Wednesday, August 27, 2008

US Housing Upturn Unlikely Before '09

Source : The Business Times, August 27, 2008

Recently-passed law to avert foreclosures a key move: official

(WASHINGTON) A recovery from the worst US housing slump since the Depression is unlikely until 'well into 2009,' Housing and Urban Development Secretary Steve Preston said on Monday.

'I think we're right in the middle of it, and I think we have a ways to go before we start seeing a turnaround,' Mr Preston said in an interview in Washington. 'We'll be well into 2009 before we see some real energy in this market.'

A slowdown in home sales and a drop in prices has contributed to record foreclosures as borrowers struggle to meet their monthly mortgage payments.

Mr Preston said a foreclosure-prevention law Congress passed last month will be important in aiding mortgage-finance companies Fannie Mae and Freddie Mac, which are supporting most new mortgages.

'We have to begin seeing the inventory of new homes begin to reduce so that we can see the buying activity begin to pull us out of the situation we're in,' Mr Preston, 48, said.

US banks repossessed almost three times as many US homes in July as a year earlier, and the number of properties at risk of foreclosure jumped 55 per cent, California-based RealtyTrac Inc said in an Aug 14 report.

The law enacted last month creates a Federal Housing Administration programme in HUD to insure as much as US$300 billion in refinanced 30-year, fixed-rate mortgages for 400,000 struggling homeowners. The law lets the US inject capital into Fannie and Freddie through stock purchases or government loans.

Mr Preston deferred to the US Treasury and Federal Housing Finance Agency, the new regulator of Fannie Mae and Freddie Mac, on whether the companies should be bailed out or nationalised.

'I don't know what the future holds for them,' he said. Mr Preston said 'it's possible' he may propose other solutions to the housing crisis, without being specific.

'Many of the policy solutions are out there and working,' he said. 'My guess is that you're going to see more fine-tuning of these programmes to ensure that they're working, rather than large-scale change.'

Other programmes include an industry-led effort called the Hope Now Alliance organised last year to help troubled homeowners modify their mortgages to make monthly payments more affordable.

A programme HUD started a year ago called FHA Secure is also aimed at averting foreclosures by helping borrowers with adjustable-rate mortgages refinance into FHA-insured mortgages.

Mr Preston, who was head of the US Small Business Administration, in June replaced Alphonso Jackson, who quit amid a federal criminal probe into contracts awarded by the agency. -- Bloomberg

URA Rejects Sole Bid For Tampines Condo Site, Saying It's Too Low

Source : The Business Times, August 27, 2008

FOR the fourth time this year, the government has rejected bids at a state land tender for being too low, amidst weakening property market sentiment and rising construction costs that have forced bidders to clip their land bids.

And what's interesting is that in three of the four instances, the top or sole bidder was the Midview group, involved in the construction and property businesses as well as in general trading.

The company, controlled by Lim Kim Hong and Lim Huixing, has its office at Midview Building at Bukit Batok Street 23.

Yesterday, Urban Redevelopment Authority (URA) turned down the sole bid for a private condominium housing site at Tampines Avenue 1/Avenue 10 as the price offered was too low.

The 99-year leasehold plot, which faces Bedok Reservoir, drew a bid of about $118 per square foot per plot ratio (psf ppr) from Midview unit Boon Keng Development Pte Ltd.

The sole bid was below general market expectations, which ranged from $150 to $230 psf ppr. When the tender for the site closed on Aug 12, most property consultants had already said there was only a slim chance of the site being awarded.

The three sites where bids were earlier rejected by the state for being too low were the Ten Mile Junction site in Choa Chu Kang (which was to have a residential component), a landed housing plot at Westwood Avenue in Jurong, and a transitional office site at Aljunied Road/Geylang East Avenue 1.

Midview group was the top bidder for the Westwood Avenue plot as well as the sole bidder for the transitional office site.

Analysts have also pointed out that some of these sites were not that attractive to begin with.

The latest Tampines plot that was not awarded, for instance, does not have strong attributes like transportation links or proximity to amenities.

An industry observer also highlighted an element of opportunistic bidding seen, especially on the part of contractors, at recent state tenders.

'With the current market uncertainty and most developers keeping away from land tenders, some players see a chance to try and get land on the cheap and hopefully reap a windfall. I guess it's their business strategy: They can manage construction costs better, plus if they can get land at low cost, and even if the property market comes down, say, 30-40 per cent, they would still be OK,' he said.

