Some cheer for new car buyers but not for long -Singapore

Some cheer for new car buyers but not for long  -Singapore

Industry players say cut in COE numbers will up premiums
By Christopher Tan, Senior Correspondent

FOLLOWING cuts announced yesterday to road taxes and registration fees, car industry players expect buyers to be happier initially, although car prices may not necessarily fall in the long term.
‘Buying a car now will probably save you some bucks compared to buying next year,’ said Motor Traders Association president Michael Wong, referring to shrinking COE supplies ahead, which would push premiums up.

But the 15-per-cent cut in road tax taking effect from July will cheer new buyers and existing car owners alike.

The road tax cut is meant to offset the addition of 16 ERP gantries coming up this year, bringing the total in operation to 71.

Those who drive more powerful ‘green’ cars, like hybrid sedans, could enjoy savings of around 35 per cent on road taxes under the new plan.

Mr Mark Choong, managing director of Toyota distributor Borneo Motors, said this would make bigger hybrids more attractive.

TOO AGGRESSIVE
‘The reason the 50-cent increases were not effective was that there was no real alternative to driving. But with all the plans to improve public transport now, you may not need to go for $1 increases.” - MR BERNARD TAY, Automobile Association of Singapore president

‘One of the main issues with these cars is the high road tax,’ he said. ‘Buyers feel they’re being punished.’

Besides the road tax reduction, which will cost Government coffers $110 million a year, car buyers can look forward to a 10 percentage point cut on a car’s Additional Registration Fee (ARF) - the main car tax.

That translates to a savings of $1,650 for a car like a Toyota Corolla and $5,000 for a luxurious Mercedes E-class.

But Automobile Association of Singapore president Bernard Tay said the registration fees could have been cut more.

He also said the decision to raise future ERP prices by at least $1 at a time - up from the current increment of 50 cents - was too aggressive.

‘The reason the 50-cent increases were not effective was that there was no real alternative to driving.

‘But with all the plans to improve public transport now, you may not need to go for $1 increases,’ he said.

While the ARF cut will help buyers save money up front, owners will get back less when they eventually scrap their cars. This is because the scrap rebate is based on the ARF.

While most motor traders welcome the tax cuts, they said a decision announced yesterday by Transport Minister Raymond Lim to limit the growth of the number of new cars on the road to 1.5 per cent annually could drive COE prices up. The old rate, in place since 1990, was 3 per cent.

Motor Traders Association’s Mr Wong said the cut was ’steep’, and reckoned car COE premiums would eventually rise to the $30,000-$40,000 region - from around $14,000 now. Car dealers said this could have a profound effect on the popularity of certain makes.

Singapore Vehicle Traders Association president Neo Nam Heng said sales of high-end cars will be least affected, while a $5,000 increase in COE rates could wipe out ‘one third’ of entry-level models.

This trend emerged in the mid-1990s, when COE prices shot to as high as $110,000. Back then, Mercedes-Benz was a bestseller with an unprecedented market share of up to 14 per cent. It is now back to more earthy levels of 4-5 per cent.

The COE back then cost much more than the car itself, pricing many ordinary buyers out.

Going down
ROAD TAX

Road taxes will be cut by 15 per cent for all vehicles from July. Motorists will save $110 million.
The owner of a $30,000 0.8 litre Chery QQ will pay $354 a year instead of $417, saving $63.

For a 1.6 litre Toyota Corolla, the tax will go down from $874 to $743, saving $131.

At the other end of the scale, the owner of a $1.5 million 6.75 litre Rolls-Royce Phantom will pay $8,248 instead of $9,704, saving $1,456.

Owners of green cars will benefit too. For example, road tax for a Lexus RX400h, which has a 3.3 litre engine and two electric motors, will be $2,870 - 36 per cent less than the current $4,482.
ADDITIONAL REGISTRATION FEE

The Additional Registration Fee for new cars will be lowered from 110 per cent of the open market value to 100 per cent from March. The Government will forgo $200 million in revenue.

