Category Archives: Transport

Sime Darby Centre for sale

Blackstone Group plans to sell Sime Darby Centre in Bukit Timah, one of the office and retail assets it acquired last year from Malaysian palm-oil producer Sime Darby Berhad, according to people familiar with the matter.

Located in an ageing commercial block along Dunearn Road and directly in front of King Albert Park MRT station, Sime Darby Centre houses tenants like kitchenware retailer ToTT, Scanteak, Cold Storage and ChildFirst pre-school. The block consists of builtup area of 250,000 sq ft — 80 per cent is office space and the rest is retail. The development sits on freehold and 999-year leasehold land parcels zoned for commercial use and with 1.8 plot ratio.

Blackstone owns a 70 per cent stake in the Sime Darby Centre and Sime owns the rest. The conglomerate, Malaysia’s biggest listed palm-oil producer, sold some property assets in Australia and Singapore to help pare debt.

The site could attract bids from large and mid-sized Singapore developers including Far East Organization, City Developments, Frasers Centrepoint and United Industrial Corp.

The New York-based private equity firm expects to fetch about S$300 million for Sime Darby Centre, which it bought for just under S$200 million last year. Blackstone in May acquired a majority stake in three Singapore property assets, including the Sime Darby Centre, in a deal that valued them at about S$300 million.

Blackstone, which manages more than US$100 billion (S$140 billion) in real estate assets worldwide, in the past has bought residential apartment blocks in Singapore’s prime area.

Braddell Road Flyover to delay completion to June

After having been delayed three times, the troubled Braddell Road flyover project has a new deadline. It is now slated to be completed by June, the Land Transport Authority (LTA) said. Its original deadline was end-2015.

A spokesman for LTA told The Straits Times that it had been working closely with the public works project’s main contractor, Feng Ming Construction (FMC), to “rectify, review and improve” safety measures after a stop-work order (SWO) stalled progress on Feb 23.

Safety inspectors from the Ministry of Manpower (MOM) discovered several safety violations during a random spot check at the worksite. The SWO was lifted on March 8, and the works have now fully resumed, said LTA .

 

 

JR Kyushu investing in South East Asia real estate

JR Kyushu, which is benefiting from a tourism boom with record numbers of visitors to Japan, gets most of its profits from real estate and station buildings. The company said in its mid-term plan it aims to spend 80 billion yen over three years on some sectors that will help boost sales from non-rail sources as the population on the island declines.

It was seeking to raise as much as 416 billion yen in an IPO, and planned to reduce its reliance on Japan by investing in residential and office properties in Southeast Asia.

Investing in Southeast Asia will be a first for the company, which owns five restaurants in China. Japan makes up almost all of the company’s revenue, according to data compiled by Bloomberg. In addition to real estate, the company also operates restaurants in Shanghai and Tokyo. JR Central, the nation’s busiest bullet train operator, also has a restaurant in London.

According to the Chairman, Southeast Asia offers huge growth potential for JR Kyushu. JR Kyushu plans to expand its non-rail sales to more than 62 percent of revenue by March 2019, from 57.5 percent in the year ended March 2012, according to the mid-term plan. Sales are forecast to increase to 400 billion yen in the same period, from 333 billion yen seven years earlier.

The company expects at least as many tourists to Kyushu this year as the 2.8 million who visited last year, as the island recovers from the earthquakes in Kumamoto prefecture in April, Karaike said.

“Foreign visitors from Asia used to come to Japan for the purpose of massive shopping, but their interest is shifting to culture, history, dining, and other aspects that are only available in Japan,” the executive said.

Based in Fukuoka City, about 890 kilometers (550 miles) southwest of Tokyo, the JR Kyushu is benefiting from record overseas visitors to Japan, spurring demand for its hotels, shops and restaurants, as well as train travel. Visitors to Kyushu from overseas reached 2.8 million last year, more than doubling from 1.3 million two years earlier, according to the transport ministry.

https://www.bloomberg.com/news/articles/2016-10-11/ipo-candidate-jr-kyushu-scouts-property-deals-in-southeast-asia

Good Take-up at Guoco Tower space

TECH and media companies are making their presence felt at Guoco Tower in Tanjong Pagar, accounting for 37 per cent of the space that has already been committed.

The premium Grade A office component of Tanjong Pagar Centre, a mixed-development project being built by the listed GuocoLand group, has 890,000 sq ft net lettable area of which 80 per cent or some 712,000 sq ft is either taken up or subject of advanced leasing discussions. Of this space, approximately 263,000 sq ft has been committed by tech and media companies, including Amadeus and OpenLink.

Earlier media reports also tipped Agoda, Dentsu Aegis Network, Palo Alto Networks, ING, Itochu Singapore, and SAS Singapore as heading for Guoco Tower. Dentsu Aegis is expected to be the biggest tenant with about 100,000 sq ft.

GuocoLand has also named as new tenants The Straits Trading Company, which will be moving out of 9 Battery Road; Danone, which is exiting Goldbell Towers along Scotts Road; shoemaker Asics, which will be leaving PWC Building; and Teva Pharmaceutical Industries, which is exiting three locations.

