Monday, 8 October 2012

News Update - 8 Oct 2012


RESIDENTIAL MARKET
MAS imposes cap on housing loan tenures
Singapore regulators signalled their concerns over still rising home prices yesterday, announcing fresh mortgage curbs to cap upward price pressures caused by low interest rates and fast credit growth.
The Monetary Authority of Singapore (MAS) said it will set an absolute limit of 35 years on the tenure of all residential property loans - both new loans and refinancings. It will also lower loan-to-value (LTV) ratios for new loans with a tenure of more than 30 years. The new rules will apply to both private homes and HDB flats and will take effect today.
"Monetary conditions worldwide are far from normal," said Deputy Prime Minister Tharman Shanmugaratnam, noting that the latest round of quantitative easing (QE3) in the United States and low interest rates have made credit easy, though this will eventually change.
"We are taking this step now to require more prudent lending, and will continue to watch the property market carefully," said Mr Tharman, who is also Finance Minister and MAS chairman. "We will do what it takes to cool the market, and avoid a bubble that will eventually hurt borrowers and destabilise our financial system."
The new rules - Singapore's sixth round of cooling measures - look set to affect not just home buyers and existing owners looking to refinance their mortgages, but also property developers and banks.
According to the central bank, over 45 per cent of new home loans have tenures exceeding 30 years.
MAS will cap the tenure of all new residential property loans at 35 years
For refinancings, the tenure of the refinancing facility and the number of years since the first home loan for that property was disbursed cannot add up to more than 35 years.
Also, MAS will lower the LTV ratio for new home loans to individual borrowers if the tenure exceeds 30 years, or the loan period extends beyond the retirement age of 65 years.
The LTV will be 60 per cent for a borrower with no outstanding residential property loan, compared with 80 per cent previously, and 40 per cent for a borrower with one or more outstanding home loans, compared with 60 per cent before the new rules.
For non-individual borrowers, the LTV ratio for home loans will be lowered to 40 per cent from 50 per cent.
The MAS move comes after the Hong Kong Monetary Authority announced a 30-year limit on the maximum term of all new mortgages last month, following the launch of QE3. With the Federal Reserve looking to pump US$40 billion into the US economy each month until sustained jobs growth kicks in, worries about hot money inflows into Asia and asset price inflation have again emerged.
Stretched tenures
Previous rounds of cooling measures had a moderating effect on home prices in Singapore, and a significant supply of housing will also come onstream in the next two years, MAS noted. "However, prices in both the HDB resale market and private residential property have continued to rise in Q2 and Q3 of 2012."
According to official flash estimates on Monday, HDB resale prices rose 2 per cent in Q3 from Q2, while private home prices gained 0.5 per cent over the same period. Separately, the SRX Residential Property Flash Report yesterday showed resale prices of non-landed private homes rising 3.2 per cent in Q3.
Low interest rates globally and locally are likely to persist and will continue to spur residential property demand, pushing up prices beyond sustainable levels, MAS warned, stressing that "the eventual correction could be painful to borrowers and destabilise the economy".
Meanwhile, financial institutions have stretched the durations of home loans, and long tenure loans pose risks to both lenders and borrowers, the central bank said. The average tenure for new residential property loans climbed to 29 from 25 years over the last three years, it revealed. Also, more than 45 per cent of new home loans granted by financial institutions have tenures exceeding 30 years.
Lower initial monthly repayments from long loan tenures and low interest rates may cause borrowers to overestimate their loan servicing ability and take a bigger loan than they can afford, MAS said. In fact, long tenure loans create a larger debt repayment burden as interest accumulates over a longer period.
"When interest rates eventually rise, borrowers who have overextended themselves will have difficulties repaying their loans," MAS said. "If property prices fall, financial institutions may be caught holding the bad loans."
Banks which offer home loans with a tenure of over 35 years will feel the impact of the new rules almost immediately. DBS and OCBC are among those providing mortgages stretching up to 40 years.
"We will reduce our existing maximum home loan tenure of 40 years to 35 years, with immediate effect," said OCBC group corporate communications head Koh Ching Ching.
A DBS spokeswoman said that most of the bank's home loans have a tenure of under 35 years. "It will take some time to ascertain the impact of the new measures while homebuyers assess the market."
Resale impact
United Overseas Bank (UOB), which introduced 50-year housing loans in July, did not respond to media queries. Some market watchers then had questioned if the product would cause borrowers to overextend themselves, and National Development Minister Khaw Boon Wan subsequently called it a "gimmick".
Maybank said its maximum loan tenure for home loans is 35 years. "With an ageing population and couples marrying and setting up home at a later age, the new rules will have impact on these segments," said Alan Yet, head of lending (consumer banking) for Singapore.
The jury is out on how the new rules will affect the residential property market. The Real Estate Developers' Association of Singapore (Redas) does not expect a significant impact. "Based on past experience, not many buyers take long tenure loans," it said. Just last week, Redas said the property sector does not need more cooling measures - at least not before a thorough review of the impact of earlier policies.
Source: Business Times – 6 October 2012
 
