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Archive for December 12th, 2008

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S’pore property investment sales fall 70% on-year

Posted by luxuryasiahome on December 12, 2008

The fallout from the US sub-prime crisis has filtered down to the property market in Singapore.

Property consultancy CB Richard Ellis (CBRE) says total investment sales in Singapore properties fell 70 per cent from 2007, to S$17.83 billion this year.

CBRE says one year on, the crisis in the US has made investors of Singapore properties more cautious.

But the sharp slowdown in transaction volumes was also because developers and investors had trouble getting financing on favourable terms.

Private investment sales accounted for about three quarters all investment sales in 2008.

Sales in this segment came in at S$13.16 billion or almost 70 per cent lower than in 2007.

Investment sales in the public sector made up the remainder of the total, coming in at S$4.67 billion — down 60 per cent on-year.

CBRE says total investment sales for residential properties, including Good Class Bungalows, fell 81 per cent from last year’s record high to S$6.25 billion.

Investment sales for offices also fell, down 38 per cent to S$5.39 billion.

But investment sales in industrial properties bucked the downtrend and recorded a 66 per cent jump from 2007 to S$3.32 billion.

CBRE’s executive director Jeremy Lake says this uptrend is expected.

“Historically, the industrial market has lagged the office market, as witnessed by the large volume of office transaction last year. A lot of investors have been looking at that sector to gain exposure.”

For 2009, Mr Lake believes the investment sales market will remain quiet in the first six months as buyers adopt a wait-and-see attitude.

Source : Channel NewsAsia – 12 Dec 2008

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HDB brings forward some projects to help smaller contractors

Posted by luxuryasiahome on December 12, 2008

Two public housing upgrading programmes will be brought forward with other government projects in efforts to increase spending and stimulate the Singapore economy.

Singapore previously deferred S$4.7 billion worth of public sector projects due to high construction costs.

The Ministry of National Development said now is a good time to do so with material costs looking to fall further.

Residents in older public housing can also expect refurbishments sooner.

At the launch of two urban design events on Friday, National Development Minister Mah Bow Tan said the Housing and Development Board (HDB) is bringing forward plans for its Home Improvement Programme.

This is one of several ways the government is stimulating the economy.

Under the plan, residents will get items like new doors, gates and toilet-fittings installed for free.

Another HDB project to be brought forward is the Neighbourhood Renewal Programme. This will spruce up the environment around older housing estates like upgrading lift landings and letter boxes.

Mr Mah said: “The primary consideration is to bring back those projects where we’re able to help some of the smaller contractors. In other words, some of the smaller projects. In addition to that, we’re also looking to see whether the different ministries are able to bring some of their projects, to take advantage of the potentially lower costs of construction, going forward.”

The move has been welcomed by the Singapore Contractors’ Association.

As to which government projects will be brought forward, Mr Mah said the details are expected by January when the government announces the 2009 Budget.

Mr Mah added: “Not all of these projects can be brought forward totally because some of the projects are very lumpy projects and some their costs may not have come down sufficiently. But where the costs have come down and where the projects are of a reasonable size, the important thing is to give priority to the smaller projects.

Vishnu Varathan, an economist at Forecast said the latest move will prevent smaller contractors from closing down, give jobs to construction workers and ensure consumption.

Even though it can counter the slowdown in the property market, he said the plan will just minimise the recession in Singapore and not stop it completely.

However, Mr Varathan cautioned against the assumption that construction costs will fall further. He said while it’s not likely to increase to rates during the construction boom, regional demand for big projects from countries like China and India may cause prices to rebound again.

Recession aside, Punggol residents can look forward to having a waterfront town of the 21st century.

This winning design was picked from 11 entries in a waterway landscape competition.

Mr Mah said Punggol’s development is on track despite the poor economy with 17,000 flats completed and 3,000 new ones expected annually till 2011.