This translates to a possible cut in price of about $1,600 for a car like a Toyota Corolla and $5,000 for a luxurious Mercedes E-class.
Source : Straits Times  - 31 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

More cars causing jam, so Singapore ERP changes a must

More cars causing jam, so Singapore ERP changes a must

Current system coming under strain after 10 years, says Transport Minister

By Goh Chin Lian
ENSURING SMOOTH FLOW: Following the opening of the Kallang-Paya Lebar Expressway’s maiden 3km stretch from Sims Avenue to Fort Road in the East Coast Parkway last October, the rest of the KPE will open on Sept 20 this year. But even with the addition of new expressways, motorists are not assured of smooth travel without ERP charges. — PHOTO: LIANHE ZAOBAO

HAVING paid the Electronic Road Pricing (ERP) charges, some motorists still find themselves still stuck in a jam on roads and expressways here.
Transport Minister Raymond Lim said yesterday that this happens because there are many more cars on the road today than 10 years ago when the ERP system was introduced.

‘Our ERP system has served us well, but it is coming under strain,’ said Mr Lim.

Cars are also used more intensively here, clocking 21,000km a year on average, compared to 9,100km in London.

Also, the 50-cent increases to ERP rates are no longer enough to keep traffic going, seeing as how after it went up nine times in 2006, another 25 rate hikes were needed last year.

The new changes announced yesterday aim to fix this problem:
ERP will kick in much earlier under a new formula;

The basic ERP charge will go up from July to $2, from $1 now, and each subsequent jump will be $1, instead of 50 cents;

Sixteen more gantries will be put up, all to help ease congestion in the city area as well as on major roads islandwide.
Currently, the gantries go active once the speed of half the motorists travelling on a particular stretch over a 30-minute period falls below the optimal level of 45kmh for expressways and 20kmh for major roads.

However, in practice, many motorists will be travelling far slower. For example, speeds measured from 7.30am to 8am on a stretch of the Pan-Island Expressway this month showed that up to 38 per cent of the motorists were actually travelling below 45kmh, despite paying the ERP.

‘This also explains why there is at times a disconnect between what the Land Transport Authority says and motorists’ actual driving experience,’ said Mr Lim.

Under the new formula, ERP charges will kick in when, in line with international practice, just over 15 per cent of vehicles fall below ideal speeds.

So, at least 85 per cent of motorists will be assured of smooth travel when they pay the ERP charges,Mr Lim said.

Mr Lim expects that with the higher basic charge and larger increments, rate changes will be less frequent.

The new formula and higher charges will be phased in to give people time to adjust.

They will start in July in the Central Business District (CBD) and Orchard Road, after more bus and train trips come on line, and then to other roads in due time.

The number of gantries will also go up in phases, from 55 now, to 60 in April, 65 in July and 71 in November.

The focus is on the city area. Speeds on major roads in the CBD have fallen by over 25 per cent, from five years ago.

To cross major junctions, say, between North Bridge Road and Bras Basah Road, motorists must wait for three or more traffic light changes.

So, ERP will be used to discourage those motorists who are just passing through the already packed Suntec City, Bugis and Marina Square shopping areas in the evenings, and on Saturdays. They make up a third of the traffic now.

The ERP changes will have an effect on motorists like retiree William Chan, 65.

He said: ‘If ERP prices keep rising, we may switch to public transport, but we’ll still retain the option of driving to places that are far away.’

Others, like manager Chua Xin Kai, 28, will not make a switch - yet.

‘I’m paying so much for the car and after driving for 10 years, I am just lazy to take public transport. Maybe when I have to scrap my car in three years, I’ll reconsider.’

Until then, the Government expects to collect from such motorists $70 million more a year as a result of the changes.

And to show that this is not an excuse to raise revenue, but really to curb congestion, road taxes will be cut 15 per cent to the tune of about $110 million.

Mr Lim said: ‘If motorists were to drive less, the Government would be happy to collect less ERP revenue.’
ERP changes
April 7: Five gantries in Upper Bukit Timah Road, Toa Payoh Lorong 6, Upper Boon Keng Road, Geylang Bahru Road and Kallang Bahru Road will be switched on from 7.30am to 9.30am on weekdays.

July 7: Five gantries along the Singapore River, from Clemenceau Avenue to Fullerton Road, will be switched on from 5pm to 8pm on weekdays.
Two of them, in Eu Tong Sen Street and Fullerton Road (towards Esplanade Drive), will operate on Saturday from 10am to 8pm.

