Re-inventing Ascott as a real estate firm

KNOWN largely as an owner-operator of serviced residences, CapitaLand unit The Ascott Group will increase its focus on buying, investing in and trading serviced residence assets.

‘One of the things I want to do is to re-invent Ascott to be a real estate company with a hospitality arm,’ CapitaLand group president and CEO Liew Mun Leong said yesterday. CapitaLand too Ascott private last year. According to Mr Liew, the bulk of Ascott’s earnings already come from trading real estate. Hospitality operations make up a small portion of the bottom line and are a ‘laborious’ way to profits, he said.

Ascott will pay greater attention to deals involving serviced residences but will not be interested in hotels, said Mr Liew. And even with the shift in focus, hospitality operations will remain an ‘important value-add’ to the business.

Ascott has some 25,000 serviced residence units in the Asia-Pacific, Europe and the Middle East through its three brands – Ascott, Somerset and Citadines.

Mr Liew said prospects are bright for the serviced residence industry in China, Europe and Australia.

Source: Business Times, 20 June 2009

S’pore’s rich list takes a beating

SINGAPORE’S rich were not spared the effects of the global financial meltdown last year, with the number of millionaires here shrinking 22 per cent to 61,000 people.

A year earlier, Singapore boasted one of the world’s top 10 fastest-growing millionaires’ clubs, with a 15.3 per cent expansion to 78,000.

A millionaire is defined as a person having net assets of at least US$1 million (S$1.45 million), excluding his main residence and everyday possessions.

Observers say the sharp drop is probably because the well-heeled here were invested heavily in equities and real estate, both of which have suffered in the crisis.

The figures emerged in the 13th annual World Wealth Report released yesterday by banking group Merrill Lynch and research firm Capgemini.

On average, Singapore’s ‘high net worth individuals’ were worth about US$3 million each, said Mr Kong Eng Huat, managing director and head of South Asia advisory at Merrill Lynch Global Wealth Management.

‘A lot of these (individuals) are in the US$1 million to US$5 million range. So that’s why you find a greater drop in terms of the high net worth population because…when the market comes down and they have invested heavily in equities then they would not be a high net worth individual any more,’ he added.

Globally, the number of people in the millionaires’ club fell by about 15 per cent to 8.6 million, which is below the figure in 2005. North America, Europe and the Asia-Pacific registered the largest declines.

The total wealth of these individuals fell to US$32.8 trillion, also below the levels in 2005. However, this is forecast to recover in all regions by 2013, with Asia-Pacific leading the growth.

More than half of the world’s millionaires last year came from three countries – the United States, Japan and Germany. The proportion is a slight increase from the year before.

China climbed one rung to become the country with the fourth largest millionaires’ population of 364,000.

The World Wealth Report also indicated that the millionaires have reacted to the crisis by moving more of their assets into cash and fixed-income securities – and away from equities.

A larger proportion of wealth was allocated to art collections and jewellery, gems and watches. This category hit 47 per cent last year, up from 38 per cent in 2006.

Mr Bhalaji Raghavan, Capgemini’s banking solutions leader for Asia-Pacific, said: ‘One of the reasons is that people believe that (these items) over a long period of time increase in value, so it’s a lot safer than putting their money in financial markets.’

Giving to charity was forecast to be on the decrease on average across the globe this year, especially in North America, but increasing in the Asia-Pacific region.

Private banks contacted by The Straits Times said their clients are now staying away from high-risk investment products.

‘Currently, it is back to basics of investment, and we have seen that cash positions in portfolios are high,’ said Mr Rajesh Malkani, Standard Chartered Private Bank’s head of Southeast Asia.

Mr Raj Sriram, RBS Coutts’ head of private banking in Singapore, agreed: ‘From a private bank perspective, the main challenge is that clients have become more risk averse due to volatility in the markets…Clients today largely prefer simpler, liquid investments.’

Source: Straits Times, 26 June 2009

8@Woodleigh: 91% of Woodleigh condominum sold

Developer Frasers Centrepoint said Tuesday 91 per cent of its 8@Woodleigh residential project has been sold following a weekend preview.

The mass market development comprises 330 units, out of which 302 have been snapped up during the past four days.

