$17m widening of CTE to begin on Monday

$17m widening of CTE to begin on Monday


1st phase to last till end-2009, but delays to traffic will be minimal


By Maria Almenoar


WORK will begin on Monday to widen the Central Expressway (CTE), but officials say the construction will cause minimal delays on Singapore’s busiest thoroughfare.


The Land Transport Authority (LTA) will add a fourth lane on both sides of a 1.5km stretch between Ang Mo Kio Avenue 1 and Ang Mo Kio Avenue 3.


The work, which will cost $16.9 million, is scheduled to last till the end of next year. The LTA said for most of that time, the expressway’s six lanes will remain open.


However, it will close after 11pm on some nights for repaving and to remove an overhead pedestrian crossing.


This is the first phase of a plan to ease congestion on the CTE, which is plagued by traffic jams during morning and evening peak periods.


The Ministry of Transport hopes the work, together with the opening of the Circle Line, Kallang-Paya Lebar Expressway and North-South Expressway, will ease congestion on the north-south stretch.


The LTA also plans to expand another 5.5km section of the CTE from the Pan-Island Expressway to Yio Chu Kang Road by 2011.


As part of the project, a new sheltered overhead bridge – replacing the old uncovered bridge – will be built to connect Housing Board blocks with the Serangoon Gardens private estate.


To keep the racket down, the LTA will use noise reduction blankets on its hoardings and put noise guards on machinery.


The authority will also use, for the first time, a more costly method of installing pipes running under the roads.


Unlike the usual ‘cut-and- cover’ method, where motorists have to be redirected to their lanes, the pipes are laid underground without the need to tear up lanes.



Source: Straits Times

Evergro to raise $170m through rights issue

Evergro to raise $170m through rights issue

The company also intends to carry out a capital reduction exercise







EVERGRO Properties, a subsidiary of Keppel Land, plans to raise about $170 million through a renounceable rights issue.



Evergro also intends to carry out a capital reduction exercise to write off accumulated losses of $36.5 million.


The fund-raising involves the offer of 761.8 million new shares on the basis of three rights shares for every two existing shares held.


Evergro, formerly known as Dragon Land, will announce finalised details of the rights issue ‘in due course’, and determine the issue price closer to the launch date.


It expects the issue price ‘to be at a discount of up to 15 per cent to the then-prevailing market price’. Shares of Evergro closed unchanged yesterday at 23.5 cents.


The China-focused property developer expects to receive net proceeds of about $169 million, of which 71 per cent will go towards land acquisition.


Evergro has a landbank of about four million square metres, and is looking to purchase around 10 per cent more land. In particular, the company will focus on land acquisition in Jiangsu for more residential and mixed-use projects.


Further residential developments around a golf course in Tianjin will take up another 11.8 per cent of net proceeds.


The remaining 17.2 per cent will be set aside for working capital needs. According to Evergro’s CEO Goh Toh Sim, the availability of land acquisition opportunities will determine how long proceeds from the rights issue will last.


Jittery stock market conditions have not deterred Evergro from conducting a rights issue. Mr Goh noted that there is strong genuine demand for mid-to-high end homes in China. Also, the stable property market presented a good buying opportunity.


‘For land acquisitions, you will not want to do it when the market overheats,’ he said.


Keppel Land, which holds a 71.37 per cent interest in Evergro, has made an irrevocable undertaking to subscribe for its full entitlement and make excess applications. Hence, all rights shares will be fully taken up.


Evergro also announced plans to reduce its issued share capital by $36.5 million, to write off accumulated losses of the same amount in their entirety.


‘This is to better reflect the financial position and share capital of the company as well as cancel or reduce any issued share capital which has been lost or is unrepresented by available assets,’ said the press release. The exercise will not involve share cancellation.



Source: Business Times

Bank loans grow at slowest pace in a year

Bank loans grow at slowest pace in a year


(SINGAPORE) Singapore bank loans grew at its weakest pace in a year in April as lending to businesses slowed, providing new signs that sluggish global demand could drag on the economy.



Bank loans in April rose 0.6 per cent to $251.1 billion in April from $249.5 billion in March, the central bank said yesterday, the slowest monthly growth since April 2007 when loans grew 0.2 per cent.


Loans to businesses fell across most industries from manufacturing to financial institutions, although the weakness was offset by the construction industry where loans grew 3.2 per cent.


Most analysts expect loan growth in Singapore to slow this year as a looming US recession slows Asia’s economies.


‘Business activity is definitely slowing down. It could be an initial sign of slower growth,’ said Kit Wei Zheng, a Citigroup economist.


