Koh Brothers buys 2 Shell kiosks for $19.6m

Koh Brothers buys 2 Shell kiosks for $19.6m

It aims to use one site for condo, other for hotel project
By UMA SHANKARI
KOH Brothers has bought two petrol kiosks from Shell - one in Bukit Timah and the other in Changi - for close to $19.6 million.
The first site, at 383 Bukit Timah Road, is next to Koh Brothers’ freehold serviced apartment complex, Alocassia Apartment. The site has a strata land area of 13,500 square feet and cost Koh Brothers $13.3 million.

Singapore-listed Koh Brothers bought Alocassia Apartment - a residential and commercial site - in May last year for $30 million.

The company intends to convert the whole site to full residential use and launch a luxury condominium with about 50 units in the third quarter of next year, chief executive Francis Koh told BT.

With the new acquisition, the entire freehold site covers 44,900 sq ft and has a 1.4 plot ratio. The latest purchase brings the price paid by Koh Brothers for the site to $799 per square foot (psf) per plot ratio, including an estimated development charge of $6.9 million.

Mr Koh estimates the project could break-even around $1,250 psf since the company does not plan to tear down the whole building. Luxury apartments in the Bukit Timah area now go for about $1,800-$2,000 psf.
‘Given its prime location, freehold status, proximity to reputable schools and easy accessibility to the city centre, we are confident the site will appeal to home buyers who appreciate the exclusivity and prestige,’ Mr Koh said.

The second site bought by the company - at 80 Changi Road - adjoins its freehold Changi Hotel.

Bought for $6.3 million, the site has a strata area of 8,000 sq ft. The entire freehold Changi Road site now has a total area of 26,400 sq ft.

Mr Koh said the company will look to build a newer, larger hotel on the combined site. Changi Hotel is now a three-storey, 61-room hotel.

Shell’s general manager for retail, Henry Chu, said such sales allow the company to capitalise on the hot property market.

‘The timing of closure and sale of these sites is a commercial decision and is to allow us to take advantage of the buoyant property market to maximise our returns,’ he said.
Source : Business Times - 23 Nov 2007

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4 office floors at The Arcade put up for sale - Singapore

4 office floors at The Arcade put up for sale - Singapore

By ARTHUR SIM

ALMOST 18 per cent of The Arcade at Raffles Place comprising four floors have been put up for sale through an expression of interest exercise, and the indicative price range is between $80 million and $90 million.

Rare opportunity: Based on the indicative price of $80 million-$90 million, the unit price for the 32,120 sq ft of space is between $2,500-$2,800 psf
Based on the indicative price, the unit price for the 32,120 sq ft of space is between $2,500-$2,800 psf.

CB Richard Ellis (CBRE) and Jones Lang LaSalle are advising the owners jointly on the divestment. CBRE added that the owners are Singaporean.

CBRE director (Investment Properties) Charles Hoon also said that the four strata-titled floors for sale represent a rare opportunity to own commercial space at Raffles Place because most of the office buildings in the area have single owners.

Mr Hoon did say that the original developer of The Arcade still owns about 30 per cent of the building so there is a potential to redevelop the site through a collective sale especially as the existing built-up gross floor plot reflects a plot ratio of about 8 but can be maximised to about 14.

The Arcade is a 20-storey mixed commercial and retail building comprising an office tower and a three-storey retail podium with a total net lettable area of about 118,317 sq ft.

The property is held on a mixture of 999-year and 99-year leasehold interests.

The current yield is about 2 per cent but Mr Hoon said that with leases expiring next year, rental appreciation can be expected.

The lease profile shows that 60 per cent of the current leases will expire in 2008 and the yield can be expected to increase to around 5 per cent.

Existing leases are tenanted out at around $9.20 psf.

Gains from capital appreciation are likely to be higher.

In Q3 2007, CBRE noted that average capital value for prime offices was estimated at $2,900 psf, reflecting an increase of 16 per cent quarter-on-quarter (QOQ) and 114.8 per cent year-on-year, while prime office yields were at 4.32 per cent, up slightly from 4.23 per cent QOQ.

The office sector is still seeing buoyant investment sales. In October, 12 floors at Springleaf Tower (near Tanjong Pagar MRT station) were sold for $225 million representing a unit price of around $2,000 psf.

