SINGAPORE – The first commercial flight landed and later took off from Changi Airport’s new Terminal 4 on Friday night, amid much buzz.
In all, 180 passengers on board AirAsia flight AK9723 from Kuala Lumpur landed at T4 at about 9.10pm. The return flight AK9722 carried 166 passengers and departed at about 9.50pm.
Departing passengers were treated to complimentary arcade machines and neck masssages since the terminal is not open yet so there were no shops and eateries operating.
Passengers were told to gather at T1, where AirAsia now operates from, before being bussed to T4 – about three minutes away.
On the bus, which The Straits Times was on, they were briefed by airport staff on what to expect at the new terminal, which opens officially later this year.
Unlike the three other terminals, T4 offers a start-to-end automated system to reduce reliance on manpower, though it also features manual counters.
Property
July 20, 2020Property / USAThe U.S. commercial real estate market is showing ever greater signs of stress, but there are still few deals to be had.
Transactions fell 68 per cent in the second quarter across all property types compared with 2019 as potential buyers and sellers remained far apart on the prices of buildings, according to data released Wednesday by Real Capital Analytics.
The paralysis set in despite near-record amounts of capital ready to be deployed by some of the world’s biggest real estate investors.
“The buyer and seller expectations are not aligned,” said Simon Mallinson, an executive managing director at RCA. “Sellers aren’t being forced to the market because there’s no realized distress and buyers are sitting on the sidelines thinking there’s going to be distress.”
Industrial Strength
Second-quarter sales plunged 70 per cent for apartments, 71 per cent for offices, 73 per cent for retail and 91 per cent for hotels, according to RCA. Industrial property transactions were a brighter spot. Sales dropped only 50 per cent in the second quarter, as online shopping thrived and manufacturers leased space to avoid supply chain disruptions.
For markets to function, there needs to be some agreement on what assets are worth. But the surging coronavirus outbreak is fueling uncertainty, making the outlook for commercial property just as cloudy as it was in March when lockdowns put the economy into deep freeze.
Dry Powder
Whether investors will come off the sidelines any time soon remains to be seen. Private real estate funds had about $273 billion for property purchases at the end of June, little changed from the record $281 billion six months earlier, according to Preqin Ltd.
With the economic fallout from the pandemic mounting, deals have fallen apart or are being reworked. The buyer of the iconic Transamerica pyramid in San Francisco is going forward with its deal — but at a 10 per cent price cut from what it negotiated at the beginning of the year, according to people familiar with the matter who asked not to be identified discussing private talks.
A spokesperson for Transamerica said the parties are moving toward a closing, and declined to share additional details.
More than $32 billion of hotel and retail real estate was newly distressed in the first half of 2020, as rent delinquencies soared and borrowers missed payments, according to RCA.
Buying Time
Approximately $90 billion more of commercial real estate is “potentially troubled,” RCA reported, meaning it’s in a forbearance plan, suffering rent collection problems or early-stage delinquencies. That includes $14.5 billion for offices and $20 billion for apartments.
Still, delinquent borrowers don’t face pressure to sell yet. Lenders are focused on ways to buy time, delaying distressed property from coming to market, according to Lisa Pendergast, executive director of the CRE Finance Council, a commercial real estate trade group.
“It’s becoming clearer, especially with the resurgence in cases across the country, that a three-month forbearance is not really going to satisfy the situation,” she said. “So there are other things that can be done. A lot of that has to do with loan modifications.”
Cheap Money
Prices have also been propped up by low interest rates. Low borrowing costs mean investors can expect higher returns on real estate than Treasury bonds, even if vacancy rates rise or tenant delinquencies increase, according to Michael Fascitelli, former chief executive officer of Vornado Realty Trust.
“The cost of money is one of the biggest costs of an asset for real estate,” Fascitelli said recently. – Bloomberg
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August 8, 2017Property / SingaporeThe Housing and Development Board’s (HDB) first Re-Offer of Balance Flats (ROF) exercise has been oversubscribed by about four times, with more than 5,500 applications received for the 1,394 flats on offer as of 5pm on Monday (Aug 7).