The Tampines Avenue 1/10 plot was offered through the confirmed list of the Government Land Sales programme where sites are released according to a pre-stated schedule and the government's minimum or reserve price is not made known.

Separately, the Housing & Development Board yesterday made available for application a 99-year condo plot at Yishun Ave 2/Yishun Ave 7/Canberra Drive through the reserve list.

The plot will be launched for tender only upon successful application by a developer, with an undertaking to bid at a minimum price that is acceptable to the state.

Wing Tai's Q4 Net Slumps 60%

Source : The Business Times, August 27, 2008

Home sellers seen unlikely to resort to fire-sale - at least until 2010

PROPERTY group Wing Tai Holdings yesterday said that net profit for its fourth quarter fell by more than half as it sold fewer homes and saw lower fair value gains from investment properties.

At the same time, chairman Cheng Wai Keung, known for his often candid assessments of the property market, said that while home prices could see some adjustment in 2008 and 2009, sellers are unlikely to have a 'fire sale' of their properties - at least until 2010.

This is because home prices in Singapore started climbing rapidly only in 2006 and 2007, and buyers of these newer properties will see the projects completed only from 2010 onwards. The push to offload their units will happen only then, he said.

The company's net profit for the three months ended June 30 fell 60 per cent to $96.3 million, from $243.2 million a year ago. Fair value gains on investment properties dropped to $90.6 million from $189 million.

Revenue for the fourth quarter fell 57 per cent to $107.3 million, down from $249.1 million in Q4 2007. Among other projects, revenue was contributed by units sold in The Riverine by the Park in Singapore.

Earnings per share fell to 12.45 cents, from 33.83 cents a year ago.

Wing Tai has declared a dividend of six cents a share, comprising a first and final dividend of three cents and a special dividend of three cents.

For the entire 2008 financial year, Wing Tai reported that net profit fell some 40 per cent to $229.4 million, from $381.8 million in FY2007.

Revenue for the 12 months fell 56 per cent to $428.2 million, from $981.6 million a year ago.

Wing Tai said in a filing to the Singapore Exchange that the underlying fundamentals of the property market are still sound.

'I have always believed that property is actually a reflection of the fundamental strength of the economy,' said Mr Cheng. However, sentiment has a part to play too, he admitted.

Wing Tai sold some 205 units in Singapore during the financial year, although the majority of units were sold in the last six months of 2007.

The company has some 1.4 million square feet in its residential land bank, but no new launches are planned for the moment, Mr Cheng said.

Temasek Warns Of Lean Years As Returns Dwindle

Source : The Business Times, August 27, 2008

It flags stagflation risk; its 7% total shareholder return on portfolio lowest in recent years

Temasek Holdings has warned of a growing danger that global economic growth could stall as the fallout from the credit crisis spreads around the world, with possible stagflation posing a severe risk for years to come.

Temasek's own vast portfolio of investments was buffeted by the turmoil that swept financial markets since the start of the crisis last year.

By market value, the total return to Temasek's sole shareholder - the Finance Ministry - for the year to end-March fell to just 7 per cent, from 27 per cent a year earlier.

Economic profit or wealth added - which Temasek uses internally to gauge its returns above a risk-adjusted benchmark - was a negative $6.3 billion, the first time in five years it fell below the cost-of-capital hurdle. A year earlier, wealth added was $23.4 billion.

By one measure, the market risk of Temasek's portfolio rose 67 per cent over the year to end-March, reflecting the 'severe stress' in global financial markets, according to its latest annual report.

Group net profit for Temasek for the year to end-March doubled to a record $18.24 billion from a year earlier, boosted by strong operating performance at its portfolio companies and divestment gains from its asset sales.

Under standard accounting rules, the consolidated net profit includes Temasek's share of profits from companies in which it has a stake of 20 per cent or more, but does not directly reflect its share of the profits or losses of firms in which Temasek has a stake below 20 per cent. Profits from Singapore's DBS Group, of which Temasek owns 28 per cent, would be included, while profits from the UK's Standard Chartered Bank, in which Temasek has a 19 per cent stake, would not.

'The credit crisis is not over - we expect to see further contagion in the real economy in the US, Europe and also Asia over the next 24 months,' said Temasek chairman S Dhanabalan in the 2008 Temasek Review published yesterday.

