Tuesday, September 23, 2008

Financial Crisis: Is The Worst Over?

Source : The Business Times, September 23, 2008

Do you think that the latest news on Lehman Brothers' collapse indicates that the global economic climate would worsen further, or is the worst over for the sector that you operate in?

Kenny Yap
Managing Director
Qian Hu Corporation

MY gut feel is if US congress approved the US$700 billion rescue package and no more banks collapse, we might be seeing the end of the global financial crisis. Typically, after one or one-and-a-half years of crisis, people kind of get used to that, learn ways to move on and become less panicky. If there's no more bad news, confidence should be back by year end. Let's hope for a better tomorrow!

John Koh
Managing Partner

THERE are currently uncertainties in the financial markets and global economies which are unlike what most people have seen in the last decade or so, and it is extremely difficult to predict whether market conditions are heading south or northward simply because the world is very different from what it used to be 10 years ago. WMRC LLP has been actively assisting our clients in the private banking and asset management sectors since our inception, and we have seen good years as well as bad ones. Looking at the current situation, we will continue to do good work for our clients as we believe bad times present lurking opportunities which many would have missed. Surviving bad times is the best test of one's true mettle and besides, pockets of opportunities continue to exist in times like these.

Jackie Cheng Ee Lieng
Hisaka Holdings

YES, I think it will trigger further downside for the global economy, because most traditional banks are still exposed to investment banks - be it through their structured products or through collaboration on funding investments. There are likely to be more investment banks that have yet to come clean on the status of the exposure. Now, my view is that the financial authorities around the world must assure the public that they will save all the traditional banks so as to restore the confidence of the public. This will prevent mass withdrawals by depositors, which would only make things worse.

State Land Sale Revenue Doubles In 07/08: SLA

Source : The Business Times, September 23, 2008

Singapore Land Authority (SLA) on Tuesday said that the total land sale revenue due to the State for the financial year ended March 31, 2008 doubled to hit $12.4 billion, from $6.2 billion in the previous year.

The numbers mark a steady increase for 10 straight years now, since the property slump in 1997/98, SLA said when it released its annual report for its 2007/08 financial year.

On the back of a property sector boom and strong demand for state properties for office, education and commercial uses, SLA's operating income achieved an all-time high, increasing by 14 per cent to $100.9 million from $88.6 million a year ago.

SLA's total operating surplus reached for the year ending March 31, 2008, was $17.1 million, close to that achieved in the previous financial year.

There are 4,016,162 sq m in total estimated gross floor area of State properties managed by SLA, which is a new record. This is translated into a 87 per cent occupancy rate.

Looking ahead, SLA aims to do more in the area of spatial information, it said. SLA is responsible for the management of a land data repository and data exchange among public agencies. It is also a key agency in a whole-of-government effort to establish a national spatial data infrastructure.

UK Housing Market 'On Its Knees', Says Rightmove

Source : The Business Times, September 23, 2008

Properties may see more weakness: BOE chief economist

(LONDON) UK house prices fell for a fourth month in September as the global credit crisis intensified, locking out homebuyers and forcing the sale of the country's biggest mortgage lender, a report by Rightmove plc showed.

'The housing market is on its knees and will remain so until financial institutions address the disastrous state of the mortgage funding markets,' said Miles Shipside, commercial director at Rightmove.

'While this market provides a good opportunity to trade up, it requires a degree of bravery.'

The average asking price for a home fell one per cent from last month to £227,438 (S$595,559), Britain's most-used property website said yesterday. From a year earlier, prices fell 3.3 per cent.

The property market may face further weakness in coming months, provoking 'painful' adjustments for many families, Bank of England chief economist Spencer Dale said last week.

HBOS plc agreed to a takeover by Lloyds TSB Group plc after plunging home values and the financial market crisis destroyed the value of the company and added to the threat of a recession.

