SGHOUSING.COM 新加坡房地产网

FY2007: boost from residential sales and revaluation and restructuring surplus.

KEPPEL Land’s turnover crossed the billion-dollar mark in 2007 to hit a record $1.4 billion, a rise of 48.5 per cent from the previous year’s $948 million.

The 12-month period ended Dec 31, 2007, saw profit after tax and minority interests (Patmi) more than trebled from $200.3 million to a record $779.7 million. This was bolstered by strong residential sales, a net gain on revaluation of investment properties of $343.6 million, and a rise of $100.5 million under an item which includes corporate restructuring surplus and enbloc property sales. The latter $100.5 million gain was after taking into consideration a $235.2 million surplus from the restructuring of its one-third interest in One Raffles Quay and $89 million in offsets to account for the diminution in value of the group’s Myanmar hotels and the fall in the value of rupiah relating to its prior investments.

Full-year earnings per share came to 108.3 cents, up from 2006’s 27.9 cents. Q4 Patmi rose from $81.2 million to $572.3 million while turnover climbed 8.6 per cent to $371.4 million.

Related links: Click here for KepLand’s press release Financial statement Presentation slides

Announcing its financial results yesterday, KepLand group CEO Kevin Wong also said that it was proposing a final one-tier dividend of 8 cents per share and a special dividend of 12 cents to ‘reward shareholders for their support’. The proposed dividends amount to $144 million.

Patmi from property trading made up 35 per cent or $274.9 million of the total 2007 Patmi. Mr Wong said this was driven by profit contribution from Singapore developments including Marina Bay Residences, Reflections at Keppel Bay and Park Infinia at Wee Nam.

Contributions from overseas business made up 39.6 per cent while Singapore business contributed 60.4 per cent, up from 36.4 per cent in the previous year. For the year ahead, Mr Wong said that overseas contributions from residential properties will likely increase to about 50 per cent, in light of the weakening US economy. ‘Our projects are mostly in China and Vietnam, and the subprime effect on these two countries will be less.’

He added that most of its development projects in these two countries were targeted at the mid- to high-end market which was supported by ‘genuine buyers’. He also said the newly instituted capital gains tax in Vietnam should add stability to the market there. ‘Demand for housing in these two countries is coming from a very low base,’ he added.

In 2007, Keppel Land acquired eight residential sites in Vietnam with a total of 22,225 potential units for sale. Three developments are expected to be launched this year.

Other overseas launches for 2008 include a 1,000 unit residential development in Jeddah, Saudi Arabia, while two mega developments with over 8,000 units in Shanghai and Shenyang, China, is expected to be launched in 2009.

Mr Wong said it will continue to look for potential development sites and these will likely be in China, Vietnam and the Middle-East. Highlighting Keppel Land’s low gearing of 0.41 per cent, and the possibility of borrowing to fund future acquisitions, he also said: ‘We can gear up.’

At the end of the trading day yesterday, Keppel Land shares closed 2 cents higher at $6.45 per share.

Source : Business Times - 30 Jan 2008

FORTUNE Real Estate Investment Trust has announced distribution income of HK$284.8 million (S$51.8 million) for 2007, up 3 per cent from 2006.

Distribution per unit for the year ended Dec 31 edged up 2.5 per cent to HK$0.3512.

‘We are pleased that Fortune Reit’s portfolio of 11 retail malls delivered stable and sustainable growth for FY07,’ said Stephen Chu, chief executive of the Hong Kong-based Reit’s manager, ARA Asset Management.

‘This was driven by strong rental reversions of about 15.6 per cent for the whole year on a portfolio basis. Our pro-active asset management strategies, coupled with exciting promotional events in the malls, have contributed to healthy demand from tenants and shoppers.’

Fortune said that as of end-2007 its tax-exempt yield was 6.7 per cent, up from 5.8 per cent a year earlier. Strong rental reversions were driven by its Waldorf Garden Property , which was enhanced in August.

The average rental rate of the entire portfolio was 6.3 per cent higher at HK$25.23 psf at Dec 31, 2007, versus HK$23.74 psf a year earlier. Approximately 45 per cent of leases in the portfolio expire this year, creating a good opportunity for organic growth in a strong retail market, Fortune said.

Source : Business Times - 30 Jan 2008

THE illustrious Tan and Lee families are the ones holding court in the current bidding war over The Straits Trading Company. But it is a seemingly silent player in the entire saga that may well hold the key to the eventual outcome: OCBC Bank.

The bank is in a delicate position in this takeover tussle, being both a substantial shareholder of Straits Trading and a company in which the Lee family has a controlling interest.

This battle between the Tans and the Lees will be a test of OCBC’s independence. The bank will need to balance its duty to its shareholders with its ties with the Lee family.