The fallout from the credit crisis 'will continue to dampen the global economy' for the next two years, he added.

The 7 per cent one-year return to the government - which includes dividends paid by Temasek to the government net of new capital injections - is the lowest since Temasek started publishing its annual report in 2004, when the return was 46 per cent.

Temasek's portfolio performance over longer periods, however, remains strong, with compounded annual returns of 23 per cent over five years, 9 per cent over 10 years, and 18 per cent since Temasek's inception in 1974.

But Mr Dhanabalan was cautious on the outlook. 'We are concerned with the emerging risks of stagflation. This presents huge socio-political as well as economic risks in the next three to five years,' he said.

Bold policies by regulators in the US had averted a major systemic failure, but 'the risks of stagflation have become more apparent with the twin bogeys of high oil and food prices', he added.

Still, 'there may be opportunities as imbalances are corrected', although such opportunities may be limited if stagflation - a period of stagnant economic growth coupled with high inflation - does set in, he added.

During the year to end-March, Temasek sold $17 billion worth of assets, including some $12 billion in Asia, 'as we anticipated a massive structural adjustment', said Mr Dhanabalan.

In April last year, Temasek also received an injection of new capital from the government, which boosted its portfolio value by $10 billion, net of dividends paid to the government. An undisclosed dividend amount is set yearly by the Temasek board, said Michael Dee, Temasek senior managing director, international, at a media briefing yesterday. Mr Dee, a former investment banker, recently joined Temasek from Morgan Stanley.

US Mortgage Applications Up 1st Time In 3 Wks: MBA

Source : The Business Times, August 27, 2008

NEW YORK - US mortgage applications rose for the first time in three weeks as interest rates edged lower, an industry group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended Aug 22 increased 0.5 per cent to 421.6.

Mortgage applications during the previous week had fallen to their slowest pace since December 2000.

While last week's increase was small, the report offers a glimmer of hope for the US housing market, currently suffering the worst downturn since the Great Depression.

Significantly tighter lending standards and an unwieldy supply of homes for sale are just some of the factors weighing on the US housing market.

Borrowing costs on 30-year, fixed-rate mortgages, excluding fees, averaged 6.44 per cent, down 0.03 percentage point from the previous week.

Interest rates were not far from year-ago levels of 6.41 per cent.

The MBA's seasonally adjusted purchase index rose 0.6 per cent to 315.9. The index came in well below its year-ago level of 424.0, a drop of 25.5 per cent.

Overall mortgage applications last week were 31.5 per cent below their year-ago level. The four-week moving average of mortgage applications, which smooths the volatile weekly figures, was up 0.05 per cent to 424.9.

The group's seasonally adjusted index of refinancing applications increased 0.3 per cent to 1,038.0. The index was down 40 per cent from its year-ago level of 1,729.6.

The refinance share of applications increased to 35.2 per cent from 34.8 per cent the previous week. The adjustable-rate mortgage share of activity decreased to 7.9 per cent, down from 8.0 per cent the previous week.

Fixed 15-year mortgage rates averaged 5.94 per cent, down from 5.99 per cent the previous week. Rates on one-year ARMs increased to 7.15 per cent from 7.07 per cent. -- REUTERS

Investing In India's Real Estate Sector

Source : The Business Times, August 27, 2008

Foreign investors need to address some key issues and regulatory requirements before jumping in

INVESTMENT in the Indian real estate sector continues to grow, albeit the pace may be slowing just a little. Foreign developers as well as private equity funds remain bullish, long-term, on India's property market.

From a foreign investor's perspective, the recent correction in real estate prices in some parts of India is good news in that it could result in land being available at attractive values.

Unclear picture: As for partially completed projects, the foreign direct investment (FDI) guidelines do not clarify whether FDI would be permitted into such projects Not only is investment flowing into the 'first-tier' cities, but attractive real-estate deals are also being negotiated and signed in 'second-tier' cities such as Indore, Jaipur and Cochin.

But although Indian property may make an attractive investment for foreign investors, it is important that they address some of the regulatory issues prior to making an investment.

According to India's current foreign direct investment (FDI) policy, 100 per cent FDI is allowed under the automatic route - that is, without requiring government approval - for the construction and development projects that include housing, commercial premises, resorts, educational institutions, recreational facilities, city and regional-level infrastructure and townships.

