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Jurong Lake Plans for public viewing

Posted by luxuryasiahome on May 7, 2008

WE REFER to Ms He Xiao Lu’s letter ‘Use existing resources to create Jurong character’ (my paper, April 25) on how the draft plans for the Jurong Lake District can tap on the existing attributes in the area.

We agree with Ms He that planning for the Jurong Lake District presents opportunities for planners to capitalise on the assets in the area.

The draft plans for the Jurong Lake District have, in fact, incorporated the education- based concept that Ms He has suggested, such as the proposal to have four or five new edutainment or nature-based attractions around Jurong Lake, targeted at families with young children.

The lake is also currently being improved to allow water- based activities.

In addition, the new Science Centre, which will be located next to the Chinese Garden MRT station and the lake, will be able to take advantage of the lake and the surrounding green spaces to extend learning experiences beyond the physical confines of the building.

The plans for the Jurong Lake District will be exhibited at the URA Centre in late May 2008 as part of the Draft Master Plan 2008 exhibition.

We welcome the public to visit the exhibition to view the plans and give us their feedback and suggestions.

We thank Ms He for her feedback.

Mr Lim Eng Hwee
Director (Physical Planning), Urban Redevelopment Authority

Source : My Paper – 7 May 2008

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ARA Asset Management reports 137% jump in Q1 earnings to S$9.2m

Posted by luxuryasiahome on May 7, 2008

ARA Asset Management has posted first-quarter earnings of S$9.2 million, up 137 percent from a year ago.

Revenue more than doubled to S$17.5 million.

The growth was mainly due to higher management fees from its REIT portfolio, as well as higher net property income.

ARA is expecting its asset enhancement initiatives to boost income for the full year of 2008. It is looking to set up REITs in new asset classes.

As at March 31, ARA’s total assets under management stood at S$10.4 billion. – CNA/ms

Source : Channel NewsAsia - 7 May 2008

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DBS, OCBC hit by global turmoil; Q1 net profits fall

Posted by luxuryasiahome on May 7, 2008

Two Singapore banks on Wednesday reported falls in first-quarter net profit as trading activities took a hit from global financial turmoil.

DBS Group, Southeast Asia’s biggest bank, said its net profit in the first quarter ended March 31 dipped 2.0 percent to S$603 million (US$446 million) compared with the previous year.

Singapore’s smallest bank, Oversea-Chinese Banking Corp (OCBC), reported a four percent fall in net profit to S$622 million for the first quarter.

DBS said its revenue totalled S$1.56 billion, up 1.0 percent from the same period last year, but it reported a trading loss of S$161 million, compared with a S$171-million net profit the year before, amid a global credit crunch triggered by a crisis in the US housing market.

Income from fees rose 14 percent over the previous year, but was down 7.0 percent from the preceding quarter “due to weaker capital market activities such as wealth management, investment banking and stockbroking,” added DBS, which has operations in 16 Asian markets including Hong Kong.

“The results were not bad,” David Lum, an analyst at Daiwa Institute of Research, said of DBS.

OCBC said its net interest income rose by 26 percent to S$638 million, boosted by loan volumes and improved interest margins.

“However, volatile financial markets resulted in overall non-interest income falling by 26 percent” to S$377 million, OCBC said, citing a decline in life assurance profits and losses in securities and derivatives trading along with lower gains on investment securities.

“The first quarter 2008 loss included a S$16 million mark-to-market loss on credit default swaps related to the bank’s corporate CDO investments,” it said, referring to collateralised debt obligations.

Despite the S$16-million loss, the bank’s corporate CDO investment portfolio of S$344 million continues to perform, it said.

OCBC added that its asset-backed securities CDO portfolio of S$250 million, written down by 85 percent in 2007, did not require further allowances in the first quarter.

CDOs are securities backed by a range of assets including bonds, loans and their derivatives, including corporate loans, high-grade mortgages, sub-prime mortgages, car loans and credit card debt.

