Author: PropInvestSG

Frasers Property recurring income supporting the stock

FPL’s 3QFY18 core PATMI of S$157m (-13% YoY) came in above estimates, due to faster-than-expected recognition of development profits in Singapore. Net gearing improved 6%pts QoQ but remains high at 89% and suggests that more properties are likely to be injected into its listed S-REITs. Also read: Parc Esta new launch cond (former Eunosville) up for sale On the residential front, volumes jumped 35% QoQ to 897 units. The recurring-income segments posted a mixed performance this quarter, with Singapore office seeing negative reversions and Hospitality SBU posting a 2nd quarter of net loss but solid occupancies in its Singapore...

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Capitaland 2Q2018 results

Capitaland released a respectable set of results for 2Q2018. The following are excerpts from various equity research houses on the company’s performance. CapitaLand reported 2Q18 net profits of S$605.5m, EPS of 14.4cts, +5.1% YoY. Core net profit of S$196.0m (-5.6% YoY) was below our expectation of S$226m, due mainly to lower residential profit recognition. Result highlights. Core profits was underpinned by higher contribution from newly acquired or opened malls and offices. Active asset recycling, with S$1.8bn of new investments and S$3.1bn of divestments (which surpassed the S$3bn target for this FY). Net revaluation gains lifted book value +4.1% to...

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Tre Ver likely to spearhead recovery for UOL group

UOL’s 2Q18 core PATMI of S$94.1m (-6% YoY) came in slightly below projections/consensus, which is attributed to the uneven recognition of profits from development property. We estimate that sold residential units surged 5x QoQ, to 145 units, helped by solid sales at 62%-sold Amber 45. Despite cooling measures, UOL has not changed its launch schedule for the three upcoming projects, which we believe is due to their competitive cost. While the contribution from OneKM fell, the proposed AEI should reposition it as one of the beneficiaries of the rejuvenation of Paya Lebar Regional Centre, spearheaded by the upcoming Paya...

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Keppel corp tie up with Vicinity, Manulife REIT DPU declines, LOGOS acquisition of an industrial building

Keppel Corporation’s (KEP) 100%-owned asset management arm, Keppel Capital Holdings (KCH), has entered into an MOU with leading Australian retail property group, Vicinity Centres (VCX), to establish a new retail-focused private fund, which intends to invest in an initial A$1b portfolio of Australian retail properties across five Australian states currently owned by VCX. KCH and VCX will manage the fund via a 50:50 JV, while each party is expected to initially hold up to a 10% equity stake in the fund, which is targeted to close by 1Q19. The fund’s investment strategy is to own, acquire and grow a...

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Tre Ver sold about 140-150 units over the weekend

The second project to be launched after 5-Jul-18’s cooling measures, The Tre Ver, sold 140-150 units during its first weekend of launch, with average pricing of S$1,500-1,600 psf in line with our estimates and should yield a solid PBT margin of 17-22% for UOL. However, we are slightly disappointed at the take-up, given over 300 cheques collected beforehand and its competitive pricing vs. recently launched Park Colonial. We believe prospective buyers are maintaining their wait-and-see approach, with an eye on two upcoming nearby launches (Jadescape and Jui Residences) which have a lower land cost and imply an even lower...

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Singapore property intelligence report

The following is an excerpt from JP Morgan’s daily property intelligence report covering key developments in the property market. The Competition & Consumer Commission of Singapore (CCCS) has issued a proposed infringement decision (PID) against the owners and operators of certain hotels in Singapore, in relation to the alleged discussion and exchange of confidential, customer-specific and commercially sensitive information (in connection with the provision of hotel room accommodation in Singapore to corporate customers) with intention to reduce competitive pressures on prices and contract terms. The infringement took place before 30-Jun-15 and the parties have six weeks from 2-Aug-18 to...

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Business as usual for OUE commercial REIT

The following is an excerpt of a research report from CIMB. 2Q/1H18 DPU of 1.06 Scts/2.18 Scts was in line with our estimates, at 24%/49% of our FY18 forecast. Slight dip in committed portfolio occupancy to 95.2%. OUEB and LP enjoyed positive rental reversion on the back of rising spot rents. Maintain Hold with unchanged TP of S$0.75. OUECT reported a 2.6% yoy decline in 2Q18 revenue to S$43.1m dragged by lower committed portfolio occupancy of 95.2% and negative rental reversions at One Raffles Place (ORP). Distributable income fell a greater 7.5% yoy to S$16.5m, further eroded by higher...