From a year ago, total loans rose nearly 25 per cent from $201.8 billion, mostly boosted by construction where lending grew 1.5 times. The industry has boomed in the past year, supported by the construction of two casinos worth around US$7.7 billion.


Analysts estimate that loan growth at the South- east Asian country’s three banks, DBS Group, Oversea-Chinese Banking Corp and United Overseas Bank is expected to slow to 12-13 per cent this year after expanding 20 per cent in 2007.


However, economists said a recovery in the three-month Singapore Interbank Offered Rate, a benchmark for mortgage loans, would ease the squeeze on banks’ profit margins. The rate fell to 1.1875 in April, its lowest level in more than four years.


Loans to manufacturers fell 1.2 per cent in April to $11.1 billion from March, while lending to financial institutions declined by 3.6 per cent.


Housing and bridging loans to consumers rose 0.5 per cent to $74.6 billion despite a slowing property market, although Citigroup’s Mr Kit said the increase was probably not a result of new transactions but buyers paying off purchases closed previously under a deferred payment scheme. — Reuters


Source: Business Times

Asia-Pac growth forecast slashed to 3.7%

Asia-Pac growth forecast slashed to 3.7%




(SINGAPORE) The Pacific Economic Cooperation Council (PECC) has cut its forecast of Asia-Pacific’s 2008 growth by more than one percentage point to 3.7 per cent.



In November last year, the think-tank was looking at 4.9 per cent growth in 2008 for the region. But ‘increased pessimism’ about the health of the US economy – which it now sees growing only one per cent this year, down from an earlier forecast of 2.9 per cent – and expectations that exports will be a drag on most of the region’s economies, weigh on the outlook.


Still, the impact of the US slowdown is ‘not forecast to be as severe on the region’s growth as on previous occasions’, PECC says in the first-quarter update of its state-of-the-region economic outlook. Much of East Asia’s growth is now driven by internal, rather than external, demand, it says.


But inflation is now a greater concern than it was six months ago – PECC has also hiked its consumer price inflation forecast to 3.6 per cent for 2008, from an earlier estimate of 2.7 per cent.


This forecast actually masks much sharper price hikes in certain Asian economies, PECC notes.


Overall, the risks to the forecasts are greater than they have been since the 1997 Asian financial crisis, it says, reiterating a point it made in November.


With rising inflation and ‘an uncertain end to the US credit crunch’, policymakers around the region will have less policy space to reflate their economies, says Yuen Pau Woo, president of the Asia Pacific Foundation of Canada, based in Vancouver, and co-ordinator of the state-of-the-region report.


Amid the bearish outlook, PECC does expect the region to bounce back in 2009 with growth forecast at 4.4 per cent. And again, the US economy – which is expected to recover and grow 2.5 per cent – will be key.


That said, PECC points out that the predicted recovery in the US economy is ‘by no means assured’.


And the surge in commodity prices in the first quarter of 2008 has led to protectionist trade stances across the region that have further reduced global supply in some cases, leading to even further hikes in prices.


Source: Business Times

Home prices in Iran going through the roof

Home prices in Iran going through the roof


TEHERAN – AS IRAN’S economy is buffeted by inflation, the country’s homeowners are fast becoming richer in a real estate bubble that is driving affordable housing beyond the reach of ordinary citizens.

A luxury 1,400 sq m penthouse sold recently for US$21 million (S$29 million) at US$15,000 per sq m in swanky northern Teheran – yet the average monthly salary of Iranians stands at US$300 to US$460.


While the housing market of Iran’s arch-foe America is facing trouble, prices in Teheran’s affluent suburbs have gone up by at least 10 million rials (S$1,500) per sq m over three months.


Property prices there compete with upmarket neighbourhoods in Paris at a range of 60 million to 100 million rials per sq m.


‘You have to spend at least a million dollars to buy an apartment in northern Teheran where the average property is 200 sq m,’ says real estate agent Ali Meshkini.


With a stagnant stock market and a hesitant industry, property remains a privileged means to absorb liquidity, which has been flowing into the economy through windfall oil earnings.


Facilities such as swimming pools, saunas, jacuzzis and health clubs have become standard features in newly built upmarket homes to attract wealthier buyers.


An opulent residential tower in northern Teheran even comes with a heliport while another has a lift that takes cars up to the apartments.


The housing boom is not confined to the hot uptown market.


Average neighbourhoods in the capital, as well as in Iran’s other large cities, have been affected.


Prices have doubled within a few months in the satellite town of Parand and Hashtgerd, 50km from Teheran, while in Isfahan, Mashhad and Tabriz, property values have doubled in a year.