World financial markets have been battered since last August by fallout from a crisis in the US sub-prime, or high-risk, loan sector which forced commercial banks to tighten lending criteria leading to a credit crunch which spread to threaten the global economy.

Banks around the world suffered multi-billion-dollar losses linked to sub-prime loans given to US homebuyers with risky credit histories.

DBS Group chairman Koh Boon Hwee said his bank remains financially strong and well-capitalised.

DBS has a relatively small exposure to the sub-prime sector. It had S$259 million in asset-backed CDOs, and said it has set aside provisions for about 90 percent of that amount.

“We don’t expect any further provision charges for CDOs to be significant in the coming quarters,” said chief financial officer Jeannette Wong, adding total CDO exposure fell to S$1.44 billion from S$1.5 billion in the fourth quarter.

Both the DBS and OCBC profit figures beat analysts’ forecasts but UOB came in below market expectations.

On Tuesday United Overseas Bank Group (UOB) said its net profit in the first quarter rose an annual 2.1 percent to S$529 million, boosted by loan growth.

UOB said its investment in CDOs declined further to S$268 million, including S$82 million in asset-backed securities, while impairment charges increased by 1.8 percent to S$89 million, largely attributed to provision for CDOs.

The bank said it has fully provided for its asset-backed securities CDOs.

Lum said the banks face a scarcity of growth sources given a risk-averse investment environment. – AFP/ac

Source : Channel NewsAsia – 7 May 2008

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OCBC Q1 profit falls 4%, sees growth opportunities

Posted by luxuryasiahome on May 7, 2008

Singapore’s Oversea-Chinese Banking Corp (OCBC), Southeast Asia’s third-largest lender, posted a lower-than-expected 4 per cent fall in first-quarter profit and said it saw growth opportunities in its core markets.

OCBC’s earnings reflected strong loan growth in Singapore during the first three months of 2008 thanks to a construction boom in the republic. But its profit was down from a year ago due to sharply lower earnings at its insurance arm.

Core earnings, which exclude one-time gains from the divestment of assets and tax refunds, fell 10 per cent to $460 million

‘Our first quarter core earnings showed resilience in spite of volatile global financial markets. We continue to see growth opportunities in our major markets for the remainder of 2008,’ chief executive David Conner said in a statement.

OCBC, whose main operations are in Singapore and Malaysia, earned $622 million (US$458 million) in the three months ended March, compared with $647 million a year earlier.

Its net profit beat the $456 million average estimate of six analysts polled by Reuters as it booked a gain of $156 million from the sale of shares in commodities and property firm Straits Trading .

Core earnings, which exclude one-time gains from the divestment of non-core assets and tax refunds, fell 10 per cent to $460 million from $510 million in January-March 2007.

The bank’s net interest income rose 26 per cent from a year ago to $638 million, while its loan margin increased to 2.17 per cent from 2.14 per cent at the end of December.

But non-interest income, which includes commissions and fees, fell 26 per cent to $377 million, the bank said.

‘Strong growth in net interest income, fee income and foreign exchange income were offset by a significant decline in life assurance profits from Great Eastern Holdings,’ OCBC said.

Great Eastern – the largest life insurer in Singapore and Malaysia – reported on Tuesday a 67 per cent fall in net profit to $45 million partly due to marked-to-market losses on its investments. OCBC owns around 87 per cent of Great Eastern.

OCBC’s first quarter 2007 net profit was partly boosted by a divestment gain of $90 million from the sale of an office property, and a tax refund of $47 million.

OCBC shares fell 3.1 per cent in morning trade ahead of its results, which were released during the midday market break.

The broader market was off 1.2 per cent.

OCBC shares fell 2.3 per cent in the first quarter this year, compared with a 3.8 per cent decline for larger rivals UOB and a 13 per cent drop for DBS, Singapore’s biggest bank by assets. — REUTERS

Source : Business Times – 7 May 2008

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DBS Q1 profit slips, outlook murky

Posted by luxuryasiahome on May 7, 2008

DBS Group, South-east Asia’s biggest bank by assets, posted a smaller-than-expected two per cent drop in quarterly profit after strong loan growth helped to ease credit-related writedowns.