Frasers said it will now release the remaining units for sale and there will be no public launch.

The 99-year leasehold property comprises a mix of two to four room units and studio apartments.

They were sold at an average of S$790 per square foot.

Some 97 per cent of the buyers are Singaporeans, and over half of them are upgraders from public housing flats.

Source: Channel News Asia, 23 June 2009

Penchant for property pays off

Astute couple aim to pay off their three mortgages in eight years and retire in their 50s on rental income

Like many Singaporeans, Mr You Der Chin has a penchant for property and, indeed, his investment in real estate has borne fruit.

‘All the properties I invested in have appreciated in value and given me and my wife good rental yields over the years,’ said Mr You, 39, the vice-president, treasury and market risk, group operations and technology, at OCBC Bank.

He and his wife, Ms Winnie Tan, 38, did their sums on what properties to invest in soon after they graduated from the National University of Singapore (NUS) in 1995. They met at NUS and got married in 1998.

He favours property located near international schools and MRT stations.

The couple currently own three properties; two are residential and the third commercial. They plan to pay off all three mortgages in eight years’ time.

‘In 10 to 20 years, our properties will be our safety net and we can ride on the rental income,’ he said. He prefers property investments as land is scarce and there is no need to monitor them as tediously as stocks and unit trusts.

Before Mr You joined OCBC in 2005, he was a senior consultant with an IT consulting firm helping banks to implement their treasury systems.

His wife runs a Kumon educational franchise in Clementi. They have a son, Wayne, 10.

Q: Are you a spender or a saver?

I consider myself a saver. My family saves 40per cent of our combined monthly income, spends 35per cent on our mortgages, 10per cent on insurance and investment, and the remaining 15per cent on miscellaneous expenses.

Q: How much do you charge to your credit cards each month?

I charge around $2,000 each month and pay off the full amount each month. I withdraw $150 a week from the ATM.

Q: What financial planning have you done for yourself?

The bulk of our family’s investment, approximately 70per cent, is in properties. The average rental yields we receive from the properties amount to around 10per cent. Our other investments include 5per cent in unit trusts, 5per cent in blue-chip stocks like OCBC and SingTel, 10per cent in life insurance and another 10per cent in endowment funds.

My life cover is about $200,000. I also participated in OCBC Bank’s Employee Share Purchase Plan (a savings-based share ownership plan) in 2006 and I managed to make a profit of a few thousand dollars at the end of the two-year period.

Q: Moneywise, what were your growing-up years like?

I grew up in a middle-income family comprising my parents and two younger brothers. From a young age, my mother instilled in us a sense of thrift and how we must spend within our means.
My father owned a provision shop at the void deck of an HDB block in Queenstown and we lived in a three-room flat above it. He had no workers so we kids helped out.

I started doing that when I was seven. It was a lot of work, long hours with low profit margins. My mother is a housewife and also helped my dad out in his shop.

Q: How did you get interested in investing?

My first foray was the purchase of a life insurance plan during my National Service. Having majored in economics at NUS, I developed an interest in equity markets. However, being risk-averse, I am always looking at longer-term investments that are relatively risk-free and stable.

Thus, I monitor only blue chips with long-term potential. I have since also moved on to properties, which I feel are safer investments in land-scarce Singapore.

Q: What properties do you own?

In 1998, we bought a two-bedroom, 1,200 sq ft freehold condominium unit near the Canadian International School in Toh Tuck for $500,000. Its rental yield is more than 5per cent a year. We also own a double-storey, 2,300 sq ft terrace house in Hillview, which we bought for around
$1.3million in late 2007.

Q: Home is now….

The terrace house in Hillview.

Q: What’s the most extravagant thing you have bought?

The house that we currently live in is by far our most expensive investment.

Q: What’s your retirement plan?

We plan to be debt-free in eight to 10 years’ time and to retire in our 50s. Based on our estimates, we will need to have a passive income of $6,000 a month in order to retire comfortably and be able to travel as often as we like.

Q: I drive….

A silver Toyota Altis.