Mortgage limits may deter older investors
The latest changes to mortgage rules could deter many house-hunters from buying a new property - or at least give them serious pause, analysts and property market watchers said yesterday.
Chief among this group will be older investors looking to buy a second or third investment property, they noted.
And HDB upgraders who want to get on the private property ladder will also not be spared.
From today, the Monetary Authority of Singapore (MAS) will cap all new housing loans at a maximum allowable tenure of 35 years.
Tighter rules will also apply to borrowers taking loans longer than 30 years, or have their loan periods extend beyond the retirement age of 65.
If they have no outstanding mortgage, the cash down payment is now 40 per cent of the property's valuation instead of the usual 20 per cent.
If they already have an existing mortgage and want to take another one for another property, the cash down payment is 60 per cent, instead of the current 40 per cent.
For these borrowers, the only way to avoid paying the additional 20 per cent cash down payment is to opt for shorter loan tenures that do not extend past the age of 65.
But this will mean higher monthly installments.
Source: The Straits Times – 6 October 2012
 
Market unlikely to be hit hard: Redas
Many developers seem to feel the new cooling measures will not have a big impact although those with more exposure to the local market could feel the pinch.
The response to yesterday's announcement from the Monetary Authority of Singapore (MAS) of the new rules was low key.
The Real Estate Developers' Association of Singapore (Redas) issued a statement saying that the cap "will not have significant impact on the property market".
"Based on past experience, not many buyers take long tenure loans," it said.
Mr Cheang Kok Kheong, chief executive of Frasers Centrepoint Homes, said: "We have always been supportive of the Government's measures aimed at curbing excessive speculative activities, as we believe in the importance of having a stable and sustainable housing market."
He said the move "is not expected to have a significant impact on the residential market".
A Keppel Land spokesman said: "We believe that there is still genuine demand for homes and well-located properties with good attributes should continue to see healthy sales."
Two other developers which declined to be named also said the new measure was not a big issue.
Far East Organization, City Developments, Hong Leong and CapitaLand declined to comment.
Consultants said the new rule to cap mortgages at 35 years could hit sales as investors and those who are stretching themselves financially will likely stay away from the market.
Source: The Straits Times – 6 October 2012
 
Banks wait to gauge impact
Banks could take a hit from the new rules on mortgage tenure but just how much they will be impacted remains unclear.
The Monetary Authority of Singapore (MAS) announced yesterday that a lower loan-to-value ratio will be imposed on loans with tenure of more than 30 years, or if the loan tenure extends beyond the borrower's retirement age of 65.
Bankers said the measures will certainly affect those taking out new loans and the mortgage-refinancing side of the lending business.
The most practical impact will be seen on older home-buyers. Those over 35 will have to take up a loan tenure of less than 30 years if they do not want to be affected by the lower loan-to-value ratio linked to the retirement age of 65.
Mr Dwaipayan Sadhu, Standard Chartered Bank's head of consumer transaction banking and mortgage for Singapore and South-east Asia, believes the new rules may also impact younger customers. He said: "Their monthly cash outflow would increase should they opt for 30-year loans instead of the current 35."
Maybank Singapore's head of lending business (consumer banking), Mr Alan Yet, agreed the refinancing market will likely be affected, but noted that as with earlier cooling measures, it does take time before the effects are seen.
Other experts think, however, that the impact could be muted.
Source: Business Times – 6 October 2012
 
