West Coast condo sold out in less than two weeks

West Coast condo sold out in less than two weeks
Buyers pay average of $880 psf for the 659 units at The Parc project
By Joyce Teo, Property Correspondent
SIZZLING SALES: Singaporeans made up more than 80 per cent of home buyers at The Parc Condominium. Prices went as high as $1,040 psf for several high-floor apartments at the 24-storey freehold development. — PHOTO: SAVILLS SINGAPORE

ALL 659 units of The Parc Condominium in West Coast Walk have been snapped up in less than a fortnight since the start of the month.
Prices for the freehold 24-storey condominium went as high as $1,040 per sq ft (psf) for several coveted high-floor units.

Overall, the apartments were sold at $880 psf on average, having risen from an average of about $820 psf at the start of sales.

Collective sale sellers of the former Westpeak condominium, on whose site The Parc now stands, got the first bite of the cherry on July 31. Other buyers joined in later.

The last unit was taken up by 6pm on Saturday, after which sales staff of the condominium’s sole marketing agent, Savills Singapore, threw a celebratory party at the show-flat.

The most common type of unit are three-bedders, ranging from 1,216 to 1,302 sq ft. There are 282 of them, or nearly 43 per cent of all homes. The condominium also has apartments as small as 667 sq ft and three penthouses at about 3,681 sq ft each in size.

Buyers were mostly Singaporeans, with foreigners making up less than 20 per cent of the purchasers, said the firm’s managing director, Mr Michael Ng.

The Singaporean buyers included young families and older people looking for retirement homes or homes for their children, he said. Foreign buyers included those from Hong Kong and Indonesia, he added.

Developed by construction and property group Chip Eng Seng and a Lehman Brothers unit, The Parc is near Clementi town centre and a short drive away from the National University of Singapore, Singapore Polytechnic, Singapore Science Park and one-north in Buona Vista.

Savills said professionals and lecturers from these places are potential tenants. The condominium features recreational facilities such as a 50m lap pool, jacuzzi and a toddlers’ pool on a relatively large site of 366,432 sq ft.

Chip Eng Seng bought Westpeak in a collective sale last April for $206.09 million, which worked out to $348 psf of potential gross floor area, inclusive of a development charge then estimated at $21.5 million.

Lehman Brothers came in for an equal share of the project last October.

Meanwhile, Chip Eng Seng soft-launched a high-end project with about 70 units in Peck Hay Road, near Cairnhill Circle, about a month ago.

It has since sold close to 50 per cent of the development - which sits on the former Venus Mansion site - at about $2,500 psf on average.

Next up for the developer will be the launch of a small, luxury condominium in Grange Road.

Source :  Straits Times - 13 Aug 2007

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Market volatility draws attention to STI contracts

Market volatility draws attention to STI contracts
RECENT market volatility caused by the troubled sub-prime mortgage market in the United States has put the spotlight on warrants of the Straits Times Index (STI).
‘One can buy a call warrant if one expects a rebound or a put warrant if one thinks the market will slide,’ said Mr Ooi Lid Seng, Societe Generale’s (SG) vice-president of structured products for Asia excluding Japan.

He highlighted two contracts from the French bank.

The first was a call warrant expiring on Oct 30, which pays investors if the STI tops the 3,500 mark.

That ended down 6.5 cents at 42 cents last Friday, with a volume of 9.45 million units - one of the most heavily traded STI contracts.

The second was a put warrant expiring on the same day, which pays out if the index dips below the 3,400 level.

That contract finished 13 cents lower at 72 cents last Friday with 962,000 units traded.

Mr Ooi said: ‘The conversion ratio of the two warrants, which is 300 warrants to one unit of the STI, are the lowest in the market. Hence, it’s more responsive to any movements in the STI.’

Global stock markets have been enduring a roller-coaster ride recently, due to growing credit market turmoil in the US.

Analysts said investors are alarmed by signs that the fallout from the US sub-prime mortgage market may be spreading to other regions.

Sub-prime mortgages refer to home loans made to people with poor credit scores that were packaged into pools and sold to investors.

