Marina Bay Taking Shape

Source : The Straits Times, April 21, 2009

MORE than $22 billion of investments have been pumped into transforming Marina Bay and the vision of a prime waterfront location for living, working and playing is steadily taking shape.

The transformation of the Marina Bay area is progressing on schedule. --PHOTO: ZAOBAO

'In one or two years' time, this bay will be alive with people, with activities, festivities and it's a testimony to the foresight of the people who started developing this area many, many years ago,' said National Development Minister Mah Bow Tan after touring key sites on Tuesday.

The immediate vicinity of Marina Bay will be ready 'for people to enjoy in a couple of years' time', he added.

The development of the entire Marina Bay area - Singapore's most ambitious urban transformation project - is expected to be completed in 10 to 15 years.

Yet the groundwork for the expansion of the existing Central Business District started back in the late 1960s. The new downtown comprises 360ha, which was reclaimed in phases from 1969 to 1992.

Plans started in earnest about 10 years ago when the area was first developed. The first site was put up for sale in 2004.

The transformation of Marina Bay into Singapore's new downtown is part of a bigger plan to remake the city and turn it into an exciting, liveable global city.

Mr Mah reiterated that the plans are going ahead in spite of the economic crisis. 'As a Government, we must be able to look farther ahead and we must be willing to invest,' he said.

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

Abu Dhabi's Aldar Launches Mid-Income Housing

Source : The Business Times, April 21, 2009

(ABU DHABI) Aldar Properties , the largest real estate developer in Abu Dhabi, is launching a 9.4 billion UAE dirhams (S$3.85 billion) mid-income housing project and the government signalled more could follow. The Al Falah project will be fully funded by the Abu Dhabi government and would be delivered in stages starting from 2011 to 2014, Aldar said on Sunday.

'This project signals the emphasis we will place this year and next in building more mid-income housing projects because there is a requirement for it from UAE nationals,' Aldar chairman Ahmed al-Sayegh told reporters. A section will be made available for expatriates, he added.

Abu Dhabi is facing a housing shortage that has driven up rents and stoked inflation as an oil price boom attracted expatriates faster than new homes could be built, but inflationary pressures have subsided since the global economic crisis spread and hit oil prices. -- Reuters

Dubai Home Prices Fell 42% In Past 6 Months

Source : The Business Times, April 21, 2009

(DUBAI) Dubai house prices have fallen as much as 42 per cent in the past six months and are likely to drop further as new homes are completed amid waning demand in the Persian Gulf business hub, Colliers CRE plc said.

Gloomy outlook: Prices are expected to decline even as estimates for the number of new homes coming onto the market are revised lower, to about 64,800 units between now and the end of 2011

Prices will decline even as estimates for the number of new homes coming onto the market are revised lower, to about 64,800 units between now and the end of 2011, the property adviser said yesterday in an e-mail report. It had previously estimated 140,000 new units by the end of 2010.

It's 'reasonable to assume that as new stock continually comes online that the downward trend in the market will continue throughout 2009 and is unlikely to stabilise before the second- quarter of 2010', Ian Albert, the firm's regional director, said in the report.

The worst financial crisis since the 1930s has weakened the real-estate market in Dubai as banks curtailed mortgage lending and speculators pulled out. Expatriates who were fired by companies trying to weather the global recession are being forced to leave the country because of visa restrictions, Colliers said.

The rest of the Gulf, richer than Dubai in oil and gas wealth, is suffering less as crude prices lost almost US$100 a barrel from their US$147.27 peak last July. Abu Dhabi, capital of the UAE and holder of most of the country's oil and gas reserves, remains undersupplied with houses.

It already lacks 70,000 homes and will require more than 120,000 new units by the end of 2012, the report said. Doha, the capital of gas-rich Qatar, is also short of homes as its population rose by almost 40 per cent last year to 1.6 million. Some 9,000 apartments will be ready by the end of 2010, according to Colliers. -- Bloomberg

Ground Zero Projects May Be Put On Hold

Source : The Business Times, April 21, 2009

(NEW YORK) Construction of several office towers at the World Trade Center site could be put off for decades because of the failing real estate market, the site's owners said on Thursday.

An analysis projected that one skyscraper might not be built and occupied until 35 years after the Sept 11, 2001, attack which destroyed the complex. Developer Larry Silverstein and the Port Authority of New York and New Jersey have been talking on and off for months about rewriting a three-year-old agreement that gives the developer rights to build three out of five towers planned for the site.