The National Development Minister said the target is to have 23,000 flats by 2011, a critical mass for a Town Centre to be built and commercial developers to set up shopping malls.

He added that flats there will be affordable for all income groups with smaller and rental flats for the lower-income.

Of the 5,000 Build-to-Order flats launched, about 550 are two-room and three-room units and about 500 rental units are already under construction.

Source : Channel NewsAsia – 12 Dec 2008

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4-room flat sold for record $495,000

Posted by luxuryasiahome on December 12, 2008

Buyers drawn by sea view

NEWSPAPER vendor Goh Wee Kiat, 48, refused to budge on his price when he put his four-room Housing Board (HDB) flat up for sale six months ago despite the softening property market.

His persistence reaped dividends when the flat, in Marine Parade, was sold for a staggering $495,000 in late October.

That is $65,000 above valuation.

It was a record price paid for such a four-room flat in the area, and it came as a surprise to industry watchers, considering the quiet property market and bleak economic climate.

In September, another four-room flat in that same ‘lucky’ block located at Marine Terrace was sold for a then-high of $490,000.

Both flats are about 33 years old.

Transacted prices for four-room flats in the area have never been more than $445,000 in the last six years, property agent Samuel Lew of ERA, who brokered the deal, said.

Costlier than bigger flats

At such prices, the two flats are more expensive than some of the newer executive flats in the market.

For example, a 1,571-sq-ft executive flat in Yishun was sold for $375,000 last month, information from HDB’s website showed. That unit was about 20 years old.

In Mr Goh’s case, he bought the Marine Parade 947-sq-ft flat in 1999 for about $328,000.

He is married with two children, a daughter, 16, and a son, 13. His wife, 50, is a homemaker.

He is pocketing at least a cool $167,000 gross profit from the sale of his flat. It is not the first time he has profited from the sale of his flats. (See report, above right).

In about two months’ time, he will be saying goodbye to the superb sea view from his unit. The view was why the buyer paid such a premium for the place.

Mr Goh said in Mandarin: ‘We will be sad to leave this flat because we really love the sea view here. During the National Day celebrations, we could even see the fireworks from our unit.

‘I know that flat prices here are good because of the view and location. That was why I was quite stubborn about my price. And I dared to ask for a high price because my unit is also on a high floor.’

From his living room, you get a stunning unblocked 180-degree-view of East Coast Park, the upcoming Marina Bay Sands integrated resort and even parts of the Central Business District.

And the city centre is just a quick drive away.

Mr Goh said that the buyers, a couple in their 40s, spent most of their time looking at the seaview instead of the condition of the flat.

He said: ‘Most of the potential buyers who came to see the unit asked many questions about the place and the condition. But this couple spent more time looking at the sea than the unit.

‘The sea view was also what attracted me to this place nine years ago. I paid a premium too for the flat, about $20,000 above valuation then.’

His agent, Mr Lew, said that it was quite a quick deal.

Deal within 30 minutes

The buyers saw the place, liked the view and offered an irresistible price – all within 30 minutes, he said.

The New Paper was not able to get in touch with the buyers.

Mr Goh and his family will be moving to Melville Park, a condominium in Simei. They paid about $610,000 for the 1,160-sq-ft unit.

He said: ‘We were not in a hurry to sell the flat. But I wanted to move so that my son would be closer to his secondary school in Tampines.

‘It takes him about an hour to get to school, and I’ve received complaints from his teacher about his being late. So I thought we should move closer to his school instead.’

The executive director of HSR Property Group, Mr Eric Cheng, said that such record prices are uncommon in today’s market.

‘We usually see record prices in good markets, where buyers try to outbid each other and are willing to pay higher for some units,’ he added.

But Mr Cheng explained that Marine Parade is a niche and popular estate because some people appreciate the value and potential of that area.

He added: ‘Some of these flats have that strong X-factor because of the location, potential MRT station coming up and the sea view.