But this is subject to certain conditions:

# Minimum area for development under each project should be:

i) 10ha in the case of services housing plots; or

ii) 50,000 sq m in the case of construction development projects.

iii) In case the project is a combination of the two, any one of the two conditions would have to be met.

# Minimum capitalisation of US$10 million for wholly owned subsidiaries and US$5 million for joint ventures with Indian parties.

# The funds have to be brought in within six months of commencement of business of the company.

# The original investment is subject to a lock-in period of three years from the completion of minimum capitalisation.

# At least 50 per cent of the project must be developed within a period of five years from the date of obtaining all statutory clearances.

# Investors would not be permitted to sell undeveloped plots.

Though the investment policy seems straightforward, investors still need to address some key issues and comply with other regulatory requirements.

For example, when it comes to funding, India's exchange control regulations permit external commercial borrowings (ECBs) - that is, commercial loans in the form of bank loans, buyers' credits, suppliers' credits, and loans from shareholders.

There are several restrictions on the end use of ECB funds. One of these is that the proceeds of ECBs cannot be used for the purpose of acquiring real estate in India. Accordingly, ECBs cannot be used for real estate development in India.

Preference shares are also considered as ECBs and, likewise, cannot be used to invest in a real estate project in India.

The only exception is the use of compulsory convertible preference shares or fully and mandatorily convertible debentures, which would be treated as part of equity and would be considered as FDI.

Therefore, apart from pure equity funding, only compulsory convertible preference shares and fully and mandatorily convertible debentures can be used. This would tend to minimise the options available for funding a project in India because all funds would have to be in the form of equity or instruments which can be converted into equity.

As per the FDI regulations, a foreign investor's original investment 'cannot be repatriated before a period of three years from completion of minimum capitalisation'.

Original investment

The question therefore arises as to the meaning of the term 'original investment'. Should the term be interpreted as 'minimum capitalisation' or should it be interpreted to mean the funds brought into the company in the first six months?

Since the term is not defined, it becomes important to have a correct interpretation, as the 'original investment' is subject to a three-year lock-in period. The view that seems to be emerging is that funds brought into the company in the initial six months - that is, the minimum capitalisation of the commencement of business - is the original investment and subject to the lock-in period.

However, the risk is that if an amount in excess of the minimum capitalisation is invested during the first six months, the entire amount would be treated as 'original investment' and would be subject to lock-in. To minimise this risk, only funds to the extent of minimum capitalisation should be invested during the first six months.

Investors in real estate have to bring the funds into India within six months of 'commencement of business'. Again, the term 'commencement of business' has not been defined. It can be interpreted in various ways; for instance, in the construction business it could mean the point at which construction actually commences.

The view emerging from Indian regulators is that the term 'commencement of business' means when the shareholders agreement or joint venture agreement is signed. Accordingly, the funds have to be invested within six months upon signing the agreement.

Finally, there are questions surrounding partially completed projects. The FDI guidelines do not clarify whether FDI would be permitted into these.

The question would arise as to the meaning of 'partially developed'. In this connection the view appears to be that if the project is less than 25 per cent complete, FDI would be permitted. However, in this case it may be prudent to seek prior approval of the Foreign Investment Promotion Board before making an investment.

Given the fact that India desperately needs good-quality housing and commercial space, the current slowdown in deals in India is likely to be temporary.

In due course, growth in the Indian real estate sector will resume with more acquisitions and consolidation. But foreign investors planning to enter India's real estate sector need to address a number of regulatory issues before they go in.

The writer is the head of tax of BDO Raffles in Singapore. The views expressed in this article are his own

Needy Will Move To Head Of Queue For HDB Rental Flats

Source : The Straits Times, August 24 2008

Stricter rules being drawn up to prevent abuse of rental scheme

Singaporeans in desperate need of a home will, from today, be moved to the front of the queue for HDB rental flats.

National Development Minister Mah Bow Tan announced this move yesterday and also gave a peek into new rules being studied to stop abuse of the rental scheme.


One of them is that the HDB will scrutinise the assets, including private property, of siblings and children of applicants to ensure they rely first on family, not on rental flats.

Another will require flat sellers to deposit part of their sales proceeds into their Central Provident Fund (CPF) accounts.

These likely changes are part of a government move to address the sharp rise in demand for rental flats, with many people joining the queue even when they have other housing options.

It is a worrying trend highlighted by Prime Minister Lee Hsien Loong in his National Day Rally speech last Sunday.