The worries about the credit market have been exacerbated by the widespread unwinding of shareholdings, especially by global hedge funds.

The STI closed at 3,359.19 last Friday - down 76.86 points or 2.24 per cent - from the previous week.

Last week, the average daily volume for the four trading days was 2.44 billion shares worth $2.7 billion, compared with 3.38 billion shares valued at $3.23 billion the previous week.

A call warrant lets an investor buy into a stock or index at a pre-set price over a period of three to nine months.

A put warrant allows an investor to sell the stock or index at a pre-set price over a period of time.
Source : Straits Times - 13 Aug 2007

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MM: Taiwan independence damaging for itself, region

MM: Taiwan independence damaging for itself, region
By Goh Sui Noi, Senior Correspondent
RIVAL TAIWAN LEADERS CALL ON MM LEE: Mr Frank Hsieh paid a visit to MM Lee last week. Mr Hsieh is here in his personal capacity at the invitation of NTUC. — PHOTOS: MICA

TWO rival politicians from Taiwan met Minister Mentor Lee Kuan Yew last week and they both got the same message - Singapore opposes Taiwan independence because it will be damaging for Taiwan and the region.
He made this remark to two rival Taiwanese candidates for next March’s presidential election when they met him on separate occasions.

They are ruling Democratic Progressive Party (DPP) presidential candidate Frank Hsieh, who leaves for Indonesia today after a two-day visit, and opposition Kuomintang (KMT) vice-presidential candidate Vincent Siew, who was here early last week.

In a statement yesterday, MM Lee said he explained to them that ‘Singapore has deep ties with Taiwan from the days of President Chiang Ching-kuo in the early 1970s’.

‘President Chiang was fully aware of Singapore’s one-China policy when he helped us,’ he told the two men.

‘So I spoke as an old friend who wishes Taiwan well, and who opposes Taiwan independence because it will be damaging for Taiwan and the region,’ he added in his statement.

Praise for S’pore’s unity, flexibility
SINGAPOREANS seem to have a consensus that they need to unite because their country is relatively small, Taiwanese presidential candidate Frank Hsieh said yesterday.

He last visited Singapore 10 years ago.

Stability in the Taiwan Strait is vital to US-China relations and to peace and stability in East Asia, so the situation must be carefully managed by all sides.

‘If Taiwan continues to project itself as a separate independent Republic of Taiwan and/or apply to be a member of the United Nations, it will be counter-productive,’ the statement said.

Taiwan has applied yearly to be a member of the UN under the title Republic of China but this year did so under the name Taiwan.

Both the DPP and KMT are proposing a referendum on Taiwan’s UN membership bid during the presidential poll.

MM Lee said the leaders of Taiwan, including the President, knew that its application must fail as none of the five permanent members of the UN Security Council would support it and China would veto it.

The political game that the two parties played to win votes was at a great cost to Taiwanese.

Pushing the Taiwan independence issue would lead China to tighten pressure on the international stage and further accelerate the build-up of its military.

‘It is best to leave Taiwan’s international position as it stands,’ the statement said.

It noted that both Mr Hsieh and KMT presidential candidate Ma Ying-jeou have said they would promote direct links with China because they understood that this was necessary to regain Taiwan’s economic vitality. The two sides do not have direct trade and transport links now.

Mr Hsieh at a press briefing yesterday said that if he became president he would take every opportunity to push for dialogue between Taiwan and China.

Source :  Straits Times - 13 Aug 2007

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Markets fear more volatility ahead

Markets fear more volatility ahead
By Goh Eng Yeow, Markets Correspondent
TRYING TIMES: A trader working on the floor of the New York Stock Exchange last week. Given the uncertainty that now exists, most analysts believe it may be better for investors to sit on the sidelines while waiting for the US mortgage crisis to blow over. — PHOTO: BLOOMBERG

Uncertainty as traders watch developments

THE dramatic intervention by the world’s central banks helped to calm jittery bourses on Friday, but as Asian markets reopen for trading today, investors will be watching to see if the relief is only temporary.
Many traders believe that any move by the more optimistic investors or ‘bulls’ to stage a rally today will be met by an equally determined attempt by pessimistic ‘bears’ to sell into any rebound in share prices.