SINGAPORE: The Housing and Development Board’s (HDB) first Re-Offer of Balance Flats (ROF) exercise has been oversubscribed by about four times, with more than 5,500 applications received for the 1,394 flats on offer as of 5pm on Monday (Aug 7).
Of the total number of applicants so far, 2,647 are applying for an HDB flat for the first time, while another 2,175 are second-timers. The remaining applicants include singles as well as elderly residents who have applied at least twice before.
The ROF exercise pools all flats that remain unsold after a Sale of Balance Flats (SBF) exercise, to help those with more urgent housing needs or who are less particular about location and attributes to have quicker access to a flat.
In all, 1,394 unsold flats from the November 2016 SBF exercise were offered again. They include 110 two-room Flexi flats, 384 three-room flats, 624 four-room flats, 260 five-room flats, seven 3Gen flats and nine executive flats across various towns and estates.
“The ROF is more flexible especially for families that have urgent housing needs but are not particular about location and flat type,” real estate agency OrangeTee’s head of research and consultancy Wong Xian Yang said.
“For example if I’m looking for a flat – maybe my first choice is in Punggol, but I don’t mind Sengkang – because the ROF pools together unsold flats from several estates, there’s a higher chance you’ll be able to find something.”
“It’s also for families looking to move in soon, if they’re not willing to wait two-and-a-half to four years for a BTO flat,” he added.
According to HDB, ROF applicants will know the ballot results from about a week after the application period closes.
Shortlisted applicants will be invited to select and book a flat if there are available units, with the flat selection appointment taking place one to five months after applications close. During the selection appointment, applicants can select the location and flat type from the range of flats listed.
The ROF method of balloting may also have its upsides, according to SLP International’s head of research and consultancy, Nicholas Mak.
“The ROF exercise does solve some of the inherent problems that were experienced in the SBF flats system,” Mr Mak said. “This time round, the type of flats that the buyers would be offered does depend on the luck of the draw – after all they would be based on the outcome of a ballot.”
“So perhaps balloting is a fair way of allocating scarce resources like HDB public housing,” Mr Mak added.
About 71 per cent of flats offered under the ROF exercise are already completed.
“Going forward, the subscription rates for ROF exercises are expected to remain healthy,” said Mr Wong. “There’s still good demand for families looking for new HDB flats that are either completed or nearing completion.”
The ROF flats are part of the 5,291 flats put up for sale by HDB last Tuesday. They include 3,897 flats under the Build-To-Order (BTO) exercise, which range from two-room Flexi to five-room flats. They are spread across three projects in the non-mature towns of Bukit Batok and Sengkang.
First-timer families get higher priority, HDB said previously, with at least 95 per cent of the flat supply set aside for them.
BTO SUBSCRIPTION RATES DECLINING
The overall subscription rate for BTO flats, meanwhile, continued its downward trend as compared to previous launches. As at 5pm, the overall subscription rate for three-room and bigger flats was 1.6, or three applications for every two flats. The rate was 2.9 in May 2017, and 3.3 in February 2017.
This is also party due to the location of the flats launched.
“The difference between May and August’s exercises is that in August, all the units launched were in non-mature estates as compared to May, when they were in Bidadari and Geylang,” said Mr Wong.
He added: “Singaporean households tend to favour homes in mature estates, because there’s more amenities in the area, so it tends to be more convenient. That could be one reason for the slight drop in subscription rates.”
The limited choices in August’s BTO exercise may have also contributed to a lower subscription rate, said Mr Mak.
“There are only projects in two towns that are being offered. And I think the other reason is that there (are) a lot more choices in the new ROF system, and that may have drawn away some of the interest,” he said. “For some of the buyers, they are also able to turn to the resale market or are attracted to the HDB resale market because prices have softened and have stabilised.”
The public housing market may also be reaching a “level of equilibrium”, according to Mr Mak.