The offices, which received Temporary Occupation Permit (TOP) last month, are on the lower 38 levels of the 64-storey tower, which is Singapore’s tallest building at 290 metres. Levels 39 and upwards of this tower comprise the 181-unit Wallich Residence. A second tower houses the 222-room Sofitel Singapore City Centre. Both of these components are expected to receive TOP between late this year and early 2017. The project also has a retail component, part of which has already received TOP.

Guoco Tower is counting on its prime location, flexible, efficient and scalable design, Tanjong Pagar Centre’s tightly integrated retail and lifestyle components, and of course, the prestige factor of being in Singapore’s tallest building as its selling points.

Most of the MNCs in Guoco Tower will be using it as their regional headquarters with average headcounts of 300 to 500 persons, coupled with relocations of many of their senior management staff from their other headquarters or regional offices to Singapore.

This would create a lot of demand for F&B, services, hotels and even housing in the area and catalyse Tanjong Pagar’s transformation. The gross effective monthly rents at Guoco Tower are estimated to be between S$8.50 and S$11.00 per square foot – comfortably above the average of S$7 to S$8 psf in the Tanjong Pagar office micromarket, and comparable to other premium Grade A developments in Marina Bay.

 

Kuala Lumpur-Singapore High Speed Rail on track

Announced in the middle of 2016, the highly-anticipated project in the coming decade between the neighbours Malaysia and Singapore are expected to be ready in 10 years’ time. Travellers can travel to KL from Singapore in just 90 mins by the High- Speed Rail (HSR).

The terminus in Singapore will be in Jurong East, while the one in Malaysia will be at Bandar Malaysia.  According to reports, Seremban, Ayer Keroh, Muar, Batu Pahat and Iskandar Puteri are among the transit stops.

This will spell good news for tourists and the locals alike though it may affect coach businesses across the causeway. Developers and property owners of sites near to the stations will also benefit from the development.

Airbnb in Japan

The world’s third most valuable startup is drumming support in the world’s third largest economy in the latest round of debate on regulation. The tourism boom in the country results in shortage in hotel room availability and Airbnb is positioning itself as offering a significant social value proposition in the situation, by supporting tourism and benefit the communities in which they operate by directly benefiting the hosts of the properties. Listing in Japan has balloted to 35K, hosting 1.38m guests. The weakened Yen together with relaxing of visa requirements pushed inbound tourists to a record of 19.7m in 2015 from 8.4m in 2012. The hotel occupancy in Tokyo is tighter than Paris, Hong Kong and New York. It is estimated that the number will hit 35m in 2020.

LVS looking to offload MBS mall next year

Owner of the iconic Marina Bay Sands, Las Vegas Sands (LVS), is looking to put up Shoppes at Marina Bay Sands (MBS) next year. The exclusive rights for LVS to operate the mall MBS was granted from 2007-2017, so that the operator can recoup the billions of dollars in construction costs and investment.  The same right has been given to Genting Singapore for Resorts World Sentosa.

The sale of the mall however is subjected to government approval. The operating income is assumed at around US$150m and the valuation of the mall is approximately US$4-5b based on 3-4% cap rate. In first quarter, the mall revenue is at US$39m, hotel room revenue at US$88.9m and Convention/retail/other revenue at US$46m, according to MBS reports.

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Scheme for underground links in Orchard Road

Urban Redevelopment Authority (URA) has scheme that provide cash grants for malls to build underground links along Orchard Road. The incentive started in 2004 and gives up to $28.7k psm for the construction of underground walkways. However there are little take up for the incentive. The biggest obstacle cited is cost, among other challenges.  Another challenge is the fear among malls that the links will allow flow to competitors.

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The Lion City ranks as the most popular destination after Bangkok.

According to a new Mastercard report for international visitors, Singapore is the most popular destination among Asia-Pacfiic spots after the capital city of Thailand.  The Thai capital attracted 21.9 million  visitors last year while Singapore draw 11.86m visitors.  Tokyo was next with 11.76m. Thailand dominated the top 10 locations by adding Phuket and Pattaya at 5th and 8th positions.

The top sources of visitors for Singapore were Indonesia, China and India. Visitors here spent $14.1b last year.

The tourist industry in Asia Pacific is the largest in the world.

On a separate note, Singapore’s Changi Airport bounced off from a weak start to 2015 to a record of 55.4m passengers passing through the airport.

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Thomson-East Coast Line to start building in Q12016

According to LTA announcement yesterday, the Thomson-East Coast Line (TEL) will start construction in this quarter. About $948m of MRT contracts have been awarded for the stations and related tunnels at Tanjong Rhu, Katong Park and Marine Terrace. The construction is slated for completion in 2023. In November last year a contract was awarded to construct Marine Parade station and associated tunnels. The contracts for 5 more TEL stations are yet to be awarded.

Starting from 2019, the TEL will open in stages, with the entire 31-station, 43 km line expected to be fully operational by 2024.