Non-landed private home resale prices up 3.2%
Resale prices of non-landed private homes rose in the third quarter, even as transaction volumes fell 7.3 per cent.
Overall resale prices gained 3.2 per cent to hit a record $1,156 per square foot (psf), led by a 2.5 per cent month-on-month increase in September, data from the latest SRX Residential Property Flash Report released yesterday showed.
The rest of central region (RCR) posted the strongest quarterly gain of 7.1 per cent for resale non-landed in Q3, hitting an historic high of $1,199 psf. This was followed by a smaller gain of 3 per cent in outside of central region (OCR) to $921 psf, and a muted increase of 0.75 per cent in the core central region (CCR) to $1,738 psf.
Resale transaction volume fell 7.3 per cent to 3,296 transactions from 3,555 transactions in Q2.
RCR recorded the largest drop in transaction volume, by 10.9 per cent to 854 transactions, followed by CCR which saw transactions drop 6.2 per cent to 662 transactions. Transaction volumes in OCR fell 5.8 per cent to 1,780 sales.
Meanwhile, rental volumes fell 5.2 per cent in Q3, to 7,723 transactions. Only RCR posted a marginal 0.25 per cent increase in rental transactions, to 2,423. OCR posted the largest drop of 8.5 per cent to 2,777 transactions while CCR saw rental transactions slip 6.2 per cent to 2,523.
Overall rental prices per square foot rose 2.9 per cent to $3.87 psf in Q3. Rents for CCR were $4.68 psf, $4.01 for RCR, and $3.05 for OCR.
Gross rental yields remained stable at 4 per cent in Q3 due to a corresponding increase in rental prices compared with resale prices.
By comparison, URA's flash estimate released earlier this month showed that home prices had inched up 0.5 per cent in Q3. This took into account new sales, which fell 2.2 per cent. It also did not take into account the last three weeks of September sales. URA uses a different methodology from the average psf pricing approach, which is adopted by the SRX index.
Source: Business Times – 6 October 2012
 
Sentosa Cove bungalow market picks up after post-ABSD freeze
Activity in Sentosa Cove's bungalow market has picked up considerably in the last four to six weeks, following a relatively dry period following last December's introduction of the additional buyer's stamp duty (ABSD) targeting foreign buying of residential properties.
BT understands that owners have issued options to buyers for about a dozen homes in the past two months. The buyers are predominantly foreigners, mostly China nationals.
These bungalows are said to include two homes on Pearl Island, both of which sold at $2,200-plus per sq ft on land area. A unit on Paradise Island went for about $22 million or slightly over $2,380 psf based on land area of 9,236 sq ft; a property on Coral Island changed hands at $16.5 million or $1,743 psf on land area of 9,464 sq ft.
A seafronting property at Cove Grove boasting views of the Southern Islands is believed to have been sold for around $26 million, or $2,600 psf. This is in the neighbourhood of the one BT Weekend reported on Sept 15 as being sold for around $24 million or $2,470 psf.
The same edition of BT also reported two transactions on Cove Drive for units facing the waterway and Tanjong Golf Course at $15-plus million each. One was sold to a Myanmar citizen at $15.3 million or $2,202 psf.
Since then, BT has learnt of another purchase of a property a little further away on the same road, but also facing the waterway and golf course. The price is thought to be $16.8 million or $2,308 psf.
Homes on Sentosa Cove have 99-year leasehold tenure.
Market watchers attribute the recent revival in both viewings and transactions to a cocktail of factors - the stockmarket run-up, which in turn has boosted sentiment, QE3 and a narrowing in the bid-ask gap that kickstarted the first few deals in the latest resurgence.
A point to note, however, is that while there is anecdotal evidence of a string of options for bungalow purchases in the upscale waterfront housing district being granted in recent weeks, evidence of caveats is relatively scarce, as most of the options have yet to be exercised by the buyers.
Caveats were lodged for six Sentosa Cove bungalow purchases in the first half of this year, followed by two more since then. This compares with 25 caveats for the whole of last year.
Sources suggest some foreign buyers may have sought longer than the standard two-week option period with a view to securing Singapore permanent resident (PR) status in a bid to lower their stamp duty outlay.
In addition to the 3 per cent standard buyer's stamp duty payable for all property purchases in Singapore, including those by Singapore citizens, a Singapore PR pays a 3 per cent ABSD for his second and subsequent residential property purchases here.
For non-PR foreigners, a 10 per cent ABSD is payable on all residential property purchases.
Hence, if a foreigner obtains PR status, he would be able to "save" 7 per cent on ABSD, or $1.4 million on a $20 million bungalow purchase on Sentosa Cove, assuming he already owns an existing non-landed residential property here.
But if this PR does not own any other existing residential property here, he does not have to pay ABSD at all - translating to a "saving" of 10 per cent or $2 million.
Word on the Cove is that some foreign buyers have been granted long option periods ranging from six weeks to three months, or even longer. In exchange for this, owners would typically demand a higher option fee, say 5 to 10 per cent of the property price, compared with one per cent in a standard deal.
Typically, a buyer in the resale market who fails to exercise an option would have to forfeit the option deposit.
Some owners who have entered into such deals on Sentosa Cove are keeping their fingers crossed that the options will be exercised.
Market watchers note that the Singapore authorities have tightened criteria for issuing PR status to high-net-worth foreigners.
On unit land price, the highest price achieved this year is $2,787 psf in May, for a seafronting property along Cove Drive.
The record price for a bungalow in Sentosa Cove was set in October 2010, by a seafronting property on Ocean Drive facing Singapore's city container ports. It transacted at $2,989 psf. Among waterway fronting bungalows, the highest price achieved was in September last year - $2,613 psf for a property on Cove Drive.
The recent run-up in deals and QE3 have boosted confidence among some owners, who have started to raise asking prices.
Source: Business Times – 6 October 2012
 