‘These buyers are willing to pay a forward price, where they pay a premium, because they think the price of the flat will appreciate in the future.’

Mr Goh’s upgrading profits

Bought three-room flat in Marine Parade in 1979

Price then: $45,000

Sold in 1999: $215,000

Gross profit: $170,000

Bought four-room flat in Marine Parade in 1999

Price then: $328,000

Sold this year: $495,000

Gross profit: $167,000

Source : The New Paper – 12 Dec 2008

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Property investment sales slow to a trickle

Posted by luxuryasiahome on December 12, 2008

Players wary of big bang deals amid weaker sentiment, tighter financing

THE weak property market sentiment and tight financing have combined to compress the total investment sales of Singapore real estate to just $17.8 billion, year-to-date. This is a third of the record $54 billion achieved for the whole of last year, according to CB Richard Ellis data.

Just $290 million of investment sales have taken place in Q4 this year (up to Dec 9).

Investment sales are a gauge of developers’ and investors’ medium- to long-term confidence in the property sector.

CBRE defines such deals as transactions with a value of at least $5 million, comprising government and private sales of land and buildings (both strata and en bloc). It also includes change of ownership of real estate via share sales.

Market watchers are not upbeat about the investment sales climate in the near future. CBRE forecasts the tally for next year could come in at a modest $5-10 billion, a level last seen in 2004.

CBRE executive director Jeremy Lake says: ‘With market uncertainty and economic risks appearing to be on the downside, many investors will remain on the sidelines of the property market, waiting for signs of price stabilisation before investing. With the global economy likely to enter a protracted downturn on the back of the deepening financial crisis, transaction volumes in property are expected to remain low over the next few quarters.’

Agreeing, DTZ senior director Shaun Poh says: ‘I would not be surprised if we don’t see any major transactions for the next three to six months. Potential investors are waiting for property prices to come down. Even property funds that have raised money can’t make acquisitions because of the difficulty of raising the debt component to pay for the purchase – despite trying to source for financing in overseas markets like Hong Kong and London in some instances.’

CBRE’s Mr Lake too notes that ‘as credit market conditions worsen and lenders further reduce their risk appetite, capital available for property investment would become even scarcer’.

‘In addition, cheap investment opportunities may arise in other asset classes, diverting capital away from property,’ he added.

The property consultancy group’s quarterly breakdown of investment sales shows that they have been sliding since Q3 last year, when a whopping $16.5 billion of deals were sealed. The performance in each quarter of this year has been lower than the corresponding periods of 2007, sliding to $290 million this quarter.

While the residential sector still accounted for the lion’s share or 35 per cent of total investment sales deals so far this year, this was lower than the 61 per cent share last year. Also, the $6.25 billion transacted value of residential investment sales year-to-date (as of Dec 9) was 81 per cent below the full-year 2007 figure.

The collective sales market was dormant as developers remained mindful of the lukewarm response to new residential launches, rising construction costs and tighter credit measures, CBRE observed. Only seven collective sales worth a total $371 million have been sealed so far this year, against the record $12.4 billion from 111 transactions in 2007.

The Good Class Bungalow (GCB) market has also slowed considerably in 2008. A total of 48 GCB transactions worth $763.7 million have been done this year, down from $1.2 billion from 90 deals in 2007.

Office investment sales of $5.4 billion so far this year are 62 per cent below the $14.3 billion for full-year 2007. Ongoing turmoil in the global economy contributed to further deterioration in business sentiment, which subsequently had an impact on the office leasing market and capital flows in the local office sector.

‘This resulted in no major en bloc office transactions in the second half of 2008. Hence, the office investment market is expected to remain quiet in the next few months,’ CBRE said.

Sizeable office investment deals in the first half of this year included One George Street ($1.7 billion or $2,600 per square foot of net lettable area), Singapore Power Building ($1.01 billion or $1,836 psf), The Atrium @ Orchard ($839.8 million or $2,249 psf), Hitachi Tower ($811 million or $2,901 psf) and 71 Robinson Road ($743.75 million or $3,125 psf).

