Singapore JTC scraps plans to list assets in Reit

Singapore JTC scraps plans to list assets in Reit
 
Industrial landlord will instead sell 62 properties to a Temasek subsidiary for $1.71 billion

By Fiona Chan, Property Reporter 
FOR SALE: Among the industrial assets that JTC Corporation is selling to Mapletree Investments are The Synergy at the International Business Park (top) and a flatted factory property in Lower Delta Road (above). — PHOTOS: ST FILE PHOTO, GAVIN ANDERSON
 
JTC Corporation has scrapped its long-awaited plans to list its industrial assets in a property trust, citing volatile market conditions.
Instead, Singapore’s biggest industrial landlord is selling the properties to Mapletree Investments, a subsidiary of Temasek Holdings, for $1.71 billion, JTC and Mapletree said in a joint statement yesterday.

Mapletree also said it might list the properties in a new trust, possibly combining them with some of its own assets.

The move caught market watchers by surprise, as Mapletree was hired in February to manage JTC’s proposed billion-dollar real estate investment trust (Reit). The listing was set down for the middle of the year.

‘It’s definitely a surprise move. It’s a complete U-turn from what JTC said earlier,’ said Mr Tan Boon Leong, industrial director at property firm Colliers International.

‘It may not sit too well with local and foreign investors, who were expecting a new Reit, to just go and sell off the properties like that. It may be seen as very ‘Singapore Inc’.’

But Mr Dominic Peters, director of industrial services at Savills Singapore, said this was ‘a better move than JTC having to list on its own because it is difficult to raise funds now’.

JTC said it would complete the sale of 62 properties, including 39 flatted factories and three business park buildings, to Mapletree by July 1. It added that this divestment option had been part of Mapletree’s proposal to JTC when the former was appointed as manager of the future Reit, although it had not been disclosed then.

Mapletree has its own industrial property trust, Mapletree Logistics Trust, which is worth about $2.5 billion. Its biggest rival, Ascendas Reit, has a $4.2 billion industrial portfolio.

If Mapletree pumps all the JTC properties into its existing Reit, it could become ‘the biggest industrial Reit around’, said Mr Tan.

But Mapletree also has other unlisted assets in its industrial fund and could combine these with JTC’s assets to form a whole new Reit.

Experts said one issue would be whether JTC’s properties were a good fit with the Mapletree assets.

‘I believe 95 per cent of JTC’s assets are older flatted factories in housing estates with rentals of $1 to $2 per sq ft - a different portfolio from Mapletree,’ said an industry watcher.

Colliers’ Mr Tan said, however, that JTC’s properties were all in ‘great locations’. The tenants, though, should expect rentals to rise after Mapletree takes over, as it would have to improve asset yields before listing them.
Source : Straits Times  - 23 April 2008

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Singapore JTC scraps plans to list assets in Reit

Singapore JTC scraps plans to list assets in Reit
 
Industrial landlord will instead sell 62 properties to a Temasek subsidiary for $1.71 billion

By Fiona Chan, Property Reporter 
FOR SALE: Among the industrial assets that JTC Corporation is selling to Mapletree Investments are The Synergy at the International Business Park (top) and a flatted factory property in Lower Delta Road (above). — PHOTOS: ST FILE PHOTO, GAVIN ANDERSON
 
JTC Corporation has scrapped its long-awaited plans to list its industrial assets in a property trust, citing volatile market conditions.
Instead, Singapore’s biggest industrial landlord is selling the properties to Mapletree Investments, a subsidiary of Temasek Holdings, for $1.71 billion, JTC and Mapletree said in a joint statement yesterday.

Mapletree also said it might list the properties in a new trust, possibly combining them with some of its own assets.

The move caught market watchers by surprise, as Mapletree was hired in February to manage JTC’s proposed billion-dollar real estate investment trust (Reit). The listing was set down for the middle of the year.

‘It’s definitely a surprise move. It’s a complete U-turn from what JTC said earlier,’ said Mr Tan Boon Leong, industrial director at property firm Colliers International.

‘It may not sit too well with local and foreign investors, who were expecting a new Reit, to just go and sell off the properties like that. It may be seen as very ‘Singapore Inc’.’

But Mr Dominic Peters, director of industrial services at Savills Singapore, said this was ‘a better move than JTC having to list on its own because it is difficult to raise funds now’.