So, share prices are likely to remain volatile today as traders react to any fresh developments coming out of the credit markets, where investors’ appetite for risk has been soured by the crisis-hit mortgage market in the United States.

Bank of America senior economist Gilles Moec told AFP: ‘One of the big issues is that no one has any real clue of the amount of sub-prime loans which have been purchased by foreigners.

‘The big question is what is the overall amount, and this is bad for the markets because if there is one thing that the markets hate, it is uncertainty.’

BIG UNKNOWN
‘The big question is what is the overall amount, and this is bad for the markets because if there is one thing that the markets hate, it is uncertainty.’
MR GILLES MOEC, senior economist at Bank of America, on the sub-prime crisis in the US
Sub-prime loans are offered at high interest rates to Americans who have a poor credit rating and might otherwise be denied credit.

But Commerzbank analyst Andreas Huerkamp was more optimistic and predicted that the crisis would blow over.

‘There are strong parallels with the crisis in the mid-1990s, so you have to be a brave investor to buy shares at the moment,’ he said. ‘But history shows that everything will be forgotten in six months, and the market will recover.’

But given the state of uncertainty that now exists in global financial markets, most analysts believe it may be better for investors to simply sit on the sidelines while waiting for the mortgage crisis in the US to blow over.

Share prices in Singapore and other major regional bourses had see-sawed last week as fears of tightening credit gripped financial markets globally.

Even the commodities markets were whiplashed as traders unwound risky positions, leading to hefty falls in the prices of crude oil and base metals.

The current panic started last Thursday after French bank BNP Paribas froze three hedge funds with US mortgage exposure, sparking widespread fears the contagion had spread to European financial institutions.

This caused international banks to be so risk-averse that they refused to take any form of debt securities as loan collateral, causing interbank lending to come to a virtual standstill.

The European Central Bank was forced to pump 95billion euros (S$197billion) on Thursday and another 61billion euros on Friday to restore calm to the banking system.

The US Federal Reserve followed with a US$24billion (S$36billion) infusion on Thursday, and another US$38billion in three separate operations on Friday to ease a growing liquidity crunch as stock markets crashed across the globe.

What made the Fed’s intervention as ‘lender of last resort’ all the more significant was its decision to accept mortgage bonds as collateral from banks - shoring up investors’ confidence in the badly shaken credit markets.

In Asia, Singapore managed to escape relatively unscathed, with the benchmark Straits Times Index closing down just 53.99 points, or 1.6 per cent, at 3,359.18 on Friday after dropping 115 points at one stage.

But European markets suffered their worst one-day drop in more than four years as London’s FTSE-100 Index slumped 3.7per cent down, while in Paris, the CAC-40 Index was down 3.2 per cent.

Wall Street, however, managed to steady itself, with the Dow Jones Industrial Average recovering to close a mere 31.14points lower at 13,239.54 following the Fed’s intervention after initially crashing by 200 points.

Phillip Securities’ managing director Loh Hoon Sun said yesterday the local stock market is likely to remain vulnerable to any bad news coming out of Europe and the US in the coming weeks.

And this may leave traders to bet on two scenarios with few alternatives in between - a swift recovery or a meltdown.

‘Stocks will look cheap if international banks can swiftly work out the extent of the credit woes arising from the sub-prime loans and chop off their losses,’ a stockbroking director said.

But share prices may fall a lot more if a few big financial institutions could not take the heat and collapse, he warned.

The only good news is that retail investors here have been partly spared from the financial carnage because of the trading curbs imposed recently by local brokerages on highly speculative penny stocks after their daily traded volumes exceeded a few hundred million shares each.

The big concern now is whether the booming residential property market will be affected if the international credit crunch continues.

‘Some investors are obviously growing uneasy about the ability of private equities funds to complete some of the collective property sales which had been announced recently,’ said a dealer.

