ING fund sale in doubt after US suitor lowers its offer

THE sale of the ING Real Estate Healthcare Fund is in doubt after a US suitor yesterday backed away from its original offer.

In December, REIT Management & Research made a cash offer of $1 per unit, plus distributions estimated at a further 3.825c per unit, for all 71.5 million units.

But in an ASX statement yesterday ING Healthcare Fund said the US real estate group had lowered its offer.

ING said it would continue to engage the Americans to determine whether a transaction could be agreed on suitable terms.

ING, which made a statutory profit of $5.9 million for the 2010 full year after a $4.4m loss in 2009, has about $180m of assets located in Victoria and Queensland.

Date: 05 February 2011 | For the full report, please visit http://www.theaustralian.com.au

Amara CEO Albert Teo to head Redas

Amara Holdings CEO Albert Teo will be the new president of the Real Estate Developers’ Association of Singapore (Redas), BT understands.

He will take over from Simon Cheong of SC Global Developments, who has helmed the organisation for the maximum two consecutive terms allowed under the Redas constitution. Each term is for two years.

BT understands that Redas’ annual general meeting was held last week, when the new management committee was elected. Following that, the president was picked by the management committee.

Among those elected to the management committee at last week’s AGM were Chia Ngiang Hong (group general manager of City Developments) and Lim Ee Seng (CEO of Frasers Centrepoint). They were first and second vice-president respectively in the previous committee.

Others voted in include Trina Loh of GuocoLand, Margaret Goh of NTUC Choice Homes and Kwee Yi-Lin of Pontiac Land Group.

The new exco and the management committee are expected to be inaugurated at Redas’ Chinese New Year gathering next week.

Mr Teo, who is in his early 60s, is a chartered accountant by training. He and his family control listed Amara Holdings.

Date: 01 February 2011 | For the full report, please visit http://www.businesstimes.com.sg

The World islands not eroding away: Nakheel

A cluster of 300 artificial islands off Dubai’s coast in the shape of a global map is stable, its developer Nakheel insists, despite a court claim alleging that ‘The World’ was neglected and eroding away.

‘There is no issue with the stability of The World islands that are approximately 70 per cent sold and handed over,’ a Nakheel spokesman said when asked about the allegations. ‘The island purchasers (have) the responsibility to proceed with their developments in due course.’

Builders have announced plans for a few of the islands, but development has yet to begin on most of them.

A company contracted to provide logistics support to the islands filed a claim with a tribunal that handles cases related to the emirate’s troubled Dubai World conglomerate, alleging that third-party developers had not been encouraged to develop the islands, and said they were being hit by erosion.

Nakheel subsidiary The World LLC ‘did not develop the project as anticipated at the time of the agreement and the project has lain largely undeveloped’, according to the claim filed by Penguin Marine Boats Services LLC.

Penguin is contracted to pay ‘a licence fee of five million dirhams (S$1.75 million) per annum’ to conduct operations, but the lack of development on the islands means it has ‘been unable to develop its business opportunities’, the claim said. Additionally, ‘the navigation channels … are presently so ill-defined and the water depths have been so seriously eroded due to reclaimed sand silting up the navigation channels that major reclamation works will henceforth be required’, it said.

A lawyer for Penguin, Richard Wilmot-Smith, was quoted by local media as having told the tribunal that ‘the islands are gradually falling back into the sea’.

Nakheel dismissed the allegations as ‘misleading and mischievous statements’. ‘The wholly incorrect and unsupported assertion relating to the state of The World islands was made in the context of a legal case brought against The World LLC by a logistics provider,’ the spokesman said. ‘Nakheel will continue to protect the interests of its operations and stakeholders and take such action as is appropriate in the circumstances.’

Date: 31 January 2011 | For the full report, please visit http://www.businesstimes.com.sg

Hang Lung’s H1 profit plummets 77%

Hang Lung Properties Ltd, Hong Kong’s third-largest developer by market value, said first-half underlying profit fell 77 per cent after it sold fewer apartments in the city.

Profit excluding revaluation gains and deferred tax was HK$1.28 billion (S$210 million) in the six months ending Dec 31, compared with HK$5.51 billion a year earlier, Hang Lung said in a filing to Hong Kong’s stock exchange yesterday.

That compares with the HK$1.29 billion median estimate of three analysts surveyed by Bloomberg News.