Yesterday, Mr Mah told reporters at a community event in Tampines: 'Our housing policy is premised on home ownership. Rental flats are there because we recognise that there is a small group of people who cannot afford to own flats.'

These are the destitute with no family and who cannot work.

He also pledged that 'if you are staying on the beach, on the void deck, and you are a divorcee with five kids, we'll find a way'.

They will go to the front of the 4,400-strong queue.

He also said the supply of rental flats will be raised by 20 per cent to 50,000 flats, in three years.

They are leased for two years at what he called 'ridiculously cheap' rent which has stayed the same for 30 years. It can be as little as $26 a month. This fuelled the trend he noted: an increasing number of old folk who want 'to cash out of their flats and ask us for rental flats'.

Hence, he is hurrying the HDB to complete the review of the eligibility criteria as early as year's end or at the latest, next March.

He identified three rules that may get the green light:

- When owners sell, they will have to put into their CPF account the subsidy they had enjoyed when they bought their flat from the HDB. The amount could be about $30,000 to $40,000.

Now, they can pocket the entire sales proceeds and the fear is they may spend it all, be in dire straits and join the rental queue.

However, Mr Mah did not say if the rule was only for people applying for rental flats or for all sellers.

- Scrapping the current rule that allows a person to apply for a rental flat only if he has not sold a property in the past 30 months.

This rule, Mr Mah said, keeps those in dire need waiting, while giving the not-really-needy the impression that if they wait for 30 months, they are sure to get a flat.

- The main measure of neediness now is a monthly household income of no more than $1,500. Soon, the HDB will also look into the applicant's children's ownership of private property and if the person's siblings and children have the means to support him.

Economists Slash GDP Projections

Source : The Straits Times, August 27, 2008

They revise growth to as low as 3.3% on 21.9% slide in July factory output

A DRAMATIC slump in last month’s manufacturing output has forced economists to cut back their growth forecasts for the economy.

Production fell 21.9 per cent - far more than had been tipped by experts compared with July last year. It was also down 1.8 per cent from this June.

This has led economists to slash their gross domestic product (GDP) forecasts, with some tipping growth of as low as 3.3 per cent for the year when, a few months ago, figures of 5 per cent or more were being confidently put forward.

While the speed of the mood change has been striking, the trend from yesterday’s figures is no surprise with the pharmaceutical and petrochemical sectors again the main drags.

Both recorded reduced output, according to Economic Development Board figures yesterday, although the electronics sector managed a small expansion.

With manufacturing accounting for a quarter of the economy, such dips spell trouble for overall economic growth.

‘The manufacturing outcome today adds to the prospect of a technical recession,’ said Standard Chartered Bank economist Alvin Liew. An economy technically slips into a recession when it has shrunk for two straight quarters.

Singapore’s second-quarter GDP fell 6 per cent from the first quarter, although the Government has reiterated it does not expect a technical recession.

This is because construction and services are ’strong pockets of growth’ that should support the economy in the current quarter and next, it has said.

But analysts say the dreaded R-word will be a strong possibility when third- quarter data are out in October.

‘Given the weaker-than-expected July industrial production numbers, we now think there is at least a 40 per cent chance of a biomedical-led technical recession in the third quarter,’ said Citigroup economist Kit Wei Zheng.

Yesterday’s numbers once again pointed to pharmaceuticals as the weak link.

Production dipped 69.7 per cent compared with the same period last year, underlining the 28 per cent year-on-year decline in the second quarter.

The Trade and Industry Ministry has said the sector’s short-term outlook is weighed down by global trends like strong competition from generic drugs and delays in approvals for new pharmaceuticals.

HSBC economist Prakriti Sofat told The Straits Times: ‘We had been expecting a bounce back as pharmaceutical output typically tends to be quite volatile on the account of plant shutdowns for cleaning. However, in recent times, pharmaceutical production has been weak for an extended period.’

Still, economists took comfort in a good showing in electronics output, up 5.9 per cent last month from a year earlier, following a revised 1.5 per cent gain in June.

But with the overall data weak, some economists have trimmed their growth forecasts for the full year.

CIMB-GK economist Song Seng Wun has lowered his number for the full year from 4.6 per cent to 3.5 per cent.

The Government expects growth to be at the lower half of a recently revised forecast range of 4 to 5 per cent.