The abortion of any blockbuster en bloc property sales may hurt the share prices of listed real estate developers and construction counters quite badly, he said.
Source :  Straits Times - 13 Aug 2007

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China says it will not dump US dollar assets

China says it will not dump US dollar assets
Central bank official says they are important component of nation’s forex reserves
By Sim Chi Yin China correspondent In Beijing & Bhagyashree Garekar US Correspondent In Washington
CHINA moved to reassure jittery financial markets yesterday by making clear it has no plan to dump its large stash of US Treasury bonds.
Reports in the US and recent remarks by President George W. Bush about the consequences of such a potential move have added to uneasiness on global markets, already battered by the US mortgage crisis.

But an unnamed Chinese central bank official all but denied yesterday that Beijing would contemplate such a move, saying China was ‘a responsible investor in international financial markets’.

He also gave a vote of confidence to the dollar, saying US dollar assets remain a key part of China’s foreign exchange reserves.

The assurances by Beijing followed a report last week by British newspaper the Daily Telegraph which said that Beijing could dump its vast dollar holdings in a tit-for-tat move if the US imposed trade sanctions on China.

The report quoted two senior economists at Chinese government think-tanks as saying that Beijing’s foreign reserves should be used as a political weapon or ‘bargaining chip’ in trade talks with the US.

China is the second-largest foreign holder of US government debt, and its US$1.3 trillion (S$2 trillion) foreign exchange reserves are believed to be largely made up of dollar assets. This potentially gives Beijing great influence over the dollar’s value and international currency markets.

The Telegraph report prompted Mr Bush to say China would be ‘foolhardy’ to dump US dollar assets. The top Republican on the Senate Finance Committee also wrote to the Chinese ambassador in Washington seeking clarification on the report.

In an interview with Fox TV last week, when asked whether such an option would hurt China more than the US, Mr Bush said, ‘Absolutely. I think so’, adding that the two countries could resolve their differences in a ‘cordial way’.

The Chinese central bank sought to end further speculation on the issue with its unambiguous declaration yesterday.

‘US dollar assets, including American government bonds, are an important component of China’s foreign exchange reserves,’ the central bank official told Xinhua in response to the Telegraph report.

‘The close economic and trade relations between China and the United States play an important role in the stable development of the two countries’ economies, and the world economy as well.’

His comments come hot on the heels of frenzied injections of billions by central banks in Japan, Europe and the US into markets to soothe investors’ worries that losses sparked by investments in sub-prime US mortgages - those given to homebuyers with poor credit ratings - could snowball into a global credit squeeze.

Meanwhile, Treasury Secretary Henry Paulson - Washington’s point man at Sino-US economic talks - dismissed the dollar speculation as ‘absurd’. Analysts point out that China cannot be unaware that selling off dollars would lower the value of the dollar - which would hurt its own investments.

But Beijing and Washington have been locked in several bitter trade and currency disputes in recent years, and signs are that political pressure is mounting.

Charging that the yuan is undervalued, several US senators have made renewed calls in recent weeks to punish Beijing if it does not let the yuan rise in value.

Reflecting this, leading US presidential contender Hillary Clinton has called for restrictive legislation to prevent US being ‘held hostage to economic decisions being made in Beijing, Shanghai or Tokyo’. She said foreign control over 44 per cent of the US national debt had left America acutely vulnerable.

China’s huge foreign exchange reserves has sparked controversy in other ways. Following Beijing’s acquisition of 10 per cent of US investment trust fund Blackstone in May, the China Development Bank announced last month that it was taking a stake in Barclays Bank - along with Singapore’s Temasek Holdings - to help the British firm raise enough money to take over Dutch bank ABN Amro.

These moves by sovereign wealth funds, which invest currency reserves in foreign assets, prompted warnings from some Western leaders. The US, France and Germany are now drawing up rules for such bids by foreign state-controlled investment funds, a development that Beijing does not relish and which might have contributed to the talk about dumping US dollar assets in retaliation.
Source : Straits Times - 13 Aug 2007

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