Profit at Hang Lung, which derived nearly two- thirds of its revenue from selling apartments in the last fiscal year, declined after it held off marketing new units.

The company opened a new shopping mall in the northeastern Chinese city of Shenyang in June, its first property outside Hong Kong and Shanghai, as part of a plan to invest about HK$40 billion building commercial real estate in the world’s fastest- growing major economy.

‘Their rental income should still be enjoying pretty good growth,’ Eva Lee, Hong Kong-based analyst at Macquarie Securities Ltd, said before the earnings were announced.

‘Investors probably won’t be too concerned about the decline in apartment sales as Hang Lung normally times the market well.’

Date: 27 January 2011 | For the full report, please visit http://www.businesstimes.com.sg

China banks doled out 2t yuan in new loans

Chinese banks channelled 2.02 trillion yuan (S$392 billion) in new loans into the red-hot property sector in 2010, accounting for a quarter of the total new yuan loans, the central bank said yesterday.

The government has repeatedly told banks to restrict lending to property developers in a bid to rein in home prices.

Banks loans for property development were 591.6 billion yuan in 2010 compared with 576.4 billion yuan in 2009, according to a statement published by the People’s Bank of China on its website (www.pbc.gov.cn).

Personal mortgage loans amounted to 1.4 trillion yuan last year, the central bank said. It did not publish the number for 2009.

Date: 27 January 2011 | For the full report, please visit http://www.businesstimes.com.sg

China Leads World in Real Estate Transactions With $197 Billion

China attracted the most real estate investment in the world for a second straight year as purchases of development sites helped lift global commercial property sales by 43 percent, Real Capital Analytics Inc. said.

China had $197.1 billion of transactions last year, 23 percent more than in 2009, the New York based company said in a statement today. That represented 34 percent of the $582 billion of deals worldwide, down from 41 percent the previous year as Chinese authorities sought to prevent the property market from overheating.

Larger down-payment requirements and efforts to clamp down on property speculation slowed transactions in China in the second and third quarters. In the final three months, the deal flow “reached the second highest in four years,” RCA said.

Increased sales of offices, malls, warehouses, hotels, condominiums and land lifted the value of global deals to the highest since 2007’s record of $1.23 trillion. The biggest driver was the U.S., where higher prices and a pickup in investor demand helped transactions more than double to $112.5 billion, RCA said.

London led the world last year for investments in existing buildings, with a total of $23.9 billion. A weaker pound and prospects for rising rents enhanced the U.K. capital’s status as a refuge for investors, the data research company said.

About 95 percent of investments in Chinese real estate in 2010 were land deals for development projects, according to the statement. The largest was the purchase of a site in Nanjing for $1.78 billion.

Date: 27 January 2011 | For the full report, please visit http://www.bloomberg.com

First Reit Q4 revenue down 0.2% to $7.65m

FIRST Real Estate Investment Trust (First Reit) yesterday posted a gross revenue of $7.65 million for the fourth quarter ended Dec 31, 2010. This is 0.2 per cent down from a year ago. Net property income slipped 0.3 per cent to $7.56 million. Nevertheless, the distributable amount rose 2.8 per cent to $5.43 million.

First Reit’s rights issue for asset acquisitions last year caused the unit base to grow, leading to a sharp drop in distribution per unit (DPU). DPU in Q4 was 0.87 cent – 54.7 per cent less than the 1.92 cents in the previous year. Excluding new units from the rights issue, DPU in Q4 would have been 1.96 cents, reflecting a 2.1 per cent year-on-year growth.

For the full year ended Dec 31, First Reit’s net property income was $29.88 million, up 0.1 per cent from a year ago. The distributable amount increased 1.8 per cent to $21.3 million. Also because of the rights issue, DPU for the year fell 13 per cent to 6.63 cents from 7.62 cents in the previous year. The adjusted DPU for FY2010 would have been 7.72 cents, translating to a 1.3 per cent growth.

First Reit expects contributions from its newly acquired assets – The Mochtar Riady Comprehensive Cancer Centre and Siloam Hospitals Lippo Cikarang – to boost distributable income in FY2011. It said that distributable income for Projection Year 2011 could reach $40.3 million, which is 89 per cent more than that in FY2010. From this, DPU is forecasted to be 6.4 cents.