Source: Straits Times, 21 June 2009

The changing face of Singapore

ARCHITECTURE in Singapore has evolved at a remarkable pace. It was not too long ago that buildings here, especially homes, were characterised by a pastiche of styles with the classical pediment a favourite roof ornament. Today, the stylish home is more likely to have a flat roof with all ornament stripped to the structural bone. This aesthetic is well represented in Singapore Houses, a new book by Robert Powell with photographs by Albert Lim, and featuring the work of some of Singapore’s best known architects.

One of them, Mok Wei Wei of W Architects, has been described as the ‘de facto leader of the next generation of Singapore architects’ and his design for a sprawling home in Cornwall Gardens epitomises this evolution of Singapore architecture.

The floor plan of the house is simple – essentially an asymmetric H-shape, with two parallel wings running from east to west, linked at the first-storey by a large living room and at the second-storey level by an equally large family room.

The play of architectural forms is also simple and comprises a combination of glass, concrete and timber boxes. The articulation of these forms, however, is not simple and every surface seems to have been lovingly detailed. Describing the use of concrete in particular, Mr Mok says: ‘The off-form concrete used in Cornwall Gardens House is impregnated with white pigments. We wanted the house to be polished and sophisticated, yet have a quality of naturalness.’

Studying the design a little more closely reveals that decorative elements, although spare, have also been incorporated. The round columns on the entrance facing facade, for instance, are not needed structurally. The architect explains that these are a continuation of the colonnade on the western facade which do support the sun-shading fins and roof and were extended to form a ‘continuous rhythm’. ‘Originally, we had designed for slender steel columns inlaid with timber.
However, for a greater sense of grandeur, the client requested that it be changed to a bigger timber profile,’ explained Mr Mok.

Apart from its size, the Cornwall Gardens House, like all the houses in Singapore Houses, are in fact extremely understated. Noting that Singapore architecture has changed ‘dramatically over the last 25 years’, Mr Powell adds: ‘The most remarkable change in this time has been in the sheer quality of finishes and the simple elegance of many of the recent houses. Also the inventiveness of Singapore architects and their clients’ exploring new ideas on how to live in the 21st century.’

Of the overall design of the Cornwall Gardens House, Mr Powell notes that the circular columns and vertical timber sunscreens of the verandah also ‘bear a slight resemblance to the facade of the 1993 Reuter House designed by William Lim Associates, the predecessor of W Architects.

The comparison is telling because the Reuter House appears in Mr Powell’s first book on Singapore houses called, The New Singapore House (2001). In the book, he notes that some had referenced the design to Chinese temples, colonial buildings and even kampung houses. Mr Powell said that the house (whose project architect was Lim Jin Geok), ‘goes a long way towards successfully fusing a universal language of architecture with local/vernacular traditions and creating a regional modern architecture’.

On his own evolution, Mr Mok reveals that having graduated in 1982 and joining one of the key proponents of ‘Post-modernist’ architecture – William Lim Associates – two well-known buildings he designed in the 1980s, Tampines North Community Centre and Church of our Savior in Queenstown, were ‘unabashedly post-modern’ in expression.

However, in the early 90s, he began to take a different path from William Lim Associates, ‘designing in a language that is modernist in essence but layered with elements of local conditions and personal cultural perception’.

It is an approach that typifies contemporary architecture here today.

Chan Soo Khian of SCDA Architects is another of Singapore’s leading architects featured in Singapore Houses whose designs are equally simple in plan, yet ’stands out for its precision and clarity of form’. Describing the experience of arrival to the Harbour View House, Mr Powell says: ‘Entry to the house is expertly choreographed through a series of spaces in the inimitable style that is the hallmark of Chan Soo Khian’s architecture.’ Mr Chan has designed more than 50 houses in Singapore and the designs, ‘are about the human experience and takes into consideration the tropical condition’.

‘Architecture is about appropriating ideas and integrating the nuances of place, climate and culture. This involves observing architecture both past and present and overlaying them with your own intuition and understanding of the composition and experience of spaces,’ he adds.

The works of 20 architectural practices are featured in Singapore Houses. Several, like WOHA Architects, are also winners of international design awards. And Mr Powell adds that all also show a good grasp of the ‘principles of designing with climate’. ‘They are concerned with orientation in relation to the sun path and to wind. Overhanging eaves are part of the vocabulary that most architects draw upon, as are high ceilings, louvred walls and the use of the ’skin’ of the building as a permeable filter’.