Punggol EC expected to be well received
Yet another executive condominium (EC) is being launched today, the seventh EC to be put on the market this year.
Property consultants expect Waterbay, in Punggol, to garner healthy interest from buyers, thanks, in part, to its location.
Waterbay, a 383-unit project at the junction of Punggol Central and Edgedale Plains, is being built by Chinese developer Qingjian Realty (South Pacific).
The company is behind several other upcoming condos in the area such as River Isles and Riversound Residence.
The smallest unit in Waterbay, a two-bedder, is 753 sq ft and has an indicative price of about $590,000 or about $780 psf.
Unusually for an EC, five-bedders are also available. These 1,496 sq ft units will cost about $1.05 million or about $700 psf.
Dual key units, which allow for multi-generational living or leasing, are also on offer.
Waterbay's launch comes about two weeks after the launch of Heron Bay EC at Upper Serangoon View, where there were 1,664 interested buyers for just 394 units.
Not all launches this year have done well, industry watchers said, noting that buyers have been selective about price and location.
For instance, the 416-unit Watercolours at Pasir Ris was almost twice oversubscribed, but was only 56 per cent sold as of end August.
Interested buyers for Waterbay can submit e-applications between Oct 12 and Oct 16. If demand outstrips supply, a ballot will be held. Successful applicants can choose their units from Oct 19.
Source: The Straits Times – 6 October 2012
 
Watertown in Punggol almost 97% sold
The Watertown integrated development in Punggol is almost 97per cent sold, according to developer Far East Organization yesterday.
The remaining 34 units are mainly those with three or four bedrooms, and range in size from 1,173 sq ft to 1,550 sq ft.
These are among the "best-facing units within the development overlooking the Punggol Waterway", said Far East, which is co-developing the project with Sekisui House.
Watertown is Punggol's first project with both a retail and residential component.
The retail portion, called Waterway Point, will feature a "24-hour basement" level, with a FairPrice Finest supermarket and Shaw Theatres operating round the clock.
FairPrice Finest will occupy about 30,000 sq ft of space at Waterway Point, making it one of the chain's largest outlets here.
Mr Christopher Tang, the chief executive of Frasers Centrepoint Commercial, said yesterday: "We are delighted that NTUC FairPrice Finest has committed to be one of the early anchor tenants.
"We are confident that the mall will be the centre of attraction at Punggol waterfront."
With total development costs estimated at over $1.6 billion, Watertown is the largest private development in the Punggol Central master plan, Far East added.
Shops will occupy 40per cent of Waterway Point, while eateries will take up 30per cent. The rest will be occupied by entertainment and other service providers, such as educational establishments, banks, and civic and community amenities.
In August, Hyundai Engineering & Construction was awarded the main construction contract, worth US$380million (S$466million), for the Watertown development. Construction of the retail component has just started and is scheduled for completion by 2015. The residential component is expected to be completed by 2017.
Separately, Far East said it has sold 96per cent of the units at another of its mixed-use projects, The Hillier at Hillview Avenue.
The 528-unit development was launched in January and 21 units are left.
Source: The Straits Times – 6 October 2012
 
