Rental flats: HDB to weed out errant tenants

Rental flats: HDB to weed out errant tenants 

 

It will conduct more checks to identify those who sublet subsidised flats illegally

By Jessica Cheam 

THE Housing and Development Board (HDB) is clamping down harder on the abuse of its heavily subsidised rental flats.

 

Enforcement blitzes to identify illegally rented flats will be stepped up and they will be extended across a wider area of the country, said the HDB on Wednesday.

 

Its response comes amid growing disquiet on several fronts about the abuse of subsidised rental housing.

 

MPs, residents of rental blocks and eligible Singaporeans who feel they have been left in the queue while foreign workers snap up cheap flats have all called for action.

 

The Straits Times reported last week that an increasing number of tenants have been illegally subletting HDB flats to cash in on the demand for low-priced accommodation. The flats are often leased to workers from Malaysia, China and India who are either in the dark about rules or just want the cheapest rental option.

 

Some MPs told The Straits Times that residents had alerted them to the illegal rentals and demanded more enforcement.

 

HDB rental flats have soared in demand over the past year, with the waiting list up by at least 30 per cent in recent months. There are about 4,000 applicants in the queue with a waiting time of 15 months – double the wait in 2006.

 

Source: Straits Times

JTC to plant more trees in Tuas to help companies cut energy costs

JTC to plant more trees in Tuas to help companies cut energy costs

 

SINGAPORE: JTC Corporation will plant more trees in Tuas to help companies there cut energy costs, the company revealed at its tree-planting event at the Tuas Biomedical Park on Wednesday.

 

It said a joint study with the National University of Singapore showed that areas with more greenery experience cooler temperatures.

 

Shade from trees and rooftop greenery can bring down temperatures in buildings by nearly five degrees, which suggests that well-shaded buildings could see energy savings of more than 25 per cent.

 

JTC is now looking at planting trees at strategic locations in Tuas View as a pilot project. – CNA/ac

 

Source: Channel NewsAsia

Sino Construction to raise S$35.6m in IPO

Sino Construction to raise S$35.6m in IPO

 

SINGAPORE : Sino Construction, a China-based construction group, has launched its Initial Public Offering (IPO) in Singapore to raise about S$35.6 million.

 

Sino Construction is offering 152,698,000 shares for sale at 39 cents each. Out of these, more than 6 million shares have been set aside for the public.

 

Sino Construction plans to use the proceeds to establish a concrete mixing base, purchase machinery and equipment, as well as general working capital.

 

The IPO will close on June 10. Trading on the Singapore Exchange is expected to begin two days later, on June 12. – CNA /ls

 

Source: Channel NewsAsia

Lukewarm response to DBSS not a sign of property downtrend

Lukewarm response to DBSS not a sign of property downtrend 

 

 

By Rachel Ang

 

The latest site to be released under the Design, Build, Sell, Scheme, or DBSS, received just 2 bids at the close of tender yesterday.

 

Analysts say the lukewarm response is a sign of growing caution among developers.

 

But analysts say this doesn’t necessarily mean that the property market is headed for a downtrend.

 

Sim Lian Land was the top bidder for the DBSS site at Simei Road, entering a tender of 52 million dollars, or 137 dollars per square foot per plot ratio.

 

The figure is at the lower end of market expectations.

 

Propnex CEO Mohamed Ismail said the modest bid reflected Sim Lian’s cautious attitude.

 

He said: “Because DBSS is a very specific market whereby the prices are relatively higher than build to order. This only caters to a certain segment, not everybody qualifies to buy a Design, Build, Sell, Scheme. And as I said, developers are being cautious of the current market, this means that the newer DBSS particularly for this site will be priced much lower.”

 

Nonetheless, Mr Mohamed Ismail said he does not see enough evidence that this cautious attitude among developers is signalling a downturn in the property market.

 

And Head of Research and Consultancy at Chesterton International, Colin Tan, noted that though property sales might be slowing down in general, some locations in Singapore are still seeing a high level of buying interest.

 

He said: “I think the market is turning, and in Singapore’s case, and as usually we’re turning very slowly to have a gradual descent. Well the sales are actually quite slow, and if you notice, the latest URA stats show that the numbers are pretty small, are very small. But if you look at some projects, you look at the Telok Kurau area, you have actually seen that the developers have already priced the units to sell, so they actually have got more sales.”

 

HDB is expected to make its decision on the DBSS tender within the next two weeks.