ERP operation hours on weekdays will also start earlier for the Central Business District, at 7am, and Orchard Road, at 10am.

New ERP formula, including the possibility of a $1 rate increase, will apply to these roads.
Nov 3: Six gantries will be switched on in Commonwealth Avenue, Jalan Bukit Merah, Alexandra Road, Ayer Rajah Expressway (west-bound, near Alexandra Road), Pan-Island Expressway (west-bound, near Eunos) and Serangoon Road.
New formula will apply to more roads with gantries, including in such areas as Toa Payoh, Dunearn Road and Bendemeer Road.
February 2009: New formula will apply on all roads with gantries.
THE ONLY WAY OUT

‘Without ERP, Singaporeans would be spending many hours in traffic snarls, just like people in Tokyo, Los Angeles and many other US cities, who pay for congestion, not with their wallets, but with the time that they have lost, stuck in traffic gridlock.’

TRANSPORT MINISTER RAYMOND LIM

Road pricing through the years
1975
The first road pricing scheme, known as the Area Licensing Scheme (ALS), is introduced.

This scheme covers the more congested parts of the Central Business District, designated as the Restricted Zone.

Cars with three or more passengers, excluding the driver, are exempted.

Motorists must buy a paper licence at $3 a day, before passing through control points on the roads, monitored by enforcement personnel.

Operations hours are from 7.30am to 9.30am daily, except Sundays and public holidays. It is later extended to 10.15am.

JUNE 1989

The scheme is extended to evening peak hours, from 4.30pm to 7pm on weekdays, following rapid growth in vehicle population.

January 1994

Restricted hours are further extended to 10.15am to 4.30pm on weekdays and 10.15am to 3pm (later to 2pm) on Saturdays. Car pools are abolished because private cars are picking up bus commuters.

SEPTEMBER 1998

Electronic Road Pricing (ERP) system replaces the manual ALS, starting with 33 gantries.

SEPTEMBER 1999

ERP is extended to some key roads beyond the Restricted Zone.

AUGUST 2005

Evening ERP kicks in on the Central Expressway. In the Orchard Road area, more gantries are introduced and operation hours are extended to 8pm on weekdays, and on Saturdays, from noon to 8pm, to control traffic flow in and out of the shopping belt.

JANUARY 2008

Announcement of fundamental changes to ERP system.
Source : Straits Times  - 31 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Valuation wrong, so Singapore Strata board rejects sale of Regent Garden

Valuation wrong, so Singapore Strata board rejects sale of Regent Garden

In an unusual case, it says $34m price agreed on by owners and developer is well below market value

By Joyce Teo, Property Correspondent

AN UNUSUAL battle over the en bloc sale of Regent Garden intensified yesterday when the Strata Titles Board (STB) threw out the sale - ruling the $34 million sale had not been done in good faith.
The showdown over the fate of the 31-unit West Coast Road condominium site is now headed for the High Court.

The case is unusual because all six dissenting minority owners had withdrawn their objections to the sale, which was inked last April.

It is now the majority owners, who signed off on the sale, who are trying to back out of the deal with buyer Allgreen Properties.

The STB said it rejected the deal because it was not done in good faith, as Regent Garden’s valuation - on which the final price was based - was wrong.

It said that Regent Garden’s $34 million sale price was well below its market value.

The deal needed STB’s formal approval as there had originally been objections to the sale.

The dispute also involves alleged extra payments made to minority owners to quell those objections.

The majority owners filed an originating summons in the High Court this month trying to overturn the sale.

They argued that the $34 million sale price was wrong partly because of a wrongly estimated $7.2 million development charge - a charge for redeveloping a site to enhance its value. The charge, payable by developers, turned out to be just $950,000.

The large disparity is not common, and a consultant said it could be due to historical reasons, as the Regent Garden site permits more space to be built than usual.

Unless those involved knew the project’s development history, they would have been unaware of this, he said.

Allgreen has also gone to the High Court to ask for an order requiring the majority owners to complete the sale deal by Feb 28.

The two cases are likely to be heard together on a date that has yet to be fixed, said a sale committee member.

Another high-profile disputed collective sale, at Horizon Towers, as well as smaller cases such as Finland Gardens, are also due to be heard by the High Court.

The STB delivered its decision yesterday in an oral statement at the end of a half-day hearing, and has yet to give the grounds for the decision.