Analysts warned that more difficulties lie ahead in the second half when a looming United States recession catches up with Asia’s robust economies, putting a brake on earnings momentum.

DBS took a previously announced $86 million (US$63.33 million) of writedowns in the first quarter on complex derivatives exposed to risky debt, which pushed its trading income into the red

‘It’s all driven by the macro environment for DBS,’ said Mr Matthew Wilson, an analyst at Morgan Stanley. ‘I’m cautious on the United States because a recession there will affect Singapore.’ Mr Wilson warned the booming Singapore property market, which had boosted loan growth for the lender, was also peaking.

Most analysts expect Singapore’s loan growth to slow to 12 to 13 per cent this year after it expanded by 20 per cent in 2007.

DBS earned January-March net profit of $603 million, down from $617 million a year ago. Analysts had predicted net profit of $566 million, according to an average forecast from six analysts polled by Reuters.

DBS shares were almost flat at $20.50 at 9.25am Singapore time after rising to a 2008 high of $20.80.

The result on Wednesday came after United Overseas Bank, Singapore’s second-biggest bank, posted a 2.1 per cent rise in quarterly profit, broadly in line with market forecasts, but warned that loan growth could slow this year. Smaller rival Oversea-Chinese Banking Corp (OCBC) reports later on Wednesday.

Writedown, Visa gain

DBS, in which state investor Temasek has a 28 per cent stake, took a previously announced $86 million of writedowns in the first quarter on complex derivatives exposed to risky debt, which pushed its trading income into the red.

But the writedown was much lower than last year when it wrote down $270 million on structured instruments, the bulk in the fourth quarter, including debt exposed to the collapsing US sub-prime mortgage market.

Asian banks, including DBS, have been spared from the worst of the sub-prime-related losses that have hit global peers such as UBS, Bear Stearns and Merrill Lynch.

However a nine per cent rise in interest income, boosted by 21 per cent growth in loans, and an unexpected $53 million gain from its investment in Visa’s initial public offering, limited the losses.

January-March fee income rose 14 per cent from a year earlier, but fell seven per cent from the previous quarter.

Stockbroking fees dropped six per cent amid volatile markets, while wealth management services fees declined 15 per cent.

Former Citibanker Richard Stanley, who took charge as DBS’s new chief executive last week, will brief the media and analysts for the first time later on Wednesday.

Analysts are looking for hints on how Mr Stanley plans to grow the bank’s Asian business beyond its core markets of Singapore and Hong Kong, from where it derives about 90 per cent of its earnings.

Chairman Koh Boon Hwee said DBS would continue to grow its customer franchise and increase business volumes as it seeks expansion in Vietnam, India and Taiwan.

DBS shares dropped 13 per cent in the first quarter, underperforming its rivals. UOB dropped 3.8 per cent and third-ranked OCBC fell 2.3 per cent.

DBS declared a dividend of $0.20 per share, similar to the previous quarter. — REUTERS

Source : Business Times – 7 May 2008

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Accountants not confident about economic outlook for 2008

Posted by luxuryasiahome on May 7, 2008

Accountants think that Singapore is up for challenges this year, according to a survey by the Institute of Certified Public Accountants of Singapore (ICPAS).

64 percent of the respondents said their outlook for the economy ranged from neutral to pessimistic.

Inflationary pressure was one of the top reasons for the dim economic outlook among Singapore accountants, with 90 percent of the respondents placing it as their most worrying factor.

Other factors included the credit market turmoil and the cost of labour. But not all were negative.

ICPAS said with the upcoming Formula One, integrated resorts and Youth Olympic Games, there are certain sectors which would remain strong.

Ernest Kan Yaw Kiong, Vice President of ICPAS, said: “There are areas that we believe will grow – such as construction, restaurants, business services as well as the hospitality industry.

“So if you look at all this in a proper context, you can see that while we have some economic turbulence going forward, (we can afford to be) optimistic because we have all these economic activities coming up.”

