mr funny
20-06-11, 13:36
http://www.businesstimes.com.sg/sub/news/story/0,4574,443921,00.html?
Published June 20, 2011
Investment sales of property dipped in Q2
But sales momentum likely to pick up in H2 as many funds are on acquisitions trail in Asia
By KALPANA RASHIWALA
(SINGAPORE) Investment sales of property have dipped so far this quarter compared with the first three months of this year due to slower transactions involving private-sector sellers, although this has been mitigated by an increase in Government Land Sales (GLS), according to separate estimates by CB Richard Ellis and Savills Singapore.
But the overall sales momentum is expected to pick up again over the next three to six months as many property funds that have raised fresh capital are on the prowl again for acquisitions in Asia, including Singapore, says Savills.
The property consultancy estimates that total property investment sales (covering both private and public sectors) so far in the second quarter have totalled about $6.9 billion and the final number could be about $7.3 billion - down from $8.3 billion in the preceding quarter but surpassing the $6.08 billion in Q2 last year.
CBRE's figures too showed the total for Q2 (up to June 17) at $7 billion with the final figure forecast to reach $7.5 billion, taking into account outstanding tenders for GLS sites likely to be awarded by June 30 and other caveats for residential transactions. These numbers are lower than the $8.37 billion clocked during January to March 2011.
With $15.37 billion of investment deals sealed in the Singapore property market year to date, CBRE executive director (investment properties) Jeremy Lake expects the pace to be sustained in the second half, which would result in a full-year tally of around $30 billion. This would be similar to the $29.07 billion for last year.
'Domestic players' appetite for real estate remains strong, and we'll also continue to see interest from foreign investors including funds. They like the transparency, level playing field, liquidity and ease of financing. And Singapore remains a growth hub within Asia.
'Any fund investing in Asia will have Singapore in its portfolio, and probably a reasonable chunk (allocated). It ticks all the boxes,' says Mr Lake.
Agreeing, Savills executive director and head of investment sales Steven Ming predicts stronger deal flow in Q3 as several real estate funds have raised fresh capital and are once again on the acquisition trail. 'Asia and Singapore continue to be the darlings of international and regional real estate investors, given the strong economic fundamentals. Local high networth investors who are 'long' on Singapore are also seeking suitable acquisitions,' he adds.
He points to significant potential investment sales deals over the next two quarters - including Triple One Somerset, 313@Somerset, JTC Corp's industrial portfolio and 77 Robinson Road. As well, state tenders for two plum private housing sites are slated to close in Q3 - a landed plot at Serangoon Garden Way and a condominium parcel beside Potong Pasir MRT Station.
Investment sales often reflect the confidence of major property players in the sector's mid- to long-term prospects.
CBRE defines investment sales as transactions of at least $10 million, including homes and sales of land and buildings, both strata and en bloc. It also includes change of ownership of real estate via share sales such as floats by real estate investment trusts or Reits. Savills too defines investment sales as deals of at least $10 million but includes sales of GLS sites and acquisitions by Reits below that amount.
Savills' data shows that investment deals involving private-sector sellers have halved to around $2.7 billion so far in Q2 from $5.3 billion in Q1. On the other hand, transactions of GLS sites have risen about 38 per cent to $4.2 billion this quarter.
Mr Ming notes that that private sector deals have eased in Q2 from a high base in Q1. 'In addition, global uncertainties arising from the slowing US economy, European debt crisis, Japan's earthquake and nuclear meltdown, effects of the Jan 13 property cooling measures in Singapore and concerns of future policy changes and new cooling measures have made investors stay on the sidelines.'
Resistance to high asking prices has also set in, following the price escalation in various sectors of the Singapore property market in the past two years which has seen historical highs being revisited in some cases, Mr Ming notes.
CBRE's Mr Lake says the public sector sales of GLS sites will continue to be active in the second half. In the private sector, he predicts that there will be more office investment sales, supported by rental growth. 'Demand for office space should remain strong enough to sustain growth in rents.
'Due to a severe shortage of office space in Hong Kong, Singapore should benefit from a spillover in demand from international occupiers seeking to expand in Asia,' he adds.
Combining both private and public sector deals, CBRE's figures show that the residential sector continues to lead investment sales, with a 52.5 per cent share in Q2; Credo Real Estate's data shows that so far this quarter, there have been 15 collective sales deals worth $737.4 million, similar to the Q1 showing of 13 deals amounting to $732.4 million. The total $1.47 billion of en bloc sales done year to date is 83 per cent of the $1.77 billion for the whole of last year, when there were 36 deals.
Based on CBRE data, the three biggest investment sales transactions thus far this quarter have all been state land sales - the $969 million sale of the 'white' site at Jurong Gateway to CapitaLand group (which plans a 60:40 retail: office project), followed by the $585.6 million sale of the commercial plot at Paya Lebar to a consortium, and the $543 million private housing site at Bendemeer Road bagged by United Engineers.
