9 per cent.

Average occupancy of office buildings in Raffles Place and Marina Centre dropped 0.3 and 1.2 percentage points to 97.4 and 98.6 per cent respectively.

Still, DTZ believes that the outlook for Asia Pacific is relatively optimistic, supported by the occupier market and improving investment access.

'Globally, we expect investment transactions to be around US$500 billion in 2008, down 30 per cent on 2007. This shift reflects weakness over the first half of 2008 and a relatively modest pick-up thereafter, which is likely to be driven principally by the Asia Pacific market,' added Mrs Ong.

Increases in yield spreads were greatest in Europe with the UK seeing the biggest year-on-year rise of almost 2 percentage points in Q1 2008 to just under one per cent.

DTZ notes that the rate of fall in capital values has been slowing in recent months in the UK, so that while investment returns remain in negative territory, some improvement has been evident.

According to DTZ estimates, investment transactions in the UK appeared to stabilise in Q1, with the market's relatively sharp repricing beginning to attract foreign-equity-based investors, notably German funds.

At the same time, DTZ said an increasing number of new opportunity (or 'vulture') funds have been set up to pick up distressed assets in the UK market at bargain prices, while sovereign wealth funds are also waiting in the wings.

尺价千元以下新公寓受落 更多发展商趁热打铁

Source : 《联合早报》July 06, 2008

除了高文地铁站旁的Kovan Residences外,这两天的另一楼盘“重头好戏”将是城市发展在白沙(Pasir Ris)发展的莉雅苑(Livia)共管公寓。


由上周供私人预览的Kovan Residences,昨天开始预售。




至于上周举行了私人预览活动的Kovan Residences,昨天开始预售。不过,据了解,一些事先联系了房屋经纪的公众,已经在前天抢先获准进入示范单位选购房子。

这个拥有512个单位的大型共管公寓项目,属于99年地契,是由胜捷集团(Centurion Group)和本地挂牌建筑商联明(Lian Beng)集团联手发展的。胜捷集团的大股东是大华继显的两名红牌交易员韩成元和罗敬惠。




来临的周末,预料还有两个尺价在1000元以下的新项目上市。第一个是位于第12邮区、玛多玛路(Mar Thoma Road)的Beacon Heights,第二个是位于第15邮区的Naturalis@Still Rd。


后者的发展商是Abacus,该永久地契项目位于直落古楼罗弄M(Telok Kurau Lor M),是一个只有43个单位的小型公寓。市场人士认为,这个项目的平均尺价应该会介于950元至1000元之间。