Prices dropped the most in the East Midlands, where they fell 5.3 per cent this month, and values declined 3.9 per cent in the south-west, Rightmove said. In London, house prices rose 4 per cent this month after a 5.3 per cent drop last month.

Lenders are reeling from higher borrowing costs in interbank lending on concerns about losses stemming from the collapse of the US housing market.

The US Treasury last week announced a US$700 billion plan to buy troubled assets and avert a financial meltdown. The pound rose against the dollar yesterday, trading at US$1.8439 as of 8.49am in London. The currency has still fallen 7 per cent since the beginning of last month.

The UK economy entered a recession in July, forecasts by the Confederation of British Industry, the country's largest business lobby, show.

Growth stalled in the second quarter, ending the longest period of uninterrupted economic expansion in more than a century.

Prime Minister Gordon Brown suspended the tax on home purchases of less than £pounds;175,000 this month. Still, the number of new listings per estate agent fell to a record low, Rightmove said.

'The changes in stamp duty are just tinkering at the edge of the system,' Mr Shipside said. 'At best they will give slightly more choice to first-time buyers.'

Commercial property derivative prices suggest that commercial property values will continue to fall until 2010 as concerns about the UK economy blunt demand, the Bank of England said in its quarterly bulletin published yesterday.

Other residential housing data also show that the slump has deepened. Home sales plunged to a 30-year record low last month, the Royal Institution of Chartered Surveyors said on Sept 9. Prices fell by the most in a quarter century, HBOS said on Sept 4.

Bank of England policy makers said that they are still concerned the fastest inflation in a decade will become embedded in the economy, making them more reluctant to lower interest rates, minutes of this month's meeting showed.

They voted 8-1 to keep the rate at 5 per cent, with David Blanchflower voting for the biggest reduction since the Sept-11 attacks and Timothy Besley abandoning a push for higher rates. -- Bloomberg

US Credit Crisis Worse Than S&L: Survey

Source : The Business Times, September 23, 2008

(NEW YORK) Sixty percent of US commercial real estate executives surveyed said they believed the current credit crisis had eclipsed the Savings & Loan crisis of 1989-1991 as having the greatest impact on the state of the industry.

Nearly 80 per cent said they did not believe the meltdown of financial powerhouses - the bankruptcy of Lehman Brothers Holdings Inc, Bank of America Corp's takeover of Merrill Lynch & Co and American International Group's bailout by the federal government - signalled the end of the crisis, according to law firm DLA Piper's 2008 State of the Market Real Estate Survey released on Sunday.

The survey was distributed in August and 424 recipients responded. But the cataclysmic events on Wall Street in the third week of September prompted the law firm to conduct follow-up questions on Sept 15, and 307 responded.

'We seem to running in place at best, and at worst, we're in some sort of a free fall,' said Jay Epstien, chairman of the US real estate practice for the law firm.

The survey was conducted before US Treasury Secretary Henry Paulson called on Friday for the government to spend hundreds of billions of dollars to rescue financial companies from defaulted mortgages and other toxic debt that have threatened to undermine the financial system.

Still, the respondents were bleak, with 90 per cent describing themselves as having a bearish outlook for the next 12 months for US commercial real estate market, up from 68 per cent from a year earlier, when the credit crisis began. Half those who said they were bullish believed they could find good opportunities resulting from distressed properties and loans.

The commercial property market has come to a near halt since the credit markets became unhinged and sources of financing dried up.

One of the cheapest and most often-used sources of debt that helped drive the commercial real estate boom was the commercial mortgage-backed securities (CMBS). Last year, the CMBS market accounted for US$230.19 billion worth of securitised commercial mortgages, according to the Commercial Mortgage Securities Association. This year the total fell to US$12.15 billion, and there have been no new issuances since June.

About 46 per cent of the respondents said they did not believe securitised lending transactions financed by the CMBS market would return to prior levels until after 2010. -- Reuters

France More Resilient To Home Price Woes

Source : The Business Times, September 23, 2008

(PARIS) Ewa Filipiak, an economist who's been apartment-hunting in Paris for six months, has decided now is not the time to buy.