‘Property has become the only profitable investment,’ says Mr Meshkini.


‘Prices have risen by over 100 per cent within a year and they will continue to go up. No other sector makes such profits.’


Several entrepreneurs echo the same view, including the owner of a popular fast-food place in Teheran who complained he had made only ‘6 per cent net profit in the busy months of January and February, when sales were surprisingly high’.




Source: Straits Times

Consumer confidence plunges to 28-year low

Consumer confidence plunges to 28-year low


WASHINGTON – CONFIDENCE among United States consumers fell this month to the lowest level in 28 years, pointing to slower spending as petrol prices reach record levels and job losses mount.

The Reuters/University of Michigan final index of consumer sentiment decreased to 59.8, the weakest reading since June 1980, from 62.6 last month. The measure averaged 85.6 last year.


Separately, US consumer spending slowed last month as income gains weakened, a sign that the biggest part of the economy could be faltering.


The 0.2 per cent rise in spending followed a 0.4 per cent increase in March, the Commerce Department said yesterday. Incomes grew 0.2 per cent, bolstered in part by the government’s tax rebates, and the Federal Reserve’s preferred measure of inflation moderated.


‘Consumers are spending cautiously,’ said Mr Michael Moran, the chief economist at Daiwa Securities America in New York. ‘The economy is in a grey area between a recession and slow growth. We had a weak performance in wages.’


The report contained good news on inflation for Fed policymakers. The central bankers’ preferred gauge of prices, which excludes food and fuel, rose 0.1 per cent after a 0.2 per cent gain in the previous month. It was up 2.1 per cent from April last year.




Source: Straits Times

Raffles Hotel won’t be sold after all

Raffles Hotel won’t be sold after all 

Consortium that inked in-principle deal declines to say why sale fell through


A PLAN to sell the historic Raffles Hotel again has fallen through.

The Business Times (BT) yesterday reported that a consortium led by former Credit Suisse banker Mark Pawley, which had inked an in-principle deal to buy the hotel earlier this month, was ‘very disappointed’ with the outcome.


Its spokesman confirmed that the deal was off.


‘This would have involved an assured distinct identity for Raffles Hotel as a flagship for Singapore in the international hospitality industry and a rejuvenation of the hotel,’ the paper quoted her as saying.


Citing confidentiality clauses, she declined to give reasons why the deal soured.


But she denied that there was any issue with the source of the funding, which is believed to be a family trust linked to a European family.


If the deal had gone through, the 121-year-old historic hotel and its adjoining shopping arcade would have changed hands for the second time in three years.


The agreed price was reportedly about $650 million – more than triple the $200 million paid by its American and Middle Eastern owners in 2005.


This was seen as a reflection of the strong boost in demand for hotel space in Singapore in recent years, with the country’s fast-growing visitor arrivals.


Mr Pawley is the chief executive of Singapore-based Oxley Capital Group, a private investment house focusing on real estate and private equity.


While he was head of the Asian real estate, gaming and lodging business at Credit Suisse Investment Banking in Asia, he was involved with the $1.7 billion sale of the entire Raffles Holdings’ hotel portfolio – including Raffles Hotel in Singapore – to United States-based private equity firm Colony Capital in 2005.


Colony later merged that portfolio with Fairmont Hotels & Resorts’ assets to create Fairmont Raffles Hotels International (FRHI). Colony reportedly holds about a 40 per cent stake in FRHI, while Saudi Prince Alwaleed bin Talal’s Kingdom Hotels International owns the rest.


On May 8, FRHI announced that it had reached an in-principle agreement to sell off Raffles Hotel. But as with its past real estate transactions, any hotels sold would continue to be part of the company’s hotel collection.


FRHI’s hotel management arm, Raffles Hotels & Resorts, also secured a long-term management contract to manage the hotel, reportedly for 40 years.


Market watchers told BT that most existing hotel groups would think twice about buying a hotel with a long-term management contract from the seller. They speculated that this clause might have scuppered the deal.


Source: Straits Times




Workers keep quiet out of fear


WHEN I walked into the building at No 2, Kampong Ampat, it was like I was entering a different world.


By S. Murali



31 May 2008


WHEN I walked into the building at No 2, Kampong Ampat, it was like I was entering a different world.


A dingy staircase led to the third storey of the building, where the workers we were visiting were housed.


We seemed to walk through a maze to reach the dorm rooms, even having to walk past toilets and open bathrooms, all the while carefully avoiding puddles of dirty water and piles of rubbish along the way.


It was hard to believe that people lived here but, as we were to discover later, more than 600 were housed by employers on two floors; in some cases, 54 to a room.