 

Under DBSS, the developer tenders for the land enjoys flexibility in designing, pricing and selling the flats.

 

Source: 938Live

Keppel Land’s Vietnam office properties fully leased

Keppel Land’s Vietnam office properties fully leased 

 

 

Keppel Land, Singapore’s third-largest developer, said its properties in Vietnam are fully leased and sees little impact from accelerating inflation in the country.

 

It said in an emailed statement that its office leases are normally for the period of two years or more and are pegged in US dollars.

 

Vietnam cut its 2008 economic growth target today to 7 percent from 9 percent as the year-on-year inflation rate reached 25.2 percent last month, the higest since at least 1992.

 

Kim Eng Securities recently cut its target price for the developer on concern that the company’s projects in Vietnam may be affected by a slowdown in the Vietnamese economy and housing market.

 

Vietnam accounted for 5.5 percent of Keppel’s net income last year, the most among Singapore’s property developers.

 

 

Source: 938Live

Canopy design adheres to heritage guidelines

Canopy design adheres to heritage guidelines

 

WE THANK Mr Loke Hoe Kit for his letter on Monday, ‘Canopy doesn’t do old Supreme Court justice’.

 

A key requirement for all entries to the architectural design competition for the National Art Gallery (working title) is that they must satisfy the Preservation of Monuments Board (PMB) guidelines. This is to ensure that the selected design for the National Art Gallery respects the heritage and architectural significance of the City Hall and the Former Supreme Court buildings.

 

The preservation guidelines stipulate that the main external architectural features of the City Hall and the former Supreme Court are their facades. The international jury panel and the Ministry of Information, Communications and the Arts have ensured that the selected design adheres to this guideline, among others.

 

The proposed design discretely sets the canopy back from the building edge. The original roofs of both monuments are left intact. This juxtaposition of old and new is an internationally accepted practice for making new extensions to historical monuments. For the Tan Si Chong Su temple, the main external architectural feature of its traditional Chinese architecture is the roof. Any changes made to the shape, ornamentations and materials of the roof, therefore, impact on the architectural significance of the building, especially if the change is irreversible.

 

We share Mr Loke’s concern on the need to preserve our monuments while ensuring their appropriate adaptive re-use.

 

K. Bhavani (Ms)

Director, Corporate Communications,

Ministry of Information, Communications and the Arts

 

Source: Straits Times

Sim Lian Land is top bidder for DBSS site at Simei

Sim Lian Land is top bidder for DBSS site at Simei

 

SIM Lian Land Pte Ltd yesterday emerged as the top bidder in a Housing & Development Board (HDB) tender for a Design, Build and Sell Scheme (DBSS) site at Simei Road.

 

The $52 million bid, or $137 per square foot per plot ratio (psf ppr), was at the lower range of earlier market expectations. Industry observers projected in April that the site could fetch between $49 million and $76 million, or $130 to $200 psf ppr.

 

The fifth DBSS site, with a lease term of 103 years and a maximum allowable gross floor area of 380,300 sq ft, attracted another bid from AMK Development Pte Ltd. Its bid of $37.3 million, or $98 psf ppr, was 28 per cent lower than Sim Lian Land’s.

 

Managing director of Sim Lian Land Kuik Sing Beng told BT that the site is expected to yield about 340 units. Five-room flats would make up 60 to 70 per cent of the units, and the rest would be a mix of four- and three-room flats. Sim Lian Land plans to launch the units for sale next May.

 

Mr Kuik also said that the breakeven cost would be about $350 psf of sellable area. He noted that the selling price for resale flats in the Simei area is about $380 psf of sellable area.

 

Cushman & Wakefield managing director Donald Han believes that HDB is likely to award the site. He observed that in spite of the gap between the two bids, Sim Lian Land’s bid is in line with current market expectations.

 

According to Mr Han, the small number of bids reflects the cautious attitude that developers have adopted. Rising construction costs are also posing a challenge for developers, Mr Han pointed out. Echoing this, Mr Kuik said that construction costs have increased substantially in the past one year.

 

HDB is expected to make a decision in the next two weeks.

 

 

Source: Business Times

CWT in for $85.7m gain from warehouse deal

CWT in for $85.7m gain from warehouse deal

Logistics group in proposed sale-and-leaseback transaction

 

By WINSTON CHAI

 

LOGISTICS group CWT Ltd stands to realise a gain of $85.7 million from the sale of one of its biggest warehouse facilities in Singapore.