Even though the houses share the same ‘vocabulary’, Mr Powell believes each is also very different.

‘What is obvious when one studies the houses in detail is that there is enormous variety, in the form and materiality of the houses,’ says Mr Powell, adding that, ‘there are deep underlying differences in approach to design to the areas to which (the architects) attach importance and the way they interact with their clients’. Of the designs that do differ in architectural ‘vocabulary’, those by Chan Sau Yan Associates and Linghao Architects stand out the most.

Explaining the design for 2Q Bishopsgate which uses 20cm thick fairface cast in situ concrete construction for the floors, walls and roofs, veteran architect Chan Sau Yan explains that the intention was to express the design as ‘continuous folded planes to achieve the naive iconic house silhouette’. This was in response to the clients’ initial request for a ‘barn-like clapboard house’. ‘Superficially, the house in Bishopsgate does not fit with the typical image of the tropical house,’ concedes Mr Chan.

There is also a perceptible streak of rebellion in Linghao Architects design for the Breamar Drive House when Mr Ling says: ‘We conceptualised the house in the simplest and almost banal manner, with the idea of different materials relating to the different atmospheres for entertaining, dining, sleeping and so on.’

While this does not shed much light on why the attic bedroom was clad in corrugated steel, it does at least suggest that the Singapore house is continuing to evolve.

Source: Business Times, 6 Jun 2009

Investors pick up higher-end condos

SOME high-end condominiums recorded sparkling weekend sales even though the overall property market was generally quiet in terms of new launches.

Of the two new previews, Illuminaire on Devonshire sold out its 72 units at $1,630 to $1,730 per sq ft (psf), while Verdure in Holland Road sold 14 units of 34 launched units at $1,400 psf.

Source: Straits Times, 14 April 2009

The 12-year-old Gallop Gables saw far stronger than expected demand, with investors picking up 28 units, even though they are about $3 million or more each.

Previously, the new projects that have attracted fairly strong interest, given today’s climate, were not in such prime areas. But some investors may be looking around now that the market has fallen quite a bit.

Mr Peter Ow of Knight Frank, which is marketing Verdure and Gallop Gables, said the response at these two sales showed individual investors are back.

‘These buyers are savvy investors who are already staying in prime areas,’ he said. ‘Generally, the property market is still weak, but there are value buys around. And people are beginning to see value in well-located projects.’

Of 14 Verdure units that Bukit Sembawang has sold during the preview, a few are penthouses. While the overall project is priced at $1,350 psf on average, the 14 were sold at an average of $1,400 psf, or from $1.5 million to $2.8 million.

A scheme offering interest absorption was available without any extra charge. The project, which has 68 units, will be launched this weekend.

Over at Gallop Gables near Botanic Gardens, Straits Trading sold 26 units – 16 more than its target. It had offered only 10 units with a guaranteed rental yield of 7 per cent for two years. The rest were purchased without the 7 per cent guarantee, but mostly with existing tenancies offering a rental yield of 3 to 5 per cent.

The buyers paid between $3,075,200 and $3,840,000, or an average price of $1,220 psf for the units, which averaged about 2,800 sq ft.

The buyers were mainly residents ranging in age from the mid-30s to the late 70s who bought for investment purposes, said Straits Trading, which had earlier said the sales would generate cash to allow it to invest in distressed assets.

A few buyers, it added, said they may live in the apartments after the end of the two-year rental guarantee period.

At Illuminaire, the affordable price drew both investors and speculators, industry experts said. As it has only one- and two-bedroom units, ranging in size from just 441 sq ft to 721 sq ft, the total price was kept low – from $749,000 to $1.21 million.

EL Development managing director Lim Yew Soon said he had changed the design of the project from a 36-unit development to a 72-unit one last September. By then, a three-bedroom showflat had already been completed – and had to be reconfigured into a smaller unit.
‘I realised the market would prefer small units,’ he said.

Mr Lim, who bought one unit for himself and kept two for business associates, said most buyers were keen on the interest absorption scheme, which was offered at no additional cost.