'It's a good time to wait and see - I think chances are getting better for finding something exceptional,' said the 29-year-old.

House price falls in Britain, Spain and Ireland have made headlines and now the slide has reached France. But several factors suggest the French market may prove more resilient than some, and Paris could even defy the trend.

People returning from August vacations who had become used to seeing a steady appreciation in the value of their homes were in for a shock when they unpacked their suitcases this year.

A national notary office report earlier this month showed existing home sales fell 25 per cent outside the French capital in the first half of the year, and Paris figures show transactions within the city's 'peripherique' ringroad dropped 20 per cent over the 12 months to June.

Nationally, average prices in France more than doubled in the decade to 2007. Now they're appreciating at their lowest rate in 10 years - and even falling in some areas - so buyers are holding back.

While 10 years of boom preceded the slowdown, in France, taxes and stricter banking rules had kept the rally more discreet than in more free-wheeling British and Spanish markets.

And just as the surge was less spectacular, so may be the slump, partly because mortgages are at fixed interest rates and cautious French households have kept debt in check.

Against a backdrop of stalling economic growth, tougher access to credit, record-low confidence and eroding purchasing power, sales data suggest falls could be right ahead.

Economist Alexandre Mirlicourtois from Xerfi consultancy predicts French prices will drop in coming months as the market corrects from years of rapid expansion, and as banks with weaker balance sheets tighten their purse strings. He estimates prices will drop nationally by 15 per cent before rising again in 2012.

HSBC France sees prices falling at an unspecified rate through 2009 before firming again in 2012.

Though prolonged, that may be less steep than in Spain, where some analysts expect homes could lose 30 per cent of their value in real terms over the next few years.

In Britain, data from the country's biggest mortgage lender HBOS showed prices already fell for the seventh month running in August to stand 12.7 per cent below year-earlier levels.

Realtors are also admitting signs of a shift.

'Prices have been disconnected from the economy, so now they're set to correct and return to reality,' said Rene Pallincourt, president of national realtors group Fnaim. Now, the general mood is one of worry, he said: slowing growth prospects are hitting real estate. Earlier this month, the government cut its 2008 growth forecast to about 1.0 per cent, from 1.7 to 2.0 per cent.

But several factors suggest price falls in France would be moderate. Mortgages are generally shorter than in the UK or the United States. A high birth rate generates regular, baseline demand. And then there's the debt factor. Most agree that Paris, propped up by the monuments, museums and leafy avenues so attractive to high-end buyers, is well positioned to avoid the worst of a market slump. -- Reuters

Rooms Going Fast And Furious? Well ...

Source : The Business Times, September 23, 2008

Only 3 out of 15 hotels report full occupancy during Grand Prix stretch

AS SINGAPORE hoteliers gear up for the nation’s first ever Formula 1 night race later this week, the initial euphoria about a potentially huge tourist windfall has given way to more realistic expectations.

Of the management teams at 15 hotels Today spoke to, only three — The Fullerton, Ritz Carlton and St Regis — report full occupancy for the Grand Prix weekend on Sept 26 to 28, but the rest have an average occupancy rate of 80 to 90 per cent.

Most of these hotels are up-market five-star lodgings, with nine of them “trackside” hotels located alongside the Grand Prix race circuit.

At least one hotel — Meritus Mandarin — expressed disappointment with the results.

Its director of marketing communications, Ms Lim Ee Jin, said bookings have not been “overwhelmingly high” as initially predicted.

Mr Jason Pereira, a senior associate at leisure sector consultancy Globalysis, said: “Given the current global credit crunch and economic uncertainty a year later, it is reasonable to expect a lower turnout than was anticipated previously as consumers globally hold back on spending.”

There have also been reports of hotels — from mid-range ones like York Hotel to five-star ones like Pan Pacific Singapore — slashing their rates, some by as much as 60 per cent, to boost demand and fill up rooms.

