Private developers will have a variety of sites to choose from by first half of 2010, says Mah

There is no need to rush to buy homes, now that a slew of land parcels will be released to private developers in the first half of next year.

That was the assurance given yesterday by National Development Minister Mah Bow Tan.

Similarly, he assured developers that they will have a variety of sites to choose from, with some up for grabs as early as January.

He was speaking to reporters a day after the Government announced that at least eight residential sites – and as many as 26 – will be offered to developers.

It made the move to allay fears of a shortage of homes in the private property market that may have sent prices surging to levels seen in the previous boom.

Five of the 26 sites are for executive condominiums, to cater to the ’sandwiched group’, Mr Mah said.

These are people who do not qualify for new HDB flats because they earn more than the $8,000 monthly income cap, but who may find private property too expensive.

The 26 sites could yield 10,550 private homes, the most from half-yearly government land sales since the second half of 2001.

Mr Mah said: ‘It sends a signal that there is ample supply, and if the demand is high, we are able to meet this demand by releasing more land.’

Another 60,000 units are also in the pipeline and have yet to be sold, he pointed out.

‘So no need to panic, no need to rush. Just take your time, look around, and you will find a home that’s suitable for you and that is within your budget,’ he said.

Earlier, Mr Mah presented certificates to 41 newly registered professional engineers, at an annual event to recognise the contributions of such professionals.

In his speech, he identified two challenges facing engineers.

One is to find ways to make buildings environmentally friendly and adopt sustainable construction practices, such as using more recycled materials.

Another challenge is to advance the construction industry through innovation, such as the prefabrication technology used to build the 50-storey residential towers at Pinnacle@Duxton.

Mr Mah also recognised the Professional Engineers Board’s efforts to promote the profession as a lifelong career.

New blood is needed, he pointed out, as six in 10 professional engineers with practising certificates are aged 50 or above.

Source : Sunday Times – 8 Nov 2009

A FORMER CapitaLand executive has stitched together a $247.55 million deal to snap up Katong Mall.

Mr Pua Seck Guan (right) set up a private trust called Perennial Katong Retail Trust to buy the mall from Tuan Sing Holdings’ Golden Cape Investment. The investors are no more than six parties, including corporate and institutional investors and Mr Pua.

The seven-storey centre, in a fairly affluent neighbourhood at the junction of East Coast and Joo Chiat roads, will undergo a $55 million revamp lasting 12 to 15 months.

This will transform it into a lifestyle and food and beverage hub, said Mr Pua, who was chief executive of CapitaLand Retail before stepping down a year ago.

Tuan Sing bought the mall en bloc for $219 million last July.

Mr Pua said this deal started about three weeks ago when ’some one approached me’.

‘After pumping in the upgrading cost, the returns can be attractive,’ he said, adding that the expected net property yield after completion will be about 6 per cent to 8 per cent.

Its gross floor area will be relatively unchanged at 282,000 sq ft after redevelopment works.

But its net lettable area will rise from 172,170 sq ft to over 206,000 sq ft, said a statement from Perennial Real Estate.

The revamp will add 99 more carpark spaces to make a total of 278. These will be on basements two and three. About 30,000 sq ft of retail space on basement two will then be relocated to more prime areas on the upper floors as well as a newly created fifth floor – now the rooftop.

A cinema will occupy the top floor, while anchor tenants will include a food court and gourmet supermarket, said the statement.

BreakTalk has expressed interest in leasing space at the mall.

Mr Pua is the founder and CEO of Perennial Real Estate but still heads the international operations at Indian real estate giant DLF, which he joined after leaving CapitaLand.

Apart from asset management, he is looking to put together a fund at DLF as well a real estate investment trust for the firm’s India assets. He said the DLF job ‘allows him to be more entrepreneurial’.

More plans are in the pipeline for Perennial, formed to engage in real estate activities, including fund and asset management and retail management in Singapore, India and China, he said.