Some buyers also liked the unusual automated car parking system. There are two car lifts that will store cars in an adjoining multi-storey carpark block.

Sentosa dream gets hazy

Fewer than 1,000 homes at Sentosa Cove are likely to be completed by end of 2009; several developers are delaying their projects further

(SINGAPORE) It was supposed to be Asia’s answer to glitzy Monaco, but plans to remake Sentosa into an island playground where rich foreigners and locals live and play are going to take longer than expected to materialise.

While key hotel projects and the Resorts World at Sentosa integrated resort are largely on schedule, things are not going as well at Sentosa Cove, the stretch of land on the island set aside for mainly residential use.

The plan was for some 2,500 oceanfront villas, waterway bungalows, hillside mansions and upscale condominiums to be built on the 117-hectare site. Earlier projections were that the bulk of the new homes would be ready by 2010.

But industry sources now say fewer than 1,000 homes are likely to be completed by the end of this year, and several developers are expected to delay their projects further.

City Developments, for example, has postponed its $580 million project comprising luxury apartments, shops and a five-star, 320-room Westin Hotel, originally slated to open this year.

One problem is that sales and prices of new homes on the island have dropped sharply in the last two quarters, exacerbated by the number of foreigners leaving Singapore.

Sentosa Cove was popular with foreigners as they could get permission to own land there with relative ease.

‘The bulk of purchasers of luxury homes, both on the mainland and on Sentosa, were foreigners,’ said Tay Huey Ying, director for research and advisory at Colliers International.

Colliers’ data, based on caveats lodged, shows that only one non-landed residential unit in Sentosa was sold in Q4 2008. In the first three months of this year, the number rose slightly to eight.

This is a far cry from transaction volumes at the height of the property boom in 2007. In Q1 2007, some 279 non-landed homes were sold in Sentosa. In Q2 that year, the transaction volume was 243.

Prices have also come down. Colliers’ data shows that the transacted price of non-landed properties at Sentosa Cove averaged $1,318 per square foot (psf) in Q1 2009 – down 45.8 per cent from the peak average of $2,431 psf recorded exactly one year ago in Q1 2008.

It should be noted, however, that these averages are based on small transaction volumes of eight units for Q1 2009, and 33 units for Q1 2008.

Occupancy levels are low too. Even for properties that are completed and fully sold, not every unit is occupied, said Nicholas Mak, director of research and consultancy at Knight Frank. At the fully sold

The Berth by the Cove, which obtained its temporary occupation permit in 2006, occupancy is at 93-94 per cent, but market watchers say islandwide, the occupancy levels are much lower.

The picture is, however, somewhat brighter for other new and upcoming developments on the island.

Luxury hotel Capella Singapore, which opened its doors last week, is seeing strong demand – despite the fact that room rates start at $750. ‘Response in our first week has been very positive, with an average of about 70 rooms per night,’ revealed general manager Michael Luible. The hotel has 111 rooms.

Mr Luible acknowledged that the hotel would not escape the effects of the economic slowdown, but pointed out that its guests are high net worth individuals who will continue to travel. ‘We will, of course, monitor the economic situation carefully and plan our strategies accordingly,’ he added.

Resorts World at Sentosa remains on-track for its soft opening, which will see Universal Studios, four of its six hotels as well as the casino ready in Q1 2010.

The four hotels – Hotel Michael, Maxims Tower, Festive Hotel and Hard Rock Hotel – will add about 1,350 rooms to Singapore’s inventory. The rest of the resort, which includes a spa and Maritime Museum, will open progressively thereafter.

Indeed, hopes are now pinned on the integrated resort which is designed to draw in visitors.
According to Suzanne Ho, deputy director of communications for Sentosa, foreign visitor arrivals have dipped since last September, in line with the downward trend of tourist arrivals into Singapore.

The lower visitor numbers are affecting food and beverage operators adversely. Ken Hasegawa, manager of Japanese restaurant Si Bon, reckoned that revenue has fallen by about 20 per cent recently.