JTC said it would complete the sale of 62 properties, including 39 flatted factories and three business park buildings, to Mapletree by July 1. It added that this divestment option had been part of Mapletree’s proposal to JTC when the former was appointed as manager of the future Reit, although it had not been disclosed then.

Mapletree has its own industrial property trust, Mapletree Logistics Trust, which is worth about $2.5 billion. Its biggest rival, Ascendas Reit, has a $4.2 billion industrial portfolio.

If Mapletree pumps all the JTC properties into its existing Reit, it could become ‘the biggest industrial Reit around’, said Mr Tan.

But Mapletree also has other unlisted assets in its industrial fund and could combine these with JTC’s assets to form a whole new Reit.

Experts said one issue would be whether JTC’s properties were a good fit with the Mapletree assets.

‘I believe 95 per cent of JTC’s assets are older flatted factories in housing estates with rentals of $1 to $2 per sq ft - a different portfolio from Mapletree,’ said an industry watcher.

Colliers’ Mr Tan said, however, that JTC’s properties were all in ‘great locations’. The tenants, though, should expect rentals to rise after Mapletree takes over, as it would have to improve asset yields before listing them.
Source : Straits Times  - 23 April 2008

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S’pore named best seaport in Asia

S’pore named best seaport in Asia 
 
THE Port of Singapore has again won the best seaport in Asia title. It is its 20th victory since it first triumphed in 1987.
The accolades do not end there.

PSA International was named best global container operator for a fourth year, while PSA Singapore Terminals was voted Asia’s best container terminal for the 19th time.

The awards were conferred at the 22nd Asian Freight and Supply Chain Awards organised by Cargonews Asia, a leading transport publication based in Hong Kong.

The winners were selected through a poll of shipping industry stakeholders, including freight lines, terminal operators, freight forwarders and other parties across Asia.

Captain Khong Shen Ping, acting chief executive of the Maritime and Port Authority of Singapore, said: ‘We are greatly…honoured by the vote of confidence from our industry partners, who have reaffirmed Singapore as their port of choice in Asia.’

Mr Fock Siew Wah, group chairman of PSA International, said the company’s wealth of experience had been crucial to its success.

‘We innovate and introduce systems and processes with the clear objective of staying relevant and providing the highest level of service to customers,’ he said.
CHIA YAN MIN

Source : Straits Times  - 23 April 2008

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Singapore Deferred payment scheme: Up to 4,200 homes may be dumped

Singapore Deferred payment scheme: Up to 4,200 homes may be dumped 

No URA figure on units sold but experts say 30% could be offloaded

By Jessica Cheam 
THE hugely popular deferred payment scheme (DPS) - scrapped last year - may now be a thing of the past, but what sort of shadow will it cast on the Singapore property market going forward?
This has been the question on market watchers’ lips since the Urban Redevelopment Authority (URA) revealed last week that as many as 29,250 homes offered under the DPS, including 5,760 unsold units as at the end of last month, will be completed from this year to 2013.

The concern is that speculators who bought homes under the DPS could dump their units at below-market prices, and this could drastically drag down overall sentiment.

But just how many units are at risk of being sold, and how big will the impact be?

The URA said while it has the number of units approved under DPS, it does not have data on how many units were actually sold under the scheme.

But four property experts The Straits Times spoke to estimated that up to 30 per cent of homes sold under the scheme last year could be held by speculators who may offload homes as the completion date nears. This translates to roughly 4,200 homes, going by a back-of-the-envelope calculation.

That is because out of the 23,490 units approved under the DPS and sold, only about 50 to 60 per cent - or roughly 14,000 - are likely to have been sold under the DPS, say property consultants and agency bosses from Knight Frank, Savills Singapore, HSR Property Group and PropNex.

The remaining 40 to 50 per cent were not bought under the DPS. Either developers did not eventually offer it, or buyers chose to pay via progressive payments, because buying a home with DPS usually means a further 2 to 3 per cent added to the price.

Next, property experts estimated that of the 14,000 or so homes sold under the DPS, about 20 to 30 per cent were probably sold to short-term investors or speculators.

This means that as a group, speculators could be holding on to as many as 4,200 units.

Why are speculators prone to selling their units as they near completion?

The DPS allowed buyers to pay just 10 or 20 per cent of the sale price upon purchase, with the rest due only when the unit received its temporary occupation permit (TOP) on completion.