OCBC and the Lee family

Thus far, little thought and attention have been devoted to the role OCBC will play in this saga. The bank is simply one of many shareholders of Straits Trading - a Singapore-listed company with interests in property , hotels and tin smelting.

But unlike many of the other shareholders, OCBC is closely linked to one of the two parties fighting to take over Straits Trading.

The bank was founded by the late patriarch and philanthropist, Lee Kong Chian, who also managed OCBC from 1938 to 1964. And, to this date - while the bank is no longer a family-owned business but a publicly traded entity - OCBC continues to be substantially owned by the Lee family.

The Lees, through their various vehicles and subsidiaries, are believed to own about a quarter of OCBC and are its single largest shareholder.

OCBC was managed for a substantial portion of its history by the late Tan Chin Tuan. Mr Tan was OCBC’s managing director and chairman from 1964 to 1983. And the Tan family, through its vehicle Tecity, retains a small stake in the bank. Still, any residual relationship OCBC has with the Tan family pales in comparison to the ties it has with the Lee family.

And it is this perceived imbalance - and OCBC’s status as a listed company in its own right - that has put it in a very delicate position, with respect to the ongoing bidding war for Straits Trading.

OCBC’s pivotal role

Tecity’s chief, Chew Gek Khim - granddaughter of the late Mr Tan - has thrown the spotlight on OCBC’s plight when her family raised its bid for Straits Trading on Monday to $6.50 a share, from $5.70 previously.

Along with the revised offer, she announced to the public that she had sent offer letters to OCBC and the bank’s insurance arm, Great Eastern Holdings (GEH) - which own 6.21 per cent and 19.92 per cent of Straits Trading respectively.

She announced that if OCBC and GEH accept Tecity’s offer, the Tan family - which now owns 23.60 per cent of Straits Trading - would end up owning 49.73 per cent of the offer target.

Her move drew the public’s attention to the pivotal role that OCBC will play in this saga, and observers will now be watching to see how the bank will respond to the competing bids for its stake in Straits Trading.

Essentially, OCBC only has one of three choices to make: sell its stake to the Lees; sell its stake to the Tans; keep its stake.

The circumstances in which it makes this choice will be closely observed. At this point, the Tan family’s offer for Straits Trading at $6.50 a share is substantially higher than the Lee family’s offer of $5.76. Selling to the highest bidder is a commercial decision that most investors understand, so shareholders are unlikely to take OCBC to task if it decides to sell its stake to the Tans.

However, if OCBC chooses to either keep its stake or sell it to the Lees, it will have to justify its decision. If the bank retains its stake, shareholders will want to know if it believes that an offer of $6.50 a share still grossly undervalues Straits Trading.

And, if it decides to sell its stake to the Lees, whose offer is $0.74 a share less than the Tans’, it will really have to come up with good reasons to satisfy its shareholders.

The picture is different if the Lees decide to counter-offer with a higher bid. Any decision by OCBC to sell its Straits Trading stake to its controlling Lee family would then be seen more as a commercial decision. And shareholders would more likely question any decision on the part of the bank to sell its stake to the Tans or to keep the stake.

OCBC, GEH and other Straits Trading shareholders have until Feb 22 to consider accepting the Tan family’s offer - that is, unless a higher bid comes in before then from the Lees.

OCBC needs to recognise that it is in a delicate position, that it is being watched, and that it should move carefully. Its move will also set the tone for GEH’s decision.

Source : Business Times - 30 Jan 2008

Developer confirms it is pushing back sales of projects by two to three weeks each.

KEPPEL Land (KepLand) has confirmed it has pushed back the launch of Marina Bay Suites and will be slightly delaying other launches in Singapore this year.

This comes amid recent wild swings in stock markets as fears mount over the fallout of the sub-prime mortgage crisis and a possible United States recession.

KepLand group chief executive Kevin Wong also cast some uncertainty on how Singapore’s luxury home segment - which had led the market boom until recently - will perform this year, saying it depends on the sub-prime outcome.

But he added that prices of mid-tier and mass market homes are expected to ‘continue to go up steadily’.

Marina Bay Suites - which Keppel is developing together with partners Cheung Kong Holdings/Hutchinson Whampoa and Hongkong Land - falls into the high-end homes category.

The 221-unit condominium was initially scheduled for launch last Friday, but Mr Wong said the consortium came to a ‘consensus’ to delay the launch until after Chinese New Year, ‘after bonuses’ and ‘when people get their hongbao’.

‘There is some rationality to pushing it back,’ he said yesterday. ‘During the Chinese New Year break, people go away.’

KepLand has five other projects to launch this year but these will be pushed back due to the Marina Bay Suites delay, as the developer wants to ’stagger’ its launches, added Mr Wong.

But he emphasised that the delays - of only ‘two or three weeks’ for each project - are ‘not material’.