 

The company yesterday said it has entered into a conditional agreement with a buyer to sell and lease back its newly-completed Logistics Hub 2 in Tanjong Penjuru.

 

CWT did not disclose the name of the purchaser but said it is a ‘property fund’ focusing on the Asia-Pacific region. The sale price for the proposed transaction is $115.2 million.

 

Upon completing the sale, CWT will lease back the building for five years with an option for an additional three-year period.

 

The firm said in a statement it expects to realise a gain of about $85.7 million from the transaction, based on the aggregate net book value of $28.1 million.

 

Of the gain, $55.5 million will be recognised as a one-time gain and the balance of $30.2 million will be accounted as a deferred gain to match off against the leaseback commitment.

 

To illustrate the financial impact, CWT said profit attributable to shareholders in FY2007 after the sale and leaseback would be $90.29 million, compared with $34.79 million before the transaction.

 

CWT said it plans to use the proceeds to reduce its bank borrowings, to fund its local and regional expansion, and for working capital.

 

The deal is subject to the approval of JTC and company shareholders. In addition, due to the nature of the warehouse, CWT must complete an environmental baseline study and submit the results to JTC and other relevant parties before the sale can go through.

 

The company currently owns two integrated logistics hubs in Tanjong Penjuru, which combine to provide nearly 850,000 sq ft of warehouse space for handling hazardous materials and chemical goods.

 

Both facilities were launched in March this year following an investment of more than $80 million.

 

Source: Business Times

Uncertainty over lease top-ups may affect sentiment

Uncertainty over lease top-ups may affect sentiment

Govt may approve shorter extensions or not top up leases

 

By KALPANA RASHIWALA

 

(SINGAPORE) The government’s recent decisions to either not top up leases of some leasehold sites to the original 99-year term or to approve shorter lease extensions could affect sentiment towards investment sales of such properties.

 

The decisions may have implications for the likes of other leasehold properties such as DBS Building, UIC Building and Shenton House, market watchers say. ‘We can’t take it for granted that the Government will agree to extend leases for sites it had sold in the past to 99 years,’ an investment sales veteran said.

 

While some may be tempted to hold back investment sales deals, a property consultant points out that in reality, the economic life of an office building is probably about just 40 years. ‘It’s just the emotional thought of being stuck with say just 60 years lease, that may make some potential investors reluctant to redevelop a property,’ he added.

 

Knight Frank executive director Foo Suan Peng added: ‘If an investor is planning to develop a new office block and hold it for rental income, he may not necessarily be deterred if he receives a shorter lease top-up or even no lease top-up on the site, since the rental income from the new office block would not vary according to the site’s leasehold tenure.

 

‘However, for residential collective sale sites, a potential developer may find it tough selling a new condo built on a plot with a remaining lease of say, 70 years or 80 years, in the Singapore context. If he develops the plot into serviced apartments or apartments for lease, though, it may still be a viable proposition.’

 

DTZ executive director Ong Choon Fah did not think the government’s decisions would scare away investors. ‘The shorter lease-term will be priced into the property. The return has to be recouped within the allowed lease period. What would be good is if investors had clarity on lease top-ups; if you know the risk, you can manage the risk.’

 

There were calls to take some precautionary steps before inking deals, especially for collective sales of residential sites.

 

‘Buyers and sellers should check with the authorities about lease extensions before they agree to anything. The authorities for their part should also come up with clearer guidelines on lease top-ups,’ says Credo Real Estate managing director Karamjit Singh.

 

Agreeing, Knight Frank’s Mr Foo said: ‘If there’s an element of risk that the lease may not be topped up, the buyer will factor this into his pricing. One way to eliminate this risk, would be for the buyer to make the deal subject to the lease being topped up to 99 years.’While that would be one option, Credo’s Mr Singh argues: ‘It does not cover a situation where the authorities may agree to extend the lease, but not to 99 years. ‘Practically, it would be difficult to impute a formula to recalibrate the sale price depending on the number of years that SLA approves for lease extension.’

 

Instead, Mr Singh suggests ‘that where the redevelopment proposal is in line with the Master Plan, Singapore Land Authority consider processing an in-principle application for a lease upgrade without a need for the applicants to first obtain an outline planning permission (OPP) from Urban Redevelopment Authority’. An OPP may cost anywhere from $5,000 to $100,000, or even more, depending on the size of the proposed redevelopment project – and owners, especially in a residential collective sale, may find this a costly upfront payment.