Speculators would, therefore, typically opt for the DPS and hope to sell their units for a profit before the TOP. Any later and they would have to pay up for their homes by arranging for bank loans or other means of financing.

Industry experts were, however, divided on the impact these 4,200 homes would have on the market.

Some maintained that panic selling is not likely, given Singapore’s strong economic outlook, which is backed by upcoming mega projects such as the integrated resorts and the 2010 Youth Olympics.

Mr Eric Cheng, HSR’s executive director, noted that homes set to be completed this year and next are less likely to be sold indiscriminately, since their owners are probably sitting on healthy gains.

But those who bought at the peak of last year’s buying frenzy, from April till October, are most likely to be at risk. These homes are likely to be completed after 2010.

Mr Ku Swee Yong, Savills’ director of business development and marketing, said the sell-off will likely be staggered, because investors have different levels of holding power.

Also, investors have bigger coffers compared to the last property peak in 1996, he added.

But he warned that if too many units in a single large project get dumped at below-

market prices, overall market sentiment may be hit.

Mr Colin Tan, Chesterton International’s head (research and consultancy), thinks that the potential risk created by the DPS is relatively high.

He added that data on homes sold under the DPS should be collected and made public, so investors know ‘what they’re getting themselves into’.

The DPS was scrapped abruptly last October after a decade-long run to remove excessive speculation and ensure financial prudence in the property market.
Source : Straits Times  - 23 April 2008

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New China visa rule: Travel agents not too worried

New China visa rule: Travel agents not too worried 
ONLY TEMPORARY: The new rule requiring visas for China-bound Singapore travellers on short trips from July 1 means extra work for travel agents, but most say the temporary ruling should not pose too much of a problem. — PHOTO: REUTERS
 
GETTING China-bound Singapore travellers to apply for visas is going to entail extra work and cost, say travel agents and corporate travellers.
But they are thankful that the new rule, effective July 1, is temporary and can be expected to be lifted after the Olympic Games, which Beijing is hosting from Aug 8 to 24.

A statement from the Ministry of Foreign Affairs on Monday made official the latest change to China’s visa rules.

Visas are currently not needed for Singaporeans, Japanese and Bruneians making trips there lasting 15 days or less.

Frequent traveller Tan Sze Wee, chief executive of biotechnology company Rockeby, said the rule made it inconvenient, but did not pose too much of a problem for corporate travellers.

Noting that visas were also required for travel to India, he added: ‘What this means is we have to plan for the trips to China much earlier to take into consideration turnaround time for visa application.’

Agreeing, Ms Ruth Lim, the manager for marketing and communications at SA Tours, said it was a return to the situation before 2003, when visas were required for travel to China.

‘Fortunately it is only temporary,’ she said.

Agreeing, her counterpart at ASA Holidays, Ms Eileen Oh, said: ‘We do not foresee much disruption to our tours, since the July to October period is typically a low season for travel.’

To apply for a China visa:
The passport must be valid for at least six months. The endorsed visa becomes invalid if the passport expires. The validity of the visa starts on one’s date of application.

The visa application must be submitted with a passport photo affixed to it. A copy of the ticket both in and out of the country and a hotel voucher must also be presented. If there is an accompanying child on the trip, the child’s photo is required with the application.

There are single-entry visas and double-entry ones. The duration of one’s stay will be determined by the visa officer.

Third-country passport holders must also provide the original and a photocopy of their Singapore Permanent Residency, Work Permit, Employment Permit or valid visa.
It costs $25 and takes four working days to get a visa to China. The application can be speeded up but this will cost $50 more. Only cash is accepted.

A receipt will be issued for passport and visa collection. If the receipt is lost, applicants must be present in person with their identity cards to collect their visas.
JUDITH TAN
Source : Straits Times  - 23 April 2008

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For Rent - Emerald Park - District 09 -Singapore Apartment Condo Listing- 23.04.2008

For Rent - Emerald Park - District 09 -Singapore Apartment Condo Listing- 23.04.2008

TY : [C]ondo [D]uplex [H]iRise [L]oRise [T]ownHse [P]enthse [W]alkUp [M]asionette

TNR=Tenure, DT=District, BDRM=Bedroom, AREA=Built-In, STR=Storey, Price $K=In Thousand