In August, the entire Chevron House at Raffles Place was sold for $730 million or a record $2,780 psf of net lettable area.
Source : Business Times - 23 Nov 2007

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CapitaLand sets up $880m India property fund

CapitaLand sets up $880m India property fund

By UMA SHANKARI
CAPITALAND, South-east Asia’s biggest developer, yesterday said that it has successfully established its first India private property fund with a fund size of $880 million.
The company first announced the fund - CapitaRetail India Development Fund - in July.

The closed-end private fund has the mandate to invest in retail mall developments in India. CapitaLand holds a stake of about 45 per cent stake in it, with the remaining held by insurance companies, pension funds and corporations.

CapitaLand chief executive Liew Mun Leong said that the fund will allow the company to increase its multi-sector prese`nce in India.

‘We are conscious of the vast opportunities presented by India’s retail real estate market, driven by the country’s strong macro-economic growth and rapid urbanisation,’ he said in a statement. ‘Over time, we expect to deepen our retail and fund management presence in India to become a significant long-term retail real estate player there.’

CapitaLand, which also has similar funds in China, hopes to replicate its successful China retail business platform in India.

CapitaLand’s shares closed unchanged at $6.50 yesterday. The company’s stock has risen some 4.8 per cent since the start of the year.
Source : Business Times - 23 Nov 2007

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Global metal prices surge as demand exceeds supply - Singapore

Global metal prices surge as demand exceeds supply - Singapore

Gold touches new heights but silver, copper and others are not far behind

By Yang Huiwen

SOARING world metal prices are having a shock and ore effect in Singapore, with manufacturers caught between a rock and a hard place, while canny investors sense a silver lining.
The rocketing gold price - up 26 per cent this year - has been hogging the headlines but copper, iron, silver, platinum and palladium have also been rising steadily, as demand continues to outstrip supply.

Manufacturing companies in Singapore are feeling the squeeze.

Mr James Wong, managing director of OE Manufacturing, said: ‘Metal prices have affected our profit margin.’

OE Manufacturing, which makes hydraulic cylinders, mainly of steel, has resorted to buying semi-finished spare parts from lower-cost countries instead of just the raw material.

‘Price increases in metals are much more than any offsets possible from productivity or efficiency gains in an already tight margin industry,’ said Mr C.Y. Gan, managing director of Interplex Singapore, a custom metal manufacturer producing precision metal stampings.
But one man’s pain can be another’s gain with investors eyeing new opportunities - and safer places for their cash.

Mr Phillip Lai, head of commodity derivatives at Phillip Futures, said a combination of factors, including a weakening US dollar, inflationary pressures and terrorism threats, has bolstered the appeal of metal as an alternative investment to the greenback.

Platinum has long been touted as a better bet than gold, with looming supply shortages making it white-hot.

The metal, used to make catalytic converters in cars as well as a range of jewellery, has soared 29 per cent this year on the London Metal Exchange, outpacing gold’s 26 per cent climb.

Gold and silver have both reached landmark levels in recent weeks; gold touched a record US$845.84 an ounce, while silver hit a 27-year-high of US$16.22 an ounce.

Local investors have generally favoured gold as a hedge against uncertainty. It is also easily traded, a key factor.

‘Platinum investment is attractive from the standpoint of its shortage, but it is not easy to access it here as the market is not as sophisticated,’ said the general manager of Standard Chartered’s wealth management division, Mr Dennis Khoo.

He added that a platinum futures exchange-traded fund, similar to the Street Tracks Gold fund listed in Singapore, could be an option.

A major factor bolstering metals as an investment is the seemingly insatiable demand across the world. Emerging markets - especially industrialising powerhouses China and India - are driving demand.

Supply disruptions, with mining giants such as Rio Tinto battling rising costs and production delays at iron ore mines, are also putting pressure on price. Iron ore has trebled in the past five years and its price is set to soar by as much as 50 per cent next year.

Copper has trebled over the past five years and analysts expect the metal, mainly used in electrical conductors, to reach new highs next year.