Similarly, at Cool Deck, a bar along Siloso Beach, business is slow. Selina Huang, Cool Deck’s assistant manager, attributed the decrease to falling tourist arrivals. Just three months ago, close to 90 per cent of the bar’s clientele were tourists, most of whom stayed at the Rasa Sentosa Hotel. Now, only 40 per cent of patrons are tourists, she noted.

The decrease in demand is prompting some outlets to modify their pricing. Even il Lido Italian Restaurant has cut prices by about 20 per cent on average in response to a 40 to 50 per cent decrease in revenue over the past three months. Its seven-course meal now costs $120 instead of $180, and it has removed some expensive items – such as truffles and caviar – from the menu.

Source: Business Times, 6 April 2009

Sentosa dream gets hazy

Fewer than 1,000 homes at Sentosa Cove are likely to be completed by end of 2009; several developers are delaying their projects further

(SINGAPORE) It was supposed to be Asia’s answer to glitzy Monaco, but plans to remake Sentosa into an island playground where rich foreigners and locals live and play are going to take longer than expected to materialise.

While key hotel projects and the Resorts World at Sentosa integrated resort are largely on schedule, things are not going as well at Sentosa Cove, the stretch of land on the island set aside for mainly residential use.

The plan was for some 2,500 oceanfront villas, waterway bungalows, hillside mansions and upscale condominiums to be built on the 117-hectare site. Earlier projections were that the bulk of the new homes would be ready by 2010.

But industry sources now say fewer than 1,000 homes are likely to be completed by the end of this year, and several developers are expected to delay their projects further.

City Developments, for example, has postponed its $580 million project comprising luxury apartments, shops and a five-star, 320-room Westin Hotel, originally slated to open this year.

One problem is that sales and prices of new homes on the island have dropped sharply in the last two quarters, exacerbated by the number of foreigners leaving Singapore.

Sentosa Cove was popular with foreigners as they could get permission to own land there with relative ease.

‘The bulk of purchasers of luxury homes, both on the mainland and on Sentosa, were foreigners,’ said Tay Huey Ying, director for research and advisory at Colliers International.

Colliers’ data, based on caveats lodged, shows that only one non-landed residential unit in Sentosa was sold in Q4 2008. In the first three months of this year, the number rose slightly to eight.

This is a far cry from transaction volumes at the height of the property boom in 2007. In Q1 2007, some 279 non-landed homes were sold in Sentosa. In Q2 that year, the transaction volume was 243.

Prices have also come down. Colliers’ data shows that the transacted price of non-landed properties at Sentosa Cove averaged $1,318 per square foot (psf) in Q1 2009 – down 45.8 per cent from the peak average of $2,431 psf recorded exactly one year ago in Q1 2008.

It should be noted, however, that these averages are based on small transaction volumes of eight units for Q1 2009, and 33 units for Q1 2008.

Occupancy levels are low too. Even for properties that are completed and fully sold, not every unit is occupied, said Nicholas Mak, director of research and consultancy at Knight Frank. At the fully sold

The Berth by the Cove, which obtained its temporary occupation permit in 2006, occupancy is at 93-94 per cent, but market watchers say islandwide, the occupancy levels are much lower.

The picture is, however, somewhat brighter for other new and upcoming developments on the island.

Luxury hotel Capella Singapore, which opened its doors last week, is seeing strong demand – despite the fact that room rates start at $750. ‘Response in our first week has been very positive, with an average of about 70 rooms per night,’ revealed general manager Michael Luible. The hotel has 111 rooms.

Mr Luible acknowledged that the hotel would not escape the effects of the economic slowdown, but pointed out that its guests are high net worth individuals who will continue to travel. ‘We will, of course, monitor the economic situation carefully and plan our strategies accordingly,’ he added.

Resorts World at Sentosa remains on-track for its soft opening, which will see Universal Studios, four of its six hotels as well as the casino ready in Q1 2010.

The four hotels – Hotel Michael, Maxims Tower, Festive Hotel and Hard Rock Hotel – will add about 1,350 rooms to Singapore’s inventory. The rest of the resort, which includes a spa and Maritime Museum, will open progressively thereafter.

Indeed, hopes are now pinned on the integrated resort which is designed to draw in visitors.
According to Suzanne Ho, deputy director of communications for Sentosa, foreign visitor arrivals have dipped since last September, in line with the downward trend of tourist arrivals into Singapore.