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Property news round up 22 Jul 2018

Latest curbs could see developers lower prices up to 10% DEVELOPERS may trim prices of new launches by as much as 10 per cent from their earlier indications in response to the latest round of property cooling measures, with high-end homes likely to see bigger adjustments, analysts say. In downgrading their stock ratings across several developers, some have started pricing in a 5-10 per cent reduction in average selling prices (ASP) in their forecasts, though they note that it is too early for any developer to consider writedowns on their projects yet. Maybank Kim Eng property analyst Derrick Heng,...

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Property news round up 15 July 2018

MILLENNIUM & Copthorne (M&C) will continue its core strategy of owning hotels, says the company’s new group chief executive. Speaking to The Business Times days into her new role, Jennifer Fox said growth for the London-listed hotel chain will be powered by acquisitions, management contracts and improving hotel performance. M&C is also looking into acquiring hotels in what are yet untapped markets for the group, such as Australia and parts of the United Kingdom, as well as key American gateway markets such as Miami. THE timing of the additional cooling measures came as a surprise on Thursday, as developers...

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Increase in non-landed and HDB resale flat prices in 2Q2018

The URA and HDB released flash estimates of property price changes for the second quarter 2018. URA reported that the private residential property price index rose to 149 from 144.1 in the previous quarter, or a 3.4% growth. The increase for non-landed private properties was highest compared to the previous quarter in the Rest of Central Region (RCR) at 5.7%, followed by the Outside Central Region (OCR) at 2.9% and 1.4% in the Core Central Region. Overall, non-landed prices rose 3.3% compared to the previous quarter. Compared to the same quarter last year, non-landed CCR prices rose 8.6%, RCR...

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Property news round up 1 July 2018

GLOBAL real estate giants JLL and Lendlease are partnering to launch an accelerator in Singapore to kickstart innovation in real estate, an industry said to have been slow to tech advancements. But unless both companies commit to a substantial investment and a long-term plan to “transform legacy businesses”, the accelerator will yield limited benefits, observers said. Propell Asia – described as the first Singapore-based regional property technology (proptech) accelerator – opens for applications on Monday. SOLAR panels are set to be installed in blocks of public flats managed by the West Coast and Choa Chu Kang town councils, in...

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CapitaLand Commercial Trust’s sale of Twenty Anson for S$516m

CapitaLand Commercial Trust (CCT) announced this week their sale of Twenty Anson, at 20 Anson Road Singapore 079912, to an unrelated third party. At a price of S$516 million, the property is 19.2% above the property’s valuation of S$433 million. The sale price represents S$2,503 psf on the building’s net lettable area of approximately 206,000 sqft. This represents a sizable profit to CCT, considering the purchase of the property was less than 10 years ago, in 2012. On 22 Feb 2012, CCT announced the acquisition of Twenty Anson which was valued at S$431 million. Even though the absolute profit...

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Recent en bloc deals in the Singapore market

The en bloc market continues its run with a number of projects being marketed, latest of which is Dalvey Court which is up for S$160m. The reserve price of S$160m for the 32 unit apartment in District 10 represents a land rate of about S$2,009 per sqft per plot ratio. The project’s gross floor area of 7,401 sqm or 79,660 sqft can be redeveloped into an apartment with 93 units, each of which is assumed to have a unit size of 70 sqm. Located close to Botanic Gardens, Dalvey Court is near a stretch of high-profile schools such as...

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Property news round up 24 June 2018

ASCENDAS Hospitality Trust has on June 15 entered into an agreement with ES-CON Japan via Ascendas Hospitality Real Estate Investment Trust (A-HReit) to acquire three hotels in Japan’s Osaka city for a purchase consideration of 10.29 billion Japanese yen (S$126.1 million). The manager of the hospitality trust said that the acquisition of the three hotels – Hotel WBF Kitasemba West, Hotel WBF Kitasemba East and Hotel WBF Honmachi – will deepen its presence in Osaka, Japan’s third-largest city with a population of 2.7 million people. The total acquisition cost is about 11.24 billion yen, comprising the purchase consideration, 102.9...

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Increase in new private home sales in May

The number of new private homes sold in May jumped 53.1% compared to April and 7.9% compared to the same month last year, according to information released by the Urban Redevelopment Authority (URA) on Monday, 18 June. Developers sold 1,121 private homes in May 2018, excluding executive condominiums, compared with 732 units in April. The number of units sold was also the highest since August 2017, when 1,246 new private homes were sold. Including ECs, 1,257 units were sold in May, a slight drop from 1,328 sold in April and lower than 1,416 sold in the same month last...

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