Bucking the trend was the industrial property sector which contributed $3.32 billion of investment sales deals this year, 66 per cent higher than last year and also the best showing since 2002. About half of the tally for this year was accounted for by JTC Corporation’s $1.7 billion divestment of its industrial portfolio to a joint venture involving Mapletree Investments, Arcapita and Mapletree Industrial Fund.

Source : Business Times – 12 Dec 2008

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UE’s Park Central @ AMK more than 70% sold

Posted by luxuryasiahome on December 12, 2008

UNITED Engineers’ (UE) Park Central @ AMK, which was launched in July, is now more than 70 per cent sold at an average price of $500 psf.

UE managing director of integrated facility management and property development business David Liew said that all the four-bedroom and penthouse units in the 578-unit development have been sold with only five-room units left.

Mr Liew added: ‘Now that the bulk of the units has been sold, our next goal is to make sure we deliver a quality home, and on time, to our customers.’

Park Central @ AMK is expected to get TOP (temporary occupation permit) in mid-2011.

The development is the third Design, Build and Sell Scheme (DBSS) development in Singapore.

The Housing and Development Board (HDB) scheme, which allows private developers to sell homes under HDB terms, was first announced in 2005.

UE says that since the launch in July, Park Central @ AMK received more than 2,300 applications. Its showflats also saw more than 23,000 visitors in the first two weeks.

A spokesman for UE added that most of the buyers have opted for HDB loans.

Last month, Chinese firm QingJian Realty launched the fourth DBSS development, Natura Loft at Bishan, with units going for around $450-$570 psf.

On Nov 14, it was reported that Natura Loft received about 600 applications for 480 flats a day before the close of applications.

Source : Business Times – 12 Dec 2008

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Condo-style HDB flats losing allure

Posted by luxuryasiahome on December 12, 2008

Falling prices in private home market chipping away at demand for DBSS flats

PRICEY condo-style HDB flats have not been spared in the property downturn, going by what has been left for sale at Park Central @ AMK.

While over 70 per cent of the project’s 578 units have been sold, the larger five-room units costing $600,000 to $670,000 each are still available.

These levels put the flats in the same price bracket as older condominiums, which might prompt some potential HDB buyers to turn to the private home market, where prices are falling.

Developer United Engineers announced the figures yesterday, and also said foundation works had begun at the Ang Mo Kio estate, which is being developed under the HDB’s design, build and sell scheme (DBSS). Under the scheme, public flats are designed, built and sold by private developers.

Sales at Park Central have been favourable in view of the challenging economic climate, said Mr David Liew, the managing director of the group’s integrated facility management and property development business.

Buyers include young couples, retirees and those with proceeds from collective sales, the group said.

The DBSS concept has been quite popular, but some experts fear the fall in private condo prices could leave buyers spoilt for choice.

Price is the key factor in DBSS projects as they are targeted at HDB buyers whose household income must not exceed $8,000 a month.

‘It’s a price-sensitive sector. These buyers can choose between HDB flats and lower-end condos,’ said Associate Professor Sing Tien Foo, the deputy head of the National University of Singapore’s real estate department.

‘During a downturn, the price gap between these segments will narrow, so demand (at DBSS projects) may be affected,’ he noted.

Most DBSS flats are priced at $500,000 to $700,000 each, roughly the level for executive condos, said ERA Asia Pacific associate director Eugene Lim. ‘There is already an overlap.’

For a $600,000 unit, the monthly instalment on a 30-year, 80 per cent loan is about $2,000, assuming an interest rate of 2.6 per cent.

When the property market was rising in 2006, DBSS products met the needs of buyers who could not afford private homes.

The first such project, Premiere @ Tampines, was an instant hit, drawing 5,700 applications for 616 homes in late 2006. Although it sold only 500 flats initially, long queues formed when the remaining units were released for sale.