The Katong Mall transaction is expected to be completed by the end of January. The mall is likely to close around the middle of next year for renovation works.

Source : Straits Times – 10 Nov 2009

Singapore-listed Ascendas India Trust said that two of its subsidiaries have obtained term loan facilities amounting to around S$74 million from DBS Bank.

The facilities will mature in December 2015 and carry an interest rate of 10 per cent a year. They will be used to fund the construction of a retail mall development in Bangalore and a multi-tenanted building development in Chennai.

The property trust said that up to this point, the ongoing construction of these two projects has been financed by its existing debt and cash.

In addition, Ascendas India trust also issued two series of three-year senior unsecured fixed rate notes totalling S$60 million. The notes come under its S$500 million multi-currency medium-term note programme, and were arranged by DBS Bank and Standard Chartered Bank.

The proceeds will be used to fully fund the development of a multi-tenanted building in the International Tech Park, Bangalore, as well as to meet working capital requirements.

The loan facilities coupled with the notes issuance are expected to raise the trust’s gearing level to around 20 per cent, from 13 per cent as of September, assuming no upward revaluation of its properties.

Source : Channel NewsAsia – 10 Nov 2009

Property cycles hard to predict
But the Government will do its best to avoid boom-bust cycles, says FinanceMinister
By Fiona Chan
PROPERTY cycles are hard to predict, but the Government will try to avoidboom-bust cycles, said Finance Minister Tharman Shanmugaratnam yesterday.’We will keep our eyes on the ball and use all the tools at our disposal,but in a calibrated fashion,’ he told about 80 business leaders at a forumto garner feedback for the Economic Strategies Committee. Mr Tharman isheading this committee to look into new ways for Singapore to grow.The Government will probably not use ‘macro tools’ to manage propertycycles, such as changing interest rates or exchange rates, because theserates have many other effects such as on businesses as well, said Mr Tharmanin his concluding remarks at the forum.But there are other options. These include tweaking rules on credit,adjusting land supply and – in extreme situations – amending tax policies,he said.Two months ago, the Government introduced measures to help cool the propertymarket, including removing the interest absorption payment scheme andsignificantly increasing land supply.On Monday, the Monetary Authority of Singapore also highlighted thepossibility that additional cooling measures may be needed if there is arenewed surge in property speculation.’We do want to manage the property cycle as best we can, prevent boom andbust,’ said Mr Tharman, adding that this is not easy as it is difficult toanticipate Singapore’s property needs four or five years in advance. As forbroader economic cycles, Singapore will always be exposed to ups and downsbeyond its control, he said. ’As a city, and a global city at that, we will always be subject to globalcycles in specific industries as well as the global macro cycle,’ he said. The important thing is to achieve good average growth over the cycle, ratherthan go for a lower growth path to avoid volatility, said Mr Tharman. ‘Ifyou try to dampen all volatility, you usually end up with a lower average aswell.’ The unusually strong growth that Singapore enjoyed in 2006 and 2007 helpedpull the average growth across the most recent business cycle up to 5 percent, he added. Without this, wage growth in particular would have beenweak.So Singapore should opt for a path of good growth in incomes, but prepareits businesses and workers well for occasional shocks and respond quicklywhen they come, said Mr Tharman.Singapore has ‘not come out too badly’ in the downturn in terms of itsability to buffer companies and employees and to prepare for recovery, hesaid. But for its next growth phase, the country must undergo a ‘stepchange’. What are needed are higher skills, higher productivity and a higherlevel of expertise across the board. Singapore could not engage in strategies of the industrial policy type, thattry to plan well ahead of the market. But it moves quickly to identifyemerging market trends and work with early adopters to develop clusters ofreal strength, Mr Tharman said. One advantage that Singapore can use is its diversity of both people andcompanies. This will prove a big boon in an age where the Asian consumer isexpected to be a key driver of economic growth, Mr Tharman said.’In Singapore, you can get a feel of what is happening all around Asia… asense of what the emerging drivers

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