“The Government is still keeping up a steady supply of new HDB flats especially for the first-timers, hence we see this gradual decline in the application rate for the BTO flats,” Mr Mak said.
“In fact in this round of exercise, the application rate for first-timers is less than two. Some of them are just at 1.0 to 1.1 times, meaning that almost every applicant among the first-timers will have a chance to apply and even get the flat they apply for,” he added.
Applications for new flats launched in this month’s exercise can be submitted via the HDB InfoWeb portal till midnight on Tuesday.
According to HDB, ROF exercises will be held twice yearly for a start in February and August, alongside BTO exercises.
Source: CNA/nc
Read more at http://www.channelnewsasia.com/news/singapore/first-re-offer-of-balance-flats-exercise-oversubscribed-by-9099676
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August 1, 2017News / PropertyBlocks of HDB housing flats around Whampoa area in the central part of Singapore. PHOTO: ST FILE
SINGAPORE – There will be 5,291 flats for sale from Tuesday (Aug 1), the Housing and Development Board (HDB) announced.
These include 3,897 Build-To-Order (BTO) units in the third BTO exercise this year, and 1,394 units under the first ever Re-Offer of Balance Flats (ROF) exercise.
This brings the total number of flats launched by HDB this year to 18,095.
Applications can be submitted online on the HDB InfoWEB until next Monday (Aug 7).
The BTO flats offered are in the non-mature towns of Bukit Batok and Sengkang.
The ROF flats are unsold balance flats from the Sale of Balance Flats (SBF) exercise in November last year, and come in a wide range of flat types, locations and prices.
PHOTO: HDB
PHOTO: HDB
HDB said that about 71 per cent are already completed, while the rest are under construction.
“Under this new sales mode, home buyers will be able to select their flats quicker, and from a bigger pool of balance flats of different flat types and in different locations,” HDB said.
Applicants are encouraged to apply for a BTO flat in non-mature towns, as there is a higher chance of success in securing one, along with more grants.
Those with more urgent housing needs and are less particular about location can consider applying for an ROF flat.
Information on the exercise is available on the HDB InfoWEB.
The next BTO exercise in November will see about 4,800 flats in Geylang, Punggol, Sengkang and Tampines, concurrently with a SBF exercise.
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July 28, 2017PropertyProspective buyers at a condominium showroom. (TODAY file photo)
SINGAPORE: Private home prices in Singapore fell for the 15th straight quarter in the April to June period, although the pace of decline eased, according to data released by the Urban Redevelopment Authority (URA) on Friday (Jul 28).
Prices fell by 0.1 per cent quarter-on-quarter, compared with the 0.4 per cent decline in the first quarter and the 0.5 per cent decline in the last quarter of 2016.
Prices of landed properties declined by 0.3 per cent in the second quarter, easing from the 1.8 per cent decrease in the previous quarter. Prices of non-landed properties declined 0.1 per cent, after remaining unchanged in the previous quarter, according to URA.
Prices of non-landed properties in the Core Central Region (CCR) decreased by 0.5 per cent, compared with the 0.4 per cent drop in the previous quarter. Prices of non-landed properties in the Rest of Central Region (RCR) increased by 0.6 per cent, while those in the Outside Central Region (OCR) fell by 0.3 per cent.
Commenting on the price declines, ERA’s key executive officer Eugene Lim said: “Overall in H1 2017, prices have only decreased marginally by 0.4 per cent. This is much better than the 1.1 per cent price decrease seen in H1 2016. It looks increasingly certain that the market is nearing its turning point.”
He said that as economic growth remains on track for the 2 to 3 per cent forecast for 2017, and with the Monetary Authority of Singapore recently saying that cooling measures will remain, he expects prices to move “sideways”.
“All in all, we are projecting a zero to 1 per cent price decrease for 2017, much less than the 3.1 per cent decline in 2016,” he said.
