CapitaLand Reaps $163m Gain From Capital Tower Beijing Sale

Source : The Business Times, September 4, 2008

Net cash flow of $498m; plan to redeploy capital for more developments

CAPITALAND has entered into a share purchase deed for the sale of its indirect wholly owned subsidiary Hua Lei Holdings, which indirectly owns 100 per cent of Capital Tower Beijing.

Many offers: The tower's buyer is a Fortune 500 company that hopes to set up its HQ in Beijing

In a statement yesterday, CapitaLand said the consideration of US$352 million takes into account the assignment of a shareholder's loan of US$166 million and values Capital Tower Beijing at US$488 million.

CapitaLand said it will obtain net cash flow of about $498 million and expects to recognise a gain of $163 million. It said Capital Tower Beijing had been intended as a core long-term asset and the divestment following an unsolicited offer will allow it to redeploy the capital to undertake more developments in China.

The divestment is CapitaLand's second in less than a week.

On Friday last week it announced that it would divest its 30 per cent stake in Inverfin - whose principal asset is Menara Citibank in Kuala Lumpur - to IOI Corporation for RM586.7 million (S$244.6 million). It said it would recognise a gain of $22.1 million.

Capital Tower Beijing was completed in 2006. CapitaLand said it received unsolicited offers from 'several prospective investors' but would only say that the buyer is a Fortune 500 company that hopes to set up its headquarters in Beijing.

It is understood that CapitaLand has its Beijing office in Capital Tower Beijing and has no plans to move.

CapitaLand president and CEO Liew Mun Leong said: 'This transaction fully demonstrates CapitaLand's skill-sets and expertise in adding value to real estate projects and its ability to unlock value for shareholders despite current volatile financial markets.'

CapitaLand said Capital Tower Beijing had been intended as a core long-term asset, but that divestment will allow it to redeploy the capital to undertake more developments in China.

Separately, CapitaLand subsidiary Australand said yesterday that it has completed the final phase of its non-underwritten one-for-one entitlement offer, raising A$461 million (S$553 million). It said 769 million new stapled securities will be allotted under the offer at A$0.60 apiece.

In July 28, CapitaLand said it had given an unconditional commitment to subscribe for its 54.2 per cent pro rata entitlement.

This comprised 502,772,610 stapled Australand securities, for a total of A$302 million.

Following the completion of the entitlement, CapitaLand now holds 59.3 per cent of Australand.

Growth Forecasts Get Another Trimming

Source : The Business Times, September 4, 2008

Construction sector, financial services buck trend but GDP predictions bleak

While they have slashed their forecasts of manufacturing and overall GDP growth, economists are apparently looking to better numbers in the construction sector and financial services this year.

The Monetary Authority of Singapore (MAS)'s latest poll of economists shows that they have cut their forecasts of Singapore's 2008 GDP growth to a median 4.2 per cent, down from 5.5 per cent in the previous poll three months earlier.

But most of the GDP forecasts from the poll are basically out of date, as the survey was done in the second week of August, just after the Q2 economic results were released.

The poor figures - GDP grew 2.1 per cent in the quarter, and contracted 6 per cent against the preceding Q1 - prompted a round of cuts to the growth forecasts, as the official projection itself was at the same time revised down to 4-5 per cent. A Ministry of Trade and Industry official even specified the 'lower half' of the range.

And in the weeks since, following the release of dismal July industrial production data - output fell almost 22 per cent - economists have cut their forecasts further. The market consensus of Singapore's 2008 GDP growth has gone below 4 per cent, with some economists at just above 3 per cent.

So, chances are, current market forecasts could be as much as one percentage point lower than indicated in the MAS poll.

In any case, the 20 economists who responded to the poll last month slashed their estimates of manufacturing growth (to just one per cent for the full year) but forecast higher for not only construction and financial services, but also wholesale and retail trade, as well as private consumption.

The construction sector is now expected to grow 15 per cent this year (up from sub-12 per cent), and financial services 11 per cent (from an earlier forecast of 9 per cent).

The economists also forecast 2.7 per cent GDP growth in Q3, and 4.8 per cent in Q4, although these too may likely be on the low side now.

United Overseas Bank economists yesterday said the risks of a technical recession here - if Q3 also sees negative GDP numbers on a q-on-q basis - have risen following July's manufacturing slump.

All eyes will be on the August industrial production figures, due to be released towards the end of September. Another output slump and chances of a 'manufacturing-led technical recession' will surge, with possibly yet another round of cutbacks to the full-year GDP number.

Property Transactions With Contract Dates Between Aug 18th - 23rd, 2008

China Banks Urged To Monitor Exposure To Property Sector

Source : The Business Times, September 4, 2008

(BEIJING) China's banking regulator has urged lenders to stress-test the impact of a cooling real estate market and to set aside more cash to cover potential losses from property loans, local media reported yesterday.

'Banks must closely monitor changes in the real estate market and seek to limit the impact on them from the difficulties the property industry is facing in raising funds,' the Beijing Times quoted Liu Mingkang, head of the China Banking Regulatory Commission, as saying.

China's banks have cut lending to the property sector, especially since late last year, in the face of stringent lending quotas and stagnant property prices in some markets.

They provided 398.8 billion yuan (S$83.6 billion) in new loans to property developers and home buyers in the first half of this year, down 30 per cent from a year earlier, according to figures from the central bank. Total loans to the property sector accounted for 18 per cent of Chinese banks' local currency lending by the end of June, at 5.2 trillion yuan.

Mr Liu urged banks to carry out thorough estimates of their exposure to the sector and set aside more provisions to fend off systemic risks to the banking industry.

China's property market has entered a downturn after a raft of government measures to rein in excessive price rises and investment growth. In the southern city of Shenzhen, 1.7 billion yuan in mortgage loans had turned sour by the end of June, up 13.8 per cent from the start of the year, the People's Daily reported. -- Reuters

卖北京凯德大厦 嘉德置地赚1.63亿

Source :《联合早报》September 4, 2008

嘉德置地（CapitaLand）以4亿9800万元的价格脱售北京凯德大厦（Capital Tower Beijing）股权给Sky Property Management，赚取1亿6300万元的利润。

嘉德置地已正式签署股票购买契据（share purchase deed）脱售其独资子公司华磊控股（Hua Lei Holdings），华磊控股拥有北京凯德大厦100％的股权。这项交易将在今年底完成。

嘉德置地将位于北京市中心长安大街的北京凯德大厦脱售，以便取得足够资本在中国发展其他项目。（档案照片)

北京凯德大厦的估价为6亿9100万元，买方购买这栋楼后将承担2亿3500万元的债负。

位于北京市中心长安大街的北京凯德大厦有两座楼高35层的办公大楼，总楼面10万7627平方公尺，临近紫禁城，中国国家大剧院及中国政府部门，目前的占用率为83％，租户包括许多跨国企业。

嘉德置地总裁廖文良表示，集团在2005年大厦还在兴建阶段时买下它，期望能将大厦发展成为世界一级的大楼。自大厦在2006年竣工后，大厦成功吸引不少国际大公司落户，集团因此也收到一些投资者的主动收购献议。

凯德置地总裁林明彦则表示，集团原本计划将北京凯德大厦列为长期核心投资项目之一，如今改变主意是因为这项交易将为集团提供资本，在中国进行其他发展项目。他指出，Sky Property Management有意在北京设立公司总部。

嘉德置地上个月曾宣布将4项在中国的商业大楼项目脱售给集团之前设立的私募股权基金——来福士（中国）基金。

嘉德置地股价昨晚闭市时报4.28元，下滑17分。