Singapore firms are bracing themselves for more price pain. Mr Alan Tan, general manager of metal manufacturer CPM Pacific, said: ‘Prices will increase down the road because energy costs continue to escalate.’ He said his firm has responded by passing on the cost to its clients to cover the rise in production expenses.
Source : Straits Times - 23 Nov 2007

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Singapore needs more energy-efficient buildings: Expert

Singapore needs more energy-efficient buildings: Expert

Cambridge don and architects want more demand for this at design stage

By Jessica Cheam

ARCHITECTS yesterday said homes and buildings in Singapore could be much better designed for the steamy climate, but developers are just not asking for that type of architecture.
Cambridge University architecture professor Koen Steemers told an architectural conference in Singapore that local buildings are not built to minimise energy consumption.

He cited the example of single-glazed glass panels. These are used in many buildings in Singapore, but they absorb heat quickly while failing to maximise natural ventilation.

Professor Steemers found plenty of support among architects around town as well as those attending the international conference on Passive and Low Energy Architecture (Plea). Those who follow this discipline factor in climatic and environmental conditions when seeking to keep buildings comfortable.

RDC Architects director Rita Soh told The Straits Times that this type of architecture was once common in Singapore; it can be seen in older bungalows and shophouses that maximise the use of light and ventilation to fit the hot, humid conditions here. As Singapore grew more affluent, Western-looking buildings with glass facades and full air-conditioning became more popular.

Parliamentary Secretary for National Development Mohamad Maliki Osman told the conference, organised by the architecture department of the National University of Singapore (NUS), that maximising a building’s efficiency has become even more important, given rising demand for energy and the soaring costs.
‘Often, the most cost-effective strategy is to incorporate energy efficiency measures at the design stage of a facility. This is where incorporation of passive and low energy architecture is essential,’ said Dr Maliki.

At Singapore’s AIM & Associates, principal architect John Ting said it was ‘timely’ to revisit the passive architecture concept. Local architects are well-equipped to design such buildings, but developers have to commission them first, added Mr Ting.

Consumers are part of the equation as well: Developers build what homebuyers want, said Mr Chia Hock Jin, the executive director of the Real Estate Developers’ Association of Singapore (Redas).

‘We do realise that sustainability is becoming increasingly important,’ said Mr Chia, adding that Redas recently formed a design committee to examine sustainability issues from the developers’ perspective.

The Building and Construction Authority (BCA), which sponsored the conference, said about 70 buildings in Singapore have been awarded the Green Mark certification; 40 are awaiting assessment. The scheme, launched in 2005, rates buildings based on their environmental impact and energy efficiency.

Dr Stephen Wittkopf, an assistant professor at NUS’ architecture department and the conference chairman, said the university plans to hold public seminars for construction industry players to promote the Plea concept, starting next year.

Mr Tai Lee Siang - the president of the Singapore Institute of Architects and a speaker at the three-day event, which is being held in South-east Asia for the first time - noted an encouraging trend where food and beverage outlets are making greater use of outdoor space.

‘The momentum is only just about to kick in. We have to get rid of the mindset that sustainable architecture costs more. This is something that’s got to change,’ said Mr Tai.

The conference ends tomorrow.
Source : Straits Times - 23 Nov 2007

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Koh Brothers buys 2 Singapore petrol station sites

Koh Brothers buys 2 Singapore petrol station sites

CONSTRUCTION and property development firm Koh Brothers Group yesterday paid $19.6 million to snap up two freehold petrol station sites, which are both next to properties it already owns.
The first - a 13,498 sq ft site in Bukit Timah Road costing $13.3 million - is adjacent to the group’s freehold Alocassia Apartment site.

Koh Brothers bought Alocassia in May last year for $30 million. The site, first developed in 1996, had 45 service apartments and seven commercial units.

Once the two sites are combined, the listed firm will have a land area of 44,863 sq ft and a gross floor area of 62,808 sq ft. Koh Brothers said in a statement that it may develop a residential project on the combined land.

The second site it bought yesterday is a 26,433 sq ft commercial plot on Changi Road, which used to be a petrol station.

The group paid $6.3 million for the plot, which is next to its 61-room Changi Hotel that opened in 1994. It said that it may build an office building with shops on the ground floor.

On a per square foot basis, the Bukit Timah plot cost around $985 while the Changi Road site cost nearly $788.

Koh Brothers’ last buy was in June, when it joined hands with three other developers to buy the freehold Lincoln Lodge site off Newton Road for $243 million.

Source : Straits Times - 23 Nov 2007

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