In a statement yesterday, Allgreen said it was surprised at the STB decision to hear the case despite pending court proceedings and the fact that there had been no objectors.

A property industry source who declined to be named said the case is unique as the STB took the effort to hear the merits of the case and threw it out even though there were no objections.

In a case where there are withdrawn objections from minority owners, these owners must sign the collective sale agreement in order to be a party to the deal. If not, the STB still has to rule on it.

However, in past cases, the STB just approved a sale, and did not look into the merits of the case as there was no need to, said the source.

Allgreen said that the STB decision would have no bearing on the case in the High Court.

Its fixed sale price of $34 million was the highest among all bids, it said. Also, it had offered owners the option of a floating sale price subject to the development charge.

But the sale committee had asked for the $34 million fixed price and refused advice to pay for an official figure.

The majority owners’ allegations are ‘nothing more than belated attempts to reopen a concluded bargain and to extract a better price for themselves’, said Allgreen.

‘We will rigorously pursue our case in court.’
Source : Straits Times  - 31 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Singapore ERP network widened, charges going up

Singapore ERP network widened, charges going up

16 new gantries and other changes are aimed at ensuring that 85% of motorists enjoy a smooth ride

By Christopher Tan, Senior Correspondent

THE bitter medicine aimed at easing road congestion was spooned out yesterday.
Motorists will have to pay more to use the roads, said Transport Minister Raymond Lim, as he unveiled the third and final instalment of the Land Transport Review.

Congestion levels have gone up by about a quarter since 1999, he noted. To arrest this, 16 new gantries will go up between April and November, making 71 in all.

On top of this, a new price structure will be introduced gradually from July: From then, passing each gantry will cost motorists at least $2, up from $1 now; and subsequent jumps in the road pricing fee will be $1, instead of 50 cents.

‘Instead of resorting to so many small adjustments, it would be more effective to make larger rate increments,’ Mr Lim said.

The Government will change the criteria for deciding which roads will be priced under the Electronic Road Pricing (ERP) system. It will also change the ‘trigger point’ for increasing the ERP rates along roads already priced.

Now, as long as average speeds on expressways and arterial roads fall in the 45kmh to 60kmh and 20kmh to 30kmh ranges respectively, all is well.

Soon, 85 per cent of road users must be able to move at these speeds to stave off ERP or a rise in the ERP fee.

Bitter as the medicine is, the Government is also offering some sugar to go with it.

Road tax, cut just last September by 8 per cent, will be cut by another 15 per cent - which will more than offset motorists’ ERP expenses. This tax cut will cost the national coffers $110 million a year.

Mr Lim stressed that ERP was never meant to be a Government revenue earner, and that the long-term policy was to shift vehicle taxes from ownership to usage.

And by beefing up public transport - changes to the bus and rail systems have been announced over the last two weeks - the Government also hopes to coax car owners onto buses and trains.

Two other sweeteners were unveiled yesterday for motorists: a cut to the additional registration fee (ARF) and new road projects.

The ARF, now at 110 per cent of the vehicle’s open-market value, will be cut by 10 percentage points from March and cost the Government $200 million a year. The change will apply to cars bought with certificates of entitlement secured from the March tender on.

As for road projects, $14 billion will be spent on building roads over the next 12 years, a leap from the $3.4 billion spent in the last decade.

One of them is the 21km North-South Expressway to link Woodlands to the East Coast Parkway. Ready by 2020, it will cut commutes from the north-east by 30 per cent.

The Marina Coastal Expressway linking the Kallang Expressway to the Ayer Rayah Expressway will be ready in 2013; the Tampines Expressway and the Central Expressway will be widened.

Going forward, fewer roads will be built, said Mr Lim. This is because 12 per cent of Singapore’s land space is already taken by roads, nearly as much as the 15 per cent now sitting under housing.

Besides, he said, building more roads ‘is like telling a person who’s suffering from obesity that the solution…is to buy bigger trousers’.

To give motorists an attractive alternative to driving, the frequency of bus services along corridors affected by the ERP expansion will be upped to one every 12 minutes by June, from one every 15 now.

And for the first time since mass transit started here two decades ago, bus services will be allowed to duplicate sections of mature MRT lines.