City View @ Boon Keng received 3,500 applications for 714 flats early this year, but only 460 were sold. Nearly 90 per cent of the flats have since been taken up, including all the three-roomers.

Park Central, Singapore’s third DBSS project, garnered more than 2,300 applications. Prices average $490 to $500 per sq ft, putting the four-roomers at between $400,000 and $500,000 each.

The fourth DBSS project – Natura Loft in Bishan – saw about 680 applications for 480 flats last month. Its four-room units go for $465,000 to $586,000 each, while its five-roomers cost $600,000 to $739,000.

Once prices go above $600,000, the flats will be competing with old leasehold condos, executive condos and bigger executive flats, said Knight Frank’s director of research and consultancy, Mr Nicholas Mak.

Unlike exec condos, which are initially subject to sale restrictions similar to those on public housing units, but become fully private after 10 years, a DBSS unit is just a value-added HDB flat, he said.

Indeed, demand for DBSS flats might be more severely affected than that for other segments as potential buyers have more choices, said Dr Sing.

Nevertheless, Mr Mak feels the DBSS concept is sustainable if the Government accepts lower land prices.

The problem is that most developers of DBSS sites bought them in good times.

There are two DBSS projects slated for launch in the first half of next year: one in Simei and a huge project of nearly 1,200 units in Toa Payoh.

Source : Straits Times – 12 Dec 2008

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Capella Singapore mixes the old with the new

Posted by luxuryasiahome on December 12, 2008

THE iconic British architect Norman Foster is perhaps associated more with designing high-tech buildings (think Hongkong and Shanghai Bank in Hong Kong, Beijing’s new airport terminal or even Singapore’s Supreme Court) than restoring old ones, but he is also responsible for some of the most masterful integration of old and new architecture in the world (think Reichstag, the German Parliament Building in Berlin).

So when developer Pontiac Land secured a prime 30 acre hotel site on Sentosa that had two 1880s colonial-era buildings as its centrepiece, it was less than surprising that Foster was chosen to perform his architectural magic on the place. Close to six years and $400 million later, Capella Singapore – the first Asian property to be managed by the Atlanta-based, ultra-luxe West Paces Hotel Group – is set to open for business in March next year.

‘Norman Foster was the hands down choice because of his ability to marry old and new,’ says Stephanie Kwee-Ng, vice-president of marketing, West Paces Hotel Group Asia. ‘Every detail was considered so that even the new copper roof matched the colour of the original terracotta tiles on the roof. The eaves of the old building are also in line with the new ones – it’s a seamless blending.’

One unintended result of the architect’s design, which incorporated an extension into the existing architecture, was that the shape of the new building follows the natural topography of the site and can be discerned to be in the shape of the figure eight – an auspicious aesthetic in this part of the world. ‘Foster was simply being sensitive to the environment,’ says Ms Kwee-Ng.

‘Capella Singapore is seamlessly integrated with the beauty of its natural setting and the remarkable historic buildings on the site,’ said Foster in a statement. ‘Our design fuses the contemporary with the historic, and the built elements with the tropical forest.’

Adding new extensions to old buildings, or updating the past and bringing it into the present is nothing new these days, of course, but it does seem to be a trend that is here to stay – or at least until we run out of old buildings to conserve and convert.

The primary structure of note is Tanah Merah, a two-storey building with white columns and a red terracotta tile roof and the site of colonial tea parties in the past. When it reopens, it will be part of a resort that features large, luxurious rooms and villas with bespoke butler service and ‘personal assistants’ assigned to every room. ‘One of the core things that Capella is about is personalised service,’ says Ms Kwee-Ng, citing West Paces founder and CEO Horst Schulze’s philosophy of going that extra mile for every guest: ‘We’ll do anything so long as it’s legal and moral.’