Mr Silverstein, unable to obtain financing for all the towers and with only about US$1 billion left in insurance money to pay for them, asked the Port Authority last fall to guarantee financing for two of his towers, officials familiar with the negotiations say.

The Port Authority agreed to back one tower already under construction, where the government agency has agreed to move once it's built.

Executive director Chris Ward on Thursday cited the exodus of major financial firms like Merrill Lynch and American International Group from downtown Manhattan as a reason not to flood the market with 10 million square feet of office space at the same time - about 2013.

Mr Ward also said that Mr Silverstein was free to build his three towers on his own.

'Mr Silverstein is asking the public sector to finance, in fact, his buildings,' Mr Ward said. Mr Silverstein 'is seeking the Port Authority's capacity to finance office space downtown'. Janno Lieber, who oversees the trade centre site for Mr Silverstein, said on Thursday that guaranteeing financing for Mr Silverstein's towers would help generate commercial rents the Port Authority could collect for the 90 years remaining on Mr Silverstein's lease.

'Most important, from a public standpoint, this allows the Port Authority to honour its commitment to rebuild lower Manhattan - a promise that the agency has made many times since 9/11,' he added.

The Port Authority is building a 1,776-foot skyscraper, commonly known as the Freedom Tower, that is set to open in 2013.

It has no beginning or completion date for a second tower that it is responsible for building. Mr Silverstein's other towers should be built whenever the market improves, Mr Ward said. The Freedom Tower and Silverstein's three planned towers - designed by architects like Lord Norman Foster and Richard Rogers - are all expected to be among the city's tallest towers.

But an analysis prepared for the Port Authority by the Cushman & Wakefield real estate brokerage projected that while two of Silverstein's towers could be built by 2013, a third wouldn't be built until 2030 and fully leased until 2036.

A second tower that hasn't been built yet wouldn't be fully leased until 2025, the analysis said.

Mayor Michael Bloomberg, who has committed city office space to the one tower the Port Authority agreed to back, said Thursday the 2036 date is 'just a number out of the blue'. 'My hope is that things will get done a lot quicker . . . The problem is that you sort of have to do everything or at least part of everything because if you don't, then nothing works.'

The lease requires Mr Silverstein to build his three towers by 2013 or forfeit rights to them. -- AP

City Of London Office Rents Plunge 38%

Source : The Business Times, April 21, 2009

It is now not among Europe's top three most expensive office locations

(LONDON) The City of London has been knocked out of Europe's top three most expensive office locations by Geneva and Paris, research by property consultants NB Real Estate and ONCOR International showed yesterday.

Flagging: City of London rents are now 157 euros cheaper per square metre than in the Triangle d'Or area of Paris, which is often compared with London's Mayfair district

Average office rents in the City business district - Britain's historic financial heartland - have fallen 38 per cent in the last 12 months to 593 euros (S$1159.30) per square metre, making it Europe's sixth-most expensive office district.

City of London rents are now 157 euros cheaper per square metre than in the Triangle d'Or area of Paris, the neo-classical neighbourhood between the Champs-Elysees and the River Seine, which is often compared with London's Mayfair district.

The West End of London remains the most expensive office district in Europe despite experiencing the largest fall in office rents in the past year, with 45 per cent wiped off its office rental values to 961 euros per square metre.

Office rents in Moscow and Geneva, Europe's second and fourth-most expensive business locations, are now 873.3 euros and 623.1 euros per square metre respectively. Dublin takes fifth spot, with average rents of 600 euros per square metre.

Geneva and Zurich saw the biggest growth in rents in the last 12 months, the report said.

Geneva has seen a 14.6 per cent increase in the rental cost of office space and Zurich a 5.5 per cent increase in rents.

'Swiss banks may have taken the axe to their London-based investment banking operations but as a whole their private banking sector has held up relatively well,' said James Crisp, director at NB Real Estate.

'Whilst the City of London and the West End now have a substantial overhang of spare office space, that does not seem to be the case in the major Swiss cities,' he added.

Less than half the 16 European office locations covered by the report posted growth in rents in the past year, the weakest overall performance since 2004.

With the exception of London, Moscow office rents suffered the largest fall in Europe in the last 12 months, dropping 15 per cent on average.

'Rents for prime offices in Moscow are still among the most expensive in Europe - how well Russia deals with its latest economic crisis will determine whether it stays in that position,' Mr Crisp said. 'Depreciation of the rouble suggests rents have further to fall,' he said. -- Reuters