The land transport masterplan, the result of a year-long review, aims to get 70 per cent of morning peak-hour trips made on public transport, from 63 per cent now.

The medicine may already be working, at least with marketing executive Loh Ye Ling.

The 23-year-old is revising her year-old plan to buy car. She realises now that if she drives daily from her Hougang home to her Bugis office, she would spend far more than if she were to take a bus.

She said: ‘I can’t afford to spend so much on ERP, though road tax will be cut.’

Mr Cedric Foo, who heads the Government Parliamentary Committee for Transport, said: ‘I don’t think it’s easy, once you get a car, to move to public transport. But as we narrow the gap between private transport and public transport standards, motorists would, over time give up their cars.’
Source : Straits Times  - 31 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Singapore CPF members earn $6b in paper profit

Singapore CPF members earn $6b in paper profit

Substantial gains made by those who invested in gold, reports GENEVIEVE CUA

THANKS to strong markets for the most of last year, Central Provident Fund members are sitting on paper gains of roughly $6 billion in aggregate value in ordinary and special accounts, according to the latest profit and loss statement for the CPF Investment Scheme.

The data tots up members’ historical entry price against the assets’ respective market values for the CPF’s fiscal year up to Sept 30, 2007. The data gives a broad idea of how members have fared, but there is no indication of for how long each investment has been held.

The most substantial gains in percentage terms were achieved by members who invested in gold, with unrealised gains of as much as 57.1 per cent. The second most rewarding was property funds, which reflected paper gains of 50.77 per cent. Gold, however, is subject to a 10 per cent investment limit. This gives it almost the smallest share in members’ investment accounts on an aggregate basis. Property funds are subject to a 35 per cent investment limit, which also applies to stocks in general.

Yesterday CPF officials briefed the press on the progress of steps taken to raise the quality of funds in the CPFIS and to lower the investment costs. The number of funds in the scheme has steadily declined from 444 as at the fourth quarter of 2006 to 387 as at January - a drop of about 13 per cent.

The CPF’s new measures, which include a requirement for a three-year track record, top quartile performance, and a cap on expense ratios, were implemented for new funds seeking inclusion in the CPFIS from February 2006. From January this year, all funds have to comply with prescribed expense ratio caps. Those which are unable to comply will not be allowed to take in new CPF money.

To distinguish between those companies that are able to satisfy all the requirements including the expense ratio cap, CPF has created a list of the qualifying funds, called ‘List A’. There are currently 46 funds in List A. Another 30 top quartile funds are as yet unable to meet the expense ratio criteria and are put in List B, along with the rest.

The distinction between lists A and B, however, remains a point of contention among a number of fund managers, as Executive Money gathers. One fund manager says: ‘Some fund managers do not want to continue to be in the CPF market any longer. They are being asked to try to curb funds with high expenses, but people want to invest in them as they do give you performance. People should still be given that choice.’

The expense requirement is also awkward for funds with a performance fee structure. Ironically, a strong year of outperformance could result in the fund being closed to new money as the effective fees would shoot up.

Does a presence in List A draw investor interest? Another fund marketer is uncertain. ‘The distinction between List A and B is in its infancy. I have had some funds in List A and others which are in List B,’ he said.

CPF assistant director (investments) Wu Meei said it is possible that more funds may drop off the scheme. ‘That depends on their commercial decision,’ she said.

While the lion’s share of CPF savings continues to be invested in insurance-linked products, the amount invested in unit trusts has just exceeded that in stocks - by a tiny margin. As at the third quarter last year, $4.5 billion was invested in unit trusts, compared to $4.47 billion in shares.

In terms of performance, however, investment-linked policies (ILPs) registered a paper gain of 36.97 per cent against historical costs, compared to 17 per cent for unit trusts, and 27.67 per cent for shares.

As the underlying asset classes for ILPs and unit trusts are similar - a number of ILPs in fact feed into unit trusts - one reason for the differential in unrealised gain could be behavioural. Investors in insurance policies are said to be less likely to trade their funds. They are also more likely to be invested in balanced funds.

As for those who realised their investments in the fiscal year ended in September, 28 per cent made net profits after bank charges and in excess of the CPF Ordinary Account interest rate, compared to 23 per cent in 2006. The proportion with realised losses, however, remained substantial at 43 per cent.