Others like The Royal Plaza on Scotts said it has removed the requirement for a minimum number of nights of stay, and is providing extras such as a free shuttle service from the hotel to the race circuit.

Still, industry experts said this is a good showing given the deteriorating economic mood in Singapore and other countries in the region. Some hotels — such as Fairmont Singapore and Marina Mandarin — said orders are still coming in and they expect rooms to be filled come race weekend.

Ms Chee Hok Yean, executive vice-president of Jones Lang LaSalle Hotels, thinks some hotels will hold rates steady and will be prepared not to hit full occupancy. “For them, it is a question of ‘what yield can I get out of it?’,” said Ms Chee.

“If I can get a high room rate at 90 per cent compared to a lower room rate at100 per cent, I’ll choose lower occupancy but at a higher rate because it is a strain on resources with no time for maintenance if every room is occupied.”

Ms Chee also noted that hotels lowering rates for the hyped-up period does not necessarily mean the hotel industry in Singapore is heading for a slump.

“Are they slashing from three times the normal rate that they would charge? They are probably slashing from that (initially) expected rate, which is still higher than, say, their average room rate for the year,” she said.

Ultimately, this is the first F1 event for Singapore, so hotels probably took some time to establish their rate structures for the period, said Mr Pereira.

While he said that hotels here have taken a cue on room rates from Monaco and Melbourne — two other cities which host F1 races — the best lessons they can learn is through studying the dynamics at play in this year’s event.

“Then, they can take action to better capitalise on the event in future years,” he said.

Economic Growth May Dip Below 4%

Source : The Straits Times, Sep 23, 2008

But Singapore's diversified economy will help it through, says minister

TRADE Minister Lim Hng Kiang said yesterday that economic growth may dip below 4 per cent this year, even as global financial markets try to turn the corner.

Mr Lim also addressed how the United States financial fallout has hit - and could further affect - Singapore.

'The financial difficulties in the US have led to de-leveraging and credit contractions, therefore slowing global growth,' said the minister, who was speaking to the media on the sidelines of the Latin Asia Business Forum 2008.

'That means more difficult export markets for Singapore companies and for our economy...later this year and going into next year.'

He added that he expects economic growth to be 'closer to 4 per cent, maybe even a bit below 4 per cent, depending on how the financial crisis pans out over the next few weeks and months'.

His forecast comes on the back of the Government's revision of its full-year forecast from 4 to 6 per cent previously to 4 to 5 per cent last month.

'We expect the economy to slow down - it's inevitable but we are confident...we are well-placed to ride this cycle,' said Mr Lim.

He said Singapore is 'as well-prepared for these difficulties as we can ever be' because of a well-diversified economy.

'We have our domestic economy to hold us up and we are also looking for other growth opportunities in Asia, Latin America and the Middle East.

'So we hope that with our exposures in different markets and diversification of different sectors...we will be able to ride through the difficulties.'

He also dismissed the notion that Singapore would slide into a technical recession - two consecutive quarters of negative growth. 'What is important for Singaporeans is whether we can keep the jobs going,' he said, adding that the Republic's 'very steady pipeline' of investments and different projects will keep generating jobs.

He also pointed to the possible benefits that could arise out of the ongoing financial system troubles: 'In every crisis, there will be opportunities but I wouldn't overplay the opportunities.

'Our first priority is to make sure we ride through this; that our ship is steady and that we continue to generate employment and Singaporeans are not too hard- pressed because of these difficulties.'

Mr Lim said that it was also fortunate for Singapore that China, India and the rest of South-east Asia are still 'holding up reasonably well'. 'And in Latin America, they are having fairly good growth at more than 5 per cent, so we should hitch on those opportunities there,' he added.

Working together with Singapore was one of the two key themes that dominated yesterday's main plenary discussion between government officials from Trinidad and Tobago, Peru, Brazil, Chile, Panama and Mexico. The other was the strong desire of the delegates to emulate Singapore's success as a gateway to Asia.