Home buyers unfazed by loan curbs
Despite new restrictions on the length of home loans that took effect yesterday, house hunters did not stay away from condominium showflats islandwide.
At new launches like Riversails along the Punggol waterfront and Cityscape at Farrer Park, showrooms were packed.
At a 748-unit development in Bedok South called eCO, for example, at least 20 units were sold yesterday.
The Monetary Authority of Singapore (MAS) said on Friday that it was capping the length of a home loan at 35 years.
It also lowered the loan limits for those who take loans past 30 years, or which extend beyond the retirement age of 65.
Such buyers can take a loan of only 60 per cent of the property's value, down from 80 per cent, starting yesterday.
This means an upfront payment in cash of 40 per cent of the property's price.
If it is their second or more loan, the loan limit shrinks further to 40 per cent - they must fork out a cash down payment of 60 per cent of the property's value.
House hunters The Sunday Times spoke to yesterday said they were aware of the latest changes but they were undeterred.
Source: The Straits Times – 7 October 2012
 
Showflats continue to see good traffic
Neither the new restrictions on home loans nor the rain kept prospective buyers from condominium showflats over the weekend.
Indeed, it was "business as usual" at newly launched projects Riversails at Upper Serangoon View and Skies Miltonia at Yishun.
According to agents, more than 300 units have been sold at Allgreen Properties' 920-unit Riversails, with at least 20 homes sold over the weekend. Prices of the larger units average slightly over $800 per square foot (psf), while the one-bedroom units average $1,000 psf.
The larger units (three-bedrooms and above) at the 99-year project have been doing well, with quite a few sold to upgraders, noted an agent who did not wish to be named. At the other end of the spectrum, three out of the five stacks of one-bedroom units launched have been sold.
Separately, some 67 per cent of units at the 420-unit Skies Miltonia have found buyers; the developer is offering an 18 per cent discount, and throwing in the option for buyers of certain units to upgrade their flooring to marble.
The 748-unit eCO in Bedok South threw in an additional 2 per cent furniture voucher in addition to an array of discounts offered.
The Monetary Authority of Singapore (MAS) said on Friday that it will set an absolute limit of 35 years on the tenure of all residential property loans. It also lowered loan-to-value (LTV) ratios for new loans with a tenure of more than 30 years.
According to the central bank, the average tenure for new residential property loans jumped from 25 years to 29 over the last three years. Over 45 per cent of new home loans have tenures exceeding 30 years.
Lower initial monthly repayments from long loan tenures and low interest rates may cause borrowers to overestimate their loan servicing ability, warned MAS.
Source: Business Times – 8 October 2012
 