Meanwhile, interiors by Jaya Ibrahim, a leading name in the design world, will also highlight the contrast between old and new, while other brand name designers such as Andre Fu and Yasuhiro Koichi of Design Studio Spin have been commissioned to work on the restaurant spaces.

‘In the ultra-luxury travel sphere, people are looking more for meaningful, significant connections,’ says Ms Kwee-Ng. ‘Luxury is a given – people are looking for experiences money can’t buy. The Capella zeitgeist includes key things like experience and legacy. The engaging blend of old-world charm and all-world luxury that Capella Singapore offers will add value to that experience,’ she says.

The global economic downturn that will continue into next year and probably beyond may put a damper on the hospitality industry, but travellers in the premium segment will still be looking for the same things. ‘These things are cyclical,’ says Ms Kwee-Ng. ‘People will generally still travel – I have seen that the high-end traveller will still want to travel, but in a less ostentatious manner.’

Capella, which bills itself as the world’s first six-star hotel management company, plans to open in winter 2010 in Niseko, a fast-growing ski resort in Hokkaido that is very popular among Singaporeans. Then, over the next five years, several other resorts in Thailand and the region will open, many with a residential property component. ‘For any successful company, you need to have a long-term strategy,’ says Ms Kwee-Ng. ‘We’re not going to go overboard. We’re still moving aggressively forward with our programme.’

Source : Business Times – 12 Dec 2008

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Freight Links sues Reit over failed property deal

Posted by luxuryasiahome on December 12, 2008

FREIGHT Links Express Holdings announced yesterday that it has commenced legal action against a private real estate investment trust, AMP Capital Business Space Reit, for not going through with the proposed purchase of an investment property at 30/32 Tuas Avenue 8.

The property is owned by Freight Links’ subsidiary Freight Links Fabpark (FLF). Freight Links said yesterday that the put and call option agreement for the proposed transaction was made in December 2007 between FLF and DB International Trust (Singapore), acting as the trustee of AMP.

‘The company wishes to announce that it has received a notice from the purchaser to rescind the agreement. The company rejects the steps taken by the purchaser and has commenced legal action in the High Court of Singapore to pursue its legal remedies in this matter,’ Freight Links said, adding: ‘The company will update shareholders on the developments of this matter.’

When Freight Links announced the proposed transaction last year, it said the sale price was $20.8 million, against book value of about $13 million.

Separately, Freight Links said that the acquisition of a 60 per cent stake in Hong Kong-based Citic Logistics (International) Company through its wholly owned subsidiary, Freight Links Capital has yet to take place, pending registration of the transfer of equity interest and changes to the operating licence.

If the transfer of share equity is not completed, Freight Links has the right to rescind the agreement, it said.

This comes shortly after Freight Links announced in early December that its Australian subsidiary had decided not to go through with the acquisition of DB2 Realty due to the ‘weak property market and tightening of credit facilities by the banks’.

Freight Links yesterday announced a 25.3 per cent year-on-year increase in net profit to $1.17 million for the second quarter ended Oct 31, 2008, while revenue inched 2.7 per cent up to $36.93 million.

Earnings per share for the quarter rose from 0.049 cents in the previous corresponding quarter to 0.055 cents in Q209.

Revenue from freight forwarding as well as other logistics fell by 4 per cent and 21.1 per cent respectively, as a result of the global economic slowdown.

However, its warehousing and logistics business registered a growth of 17.5 per cent while chemical storage and logistics was up by 20 per cent.

Foreign exchange gains on a stronger yuan contributed to a 6.5 per cent increase in other income to $1.2 million.

Half-year profit came in 24.5 per cent higher at $3.7 million. Revenue rose 7.9 per cent to $74.69 million.

Commenting on the outlook for the next 12 months, the group said that freight and warehouse rates are likely to soften and occupancy rates are expected to decline.