Major private-sector sales include the $477.2 million sale of PSA Building and Alexandra Retail Centre to Mapletree Commercial Trust, which was floated in April, the $224.5 million transaction of Crowne Plaza Changi Airport Hotel and Amber Towers' en bloc sale ($161.6 million).
http://www.businesstimes.com.sg/mnt/media/image/launched/2011-06-20/krinvest20.jpg
Published June 20, 2011
Investment sales of property dipped in Q2
But sales momentum likely to pick up in H2 as many funds are on acquisitions trail in Asia
By KALPANA RASHIWALA
(SINGAPORE) Investment sales of property have dipped so far this quarter compared with the first three months of this year due to slower transactions involving private-sector sellers, although this has been mitigated by an increase in Government Land Sales (GLS), according to separate estimates by CB Richard Ellis and Savills Singapore.
But the overall sales momentum is expected to pick up again over the next three to six months as many property funds that have raised fresh capital are on the prowl again for acquisitions in Asia, including Singapore, says Savills.
The property consultancy estimates that total property investment sales (covering both private and public sectors) so far in the second quarter have totalled about $6.9 billion and the final number could be about $7.3 billion - down from $8.3 billion in the preceding quarter but surpassing the $6.08 billion in Q2 last year.
CBRE's figures too showed the total for Q2 (up to June 17) at $7 billion with the final figure forecast to reach $7.5 billion, taking into account outstanding tenders for GLS sites likely to be awarded by June 30 and other caveats for residential transactions. These numbers are lower than the $8.37 billion clocked during January to March 2011.
With $15.37 billion of investment deals sealed in the Singapore property market year to date, CBRE executive director (investment properties) Jeremy Lake expects the pace to be sustained in the second half, which would result in a full-year tally of around $30 billion. This would be similar to the $29.07 billion for last year.
'Domestic players' appetite for real estate remains strong, and we'll also continue to see interest from foreign investors including funds. They like the transparency, level playing field, liquidity and ease of financing. And Singapore remains a growth hub within Asia.
'Any fund investing in Asia will have Singapore in its portfolio, and probably a reasonable chunk (allocated). It ticks all the boxes,' says Mr Lake.
Agreeing, Savills executive director and head of investment sales Steven Ming predicts stronger deal flow in Q3 as several real estate funds have raised fresh capital and are once again on the acquisition trail. 'Asia and Singapore continue to be the darlings of international and regional real estate investors, given the strong economic fundamentals. Local high networth investors who are 'long' on Singapore are also seeking suitable acquisitions,' he adds.
He points to significant potential investment sales deals over the next two quarters - including Triple One Somerset, 313@Somerset, JTC Corp's industrial portfolio and 77 Robinson Road. As well, state tenders for two plum private housing sites are slated to close in Q3 - a landed plot at Serangoon Garden Way and a condominium parcel beside Potong Pasir MRT Station.
Investment sales often reflect the confidence of major property players in the sector's mid- to long-term prospects.
CBRE defines investment sales as transactions of at least $10 million, including homes and sales of land and buildings, both strata and en bloc. It also includes change of ownership of real estate via share sales such as floats by real estate investment trusts or Reits. Savills too defines investment sales as deals of at least $10 million but includes sales of GLS sites and acquisitions by Reits below that amount.
Savills' data shows that investment deals involving private-sector sellers have halved to around $2.7 billion so far in Q2 from $5.3 billion in Q1. On the other hand, transactions of GLS sites have risen about 38 per cent to $4.2 billion this quarter.
Mr Ming notes that that private sector deals have eased in Q2 from a high base in Q1. 'In addition, global uncertainties arising from the slowing US economy, European debt crisis, Japan's earthquake and nuclear meltdown, effects of the Jan 13 property cooling measures in Singapore and concerns of future policy changes and new cooling measures have made investors stay on the sidelines.'
Resistance to high asking prices has also set in, following the price escalation in various sectors of the Singapore property market in the past two years which has seen historical highs being revisited in some cases, Mr Ming notes.
CBRE's Mr Lake says the public sector sales of GLS sites will continue to be active in the second half. In the private sector, he predicts that there will be more office investment sales, supported by rental growth. 'Demand for office space should remain strong enough to sustain growth in rents.
'Due to a severe shortage of office space in Hong Kong, Singapore should benefit from a spillover in demand from international occupiers seeking to expand in Asia,' he adds.
Combining both private and public sector deals, CBRE's figures show that the residential sector continues to lead investment sales, with a 52.5 per cent share in Q2; Credo Real Estate's data shows that so far this quarter, there have been 15 collective sales deals worth $737.4 million, similar to the Q1 showing of 13 deals amounting to $732.4 million. The total $1.47 billion of en bloc sales done year to date is 83 per cent of the $1.77 billion for the whole of last year, when there were 36 deals.
Based on CBRE data, the three biggest investment sales transactions thus far this quarter have all been state land sales - the $969 million sale of the 'white' site at Jurong Gateway to CapitaLand group (which plans a 60:40 retail: office project), followed by the $585.6 million sale of the commercial plot at Paya Lebar to a consortium, and the $543 million private housing site at Bendemeer Road bagged by United Engineers.
Major private-sector sales include the $477.2 million sale of PSA Building and Alexandra Retail Centre to Mapletree Commercial Trust, which was floated in April, the $224.5 million transaction of Crowne Plaza Changi Airport Hotel and Amber Towers' en bloc sale ($161.6 million).
http://www.businesstimes.com.sg/mnt/media/image/launched/2011-06-20/krinvest20.jpg