A policy resolve to rein in asset prices
When the Monetary Authority of Singapore (MAS) last Friday announced fresh mortgage curbs to prevent new bubbles from forming in the property market, much of the attention focused on the measures and their impact.
But arguably, what is even more significant is the signal Singapore policy makers are sending to the market.
After the US unveiled a third round of quantitative easing (QE3) last month, a BT article raised the threat of fresh liquidity flows and the likelihood of more cooling measures to keep asset bubbles away. It was, at the time, not the consensus view, with many arguing, as they still do now, that existing policies are sufficient to keep prices in check. This was especially (and not surprisingly) the view of the real estate sector, and as recently as the end of September, the Real Estate Developers' Association of Singapore (Redas) said the property sector did not need another round of cooling measures, and that a thorough review of earlier measures put in place should be done first.
Such views, while reasonable enough in themselves, miss the bigger point. And that is that in any robust policy making framework, the imperative is to stay ahead of the curve. Existing cooling measures may or may not have already reined in property prices, but that does not define current scenarios.
A new situation has arrived with QE3. The Federal Reserve's decision to pump US$40 billion into the US economy each month until sustained jobs growth kicks in, while welcome news for the struggling global economy, also created the risk that loose monetary conditions in the US may push funds into the region in search of yields and fan asset price inflation, with Singapore a likely prime target for such flows. Indeed, QE3 also marks the start of what many see as an extended round of global easing, with all the associated liquidity risks.
It is in this context that the MAS is acting. "Monetary conditions worldwide are far from normal," said Deputy Prime Minister Tharman Shanmugaratnam, noting that the latest round of QE3 in the US and low interest rates have made credit easy, though this will eventually change.
"We are taking this step now to require more prudent lending, and will continue to watch the property market carefully," said Mr Tharman, who is also Finance Minister and MAS chairman.
And Singapore has signalled clearly it will not lag behind the regulatory curve. Hong Kong, notably, moved to introduce mortgage curbs immediately after QE3 was announced. In its fifth round of mortgage-tightening measures, the Hong Kong Monetary Authority announced that it would limit the maximum term of all new mortgages to 30 years. Additionally, mortgage payments for investment properties cannot be more than 40 per cent of buyer's monthly incomes, compared with 50 per cent previously.
There is some debate over whether the MAS could be acting prematurely in the domestic context because property price increases recently have not been so marked. Official data showed that HDB resale prices rose 2 per cent in Q3 from Q2, while private home prices gained 0.5 per cent over the same period. Separately, the SRX Residential Property Flash Report showed resale prices of non-landed private homes rising 3.2 per cent in Q3.
However, it's worth pointing out that the stated policy objective has always been that property values should move in tandem with economic fundamentals. Economists now expect advance estimates for Q3 to show that the economy shrank 1.8 per cent over the July to September period. Add to Q2's seasonally adjusted 0.7 per cent quarter-on-quarter annualised drop in GDP, and Singapore would have suffered a technical recession, or two consecutive quarters of quarter-on-quarter contraction. Viewed in this context, even a modest rise in property prices could be fundamentally out of line.
So far, the property sector's reaction to the new measures has been mixed. The changes include setting an absolute limit of 35 years on the tenure of all residential property loans and tightening loan-to-value (LTV) ratios for certain new loans. Redas said the measures will not have a major impact, and the initial assessments suggest that the new rules will affect mostly older buyers, and those looking to own more than one property. But again, this may not be the most crucial point.
The most important point that the market should take away from the latest MAS measures is the underlying policy resolve to keep asset prices here in check. Singapore regulators have signalled their intention to act, again and again if necessary, to ensure that the runaway prices of the last cycle will not be repeated.
Last Friday's measures may be confined to the residential market and a specific group of buyers, but the evidence is clear enough that policy makers are prepared to introduce more measures to cool prices in non-residential sectors for instance - where there have been some signs of overheating - or to further curb foreign buying interest, if needed. "We will do what it takes to cool the market, and avoid a bubble that will eventually hurt borrowers and destabilise our financial system," Mr Tharman said. That is as explicit as it can get.
Source: Business Times – 8 October 2012
 
COMMERCIAL MARKET
Raffles City Tower to get $34.7m facelift
CapitaCommercial Trust (CCT) and CapitaMall Trust (CMT) will pump in $34.7 million to revamp Raffles City Tower, the 42-storey office tower of Raffles City Singapore.
In a joint statement released yesterday, managers of the Reits said the move was aimed at enhancing Raffles City Tower's allure as a choice location for businesses.
"It is an opportune time to refurbish the office tower now, given that the City Hall/Beach Road area in which Raffles City is located currently has low vacancy rate and there is no new office supply completing in the next two years," said Lynette Leong, chief executive of CCT Management.
The enhancements to the building include upgrading of the main lobby and installation of security turnstiles and a close-circuit television system. Common areas, lift lobbies and restrooms on all office floors will be refurbished, too.
The asset-enhancement works will start in November this year. Existing office tenants will continue to operate in the building.
The works will be carried out in phases progressively until the second quarter of 2014 to minimise inconvenience to existing occupiers, managers of the Reits said.
Raffles City Tower currently has an occupancy rate of 99 per cent. It last had its common areas, including restrooms and lift cars, upgraded in 1994 and 2010, respectively.
"In 2010, the direct connection to the new Esplanade MRT station on the Circle Line of the MRT system was opened, and it has since introduced more traffic into Raffles City," said Wilson Tan, chief executive of CMT Management. "With the completion of the Basement 2 link of Raffles City Shopping Centre in 2010, the next focus of asset enhancements on the office tower is a natural progression," he added.
The initiative is expected to generate an 8.6 per cent return on investment.
Raffles City is jointly owned by CCT and CMT through an unlisted special-purpose sub-trust, RCS Trust. CCT and CMT respectively own 60 per cent and 40 per cent of the property.
Source: Business Times – 6 October 2012
 