RENTALS FALL FURTHER
Rentals of private residential properties also fell 0.2 per cent, after declining 0.9 per cent in the previous quarter, URA said.
image: http://www.channelnewsasia.com/image/9071900/0x0/659/323/66f6b3cebe405358d49f9b43947a7995/jv/ura-rental-index-q2.png
Rentals of landed properties fell 0.1 per cent, while those of non-landed properties decreased by 0.2 per cent.
Rentals of non-landed properties in CCR increased by 0.1 per cent, while those in RCR decreased by 0.4 per cent. Rentals in OCR also fell 0.6 per cent.
“Perhaps rents are also reaching their turning point, as we gradually pass the supply peak,” ERA’s Mr Lim said. “In 2018 and 2019, there will only be about 8,400 private residential units completed per year. In comparison, there will be an estimated 16,544 private residential units completed in 2017 alone.
“We should be expecting rents to recover from 2019 onwards,” he said, adding that for 2017, he is expecting a drop of 2 ro 3 per cent.
LAUNCHES AND TAKE-UP
Developers launched 2,011 private homes – excluding executive condominiums (ECs) – during the second quarter, compared with 1,949 units in the previous quarter. A total of 3,077 homes were sold, compared with the 2,962 units sold in the previous quarter.
image: http://www.channelnewsasia.com/image/9071896/0x0/844/285/24a5c150a56070325696aaec588c74e4/dj/ura-private-property-indicators-q2.png
Developers did not launch any ECs in the second quarter but sold 954 EC units over the period, compared with the 1,024 units launched and 1,072 units sold in the previous quarter.
There were 3,698 resale transactions, compared with 2,170 in the previous quarter. Resale transactions accounted for 53.6 per cent of all sale transactions in the quarter, compared with 41.7 per cent in the previous quarter.
There were 35,423 uncompleted private homes – excluding ECs – in the pipeline, compared with 36,942 in the previous quarter. Taking into account ECs, there were a total of 43,202 units in the pipeline. In total, 17,827 units units were unsold as of the end of the second quarter.
Source: CNA/mz
Read more at http://www.channelnewsasia.com/news/singapore/private-home-prices-down-for-15th-straight-quarter-pace-of-9071814
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July 20, 2017Property / SingaporeOnly 34 outbound investment deals were done in H1 2017, against 144 in 2016. Primary-market property sales are up at home, as are en bloc sales
THE capital flight to greener pastures abroad from Singapore has slowed to a trickle, amid a turnaround in the property market at home.
Data compiled by Real Capital Analytics and Knight Frank Research shows that the number of outbound investment deals dwindled to 34 in the first half of 2017. The figure was 144 for last year, and 503 in 2015.
The transaction value of deals done in the first half of the year also slid – to S$6.7 billion, from S$14.6 billion last year and S$37.7 billion in 2015.
In 2015, there was an exodus of capital abroad from a poorly-performing domestic property market, as capital values of Singapore homes and commercial properties fell steadily in reaction to the government’s measures to cool the market.
Ian Loh, Knight Frank’s executive director and head of investment and capital markets, said at the launch of the property consultancy’s inaugural “Active Capital” report on Wednesday: “Two years ago, when Singapore was relatively quiet, locally listed players were rethinking what to do with the money, which was why they ventured offshore to look into recurring income assets.
“But since then, capital values in these markets have appreciated, and somehow, in many major cities, some sort of protection and stamp duties against foreigners have been introduced. Some of these investors have chosen to take profit in these overseas destinations. What then to do with the money? Meanwhile, Singapore is looking good.”
Indeed, there are initial signs that the residential property market in Singapore is bottoming out. In the primary market, developers sold 6,388 private homes in the first six months of this year – just 20 per cent shy of the 7,972 units they moved in the whole of last year.
Private home prices also appear to be close to their trough, with the 0.3 per cent fall in the official benchmark price index in Q2 being the smallest of the 15 quarters since the peak in Q3 2013.
There has also been a pick-up in collective sale activity. Four deals have been done this year – One Tree Hill Gardens, Goh & Goh Building, Rio Casa and Eunosville – for about S$1.5 billion. The latest to be put on the market is Villa D’Este condominium in Dalvey Road, for S$96 million. The en bloc sale of two more condominiums, Dunearn Court and Normanton Park, are in the pipeline.