During the period under review, the SES All Index gained 52 per cent, and the STI 44 per cent. The MSCI World Index gained 19 per cent.

CPF also briefed the press yesterday on the progress of initiatives to encourage members to defer withdrawal of their savings in retirement. As part of measures announced last year, savings of $60,000 in combined CPF balances will earn an extra 1 per cent in interest. The drawdown age is also to be raised progressively.

To help members between 50 and 57 cope with the later drawdown age, CPF will pay a one-off ‘D-bonus’ in May. Some 105,000 letters will be sent out this week to members who were 55 to 57 in age last year.

There is also a ‘V-Bonus’ or voluntary bonus to encourage members to voluntarily defer their drawdowns to age 65. Of the 10,123 members who turned 63 or 64 between January and February this year, 75 per cent - 7,583 - have deferred their withdrawals.

Source : Business Times  - 30 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Drew & Napier tops ranking of law firm employers- Singapore

Drew & Napier tops ranking of law firm employers- Singapore

By CHEW XIANG
DREW & Napier is the top employer among local and foreign law firms in Singapore, according to a survey by Asian Legal Business (ALB) magazine.
Home-grown giant Allen & Gledhill came in third in the overall rankings. Foreign firm Linklaters took second place, while Baker & McKenzie was fourth. Clifford Chance and Allen & Overy were joint fifth.

The magazine polled 20,000 lawyers across 13 jurisdictions in the Asia-Pacific. Firms were then scored on six categories, including financial rewards and work-life balance. The magazine also spoke to consultants and ex-employees of the law firms.

ALB managing editor George Walmsley said: ‘The difficulty of attracting and retaining legal talent … has been a recurring theme across Asia for some time now. We find it fascinating how the dearth of talent, whether caused by somewhat out-of-date legal training regimes or sheer pace of demand growth can change the whole shape of the legal services industry.’

ALB quoted Sandra Godbold of recruitment firm Hays as saying ‘it generally only takes one or two key people to take the lead and move firms to … encourage larger numbers of lawyers to follow.’

‘This is particularly true in the Asian legal market where lawyers move far more frequently than they do in Europe and the US.’

And in Singapore, the main motive in moving seems to be money. The report said that lawyers here and in mainland China sought the best compensation when choosing a new firm. However, Latham & Watkins, voted No 1 in Singapore for financial rewards, failed to make the top five in the overall rankings here.
Source : Business Times  - 30 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

VivoCity eyeing first Singapore Tourism Award

VivoCity eyeing first Singapore Tourism Award

IT’S a battle between the newcomers and the stalwarts in this year’s Singapore Tourism Awards. VivoCity, which opened in December 2006, will vie for the ‘Best Shopping Experience - Shopping Mall’ category alongside the more established Paragon and Wisma Atria. The category was revived for this year’s awards after a two-year break from the scene.
VivoCity deputy general manager Chang Yeng Cheong felt that the mall has an edge over the other finalists in terms of its size, new brands, as well as ‘good amenities’.

The ‘Best Nightspot Experience’ category, on the other hand, saw two first-time finalists - The Butter Factory and St James Power Station - up against last year’s winner, Ministry of Sound, and Zouk, which won the award in 2005. St James also has two staff members as finalists in the ‘Best Tourism Host - Nightspot’ category.

Other fresh faces include CHNG Kee’s Spice of Life, Franck Muller Boutique, iwannagohome! and Giordano Concepts, which are up against one another in the ‘Best New Retail Concept’ category.

The annual Singapore Tourism Awards, organised by the Singapore Tourism Board, honour individuals and organisations that provide excellent service and products for the tourism industry. About 35,000 nominations for the 22 categories were received through public votes for this year’s awards. Judging panels then shortlisted the nominees based on each category’s criteria, visiting the shortlisted nominees for first-hand service experience.

The winners will be announced next Tuesday.

Source : Business Times  - 30 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Singapore Condo site facing reservoir launched

Singapore Condo site facing reservoir launched

By KALPANA RASHIWALA
THE Housing & Development Board (HDB) has launched the tender for a 99-year-leasehold site at the corner of Yishun avenues 1 and 2 that fronts Lower Seletar Reservoir and is near Singapore Orchid Country Club/Golf Course.
The plot, which is about 10 minutes’ walk from Khatib MRT Station, is expected to fetch bids in the range of $200-$300 per square foot (psf) of potential gross floor area, property consultants say.