'We have already signed 57 free trade agreements and 97 per cent of our exports flow to those countries,' said the Chilean Vice-Minister for Finance, Ms Maria Olivia Recart Herrera. 'So like Singapore in Asia, Chile can be an open door to Latin and South America.'

Panama's Deputy Minister for Foreign Trade, Mr Severo Sousa, agreed: 'Yes, we too are often referred to as the Singapore of Latin America and that's because with our Panama Canal, we are really the gateway to the Americas.'

Peru, the latest Latin American nation to sign a free trade deal with Singapore - after Panama - cited similarities between Singapore and Peru in terms of how easy it is to run a business. 'Like Singapore, we give the same treatment to both foreign and local businessmen so as to facilitate more opportunities,' said the nation's Foreign Commerce and Tourism Minister, Ms Mercedes Araoz Fernandez.

The comments struck a chord with Mr Lim: 'That's our job in Government: To provide these opportunities to as many Singaporean companies as possible, be it in Asia, Latin America and the Middle East.'

SWFs Seen Raising Property Investment

Source : The Business Times, September 23, 2008

(SAN FRANCISCO) Sovereign wealth funds may increase investment in commercial properties to a net US$725 billion by 2015 as they diversify their holdings from stocks and bonds, according to CB Richard Ellis Group Inc.

The funds will probably raise the proportion of money they invest in real estate to 7 per cent from 4 per cent in the next seven years, the world's largest commercial-property broker said in a report published yesterday. Abu Dhabi, Norway, Saudi Arabia, Singapore and China have the largest funds, CB Richard Ellis said.

'The attraction of property is that it provides the yield of bonds and the appreciation of stocks,' Ray Torto, Boston-based chief economist for the broker, said. 'In a distressed environment, trophy assets become available.'

Commercial property prices are declining amid scarce financing and a slowing global economy. US real-estate values fell for the fourth straight month in June and are 12 per cent below their October 2007 peak, according to Moody's/REAL Commercial Property Price Indices.

European real-estate stocks have dropped 37 per cent since the end of 2006 and may fall another 10 per cent before recovering next year, JPMorgan Chase & Co analysts said on Sept 3.

As much as half of the property-related investments made by sovereign wealth funds will be on acquisitions of buildings and as much as 30 per cent will be put into private-equity funds and private real-estate investment trusts, the CB Richard Ellis report said. As much as 25 per cent will be invested in real-estate debt.

Until now, the funds have mainly purchased properties in the US and Middle East, according to the report. In future, they will probably spend more in countries with currencies that aren't held in the funds' foreign reserves, the report said.

Japan is attractive because its old buildings need to be replaced, and UK prices have already dropped to levels where the funds are interested in buying, Mr Torto said.

The spread in the US between selling prices and what buyers are willing to pay is still too wide to attract sovereign-fund investment, he said.

'They like big financial capitals,' Mr Torto said of the funds' interest in Tokyo and London.

'The question we've been kicking around is if New York City has tarnished itself badly over the last six months, but New York is resilient.' - Bloomberg

Bay Window, Planter Box Rule Change To Kick In Later

Source : The Straits Times, Sep 23, 2008


Grace period extended till Dec 31 to give firms more time to adjust

THE fate of the bay windows and planter boxes in private condominiums has been sealed, and homebuyers could see less of such features.

The Urban Redevelopment Authority (URA) is standing by its decision to abolish the exemption of such features in gross floor area (GFA) calculation.

But a recent appeal by the Real Estate Developers' Association of Singapore

(Redas) has prompted the agency to give property firms more time to adjust.

It has extended the grace period until Dec31. The new guidelines were originally meant to take effect from Oct7. With the extension announced yesterday, any application made by developers before Jan 1 will still be considered under the old guidelines.

'We have received feedback from the industry that many projects are at advanced design stage using the (old) guidelines, and a longer grace period would be very useful,' said URA development control division director Han Yong Hoe.