Source : Business Times – 12 Dec 2008

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Construction industry in better shape now

Posted by luxuryasiahome on December 12, 2008

THE Singapore Contractors Association refers to the article, ‘Construction firms face ‘collapse risk” (Nov 28).

The association does not agree with the interpretation of data provided by DP Information Group and the statement by DP managing director Chen Yew Nah. The banks enjoy a good working relationship with construction firms, and have supported construction firms with credit facilities for their projects.

The data provided by DP cannot independently conclude the financial health of construction firms or be used to summarily predict that these are warning signs.

Historically, the firms, especially smaller ones, are mostly self-financing and use short-term credit sparingly. Where required, banks usually provide credit facilities such as overdrafts, bonds, letters of credit and project financing to construction firms. Typically, project financing is at only 60 to 80 per cent, against contractor claims or certification, as developers are required to pay contractors on a maximum 56-day term. If the developer pays the contractor on a shorter payment term, there may not be any financing requirements.

In this global financial downturn, no one is spared. It is only the degree that varies. The construction industry has gone through many cycles and has come out stronger each time. Construction firms that survived the last downturn in the industry are in better shape moving forward.

The industry has improved and has put in place measures like the Security of Payment Act which helps stakeholders secure progressive payment for work done. Public-sector agencies use financial ratings to evaluate the financial health of the contractors participating in their projects.

The whole system is reinforced by the fact that developers are cautious in their award of projects to construction firms, and award criteria, besides tender price, include performance record in past completed projects, workplace safety and health and environmental record, manpower and financial records.

Simon Lee
Executive Director
Singapore Contractors Association

Source : Straits Times – 12 Dec 2008

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Is Pasir Panjang hub still viable?

Posted by luxuryasiahome on December 12, 2008

HDB commissions market survey to decide fate of struggling wholesale centre

THE fate of the Pasir Panjang Wholesale Centre hangs in the balance. With more businesses importing directly from overseas suppliers, the 15ha site faces the threat of being bypassed as a wholesale centre, according to an HDB tender document on the government business website.

The HDB has called for a major study on the wholesale centre’s future viability. It is owned and managed by HDB through an agent and has 1,405 units comprising stalls, shops, cold rooms and offices. According to the Agri-Food and Veterinary Authority (AVA), some 30 per cent of fruit importers and 60 per cent of vegetable importers have their warehouses, cold stores and distribution sites there.

At the wholesale centre yesterday, sellers told the same story: Their sales have been on the decline since the Sars outbreak in 2003 when the market was shut for two weeks after some sellers fell sick.

Some walk-in customers stayed away and never returned, while some businesses found alternative sources by liaising directly with suppliers, said sellers. Most who spoke to The Straits Times said sales had dropped by half since then.

Madam Tan Ai Keow, 55, who has been selling vegetables at the market since it opened in 1983, said: ‘Times are bad. The market has no business.’

Sellers said one major issue is that businesses are being directly supplied from Malaysia. Trucks carrying goods go through Customs and deliver directly to businesses.

The AVA, which uses the wholesale centre as an inspection point to take samples to check for pesticide residues and contaminants, said not all goods are required to report to the centre, only randomly targeted vegetables and fruits for the day.

Mr Raymond Tan, owner of MCP Supermarket which has six outlets in Singapore, used to buy all of his produce from the wholesale centre when he established the chain in 1999.

Now, he buys only 30 per cent there. He imports 70 per cent directly from Malaysia.

According to the tender document, the appointed consultant would be given three months to study the overall wholesale industries in vegetables, fruits and dried goods, and in relation to the operations of the Pasir Panjang centre.

It will give recommendations on whether and how the wholesale centre can ‘continue to remain relevant and viable in future’.

However, many sellers said if the wholesale centre closes or relocates, they will wind up their businesses. One vegetable seller, who wanted to be known only as Madam Chia, 60, said: ‘We’re old; we won’t carry on if it’s gone…It’s very hard to sustain the business.’

Source : Straits Times – 12 Dec 2008

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