The 2.7 hectare site has a 2.1 plot ratio, allowing a maximum gross floor area of 609,163 square feet, enough for a condo with about 500 apartments averaging 1,200 sq ft.

CB Richard Ellis executive director Li Hiaw Ho said that a condominium on this site would be able to enjoy scenic views of the reservoir and golf club.

As the suburban market is expected to strengthen this year, Mr Li expects the site to draw keen interest from developers.

‘Demand is likely to come from Housing & Development Board flat upgraders and people who work in the northern part of Singapore. Units in Orchid Park Condominium nearby are being sold in the secondary market at around $550 psf, while new freehold units in the vicinity such as The Sensoria and Northwood were sold at prices ranging from $600 psf to $650 psf.

‘Based on a selling price of $600 psf to $650 psf, it is expected that the tender bids for the site will range from $200 to $240 psf per plot ratio.’

Credo Real Estate managing director Karamjit Singh places the fair value of the plot even higher, at $280-$300 psf ppr, and reckons that the top bid may surpass that, given the plot’s attractions. Assuming this higher price range, the breakeven cost for a new condo would be around $600-$610 psf and the project is likely to command an average price in the high-$600 psf range, he added.

The tender closes on March 25. It is part of the confirmed list, under which the government launches land parcels for tender according to a pre-stated schedule regardless of demand.
Source : Business Times  - 30 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Singapore only nation with high growth, job creation

Singapore only nation with high growth, job creation

Lim Swee Say cites Economist report; NTUC to help 8,000 unemployed workers get jobs
By CHUANG PECK MING

SINGAPORE was the only country in the world to post high economic growth and low unemployment in 2007. The labour movement here wants Singapore to at least keep up with this achievement in 2008, as it unveiled its work plan yesterday for the new year.
Despite global uncertainties and the threat of a recession in the United States in 2008, Lim Swee Say, secretary-general of the National Trades Union Congress (NTUC), said that the strong economic gains made in the past few years have built up a healthy pipeline of jobs to provide some buffer against a global downturn and carry workers through the year.

He noted that Singapore has continued to take in foreign workers, indicating that there are more than enough jobs to go around for all.

‘We are in a much better position than many countries,’ Mr Lim told reporters at a press conference.

Earlier, in an address to unionists, the NTUC chief cited a study reported in The Economist, which showed that out of 56 countries, including fast-growing economies like China and India, Singapore was the only one in 2007 to have achieved high economic growth and created enough jobs for its workers.

China, which probably chalked up the world’s highest economic growth of 11.5 per cent in 2007, has an unemployment rate of 9.5 per cent. Some 25 countries, among them India, Indonesia, Malaysia, Hong Kong and South Korea, fell into this category of high growth but insufficient jobs last year.

Another 25 countries, including the United States, Japan, Germany and Taiwan, were marked by low economic growth but high unemployment. Five countries, among them Norway, Thailand and Switzerland, while low in economic growth, were able produce plenty of jobs.

‘Singapore did exceedingly well in 2007,’ said Mr Lim who is also Minister in the Prime Minister’s Office.

On the labour union front, he ticked off the lowest number of lay-offs since 1993; a sharp drop in worker grievances; the biggest pay rise in three years; and a 17-year-high bonus of 4.42 months’ salary.

According to Mr Lim, to help keep unemployment low this year, the NTUC will work closely with the government and employers to find work for some 8,000 jobless workers, up from 7,757 in 2007.

Through various employment-help programmes like Job Re-Creation, Place and Train and Careerlink, the labour movement hopes to place some 7,000 unemployed.

It will also help another 1,000 mature professionals, managers, executives and technicians under the Professional Conversion Programme to shift to new careers in logistics, tourism and call centres.

The NTUC also wants to raise the employment rate through re-employment, re-deployment and back-to-work initiatives. Specifically, it wants to help mature Singaporeans to stay employed; workers hit by business restructuring to keep their jobs; and housewives who want to return to work.

In all, the NTUC is setting its sights on 8,000 Singaporeans in this category, up from 4,311 in 2007.