As for the increase in foreign investors’ tax burdens, Australia in July introduced a capital-gains tax for foreigners, at 12.5 per cent for properties worth more than A$750,000. States such as New South Wales, Victoria and Queensland have also raised the stamp duty for foreign property buyers.
London has also in recent years imposed a capital-gains tax on foreigners, and raised the stamp duty for buy-to-let properties.
The change in investment sentiment in Singapore’s property market has caused other countries to sit up; in recent months, many have started to pump money into the sector.
Inbound investment data shows that in the first half of this year, the number of deals closed that involved foreign entities buying Singapore land or properties was 14, compared to 21 for the whole of last year.
Transactions in the first half of this year were worth a total of S$5.5 billion, against S$8.9 billion in 2016.
Much of this capital came from China and Hong Kong (see chart), and went into purchases of development sites in particular. This drove up bids and prodded local developers into raising their stakes in their bids.
Many of these foreign bidders succeeded in clinching the sites. For instance, in May, Hong Kong-listed developer Logan Property, with Chinese conglomerate Nanshan Group, placed a S$1.003 billion bid for a housing site near Queenstown MRT station in Stirling Road.
In June, Fantasia Investment (Singapore), a subsidiary of Chinese property developer Fantasia Holdings, won a residential land parcel in Hougang for S$75.8 million.
Knight Frank’s Asia-Pacific research head Nicholas Holt said Chinese companies have been able to invest overseas despite the country’s curbs on capital outflows because they likely have overseas capital, either in foreign currency reserves or in offshore entities, including in Hong Kong.
Guanxi, or connections with the authorities, also helps big institutions to get approval for their investments more easily.
Late last year, Malaysia’s IOI Properties Group also shook the market with an aggressive S$2.57 billion bid in a hotly contested tender for a mixed-use Marina Bay site at Central Boulevard.
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For the first time at Changi, the new terminal also features a facial recognition system which will capture the passenger’s photo at different stations.
From check-in to bag tagging, as well as bag drop, immigration clearance and boarding, it was all automated.
The systems and processes, which The Straits Times also tested, all worked fine.
Changi Airport Group spokesman Ivan Tan said many passengers used the self-service options, and assistance was provided to those who were not familiar with the system.
“All the airport systems were tested in a real operating environment and functioned as expected,” he said.
Most of the passengers said they were excited about the new facilities.
Upon arriving at the new terminal, many were impressed with the modern facade, and started whipping out their handphones to take selfies, and even to film the self-baggage check-in process.
But some expressed concerns about security and accessibility.
Doctor Benny Ang, 60, said that he had some concerns about security, when it came to the self-check-in baggage machines.
“There might be some concern with bag tampering, when there is no staff around to physically help us to check in our bags,” said Mr Ang, who is travelling with four other family members for the long weekend.
“When it’s all done by the machine, some people might wonder where the bags will be going to.”
However, he added that the self-service machines were easy to use as they are similar to those used in other airports.
“They were easy to use and the instructions were clear, and many staff were on hand to help, although today the crowd is quite small.”
AirAsia had sent SMS messages and emails informing passengers in advance that they would be departing from T4 on a test flight. Calls were also made to passengers though some could not be contacted.
Of the five travellers The Straits Times spoke to, none of them realised that they were going to be taking the first commercial flight at a new terminal at the point of booking their tickets.
“If I had known, I would not have chosen this flight,” said a traveller who wanted to be known as Ms Yong and is in her 50s.
She is a frequent traveller with AirAsia, taking the airline’s flights at least three times every month over the past three years.
“The airline informed us (through email) that we had to arrive three hours early for this flight. I was worried that if I came later, there would not be access to the new terminal,” added the human resource manager.
Others were more than happy to be selected for the first test flight at the new terminal.
Mr Soh Chin Yong, 31, banker, said that he was “excited” and “privileged”.
“I didn’t know that it was going to be there!” he said.
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