Price are subject to changes , please call (+65) 91002985 for lastest update
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #02-ABV
Area — 1178
Bedroom — 3
PSF — 4.24
Price$ — 5000
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #04-ABV
Area — 1158
Bedroom — 3
PSF — 4.15
Price$ — 4800
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #04-ABV
Area — 1000
Bedroom — 2
PSF — 3.6
Price$ — 3600
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #04-ABV
Area — 1100
Bedroom — 2
PSF — 3.18
Price$ — 3500
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #05-ABV
Area — 1238
Bedroom — 3
PSF — 4.04
Price$ — 5000
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #07-ABV
Area — 1238
Bedroom — 3
PSF — 4.04
Price$ — 5000
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #07-ABV
Area — 1289
Bedroom — 3
PSF — 3.49
Price$ — 4500
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #07-ABV
Area — 1200
Bedroom — 3
PSF — 3.75
Price$ — 4500
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #08-ABV
Area — 1238
Bedroom — 3
PSF — 3.88
Price$ — 4800
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #08-ABV
Area — 1238
Bedroom — 3
PSF — 4.2
Price$ — 5200
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #10-ABV
Area — 1100
Bedroom — 2
PSF — 3.45
Price$ — 3800
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #11-ABV
Area — 0
Bedroom — 2
PSF — null
Price$ — 1700
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #11-ABV
Area — 1398
Bedroom — 3
PSF — 3.65
Price$ — 5100
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #11-ABV
Area — 1381
Bedroom — 3
PSF — 3.4
Price$ — 4700
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #11-ABV
Area — 0
Bedroom — 1
PSF — null
Price$ — 1900
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #12-ABV
Area — 0
Bedroom — 1
PSF — null
Price$ — 1900
Type — C
District — 3
Estate — EMERALD PK, TWR 1 #12-ABV
Area — 1305
Bedroom — 3
PSF — 4.21
Price$ — 5500
Type — C
District — 3
Estate — EMERALD PK, TWR 2 #06
Area — 926
Bedroom — 2
PSF — 4.86
Price$ — 4500
Type — C
District — 3
Estate — EMERALD PK, TWR 2 #09
Area — 1206
Bedroom — 3
PSF — 4.31
Price$ — 5200
Type — C
District — 3
Estate — EMERALD PK, TWR 2 #12-ABV
Area — 600
Bedroom — 2
PSF — 3.5
Price$ — 2100
Type — C
District — 3
Estate — EMERALD PK, TWR 2 #12-ABV
Area — 1300
Bedroom — 3
PSF — 4.23
Price$ — 5500

Real estate in Singapore - property of Singapore, Buy, sales, rents, investment,

MINDY YONG

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Landed plots fetch 22% less at Singapore URA auction

Landed plots fetch 22% less at Singapore URA auction

By EMILYN YAP

LANDED-HOUSING sites at Sembawang were sold yesterday at prices 22 per cent lower on average than nearby plots a few months ago. Yesterday’s auction by the Urban Redevelopment Authority was for 11 plots with 99-year leasehold tenure. All were sold - for a total of $45.29 million, or $223 per sq ft (psf) on average.
The plots come under phase two of Sembawang Greenvale estate. URA sold the 12 plots in nearby phase one in October last year for about $285 psf on average. Smaller developers and individuals turned up yesterday to bid for the phase two plots, which can be developed into 90 dwellings - one bungalow, 16 semi-detached houses and 73 terraced houses.

Fragrance Homes reaped the biggest harvest, winning four plots that can house eight semi-detached houses and 40 terraced houses. The largest plot, in Penaga Place, designated for 18 terraced houses across 35,624 sq ft, cost Fragrance $8.7 million or $244 psf. This was the highest psf price for any of the 11 plots.

Odeon Properties’ $1.66 million bid for a plot in Kerong Lane represented the lowest psf price of $151. The 10,989 sq ft site can accommodate one bungalow and two semi-detached houses. Reflecting the better market last year, prices on a psf basis in phase one ranged from a higher $210 to $327 psf.

The only individual to submit a wining bid yesterday, Christina Sui Fong Fong, bought the third-largest land parcel for $6.65 million or $221 psf.
 
Asked about plans to release more landed-housing parcels, URA’s director of land administration Choy Chan Pong said: ‘We will be releasing according to market demand.’