Lastly, the labour movement wants to extend its help to those who are under-employed - those working but earning low pay. It will help them boost their skills and secure better jobs and better pay.
Source : Business Times  - 30 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Straits Trading bidding war will be test for OCBC - Singapore

Straits Trading bidding war will be test for OCBC - Singapore

By MICHELLE QUAH

THE illustrious Tan and Lee families are the ones holding court in the current bidding war over The Straits Trading Company. But it is a seemingly silent player in the entire saga that may well hold the key to the eventual outcome: OCBC Bank.

The bank is in a delicate position in this takeover tussle, being both a substantial shareholder of Straits Trading and a company in which the Lee family has a controlling interest.

This battle between the Tans and the Lees will be a test of OCBC’s independence. The bank will need to balance its duty to its shareholders with its ties with the Lee family.

OCBC and the Lee family

Thus far, little thought and attention have been devoted to the role OCBC will play in this saga. The bank is simply one of many shareholders of Straits Trading - a Singapore-listed company with interests in property, hotels and tin smelting.

But unlike many of the other shareholders, OCBC is closely linked to one of the two parties fighting to take over Straits Trading.

The bank was founded by the late patriarch and philanthropist, Lee Kong Chian, who also managed OCBC from 1938 to 1964. And, to this date - while the bank is no longer a family-owned business but a publicly traded entity - OCBC continues to be substantially owned by the Lee family.

The Lees, through their various vehicles and subsidiaries, are believed to own about a quarter of OCBC and are its single largest shareholder.

OCBC was managed for a substantial portion of its history by the late Tan Chin Tuan. Mr Tan was OCBC’s managing director and chairman from 1964 to 1983. And the Tan family, through its vehicle Tecity, retains a small stake in the bank. Still, any residual relationship OCBC has with the Tan family pales in comparison to the ties it has with the Lee family.

And it is this perceived imbalance - and OCBC’s status as a listed company in its own right - that has put it in a very delicate position, with respect to the ongoing bidding war for Straits Trading.

OCBC’s pivotal role

Tecity’s chief, Chew Gek Khim - granddaughter of the late Mr Tan - has thrown the spotlight on OCBC’s plight when her family raised its bid for Straits Trading on Monday to $6.50 a share, from $5.70 previously.

Along with the revised offer, she announced to the public that she had sent offer letters to OCBC and the bank’s insurance arm, Great Eastern Holdings (GEH) - which own 6.21 per cent and 19.92 per cent of Straits Trading respectively.

She announced that if OCBC and GEH accept Tecity’s offer, the Tan family - which now owns 23.60 per cent of Straits Trading - would end up owning 49.73 per cent of the offer target.

Her move drew the public’s attention to the pivotal role that OCBC will play in this saga, and observers will now be watching to see how the bank will respond to the competing bids for its stake in Straits Trading.

Essentially, OCBC only has one of three choices to make:

sell its stake to the Lees;
sell its stake to the Tans;
keep its stake.

The circumstances in which it makes this choice will be closely observed. At this point, the Tan family’s offer for Straits Trading at $6.50 a share is substantially higher than the Lee family’s offer of $5.76. Selling to the highest bidder is a commercial decision that most investors understand, so shareholders are unlikely to take OCBC to task if it decides to sell its stake to the Tans.

However, if OCBC chooses to either keep its stake or sell it to the Lees, it will have to justify its decision. If the bank retains its stake, shareholders will want to know if it believes that an offer of $6.50 a share still grossly undervalues Straits Trading.

And, if it decides to sell its stake to the Lees, whose offer is $0.74 a share less than the Tans’, it will really have to come up with good reasons to satisfy its shareholders.

The picture is different if the Lees decide to counter-offer with a higher bid. Any decision by OCBC to sell its Straits Trading stake to its controlling Lee family would then be seen more as a commercial decision. And shareholders would more likely question any decision on the part of the bank to sell its stake to the Tans or to keep the stake.

OCBC, GEH and other Straits Trading shareholders have until Feb 22 to consider accepting the Tan family’s offer - that is, unless a higher bid comes in before then from the Lees.

OCBC needs to recognise that it is in a delicate position, that it is being watched, and that it should move carefully. Its move will also set the tone for GEH’s decision.
Source : Business Times  - 30 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com