Mr Song believes the Monetary Authority of Singapore is now more likely to ease the rate of the Singdollar’s appreciation in its next policy statement in October.

OCBC economist Selena Ling has cut her full-year GDP growth forecast to 3.3 per cent from 4.8 per cent to reflect ‘global growth downside risks’.

Some economists query whether the Government is still too bullish on growth. One said: ‘Are there real drivers lending the Government to such optimism?’
United Overseas Bank economist Ho Woei Chen concedes that the construction sector is doing well, but it accounts for a very small part of Singapore’s GDP.
‘Services is still holding up but the risk is that the sector could slow as a result of the synchronised downturn in the United States, European Union and the United Kingdom,’ Ms Ho said.

What remains to be seen, say economists, is whether the Formula One boost to tourism materialises next month, given the huge costs involved and the possible lack of spending by cash-strapped fans.

‘I’m mindful that tourism receipts add up only to close to 6 per cent of full-year GDP based on last year’s numbers,’ said Mr Liew. ‘One event, three days, you do the maths.’

New URA Reserve Site At Serangoon Avenue 3 For Residential Devt

Source : AsiaOne, Wed, Aug 27, 2008

The Urban Redevelopment Authority (URA) today released the detailed sales conditions for a Reserve List site at Serangoon Avenue 3 for residential development. Developers interested in purchasing the site can now apply to URA for it to be put up for tender.

The Land Parcel is located within an established private residential estate and easily accessible via major roads and expressways such as Upper Serangoon Road, Pan Island Expressway and Central Expressway. The site is also located next to the future Lorong Chuan MRT station where future residents can enjoy convenient access to all parts of island.

With a site area of about 1.39 ha, the site can generate a maximum permissible gross floor area of about 38,857 sqm for residential use.

Under the Government's Reserve List system, a site on the Reserve List would only be put up for tender if a developer's indicated minimum bid price in his application is acceptable to the Government.

Details of the Land Parcel and other sites that are currently available for application on the Reserve List can be found on URA's website: intro.html .

Home Prices Stable Till 2010: Wing Tai

Source : The Straits Times, August 27, 2008

It is in no rush to launch Ardmore Park sites despite softening market

PROPERTY developer Wing Tai Holdings is in no hurry to launch the two sites it owns in the prestigious Ardmore Park area: the Ardmore Park condominium and Anderson 18.

Wing Tai chairman Cheng Wai Keung said yesterday that although home prices are softening, he expects them to remain mostly stable until at least 2010.

Units at Anderson 18 are being rented out as redevelopment is on hold. -- PHOTO: KNIGHT FRANK

This is because projects that are being completed this year and next were originally sold at relatively low prices in 2005 and 2006, so there is no urgency for buyers of these projects to unload their units.

'Developers are also quite strong financially, so if they can hold and allow the orderly release of units, I do not see prices dropping drastically,' he told reporters and analysts at the release of Wing Tai's full-year results.

Beyond 2010, however, the situation may change. Projects to be completed then were launched at 'very high prices' last year, and if the economy does not improve by then, these expensive apartments may flood the market while financially strong developers will probably also weaken, Mr Cheng said.

But he added that while prices have softened, it is not because Singapore's economic fundamentals have worsened but rather because 'traders', or speculators, have left the market. 'I maintain that fundamentals are sound,' he said.

In fact, Mr Cheng said he is prepared to hold out for prices to reach $4,000 per sq ft (psf) again at Ardmore Park. 'Even at the peak, when they were talking about $4,000 psf, I still think that was relatively cheap, compared to values in the world and in Singapore.'

He added that Wing Tai owns two of the three sites to be launched in the Ardmore Park area. SC Global has the third, The Ardmore. 'We are the ones who will set the price; if we never lower prices, how can it lose value?'

For now, Wing Tai has already locked in construction costs for Ardmore Park and is renting out the units in Anderson 18 rather than tearing down the building for redevelopment.

In the meantime, the developer may launch some of the other sites in its land bank this year or next, said Wing Tai's chief operating officer Tan Hwee Bin.

Belle Vue Residences in Oxley Walk will be launch-ready next month, while a 99-year leasehold site in Alexandra Road near the Redhill MRT Station will obtain all the necessary approvals by the year end.

Ms Tan said the group will position the Alexandra Road condo as a mid-tier project minutes away from Orchard Road, and may bring to it some of the features it has used in its high-end Draycott8 development.