The lower visitor numbers are affecting food and beverage operators adversely. Ken Hasegawa, manager of Japanese restaurant Si Bon, reckoned that revenue has fallen by about 20 per cent recently.

Similarly, at Cool Deck, a bar along Siloso Beach, business is slow. Selina Huang, Cool Deck’s assistant manager, attributed the decrease to falling tourist arrivals. Just three months ago, close to 90 per cent of the bar’s clientele were tourists, most of whom stayed at the Rasa Sentosa Hotel. Now, only 40 per cent of patrons are tourists, she noted.

The decrease in demand is prompting some outlets to modify their pricing. Even il Lido Italian Restaurant has cut prices by about 20 per cent on average in response to a 40 to 50 per cent decrease in revenue over the past three months. Its seven-course meal now costs $120 instead of $180, and it has removed some expensive items – such as truffles and caviar – from the menu.

Source: Business Times, 6 April 2009

RE/MAX 5th CES Intake

CES Course (5th Intake) by RE/MAX Training Centre
SAEA CES Approved Training Centre

“Be A Certified Agent”

This will be our 5th intake to prepare participants for the June 2009 Common Examinations for Salesperson.

We are proud to announce that the passing rate of our past participants is almost 98%. Our lecturers have many years of experience practising real estate. They will share their knowledge with the aim of helping participants understand the various topics and most importantly pass the CES exams at the 1st attempt.

Date: Commencing 28th April 2009 (Every Tues and Thur)
Time: 10am – 1pm
Duration: 10 lessons
Venue: HDB HUB
Cost: $328.00 (before GST, inclusive of notes)

For more details, CALL 6846 4833 (Lila/Eunice)

New risks emerge for property companies

Credit crunch, price uncertainty affecting firms, says E&Y

(SINGAPORE) Real estate companies face new and growing risks amid the downturn in the world economy, says Ernst & Young (E&Y).

‘The credit crunch, fluctuations in global economies and resultant pricing uncertainty are affecting real estate companies globally, including those in Singapore,’ says E&Y Singapore’s assurance partner and market leader for real estate Liew Choon Wai.

Many local developers have overseas portfolios, including in emerging markets, and a major concern is the economic vulnerability of these markets and possible changes to local regulations as a result, he says.

Another source of potential concern is the real estate investment trust (Reit) sector. ‘Should the economic downturn be prolonged or worsen, we expect some form of consolidation in this sector, especially with its refinancing needs and the continuing pressure on rents.’

As for residential property, E&Y continues to see a ‘rebalancing of selling prices and judicious timing of property launches’, Mr Liew says.

E&Y’s 2009 real estate business risk report itemises the top 10 risks faced by the industry as ranked by leading analysts.

The greatest concern is continued uncertainty and the impact of the credit crunch. As E&Y points out, the real estate sector has felt tighter credit conditions perhaps more than any other industry.

Restrictions on availability of credit and the short-term inability to deploy capital at acceptable levels of return have ‘paralysed’ the industry’s transactions sector, says E&Y’s global infrastructure and construction leader Michael Lucki.

‘The only lending today is on deals with 50 per cent loan to value and at rates 200 to 400 basis points higher than six months ago, whereas towards the end of 2007 most loans were at 80-90 per cent loan to value,’ he says.

But some lenders may be on the lookout to move real estate related assets off their books fast, paving the way for forward-thinking companies to develop strategies to take advantage of distressed assets and debt situations.

Besides volatility and a lack of credit, other risks for the real estate sector seen by E&Y are: the impact of ageing or inadequate infrastructure; the worldwide war for talent; changing
demographics; the inability to find and exploit global and non-traditional opportunities; pricing uncertainty; the green revolution, sustainability and climate change; and volatile energy costs.

Still, E&Y’s global and Americas real estate leader Howard Roth still believes there is a lot of capital on the sidelines waiting to take advantage of distressed real estate opportunities when the time is right.

‘A structured, comprehensive due diligence programme will be more important than ever as buyers and sellers evaluate their opportunities,’ he says.

Source: Straits Times, 31 Mar 2009