Date: 22 January 2011 | For the full report, please visit http://www.businesstimes.com.sg

Ascott Reit’s DPU up 16% for Q4

THE 28 service residence properties that Ascott Residence Trust (ART) injected into its portfolio in October last year has helped it to notch a 16 per cent jump in payout to unitholders for its final quarter of fiscal 2010.

Announcing the results before the market opened yesterday, Reit manager Ascott Residence Trust Management Ltd (ARTML) said that distribution per unit (DPU) came to 2.16 cents, up from 1.87 cents a year ago.

Overall, the quarter saw a surge in distributable income to $23.9 million, double the $11.5 million reaped for the October-December period a year ago.

In August last year, the Reit announced that it was buying 28 properties – the bulk of which were in Europe – from its sponsor, The Ascott Ltd, for $969.6 million.

ART then undertook an equity fund-raising exercise, under which it issued as many as 487.5 million new units that bumped up its total number of units to 1.1 billion. The acquisition of the properties was completed at the start of October.

ARTML chairman Lim Jit Poh said: ‘It was anticipated . . . that following the yield-accretive acquisition of the 28 Asia and Europe properties last year, Ascott Reit’s performance would improve.’

The acquired properties helped ART nail a 58.1 per cent increase in revenue to $72.8 million from $46.1 million a year earlier.

Mr Lim added that the group would continue to seek yield-accretive acquisitions in Singapore, China, Vietnam and the UK. It will also explore opportunities in new emerging markets.

For 2011, ARTML expects the group’s Singapore properties to see rising demand on the back of a robust local economy. Its UK properties are also likely to benefit in the lead-up to the 2012 London Olympics, said Chong Kee Hiong, ARTML’s chief executive.

Date: 22 January 2011 | For the full report, please visit http://www.businesstimes.com.sg

Fancy buying a chalet in Switzerland?

ASIAN investors interested in owning a piece of Switzerland will be glad to know that 29 apartments at Mer de Glace Hotel and Spa are available to foreigners. This is the first chalet-style apartment and hotel complex in Nendaz.

According to Jeremy Rollason, managing director of Alpine Homes International, there are a hundred permits issued this year allowing foreigners to buy Swiss properties, 29 of which have been allocated to Mer de Glace.

A property launch outside of Switzerland was held in Singapore last Thursday. This is the first time that a Swiss project has been brought to Singapore.

‘Singapore is an important market for our Asian strategy,’ said Mr Rollason, stating that Singapore visitor arrivals in Switzerland have increased approximately 50 per cent over the last five years. In addition, Alpine Homes has sold three Swiss properties to Singaporeans in the past six months, indicating a strong potential in the Asian market.

Located near Verbier, it is close to the Four Valleys ski area. ‘This is a genuine opportunity to balance your portfolio,’ said James Talbot, director of Savills, UK and Europe, as vacancy rates are low and few properties are offered to foreigners.

Date: 23 January 2011 | For the full report, please visit http://www.businesstimes.com.sg

Perth’s liveability ‘average’ – survey

PERTH residents have ranked the capital city as an average place to live, with taxes and housing affordability weighing on the city’s standing, a liveability survey shows.

According to a national survey of more than 4000 residents by the Property Council of Australia (PCA), Perth was overall ranked fourth on the liveability survey with a score of 60.6.

Adelaide was the number one place to live with 63.4 points, followed by Canberra and Melbourne. Hobart came in fifth, then Brisbane and Darwin while Sydney was ranked as the least liveable city in Australia at 55.1 points.

“The survey asked residents in Australia to rate their city on key performance areas and it found that Perth was average in most and good in some, but several key aspects of living in Perth need to improve markedly,” PCA executive director Joe Lenzo said.

“Perth residents ranked the city second last for culture opportunities, seventh overall for security and fifth for design.
“On the plus side Perth residents rated Perth highly for having a good climate, an attractive natural environment, and being clean and well maintained.”

The survey also asked residents about the preferred housing type for the future, with Perth respondents likely to support new neighbourhoods of freestanding houses on the outskirts of the city.

Perth residents would also support the conversion of old industrial sites to apartments and townhouses and more apartments at major transport and retail centres.

The State Government rated poorly by Perth residents in terms of housing affordability, land taxes and stamp duty associated with housing and managing growth in relation to roads and congestion.

However the government got fair marks for its bit in releasing land for new homes and planning and managing urban growth.

Date: 24 January 2011 | For the full report, please visit http://www.perthnow.com.au