Source : Business Times  - 23 April 2008

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Alternative real estate ripe for picking - Singapore

Alternative real estate ripe for picking - Singapore

By ARTHUR SIM

WITH probably less than 350 completed office and industrial buildings in Singapore available for sale on a strata basis, transaction volumes have been steadily rising with more investors seeing an upside.
In a White Paper, Colliers International notes that since 2006, the strata office sector saw sales transactions rise 59.1 per cent from 2005 levels while the corresponding rise for the strata industrial sector was 49.6 per cent.

By 2007, the office sector chalked up total annual sales of 595 transactions, a 117.2 per cent rise compared with 2005.

The industrial sector, on the other hand, saw 1,227 sales transactions in 2007, up 81.8 per cent from 2005.

While Colliers does say that some of the purchases were by end-users, it also believes that investors were drawn by the attractive net rental yields offered by these properties. This can range between 5 and 7 per cent.

Residential properties, however, offer net yields of 2.5 to 4 per cent.

‘Judging from the caveats lodged for office and industrial properties, signs of interest in office and industrial properties started showing as early as 2006 when their capital values were at or close to rock bottom,’ added Colliers.
 
Besides end-users and investors, Colliers believes there were buyers who bought units in ageing developments (particularly offices) with collective sale potential in the hope of reaping a windfall some time in the near future.

Examples of developments which were popular with such investors in the last two years include Textile Centre and Golden Mile Complex, both in the Beach Road area.

‘With the office supply crunch likely to persist in the next two years, the industrial sector will continue to enjoy robust spillover demand from the office sector on top of demand from the mainstream manufacturing industry,’ added Colliers.

Colliers also highlighted that, compared with the mid-1990s peak, capital values of office and industrial properties as at end-2007 were still some 27.5 per cent and 33.7 per cent lower. ‘The sectors, thus, still hold immense upside potential in rents and capital values,’ Colliers added.

Colliers said that the bulk of available strata office and industrial properties are likely to be more than 20 years old.

Strata office buildings that have seen high transaction volumes since January 2006 include Chinatown Point, International Plaza and People’s Park Centre.

Strata industrial buildings that have seen high transaction volumes include E-Centre @ Redhill, Eunos Technolink and Ubi Tech Park.

Source : Business Times  - 23 April 2008

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Mindy Yong

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Singapore Govts must lead private sector in going green

Singapore Govts must lead private sector in going green

By LYNETTE KHOO

THE urgency for managing climate change has not really sunk in and governments have to lead the private sector in efforts to cope with climate change, the audience at the Business for Environment Global Summit was told.
 
‘As long as the private sector sees the benefits for them (green products and fixtures), then we are going to move forward.’
 
- Liz Thompson, 
former minister of energy and the environment in Barbados 
 
 
 
The panelists comprising former prime ministers and former ministers drew attention to some constraints faced in pursuing this climate agenda. They include limited resources and perceived disconnection between economic gains and environment conservation.

‘We need to establish economic development more and more on sound ecological principles,’ said Liz Thompson, former minister of energy and the environment in Barbados.

Ms Thompson, who used to handle the portfolios of energy and environment, said there is no contradiction between the two disciplines. She said that they developed their energy policy based on sustainable development strategies.

She noted that some 60 per cent of the country’s households now use solar energy for water heating and the country has put in place incentives to encourage people to retrofit their homes in ways that enable them to tap solar energy.

Balgis Osman-Elasha, a senior researcher at Sudan’s Higher Council for Environment & Natural Resources and lead member of the Nobel Peace Prize winning Intergovernmental Panel on Climate Change (IPCC), pointed to the lack of resources in her country to deal with climate change.
 
The Sudanese researcher has worked on a range of research projects in her country, including Darfur, demonstrating to vulnerable communities the feasibility of adapting to climate change and extreme weather events.

While the government has to take the lead in managing climate change, private sector involvement is vital, Ms Thompson said. She advocated more communication with the private sector and the development of public-private partnerships and recommended the use of ‘more carrots than sticks’ for the private sector.

The tourism industry, for instance, can be given incentives like tax savings to retrofit hotels and restaurants with green products and fixtures, she said. ‘As long as the private sector sees the benefits for them, then we are going to move forward.’

Ms Thompson is the winner for Latin America and the Caribbean and Ms Osman-Elasha is the winner for Africa for this year’s United Nations Environment Programme (UNEP) Champions of the Earth Awards.

The annual prize rewards individuals from around the globe who have made a significant and recognised global and regional contributionto the protection and sustainable management of the Earth’s environment and natural resources.