Yes, that’s 54 people in a room measuring 25ft by 20ft.


How is that possible?


Well, there are 18 triple-decker beds in the 15ft-high room, packed next to each other like crates.


The only space left are the small corridors to allow access to the beds.


Perhaps calling them beds is not quite accurate, because there is no mattress or bedding at all.


There are only wooden planks for the workers to lie on, and they have lined the planks with masking tape to prevent bedbugs from getting at them through the cracks.


I tried to sit on a bottom bunk bed, which was centimetres from the floor. As I sat down, my neck was already at the level of the next bunk, meaning I or the workers couldn’t even sit up on the ‘beds’ without hitting our heads on the bunk above.


Clothes were strewn all over the place, washed and hung to dry in any available space. At the side of the beds, if there was space available, suitcases were piled up and functioned as makeshift tables.


Even with the windows open, a heavy smell hung in the air, making me feel claustrophobic.


It was like stumbling onto one of those farms where they force-feed chickens and house them in inhumane conditions.


But we are talking about people who are living and working among us.


Why are only a few of them willing to come forward and complain?


After pleading with us to ensure that they remain nameless, some workers told us that they live in constant fear.


Fear of being sent home for complaining.


Fear of being deprived the chance to do overtime, so that they can earn slightly more than $500 a month to pay off the debts they took to get to Singapore.


Fear of being blacklisted by bosses who can speak English.


Fear of telling their families back home that their ‘Singapore dream’ has become a nightmare, that they are now financially worse off than when they left their countries, and that they may lose their homes and land which they put up as collateral for loans.




Social workers such as Mr Jolovan Wham believe that the problem is systemic, as the workers are joined to their employers at the hip due to the work-permit process, and feel that they are at their complete mercy.


Unfortunately, too often, they are right.


The workers we spoke to have blown the whistle on two occasions.


The first time they did, they were moved into even worse accommodations, allegedly as punishment.


If things don’t get better this time around, or if the workers get sent home, which is their worst fear, then we have to wonder if we have the correct system in place to protect their rights.



Source: The New Paper




54 workers crammed in one room


THEY were living in squalid conditions – 38 foreign workers squeezed into a tiny, dirty shophouse – when Ministry of Manpower (MOM) officials ordered their employer to find them acceptable accommodation.


By Tay Shi’an



31 May 2008


THEY were living in squalid conditions – 38 foreign workers squeezed into a tiny, dirty shophouse – when Ministry of Manpower (MOM) officials ordered their employer to find them acceptable accommodation.


But the employer allegedly told the workers off for going to the authorities – and moved them into an even worse dormitory as ‘punishment’ .


Their new home: A bedbug-infested dorm in a converted factory building in MacPherson, packed with more than 600 foreign workers from various companies on two floors.


The New Paper entered one room, measuring 25ft by 20ft (about the size of a two-room HDB flat), with 54workers were crammed inside.


The building, at Kampong Ampat, is on lease from HDB and the dorm is on the list of approved dorms on MOM’s website.


The foreign workers from the first dorm said they did not dare complain to MOM again, as their boss had allegedly threatened to send them back to India and get them blacklisted from working in Singapore again.


But their employer, Rite Choice Technologies, denied this.


Its director, Mr V Raju, said he was unaware of the conditions at the new dorm, which he stressed is on the list of approved dorms.


His company, which was fined $2,000 for the previous offence, is now being investigated by MOM for failure to ensure the well-being of their workers, along with the other companies which had housed their workers at Kampong Ampat.


Said a foreign worker in his 20s: ‘This place is much worse, I’ve lost 4kg just by staying here.


‘It’s more crowded, it’s very smelly and dirty, and the bedbugs are worse. I can’t get any sleep.


‘How can a person stay here?’


After The New Paper notified the authorities, MOM officers investigated the dorm on 22 May.


Said its spokesman: ‘We found that the workers were being housed in overcrowded conditions, with more than 600 foreign workers crammed into the third and fourth storeys of the factory-converted dormitory.’


The Singapore Civil Defence Force (SCDF) also inspected the premises and found fire safety infringements relating to overcrowding and obstruction to fire escape routes, said LTC N Subhas, director of its public affairs department.


As for the other allegations by the Rite Choice Technologies workers, MOM’s spokesman said: ‘MOM is also assisting the workers in resolving their complaints on other employment-related issues.


‘We will also facilitate change of employers for foreign workers who have been victimised.’


Four Rite Choice Technologies workers agreed to speak to The New Paper on condition of anonymity.


They said they had put up with the conditions at their former dorm at a Tanjong Katong shophouse until a workplace dispute on 20 Mar.