Bay window and planter boxes, which often make up about 5 per cent of a condo's saleable area, used to be exempt from GFA calculations. But developers who provided such features could charge buyers for it as it was built as part of a unit.

The URA caught the industry by surprise on July 7 when it stated that the features would no longer be exempted from GFA calculations, starting from Oct 7. It was reported at the time that the move would close a 'loophole' that developers had been exploiting and profiting from.

Developers such as UOL Group and City Developments have since refuted suggestions that they have been getting free GFA, pointing out that the value of these features was calculated in the bidding and pricing of land.

Mr Han said yesterday that the URA's regular rules review found that the original objectives for GFA exemption were not being met.

The GFA exemption for bay windows was to give developers incentives to introduce desirable building features, and add 'articulation' to otherwise 'flat- or boring-looking' buildings.

But the URA said that even with the GFA exemption for such windows, building facades could still look plain.

It also said that bay windows were contributing to the air-conditioning load and making buildings less energy-efficient.

Planter boxes were introduced to provide greenery and visual relief to high-rise condominiums.

But the URA found that less than 10 per cent of planter boxes were actually used for greening purposes. And those not used created maintenance issues, including mosquito breeding. Many were also illegally converted into balcony space or living room extensions, said the URA.

Mr Han said the change might even encourage more unique residential projects, as architects were no longer obliged to include these features in all buildings.

On whether the new guidelines would affect future bidding prices for land - a possibility highlighted by some property analysts - Mr Han said land prices depended on many factors, and it was hard to say whether this factor alone would 'have an effect on the bid price'.

Redas executive director Chia Hock Jin said the association was discussing the latest development.

Old Bay Window Rules Valid For 3 More Months

Source : The Business Times, September 23, 2008

Deadline extended as many projects are at advanced stage of design, says URA

The Urban Redevelopment Authority (URA) will extend by three months the deadline for submission of provisional permission (PP) applications for new developments based on existing bay window and planter box guidelines.

URA said yesterday it has received feedback from developers that many projects are at an advanced stage of design using the old bay window and planter box guidelines.

The deadline for PP submissions was originally Oct 6 but developers asked for a longer grace period, URA said. The deadline has therefore been extended to Dec 31.

On July 7, URA announced that developers would have to include bay windows and planter boxes in total gross floor area (GFA) calculations. Previously they were exempt.

URA says bay windows are increasingly treated as internal floor space and few home owners use planter boxes for plants. The change in the guidelines is not expected to have a big impact on on-going projects. URA said that since the announcement there has been no 'spike' in PP submissions.

When the change was announced, the industry responded by saying that with no incentive to provide bay windows or planter boxes, buildings would start looking 'flat'.

But TID, which won the tender for a residential site next to Tanah Merah MRT station in September, said that despite the withdrawal of the GFA incentive, it has 'included bay windows and planter boxes in the design as it enhances livability'.

A spokesman for TID, a partnership between the Hong Leong Group and Japanese real estate company Mitsui Fudosan, said: 'With the extension of PP submission deadline, TID will have more time to finalise its proposal.'

Another aspect of the extension is that developers who priced in the GFA incentive when they bid for sites will now have more time to make submissions so their breakeven costs stay on track.

For a consortium led by Hoi Hup Realty, which won the tender for a Housing and Development Board Design, Build and Sell Scheme site at Lorong 1A Toa Payoh in August, submitting a PP application before the deadline could mean slightly lower prices for buyers. A Hoi Hup spokesman said launch prices could be 5-10 per cent lower than they would be without the GFA incentive.

URA is open to reviewing the new guidelines in a couple of years. 'The industry could possibly come up with innovative designs in response to the revised guidelines,' it said.

WPP Leases All Of Scotts Rd Project

Source : The Business Times, September 23, 2008

Advertising PR giant said to be paying about $8 psf monthly rental

International advertising, communications and marketing giant WPP has leased an entire office development to be built on a transitional site at Scotts and Anthony roads, BT understands.