Other winners who received the award at the gala evening held here last night were Prince Albert II of Monaco; former US Senator Timothy E Wirth; New Zealand’s Prime Minister Helen Clark; Atiq Rahman, executive director of the Bangladesh Centre for Advanced Studies and Abdul-Qader Ba-Jammal, the secretary general of the Yemen People’s General Congress.

Source : Business Times  - 23 April 2008

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Call to make businesses environmentally friendly - Singapore

Call to make businesses environmentally friendly - Singapore

Private push can spark govt actions to adopt sustainable development

By CHEN HUIFEN

THE private sector needs to start investing to make their businesses more environmentally friendly, say speakers at the Business for the Environment Global Summit (B4E).

Their engagement will not only help to push political leaders to set up policies that will enhance sustainable development, but also help them better manage the burden of climate change in the future.

‘Business prides itself on being able to read the future better than governments can, and I think this is perhaps true,’ said United Nations Environment Programme (UNEP) executive director Achim Steiner. ‘It requires our governments also to be more coherent and. . .to invest in longer term policy decisions.’

The call comes on the heels of the Bali Road Map, sealed at the UN climate change conference last December. The road map, which almost fell apart, is to pave the way for another two years of negotiations for countries to agree on greenhouse emission regimes following the lapse of the Kyoto Protocol in 2012.

UN Global Compact executive director Georg Kell is hoping that the greater scrutiny placed by investors on environmental, social and government policies will give governments and businesses more incentive to be more proactive.

‘Environment, social and government issues are . . .increasingly material to long-term performance,’ he said, adding that they are becoming part of the risk assessment that long-term investors are beginning to consider seriously.

Singapore’s National Development Minister Mah Bow Tan also urged the involvement of the business community at the conference. He said engagement need not come at the expense of profitability, especially in the case of Singapore when government support is available.

He listed a number of programmes spearheaded by the government to encourage sustainable development. They include a $50 million Sustainable Energy Fund to co-fund design projects, fund the implementation of energy-efficient equipment, and train relevant manpower.

There is also a $10 million scheme to help companies conduct energy audits and identify energy efficiency measures. So far, 87 manufacturing facilities have benefited from the scheme, which has collectively led to $23 million in annual energy savings.

‘In addition, companies that learn to be more resource-efficient ahead of the competition will reap first mover advantage in a new carbon-constrained world,’ said Mr Mah. ‘Businesses that adopt environmental sustainability as a form of corporate social responsibility will distinguish themselves in a world of increasingly discerning consumers.’

Germany was cited as one of several ‘green economies’ that had the foresight years ago to invest in innovative technologies that have the potential to combat the growth of carbon dioxide emissions. Because of that, it has developed the capabilities to take advantage of the emerging clean energy industry today.

Held at the Suntec Singapore International Convention and Exhibition Centre, the two-day B4E summit co-organised by the UNEP and UN Global Compact was attended by some 500 delegates.

Source : Business Times - 23 April 2008

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Singapore ICA offers more services online and cuts waiting times

Singapore ICA offers more services online and cuts waiting times
 
THE Immigration & Checkpoints Authority (ICA) yesterday announced plans to cut queues at its Lavender building by offering more services on line.
Through an online platform called e-Appointment, users will be able to book an appointment before they head to the ICA building.

The platform was soft-launched in March for applicants for long-term social visit passes, and to permanent residency applicants a month later.

According to the ICA, waiting times are likely to be cut drastically. The online service will now be available to passport applicants - and is expected to cut waiting time from an average of three hours to less than half an hour.

ICA said it sees just under 2,000 passport applicants daily who will benefit from the service.

ICA has also launched an electronic Re-Entry Permit (eREP) system, through which users can renew, transfer or enquire about permits entirely online.

The measures were announced at the start of ICA’s Workplan Seminar 2008, attended by Home Affairs Minister and Deputy Prime Minister Wong Kan Seng.
 
He said Singapore can expect the movement of travellers and goods to increase significantly, with the hosting of events such as the Formula One race this year and the Youth Olympic Games in 2010.

Source : Business Times  - 23 April 2008

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Iswaran: Strong tourism growth set to continue - Singapore

Iswaran: Strong tourism growth set to continue - Singapore

SINGAPORE set new tourism records last year - close to $14 billion in receipts and 10.2 million visitors.
And the plan is to break those records, as the island plays host to the Formula One Grand Prix and other events.