On the other hand, the outlook for manufacturing, wholesale, retail, transport and storage is slipping. Employment is also not expected to grow.

Nonetheless, ICPAS said Singapore’s fundamentals remain solid.

Mr Kan said: “I believe we have very strong fundamentals. Even with the inflationary pressure, steps that the government has taken are very, very positive. As we go through this economic turbulence, things will work out better in time to come.”

More than 200 respondents took part in the ICPAS Business Confidence Survey 2008. – CNA/so

Source : Channel NewsAsia- 7 May 2008

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Allco Reit to sell Australia properties

Posted by luxuryasiahome on May 7, 2008

Singapore-listed Allco Commercial Real Estate Investment Trust said on Wednesday that it has appointed sales agents to sell its 50 per cent interests in two Australian properties.

The company said in a statement that it had acquired the two properties for $371.1 million (US$272.4 million). — REUTERS

Source : Business Times - 7 May 2008

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Allco Commercial REIT to sell stakes in two Australian properties

Posted by luxuryasiahome on May 7, 2008

Allco Commercial REIT said on Wednesday it is putting its stakes in two properties in Australia up for sale and has appointed sales agents for these properties.

The properties are Central Park in Perth and Centrelink Headquarters in Canberra. Together, they are valued at around A$483 million or S$624 million.

CB Richard Ellis and Jones Lang LaSalle (JLL) will sell Allco’s 50 percent interest in Central Park through an international Expressions of Interest campaign which closes on July 10.

JLL and Colliers International have been appointed to market each of Allco REIT’s and Record Realty’s 50 percent interest in Centrelink Headquarters through an international Expression of Interest campaign which closes on June 5.

Central Park is a premium grade office tower and the tallest building in Perth. The property comprises a 47-storey office tower, with a total net lettable area of about 716,000 square feet.

Centrelink Headquarters is a new five-storey Grade A office complex. The property is located within the core of the Tuggeranong Town Centre, one of four town centres within the Australian capital Canberra.

Allco had said that the capital will be redeployed to higher-growth areas in Singapore and Asia. The funds could also be used to repay debts. – CNA/ms

Source : Channel NewsAsia - 7 May 2008

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Coping in an age of uncertainty

Posted by luxuryasiahome on May 7, 2008

SO even accountants and auditors in Singapore are bearish about the economic outlook, joining a list that includes manufacturers and those in the services sector – just about most in the business community, it’s safe to say. As number-crunchers with typically the early eye on the quarter’s figures, accountants and auditors get a snapshot of the business climate, even if it’s just within the microcosm of a company or two (their own or their clients). And a recent poll by the profession has found Certified Public Accountants (CPAs) to be less than upbeat about the economy and business in the quarters ahead; fairly anxious, in fact, about the US downturn and all the attendant uncertainty. That seems to be the prevailing sentiment all round.

Uncertainty is indeed the order of the day, even in today’s relative calm and stability. The global financial markets are thankfully free of mayhem for now, but turmoil and upheaval – as the last several bouts in recent years remind – are always a trigger event away. The worst appears to be over in the prolonged credit crisis but already the doomsayers point to the flipside, saying that a restoration of order in the credit markets could also spell the premature end of reform efforts. For now, however, greater uncertainty lurks in the real economy, where fears and worries about a global downturn, led by a US recession, have been feeding pessimism in the business world and among consumers, even before the first negative numbers appear in the latest US statistics. That is not to dismiss the very real concerns about a US downturn, with resulting decreases in American consumption and investment, and knock-on effects on Asian exports; but economic uncertainty tends to breed bearishness (rather than bullishness, for one) and sentiment and expectations guide many a business investment (or consumer spending) decision. That leads, in turn, to a further decline in business and economic activity – in the US and in the Asian economies. And then there’s the inflationary cost spiral and the surge in commodity and food prices in recent months. But while the external climate has been cloudy and choppy, things on the domestic front in Singapore have seemed healthy enough, with robust economic figures in the first quarter amid rising inflation. With such mixed signals, little wonder that the man in the street, including business folks, is left feeling even more uncertain about the economic outlook.