That’s when they lodged a complaint with MOM.


The 38 workers – 17 from Rite Choice Technologies and the rest from its associate companies – had been squeezed into three bedrooms in the 1,800sq ft shophouse. The Straits Times had carried a report on it, ‘Shophouse of horrors’, on 1 Apr.


They slept on bunk beds, shared a single bathroom and toilet, and put up with overloaded power points and regular power trips.


Said one worker in Tamil: ‘MOM came and interviewed us. They came back one more time to check on our well-being, then gave us a number to call if we had any more problems.


‘They told us not to be scared.’


But he alleged that Mr Raju later questioned the workers and threatened them. He said: ‘He told us he will not be affected by this complaint. They cannot touch a hair on his head, and we will be punished for going to MOM.’




In early May, the workers were moved to Kampong Ampat, where they slept on triple-decker beds.


The bedbug infestation was worse.


Many of the workers had mortgaged their land and houses in their home country, and could not afford to be sent back with huge debts over their heads.


They earn about $500 a month here, and usually spend their first year working off their loans.


Many are single, and a common dream is to earn enough money, then go home and get married.


Said one worker: ‘We thought in Singapore, we could make 25,000rupees ($800) a month and send back money. We were told that if work hard, we can make good money for our families.


‘If we knew what we know now, we wouldn’t have come here.’


But Mr Raju claimed it was a coincidence that his company was facing its second investigation in just over two months for failure to ensure the well-being of his workers.


He claimed he was not aware there were violations at the Kampong Ampat dorm until The New Paper called him.


‘I’ve never been there, I’m not aware of the conditions,’ he said.


He faxed over his contract with the dorm operator to show that the arrangement was legitimate.


Of his workers’ allegations that he had threatened them, he said: ‘No such thing. When did I say this, tell me? Can they prove it?’


He said that despite his company hitting the headlines last month, he did not send home a worker who had made allegations against it.


‘They are still working for me,’ he said. ‘I’m not planning to send back any one, I have jobs for them.’


His company was served a termination notice by the dorm operator, ISO Industry, and 26 of his 90 workers who are still staying there will have to leave by 26 Jun.


ISO Industry’s managing director, Mr Patrick Peh, said the company has admitted to the overcrowding in the Kampong Ampat dorm to MOM, and will be rectifying the conditions.


He said most of the workers will be moved to an approved dorm on Yishun Avenue 7 by this Sunday.


‘While they are away, we are going to improve the facilities and conditions. We hope to satisfy all conditions set out by the relevant authorities, ‘ he said.


HDB is also conducting an investigation because it was not informed that Rite Choice workers were staying there.


Mr Peh said this was an oversight, and ISO had informed HDB of the other sub-tenants.


The MOM spokesman reminded employers that, as part of the work permit conditions, they must provide proper housing for their foreign workers that comply with the requirements set by the various government agencies.


‘Errant employers will be prosecuted and barred from hiring foreign workers,’ she said.


‘MOM conducts audit checks on the approved dormitories regularly.’





What happened


20 Mar: Rite Choice Technologies workers report to Manpower Ministry about conditions in Tanjong Katong dorm – 38 workers crammed on double-decker beds in dirty, smelly shophouse with single toilet.


MOM orders Rite Choice to provide acceptable accommodation for workers. Fines it $2,000.


Early May: 26 workers moved into Kampong Ampat dorm, housing 600 workers on two floors of converted factory. They sleep on triple-decker beds




Source: The New Paper

Raffles Hotel deal is off after all

Raffles Hotel deal is off after all 





A CONSORTIUM :led by former Credit Suisse banker Mark Pawley that was to have bought the grand dame has called the deal off, :The Business Times: (BT) reported on Friday.


“We regret to say that the sale will not be completed as planned,” a consortium spokeswoman was quoted as saying. “The consortium is very disappointed with the current outcome as we had hoped for a win-win solution involving all parties.”


A spokeswoman for Raffles Hotel confirmed the news with Today. Both parties declined to give reasons for the deal being called off, citing confidentiality clauses.


The spokeswoman for the buyers, according to BT, also rebuffed suggestions that the consortium might have faced funding problems, saying: “We have the money. To say otherwise is baseless.”


The hotel sale, including the adjoining shopping arcade, was announced on May 8. The deal was reported to be in the range of $650 million.


Fairmont Raffles Hotels International — controlled by Saudi billionaire Prince Alwaleed Talal and American-based private equity firm Colony Capital — had bought over the iconic hotel for $1.7 billion only in 2005. They would have continued running the property through a management contract if the sale had gone through.


Source: Today Newspaper