For the past year, slower home sales have taken their toll on the performance of the property and retail group.

Wing Tai's fourth-quarter net profit fell 60 per cent to $96.3 million, dragging down full-year net profit 40 per cent to $229.4 million. Revenue more than halved both in the fourth quarter, to $107.3 million, and in the full year, to $428.2 million.

Earnings per share dropped to 30.11 cents for the year to June 30, from 53.12 cents the previous year. Net asset value per share slipped to $2.03 as at June 30, from $2.07 a year ago.

Wing Tai is proposing a dividend of six cents per share for the year, comprising a first and final dividend of three cents and a special dividend of three cents.

New HDB Flats For Sale, Rent In West

Source : The Straits Times, August 27, 2008

Coming up in Bukit Panjang: 474 homes for sale, 300 for rent

HOMEBUYERS are being offered a further 474 new flats to choose from, with the launch of a new Housing Board project in Bukit Panjang yesterday.

Also, 300 units in two new rental blocks will be built nearby, for the first time under the same contract as the flats being offered for sale.

Bookings for Senja Green are now open. Models of the development can be viewed at the HDB Hub. -- PHOTO: HOUSING BOARD

HDB's latest move to ramp up the building of new flats and rental homes comes after demand soared for both types of housing in the past year.

The new project, called Senja Green, offers two- to four-room units - with prices ranging from $82,000 to $270,000 each.

The flats, under HDB's build-to-order scheme, will only be built if a certain level of demand is reached.

HDB's latest development brings the number of new flats launched for sale this year to 5,000. It plans to launch 8,400 units by the end of the year.

As for rental flats, HDB said it expects to increase its current stock from 42,800 to 49,860 by 2011.

The sharp hike in demand for rental flats was flagged by Prime Minister Lee Hsien Loong in his recent National Day Rally speech as a worrying trend.

To prevent abuse of the rental scheme, National Development Minister Mah Bow Tan announced stricter rules last Saturday, effective immediately, which will see Singaporeans in desperate need of a home given priority for such flats.

Each month, about 131 tenants give up their flats and 382 people join the queue.

In June, there were 4,387 applicants on the waiting list. They wait, on average, 18 months for a one-room rental flat and nine months for a two-room flat.

HDB said yesterday that the rental flats were included in the same building contract 'for greater economies of scale, amid rising construction costs'.

The launch of Senja Green follows another HDB project, Segar Meadows, in Bukit Panjang town, which was launched last November.

As at 5pm yesterday, 177 applications had been lodged for the new units.

Senja Green is located in Woodlands Road and is bounded by Senja Way and Senja Road. The rental blocks are separate from Senja Green but will also sit on Woodlands Road.

The new flats are close to the Ten Mile Junction shopping mall and Senja LRT Station as well as West View Primary School and West Spring Secondary School.

Residents can also look forward to the Downtown Line 2 in Bukit Panjang, which will be ready in about 2015, HDB said.

The 96 two-room flats available at Senja Green will come with a floor area of 47 sq m each. They will be priced between $82,000 and $106,000 each.

The 94 three-room flats will have a floor area of 67 sq m each and cost $138,000 to $170,000. There are also 284 four-room flats of 93 sq m in size, which will go for $211,000 to $270,000 each.

Buyers can opt for ceramic floor tiles and internal timber doors to be installed in their flats, at an additional cost.

Interested buyers can apply online at HDB's website from now until Sept 8.

The selection exercise will start from November. Models of the estates are on display at the HDB Hub Habitat Forum in Toa Payoh until the closing date.

HDB Launches Latest BTO Project In Bukit Panjang

Source : The Business Times, August 27, 2008

THE Housing and Development Board (HDB) yesterday launched its 474-unit Senja Green project in Bukit Panjang.

On the market: Senja Green comprises 96 two-room, 94 three-room and 284 four-room apartments. It is bounded by Woodlands and Senja roads and Senja Way

The flats, offered under HDB's build-to-order (BTO) scheme, are among 8,400 BTO units planned for 2008, HDB said.

Senja Green comprises 96 two-room, 94 three- room and 284 four-room apartments.

Two-room flats cost $82,000-$106,000, three- room flats $138,000- $170,000 and four-room flats $211,000-$270,000.

Senja Green is bounded by Woodlands and Senja roads and Senja Way. Come 2015, residents will also be near the upcoming Downtown Line 2 at Bukit Panjang.