The policymakers here have spelt out the best and worst-case scenarios – all of which hinge heavily on the severity of the US downturn – and the prognosis is good. Brace for a rough ride, to be sure, but barring a full-blown economic storm, domestic fundamentals and regional support will prevent the Singapore economy from crashing this year, the central bank says. And a downturn that stretches into 2009 likely still means, in Singapore’s context, growth at the lower end of the trend 4-6 per cent range. Awareness of the risks ahead is good planning, but excessive pessimism could sometimes just become self-fulfilling.

Source : Business Times – 7 May 2008

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Beach Rd building sold for $70m

Posted by luxuryasiahome on May 7, 2008

Hirsch Bedner and Irish private equity firm turning asset into boutique offices

AN Irish private equity firm and renowned international interior design firm Hirsch Bedner Associates have bought 700 Beach Road, currently a small office, home office development named In-City Lofts, for a total $70 million.

The duo will pump in a further $3.5 million to upgrade the eight-storey building and reposition it as a boutique office block.

700 Beach: The total investment of $73.5m works out to $1,097 psf of the enlarged total net lettable area

 The building has 8,500 to 12,000 sq ft floor plates, 4.5-metre ceiling heights and a roof terrace with a full-sized lap pool and gym facilities. When the refurbishment is completed in August this year, the property – located between Golden Mile Tower and Golden Mile Complex – will be renamed 700 Beach.

 

The spruce-up will increase the building’s existing net lettable area by about 5,000 sq ft to 67,000 sq ft – of which 12,000 sq ft will be owned by Hirsch Bedner and 55,000 sq ft by Fine Grain Property Consortium (Singapore) Pte Ltd.

The all-in investment of $73.5 million by the two parties works out to $1,097 per square foot of the enlarged total net lettable area. Hirsch Bedner has taken about one-and-a-half floors while Fine Grain has bought the remaining six-and-a-half levels.

The site’s lease was extended to 99 years starting April 2004, after the building was completed.

The interior design process of the refurbishment for the entire building is being handled by Hirsch Bedner, which will also move into the space it has bought. This will be the Los Angeles-based firm’s regional office, housing its 80-strong design team.

Fine Grain has appointed Jones Lang LaSalle to lease its space in the building. ‘The gross monthly per square foot asking rent is in the high single-digit range and we’re targeting MNCs who’re sensitive to high office rents in the CBD,’ says JLL regional director and head of markets Chris Archibold. JLL is in talks with three potential tenants for areas of various sizes, Mr Archibold added.

Assuming an average rent in the high-single digit range, the net property yield would be about 8 per cent, analysts say.

Fine Grain is 65 per cent controlled by Ireland-based investors led by Ronald Bolger, Singapore’s Honorary Consul General in Ireland and former managing partner of KPMG Ireland.

The other 35 per cent is controlled by Singapore- based investors led by Colin MacDonald and Wan Fook Kong. (Mr MacDonald is also managing director of McCraic Holdings, owner of Molly Malone’s Irish pub and BQ Bar). Mr MacDonald, his brother Alastair (a chartered accountant), Mr Bolger and Mr Wan are directors of Fine Grain.

700 Beach Road is Fine Grain’s first property acquisition in Singapore and the firm has allocated about $70-80 million more for further property purchases here in the next six months or so. ‘We’re targeting undervalued assets, overlooked by investors perhaps because of the properties’ current use or the way they’re being managed. We can refurbish and reposition such assets and seek to add value to existing buildings rather than build something from scratch,’ says Mr MacDonald, who is also Fine Grain’s CEO.

Fine Grain’s portion of the acquisition will be funded by 70 per cent debt, provided by Munich-based Hypo Real Estate Group.

700 Beach Road was sold by In-Space Pte Ltd, whose shareholders include Wee Chwee Heng of Kumpulan Akitek.

Source : Business Times – 7 May 2008

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