RETAIL MARKET
Waterway Pt gets anchor tenants
Watertown, Punggol's first integrated waterfront residential and retail development, has secured two anchor tenants for its shopping mall: NTUC FairPrice Finest and Shaw Organisation.
The supermarket will take up some 30,000 square feet in the basement of the mall, Waterway Point, and be open round the clock.
It is the 10th FairPrice Finest outlet here, and the chain's second 24-hour Finest branch, after the one in Serangoon Gardens.
Shaw Organisation's theatres, including a 1,000-seating-capacity Imax hall, will take up 32,500 sq ft of retail space.
In the rest of Waterway Point, the tenant mix will be 40 per cent retail, 30 per cent food and beverage, with the remaining space given over to entertainment and other service providers such as educational institutions, banks and community amenities.
The four-level mall, which has about 370,000 sq ft of net lettable area, will be linked to Punggol MRT Station and is part of Watertown, a project of Far East Organisation, Frasers Centrepoint and Japanese firm Sekisui House.
The residential part of this complex comprises 11 residential towers of 13 and 14 storeys.
Almost 97 per cent of the 992 units have been sold to date.
Another 34 units, mainly three- and four-bedroom units overlooking Punggol Waterway, are still available. These, with their superior facing, have been priced from $1.68 million for a 1,195 sq ft three-bedroom apartment.
The available units range in size from 1,173 to 1,550 sq ft.
The developer is giving away FairPrice Finest vouchers ranging from $8,000 to $10,000 to each new buyer.
Hyundai Engineering & Construction Co Ltd was awarded the main construction contract worth US$380 million for the Watertown development in August.
Building of the retail component has just begun and is to be completed by 2015; the development of the residential component is expected to be done only in 2017.
Separately, only 21 units at Far East's 528-unit The Hillier are left on the market.
Configurations of the still- available units in this Hillview Avenue development comprise Type A (506-624 sq ft), Type B (592-678 sq ft) and Type C (807-840 sq ft).
Prices start at $875,000 for a 506 sq ft unit.
The fully dedicated Soho (small office, home office) development comprises two towers of Soho apartments with an adjoining retail podium, HillV2.
It is estimated to TOP in 2016.
Source: Business Times – 6 October 2012
 
New lease of life for lifestyle centre
It has been an uphill battle for tenants at a lifestyle centre in Serangoon Gardens which was built as a buffer between a foreign workers' dormitory and landed properties in the area.
But the tenants at the Lifestyle Hub @ Burghley have finally managed to breathe some life into the development.
Business has as much as doubled from last year, said the tenants who operate art workshops, sports facilities, eateries and education centres.
This was after taking matters into their own hands by organising carnivals and roadshows, designing and printing thousands of fliers, and giving out freebies.
The owner of My Art Studio, Mr William Lee, 40, who was the first tenant on the 6,880 sq m site - which is slightly larger than a football field - said that nine tenants decided to unite last year "to change a desert into an oasis for kids".
The 40-year-old, who spearheaded the drive, said: "We knew we needed to drive awareness for this place. It was so dead. No one knew about this place, no one came." Tenants, he said, have spent about $10,000 out of their own pockets in total.
It has been a series of fits and starts for the site's master tenant Hean Nerng Facilities Management, since it won the tender for the state-owned site in 2010.
Then, the site's three single-storey blocks were found to be plagued by electricity brown-outs, leaky roofs and termites. After six-month-long renovations, three tenants moved in.
The number of tenants inched up until early this year, then two - a cafe and a music school - threw in the towel because business was dismal.
Things had turned a corner by the middle of the year, when the centre's 15 units were full and its tenant-mix stable.
Mr Kelvin Lim, the managing director of LHN Group, Hean Nerng's parent company, said that it took some time to get the place up and running as they had to ensure that the sub-tenants complemented each other.
"Also it was difficult to attract tenants and customers initially as we were sited next to the workers' dormitory which residents had major concerns over," he said, adding that this led to negative publicity.
The site is 15m away from a foreign workers' dormitory and is separated from it by a 2m-high fence. They both share the plot that used to house Serangoon Garden Technical School. The centre was carved out to form a buffer between the dormitory and houses in the area, after more than 1,400 residents petitioned against the building of the dormitory there.
It seems that the worst is over.
The good spell, however, may be short-lived - a sore point for several tenants there. The lease for the site ends mid-2014. The Urban Redevelopment Authority has zoned the site for residential development in Master Plan 2008.
When contacted, the Singapore Land Authority (SLA), which manages the site, said that Hean Nerng had just started its final two-year-term in July. "Should the planning authority subsequently allow for further interim use, we will put up the site for tender," said an SLA spokesman, adding that Hean Nerng can also participate in the tender.
Source: The Straits Times – 8 October 2012

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