The transitional site: Housing various businesses under the WPP banner, such as Bates, JWT, Y&R, Burson Marsteller, Hill & Knowlton and Enfatico, at the new location will generate greater synergy

The four-storey structure, next to Newton MRT Station, will have about 130,000 square feet of offices and 135 parking spaces. It is slated for completion in about a year.

Various businesses under the WPP banner here - such as Bates, JWT, Y&R, Burson Marsteller, Hill & Knowlton and Enfatico - will be consolidated under one roof.

But Ogilvy group, also part of WPP, is expected to continue to operate from its current premises at Ogilvy Centre in Robinson Road.

WPP is said to have signed a 14-year lease on the Scotts Road building, which is going up on a 15-year leasehold site sold this year by the Urban Redevelopment Authority.

BT understands that WPP will pay gross monthly rent of about $8 per sq ft (psf).

The deal is believed to have been brokered by Cushman and Wakefield, which declined to comment.

The project is being developed by Sun Venture (S) Investments, a subsidiary of interior design and building company DB&B (Singapore) Developments, which paid $226 psf per plot ratio for the 97,284 sq ft site in a state tender that closed in late April this year.

Sun Venture general manager Alvin Teo would say only that 'the building has been fully leased for a full 14-year term to a global firm', without confirming that WPP is the tenant.

The project is next to another transitional office site, also sold in April, to stockbroking firm UOB Kay Hian, which has said that it will occupy the project on the site.

The two sites are opposite a project completed recently by Scotts Spazio on the maiden transitional office site sold by URA last year. Prudential has leased all 150,000 sq ft of office space in that development under a deal arranged by CB Richard Ellis.

CBRE executive director Moray Armstrong said of the latest deal for Sun Venture's project: 'We understand a single end-user has been in negotiation for the -property. This demonstrates there is still an active leasing market for well-located office developments, despite the cooling business climate.'

URA Office Site For Sale

Source : The Straits Times, Sep 23, 2008

A TRANSITIONAL office site, with direct frontage along Mountbatten Road, has been put up for sale by public tender on Tuesday.

The Urban Redevelopment Authority (URA) said the site is one of the three commercial sites to be sold through the confirmed list under the Government Land Sales Programme for the second half of this year.

The site is being tendered out for use as a transitional office building. It has a site area of about 1.17 ha and a maximum permissible gross floor area of about 11,739 sq m.

The site is sold on a short-term lease of 15 years. The office building on the site is expected to be a low-rise development of up to three storeys that can be built quickly in about a year.

SLA Reaps $12.4b In Sales

Source : The Straits Times, Sep 23, 2008

THE property market might not be red-hot at the moment, but the bullrun last year was enough to send sales revenue at the Singapore Land Authority (SLA) shooting to a ten-year high of $12.4 billion.

This was a two-fold increase from the $6.2 billion achieved in the 2006 financial year, and is just shy of the record set in 1997, when sales revenue climbed to $14 billion.

SLA's annual report, released on Tuesday, showed that land sales proceeds from the private sector hit a new record of $10.4 billion, compared to $3.5 billion for 2006, and $6.9 billion in the last property peak in 1997.

Land sales to the public sector dropped slightly to $2 billion, from $2.7 billion collected in 2006.

SLA's 2007 financial year, which ended March 31 this year, was marked by strong demand for office, hostels, international schools and other commercial uses.

To meet this surge in demand, the agency rolled out 78 tenders - an average of one every 4.5 days - an 8 per cent increase from 2006.

SLA's chairman Greg Seow also announced on Tuesday that SLA will focus on a new initiative in the coming year: Establishing a national spatial data infrastructure to support geographic information exchange across government agency networks

'This initiative is significant as it aids in both strategic planning and operations for the appropriate agencies. It will also demonstrate a government-wide approach to problem solving and resource sharing.'