 

In early 2005, history was made when Eng Cheong Tower in the Beach Road area became the first collective sale of a 99-year leasehold property. Paving the way for the deal was an unprecedented decision by SLA to grant in-principle approval to top up the site’s lease to 99 years before the site’s sale.

 

 

Source: Business Times

Reality check for 99-year lease top-up assumption

Reality check for 99-year lease top-up assumption

Recent decisions show such extensions not a given as govt retains planning flexibility

 

 

By KALPANA RASHIWALA

 

(SINGAPORE) The market used to assume that the government would top up leases for sites to 99 years as they came up for redevelopment. A series of recent decisions – in which the authorities either declined lease top-ups or allowed them, but for shorter tenures – have put a big question mark over that assumption.

 

Property players say these decisions could have an impact on investment sales of 99-year leasehold properties or at least the way such deals are structured.

 

In January, when the proposal for Market Street Car Park’s redevelopment into an office tower was made public, owner CapitaCommercial Trust revealed that the authorities declined to top up the lease for the site, which has another 65 years to run.

 

More recently, the market learnt that the former Crosby House site at 71 Robinson Road – which is being built into a new office block – had its lease topped up in April last year, not to the usual 99 years but 85 years and 10 months instead. This was apparently to match the remaining lease term of SIA Building next door.

 

BT understands that no lease top-up was granted for Marina House last year, which is proposed to be redeveloped, although HMC Building nearby (being developed into Lumiere condo) got a lease top-up to 99 years earlier. Sources say another building at Cecil Street has also had its lease top-up application rejected. Again, the Urban Redevelopment Authority (URA) may have plans for the streetblock where it is located.

 

In recent years, the government has topped up leases of nearby sites to the original 99-year term, including 1 Shenton Way (being redeveloped into One Shenton), NatWest Centre (being redeveloped into The Clift) and HMC Building.

 

The recent decisions appear to run contrary to the perception that the government would generally agree to top up leases of such sites to the original 99 years, so long as the planned redevelopment scheme is in sync with URA’s long-term vision for the area.

 

Instead, Singapore Land Authority (SLA) said: ‘The government will generally allow leases to expire, without extension.’ It noted that ‘the state generally sells land on leasehold to allow it the flexibility to reallocate land to meet socio-economic needs.’

 

‘However, the government has considered and allowed lease extensions based on whether the proposed redevelopment is in line with the government’s planning intention and long-term development plans, and factors such as whether there would be significant intensification, or greater optimisation in land use. That remains the government’s policy,’ SLA said.

 

SLA evaluates each application on its merits and in consultation with the relevant agencies. The specific circumstances of each development dictate whether it should be given a lease extension – and for how long.

 

Market Street Car Park’s lease was not topped up ‘as there is a need to retain planning flexibility over the future development of the site’, SLA said.

 

URA said it evaluates requests for topping up leases based on ‘a range of planning considerations in relation to the specific location and context of the area’. This approach gives ‘the state flexibility to review the longer-term plan for the area, as and when the existing leases expire or come in for extension in future, and to reconfigure the parcels, if required, to provide for better land utilisation’, it added.

 

In the Central Business District, for instance, the considerations may vary from streetblock to streetblock, URA said, when queried about the unusual lease top-up to 85 years and 10 months for 71 Robinson Road. ‘This lease period is sufficient to allow for the owner to redevelop the site to a new modern office building,’ URA added.

 

DTZ executive director Ong Choon Fah said: ‘In the past, the government may have been pretty liberal in topping up leases. Now, they’ve to think of Concept Plan 2011 and how to accommodate a long-term population of 6.5 million people.

 

‘So they have to be more creative and safeguard land for the future, by having a common lease expiry period.’

 

The head of a property consulting group said: ‘URA’s probably doing a housekeeping exercise of trying to coordinate lease expiries of buildings in the same streetblock, to give themselves some flexibility. So they may ask: ‘What’s the longest remaining lease in this block? Let’s now try, going forward, to have leases in this streetblock expire at the same time, so that in future, if we want to do anything, we’ll be able to do that.’

 

DTZ’s Mrs Ong observes: ‘There are many pencil buildings on tiny plots in the CBD. It would be more efficient if the government has common lease expiry periods for adjacent plots so that they may amalgamate them into bigger land parcels and resell them in future.

 

‘It’s more efficient to intensify land use for bigger land parcels. Globally too there’s a trend of mixed developments, with a live, work, play environment. It’s more environmentally friendly and reduces commuting time. For that too you need bigger sites.’

 

Source: Business Times