‘The strong growth in tourism is set to continue in the years ahead, especially with new attractions like the Singapore Flyer and the F1 in September,’ Senior Minister of State for Trade and Industry S Iswaran said yesterday at the opening of Food&HotelAsia-2008, Asia’s biggest food and hospitality trade show, which runs until Friday.

Organised by Singapore Exhibition Services, the show occupies seven halls of the Singapore Expo and has more than 2,600 exhibitors from 70 countries.

It is expected to attract more than 37,000 visitors from 80 countries, with 38 per cent of those attending coming from overseas.

In a highlight of the event, 600 chefs will showcase their carving and cooking skills as they compete in the FHA Culinary Challenge.

And besides the many exhibits, the show includes an Asian Hospitality Finance and Technology conference, at which business delegates will share experiences on best practices.

Source : Business Times  - 23 April 2008

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Cold market forces Mapletree, JTC to freeze Reit plan - Singapore

Cold market forces Mapletree, JTC to freeze Reit plan - Singapore

JTC to sell assets worth $1.7b to private Mapletree trust instead
By KALPANA RASHIWALA

(SINGAPORE) Timing is everything. JTC Corp and Temasek subsidiary Mapletree Investments are not proceeding with their earlier plan to list a real estate investment trust (Reit) owning a portfolio of JTC assets for now, because of unfavourable market conditions.
 
‘The average (distribution) yield spread for S-Reits over the 10-year Singapore Government Bond yield is 350 basis points today, up from a low of 80 basis points around a year ago.’
 
- JP Morgan analyst Chris Gee 
 
 
 
 
Instead, JTC Corp will divest the $1.71 billion worth of assets to a private trust sponsored by Mapletree.

It was more than two years that JTC Corp revealed plans to divest part of its property assets to a Reit and a couple of months ago that it announced it had picked Mapletree to manage the proposed Reit, after a ‘rigorous selection process’.

This process eliminated Australia’s Goodman group, which had earlier been reported as JTC’s initial top choice. According to market talk yesterday Goodman apparently got cold feet and did not want to even attempt a Reit IPO. Instead, it wanted to buy the JTC assets to park into a wholesale property fund.

Mapletree, on the other hand, agreed to try a Reit IPO in the first instance but offered a ‘backstop option’ of buying the assets for a private trust if the IPO was not feasible. The end result appears to be similar - no Reit IPO for now. BT also understands that Goodman had wanted JTC to put some money into the wholesale property fund.

‘There were probably other factors at play as to why JTC picked Mapletree and not Goodman, but it seems we’re none the wiser now,’ an analyst with a stockbroking house said.
 
Agreeing, a market watcher added: ‘It looks like JTC has missed the window of opportunity for listing a Reit.’

Mapletree CEO Hiew Yoon Khong said in a release yesterday that in due course, the company will explore the possibility of listing the JTC portfolio as a Reit, possibly in combination with other Mapletree industrial assets. The transfer of properties to Mapletree is expected to be completed by July 1, 2008.

Tenants of the flatted factories, stack-up and ramp- up buildings in the portfolio will have a rental cap for a period of three years from this date. Mapletree will cap the increase in rent to a maximum of 5 per cent per annum based on JTC’s July 1, 2007 posted rent.

The properties to be divested comprise 39 blocks of flatted factories in various locations including Kaki Bukit, Kallang Way, Loyang, Serangoon North and Tanglin Halt, 12 amenity centres, six stack-up buildings, a ramp-up building, The Synergy and The Strategy at International Business Park in Jurong and The Signature at Changi Business Park, plus a warehouse building at Clementi West.

JTC and Mapletree said in a joint statement yesterday that they will not be proceeding with the proposed Reit listing ‘at the present time’ based on the advice of the Reit financial advisors DBS Bank, Goldman Sachs and UBS AG. ‘This is in light of the current volatile market conditions which are not conducive for a Reit initial public offering.’

JP Morgan analyst Chris Gee acknowledged that market conditions are indeed challenging for floating a Reit today. ‘The cost of capital for Singapore Reits has risen over the last year. The average (distribution) yield spread for S-Reits over the 10-year Singapore Government Bond yield is 350 basis points today, up from a low of 80 basis points around a year ago.’