The other projects include 400 units in Reflections at Keppel Bay, which are scheduled to start being sold in ‘the middle of the year’, Mr Wong said.

KepLand also plans to launch 52 units in Park Infinia at Wee Nam, 15 units in The Crest @ Cairnhill, 34 units in The Tresor at Duchess Road and 56 units in Madison Residences in Bukit Timah Road.

The group yesterday posted a sterling set of results, due to good sales in projects such as The Suites at Central and Belvedere in Singapore; Villa Riviera in China; and Elita Promenade in India.

Net profit for the fourth quarter ended Dec 31 surged seven times to $572.3 million, largely due to a $388.2 million gain on revaluation of investment properties . Revenue rose 8.6 per cent to $371.4 million.

Earnings per share for the quarter soared to 79.5 cents, from 11.3 cents a year ago.

For the full year, net profit more than trebled to $779.7 million while revenue climbed 48.5 per cent to $1.4 billion.

Net asset value per share was 3.18 cents as at Dec 31, from 2.21 cents a year ago.

KepLand is declaring a total cash dividend of 20 cents for the year, consisting a final dividend of eight cents and a special dividend of 12 cents.

Source : Straits Times - 30 Jan 2008

With two other malls, it will make town hub an even stronger shopping destination.

THE popular suburban haunt of Tampines is set to get a fresh injection of retail buzz when a new $450 million mall, now under construction, opens for business early next year.

The arrival of Tampines 1 on the scene will alleviate a shortage of shopping space in the crowded town hub, where rents in two existing malls have risen over the years, industry sources say.

The new mall’s manager has already signed up anchor tenants. It is now 40 per cent leased and is expected to be fully leased by May, said AsiaMalls Management (South East Asia).

Located beside the Tampines MRT station, it will complement two existing malls, CapitaMall Trust’s Tampines Mall and Asian Retail Mall Fund’s Century Square.

Tampines 1, due for completion later this year, sits on a 91,000 sq ft site and has shops spread over five storeys and one basement. It will have 203 carpark lots.

The mall has a net lettable area of 260,000 sq ft, which makes it smaller than Tampines Mall’s 323,000 sq ft but bigger than Century Square’s 210,000 sq ft.

When combined, the three malls will make Tampines an even stronger shopping destination, according to Knight Frank’s deputy managing director, Mr Danny Yeo.

Popular suburban malls, such as those in Tampines, can command relatively steep rents due to their high levels of traffic.

This trend is growing now that the Housing Board has stopped building neighbourhood shops, as shoppers prefer to frequent bustling suburban malls, said Mr Yeo.

He added that ground-floor rents in Tampines suburban malls could fetch between $35 and $50 per sq ft (psf) a month.

That range is relatively high for outlying shopping centres, given that ground-floor rents in main shopping malls along the Orchard Road shopping belt go for about $45 to $70 psf on average.

While Tampines 1’s anchor tenants may be familiar brand names, such as Cold Storage, the mall will strive to be different by bringing in new retail concepts to tie in with its ‘young, savvy and lover of all new things’ theme.

One of them is a fitness club and spa that will come complete with a swimming pool.

The BEYS fitness club and spa by the Amore Fitness group will take up about 17,500 sq ft of space on the fifth floor.

Cold Storage supermarket, which will be fitted out to the tune of $3 million, will occupy almost 14,000 sq ft of the basement.

This outlet will focus on high-quality fresh food and offer more than an ordinary heartland supermarket, said the mall manager.

For instance, it will have the largest range of smoked salmon and Alaskan seafood and will offer ready-to-eat steamed lobsters and shucked oysters.

Times The Bookshop is another key tenant, while Challenger, the information technology superstore, will take up 6,100 sq ft on level four.

Challenger used to be a tenant at DBS Tampines Centre that, together with Pavilion, have been torn down to make way for the upcoming mall.

Asian Retail Mall Fund II bought the two sites for nearly $289 million. Its total investment in the mall has reached $450 million, including land cost.

Apart from new retail concepts, Tampines 1 will also offer new architecture elements, such as a European-inspired Sunken Plaza and double-floor retail shops, said the mall’s assistant general manager, Ms Stephanie Ho.

One of these duplex units - on levels four and five - will be taken up by Japanese restaurant chain Sushi Tei.

POPULAR RETAIL HAUNTS

Suburban malls will continue to command high rents, as shoppers prefer to frequent these places over neighbourhood shops.MR YEO, Knight Frank’s deputy managing director, on the new mall’s commercial potential.

NEW AND IMPROVED

Tampines 1 will offer new architectural elements, such as a European-inspired Sunken Plaza and double-floor retail shops.MS STEPHANIE HO. the mall’s assistant general manager.

Source : Straits Times - 30 Jan 2008