Amid rising HDB prices, the BTO scheme offers first- time buyers one of the cheapest options, market watchers say.

The flats are priced a shade lower than nearby resale flats, says Eugene Lim, assistant vice-president of property agency ERA Asia- Pacific.

A four-room resale flat in the area costs about $280,000, he said.

'The new flats offer buyers a variation from previous BTO projects, which have mostly been in areas such as Sengkang and Punggol,' he noted.

Hotel Site At Short Street Now Available

Source : The Business Times, August 27, 2008

DEVELOPERS interested in a hotel site in Short Street can apply for it to be put up for tender, after the Urban Redevelopment Authority (URA) released detailed sale conditions.

The 0.12 hectare site is one of two new hotel plots on the reserve list under the second-half 2008 Government Land Sales (GLS) programme.

The site, in the Bras Basah/Bugis district, has a maximum permissible gross floor area of 4,077 sq metres (43,884.4 sq ft) - smaller than others released this year.

Cushman and Wakefield managing director Donald Han believes it will attract smaller developers and new entrants to the market.

The owner of neighbouring Albert Court Hotel may feel compelled to bid, he said.

He reckons that if the site goes up for public tender, bids could range from $350 to $400 psf per plot ratio (psf ppr) - a quantum of $15.4-$17.6 million.

Knight Frank director (research and consultancy) Nicholas Mak also sees bids in this range.

'Based on planning details and the neighbourhood, a boutique hotel development with an ethnically artistic design is deemed suitable,' he said.

For instance, a developer could put up a Peranakan-style building similar to Albert Court Hotel.

Earlier this month, URA received a committed bid of $51 million or $249.6 psf ppr for a reserve list hotel site at Kallang and Jellicoe roads.

Also this month, URA awarded a hotel site in Balestier Road to HH Properties, which put in the highest bid of $172 psf ppr.

There are now nine hotel development sites on the GLS reserve list.

According to URA, the reserve list for H2 2008 provides for potential supply of 5,050 hotel rooms, including a white site at Outram Road.

Tampines Site: Sole Bid Rejected

Source : The Straits Times, August 27, 2008

THE sole bid for a Tampines condominium site overlooking Bedok Reservoir has been shot down for being too low.

Boon Keng Development's optimistic offer of $84.6 million, or $118 per sq ft (psf), for the site was just not enough, said the Urban Redevelopment Authority (URA) yesterday.

Consultants were not surprised that the bid was rejected.

They had previously said that anything from $150 to $230 psf would have been more reasonable as apartments on the 3.2ha site could sell for up to $700 psf.

According to Knight Frank's director of research and consultancy, Mr Nicholas Mak: 'If the Government had accepted it, it would be taken as a signal that it is lowering its reserve price for all other sites.

'Or (a signal) the Government is of the opinion that the land price has fallen to the same level as that during the 1998 recession.

'Even then, the last piece of government land sold in 1997 before site tenders were suspended because of the recession was $171 psf for a piece of land at Hougang Street 11.

'So it was too optimistic to expect the government to award this bid.'

The tender for the 99-year residential site at the junction of Tampines Avenue 1 and 10 was launched on June 17 and closed on Aug 12.

武吉班让推出新预购组屋 4座二至四房式组屋共474间

Source :《联合早报》August 27, 2008


这个取名为“Senja Green”的新项目,坐落于兀兰路、信佳路和信佳道之间,靠近信佳轻轨列车站和武吉班让巴士转换站。该地段周围的道路也便于通往克兰芝高速公路以及武吉知马高速公路。

值得一提的是,拟议铺设的滨海市区线(Downtown Line)第二阶段工程的地铁站,将建在这个新项目附近,大大缩短住在这一带居民前往市区的时间。

新项目“Senja Green”坐落于兀兰路、信佳路和信佳道之间,靠近信佳轻轨列车站和武吉班让巴士转换站。(建屋局美术构想图)

Senja Green的单位面积从47平方米到93平方米不等,二房式单位售价介于8万2000元至10万6000元之间,三房式单位售价介于13万8000元至17万元之间,而四房式单位的售价则介于21万1000元至27万元之间。





公众可通过建屋局网站申请预购Senja Green组屋,并可到建屋局中心3楼展示厅参观及索取销售资料,展示厅平日开放时间是上午8时至下午5时,星期六是上午8时至下午1时。