Cambridge Industrial Trust is currently trading at about 8.8 to 9 per cent distribution yield based on analysts’ consensus earnings forecast for the year ending Dec 2008, and Ascendas-Reit, which has a larger and more diversified portfolio, is currently trading at about 6 per cent based on March 2009 consensus earnings, Mr Gee notes.

BT understands that the forecast 2009 net property yield on the JTC portfolio bought by Mapletree is about 6-7 per cent but rental growth prospects may be muted over the next few years because of the rental caps. ‘You need time to let the portfolio mature. Income will also grow as occupancy rates in the properties rise, from the current portfolio average of under 90 per cent,’ an analyst estimates. On a portfolio basis, the properties have an average remaining land lease of 50-60 years.

Mapletree is expected to look into combining the JTC assets it is buying with those of its privately-held Mapletree Industrial Fund - which has about $300 million of non-warehouse industrial properties in Singapore, Malaysia and China - for an eventual Reit listing at some point.

The three banks are expected to be compensated by JTC for their services thus far, but they’ll miss out on lucrative underwriting fees they would have reaped had there been an IPO.

Source : Business Times  - 23 April 2008

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Singapore Temasek to strike out into oil, gas ventures

Singapore Temasek to strike out into oil, gas ventures

New subsidiary Orchard Energy may be answer to supply security concerns
By RONNIE LIM

(SINGAPORE) With oil prices continually testing new peaks - they touched US$118 a barrel yesterday - Temasek Holdings is entering into big-money exploration and production (E&P) ventures in oil and gas to ensure Singapore’s energy supply security.
So, for the first time, Temasek has set up an E&P subsidiary, Orchard Energy Pte Ltd. And in a clear indication that Orchard is preparing to strike out into E&P joint ventures regionally and beyond, it has been recruiting a team of oil specialists, sources told BT.

‘Mostly foreign talent, they include geophysicists, geologists and petroleum engineers who can help Temasek assess potential E&P property that the Singapore investment company can put money into,’ one source said.

BT has also ascertained that Temasek managing director Tan Suan Swee is heading Orchard Energy as its director, with Greg Solomon being its ventures director. Mr Tan was unavailable for comment as he is on an overseas trip.

The Orchard Energy venture marks Temasek’s return to the offshore arena after it failed in 2004 to buy into Indonesia’s largest listed oil and gas company, Medco Energi.

Temasek was named the preferred bidder for a 44.9 per cent stake in Medco, but the company’s founder, the Paniogoro family, eventually exercised its pre-emptive right to match Temasek’s bid and bought back its stake.
 
Temasek’s bid to acquire Medco was not seen as a mere investment play, but also one that would potentially boost supply security for the Republic, especially given its dependence on Indonesian natural gas supplies.

‘Although SembCorp recently managed to get more Indonesian gas, the talk is that this (supply) is drying up,’ one source said yesterday.

He was referring to SembCorp Gas’s recent US$5.5 billion deal to buy an additional 86 million standard cubic feet daily from Natuna for 7-10 years, which adds about 26 per cent to its current Indonesian supplies.

Singapore is also preparing to source liquefied natural gas (LNG), to supplement its Indonesian and Malaysian piped gas supplies, and just last Friday appointed a sole LNG buyer which is expected to source for the LNG from Egypt, Trinidad & Tobago, Equatorial Guinea, Nigeria, and Australia’s Queensland project.

A Reuters report yesterday cited a Temasek source saying that its new E&P venture could potentially look at participating in ventures in the Gulf of Thailand and offshore Myanmar.

Orchard is also unlikely to be a passive investor in the E&P ventures; it hopes to quickly become a lead operator working with more established upstream firms, the source reportedly said. This explains why it has been aggressively recruiting upstream specialists for its operations.

Temasek also has a deemed interest of 45.7 per cent (through KepCorp and DBS) in Singapore Petroleum Company (SPC), which has been aggressively building up its upstream asset portfolio.

SPC in its just-released 2007 annual report said that its average oil/gas production had shot up to 10,000 barrels of oil equivalent a day by end-2007 - from below 3,000 barrels at the start of the year.

This came from its acquisition of producing oilfields in China’s Bohai Bay, as well as production from its Indonesian Kakap and Oyong fields.

Orchard, which was incorporated with a share capital of S$5 million, is also seen by some analysts as a bid by Temasek to diversify its financials-heavy global investment portfolio of some S$164 billion.

Source : Business Times  - 23 April 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com