SGHOUSING.COM 新加坡房地产网

THE property markets of South-east Asia are expected to sustain the buoyant growth seen in 2007, says DTZ Debenham Tie Leung.

DTZ said that residential markets in the region are expected to continue to grow, ‘driven by steady economic expansion, increasing affluence and increasingly attractive projects as developers strive to refine concepts’.

In Vietnam, DTZ noted that demand for residential properties , which was already growing fast, was bolstered by the recent relaxation in rules for housing ownership, allowing foreign land ownership terms to increase from 50 to 70 years. DTZ said this also encouraged foreign developers to build residential properties there.

In Malaysia, DTZ said take-up was encouraging for high-end condominiums in Kuala Lumpur, with a complete sell-out for several luxury projects. This was supported by the relaxation of rules for foreigners to buy residential properties and the waiver of real property gains tax last April. While monthly average gross rents remained unchanged at RM4 (S$1.25) per square foot, average capital values increased 3 per cent year-on-year to an average RM500 (US$152) psf.

The residential market in Thailand is also expected to recover, as the political situation improves and developers are encouraged to launch projects which have been withheld.

In the office sector, DTZ says demand for office space in Vietnam is expected to continue to be underpinned by limited potential supply. It said that in Vietnam, most potential supply comprises non-prime office buildings, ‘which will lead to greater competition for prime office space’. Occupancy remains high, at above 95 per cent, while Grade A rents average US$3.70 psf per month in Hanoi and US$4.37 psf per month in Ho Chi Minh City.

The office market in Kuala Lumpur was also active, with increasing demand by the services, oil and gas, information technology and financial sectors. Together with limited new supply, prime office rents rose 7.8 per cent year-on-year to RM62.65 (US$18.16) psm.

Jakarta also saw office occupancy rates of over 90 per cent. Rents did, however, remain at about US$0.76 psf per month amid fluctuations in exchange rates.

The Bangkok office market was the only one that was subdued, with a negative net absorption for H1 2007. DTZ said this was due to a less favourable operating environment which affected investors’ confidence.

Source : Business Times - 5 Feb 2008

IT was reported recently that a listed company had sold a property it had developed to the relatives of a director.

What was unusual this time was that the relatives were walk-in customers during a public sale which was held after the sales preview for invited guests.

The sale was also on the same terms as those offered to members of the public.

I feel that this approach to transacting properties with directors and their related parties represent a standard of corporate governance for other listed companies to follow.

I am sure that shareholders have no qualms about directors buying properties that were left unsold after having been launched to members of the public or even if directors purchased them during the public launch.

However, if directors were given preference to units during the pre-launch, as is often the case, these transactions should be disclosed by the company in a clear and transparent manner.

At the outset, companies should state if these property sales, or the profits from any subsequent resale by the directors, are meant to be part of their remuneration.

If they are, then the amount should be determined and, if necessary, approved at annual general meetings.

Also, if the directors were related to the major shareholder, then minority shareholders should get a chance to vote on it.

If the company’s view is that the sale was not part of their remuneration, then there should be a test of valuation or a governance guideline to be followed to ensure that revenues were maximised in the sales to directors.

The reason being, even when properties are sold at list prices without discounts, it is not clear to shareholders that the properties were sold at the best possible price.

If directors were responsible for setting prices and would also likely to have had the first pick of the best units, it is difficult for shareholders to be certain if the launch price was correctly priced to begin with.

The only way to be confident that a company got the best price for the property is if the properties were first open to third parties for purchase or bidding.

Therefore, the guideline for sales to company directors should be that the directors make purchases after the public launch, or at the very least, during the launch.

This will clear doubts on whether the transactions involving directors were in the interest of shareholders.

Source : Business Times - 5 Feb 2008

I REFER to the report, ‘CapitaLand tells Gillman Heights owners to honour sale’ (ST, Feb 2). The news, like that of Horizon Towers and Regent Garden, bears similar learning lessons. They concern sellers in a collective property sale who refuse to accede to the terms of the contract they signed with the buyers. The lessons we can draw from these three examples are:

Collective sellers can disregard the terms of a signed contract by simply challenging the rules and rescinding it;

If enough sellers withdraw from a signed contract, the law may not be swift enough to give the buyers due protection as a result of the broken promise made by the sellers; and

Lawyers are the only clear winners in the arena of failed agreements between willing sellers and buyers.

A contract, in the simplest definition, is a promise enforceable by law. In the recent cases, it is crystal clear the sellers went back on their word because the agreed sale price was ‘too low’. I feel the courts should have just enforced penalties here, rather than let the subsequent chain of events run.

So the buyers had to threaten these sellers with lawsuits. The latter responded with a host of ‘reasons’ why the sale agreement should be cancelled. Yet the courts are obliged to hear out both plaintiffs and defendants. Lawyers are hired to represent their respective clients.

All these legal disputes are counter productive, especially for the aggrieved buyers who have the commercial right to proceed with their legal suits against the sellers. Time, money and tears are shed over something that could have been easily resolved by the courts.

An agreement, commercial or social, remains an agreement. If the irresponsible party defaults on the terms of the contract so the aggrieved party takes the issue to court, the court should immediately arrive at a verdict. Penalties should be meted out swiftly against the wrongdoer.

Our society needs to be confident in carrying out the terms of commercial and social contracts. Our children and the next generation are watching us closely in the way we make just decisions. Foreign businesses and enterprises are watching us to see how we deal with simple issues such as breaking a basic contractual agreement.

In this regard, I suggest the Ministry of Education introduce a basic civics education module for students on ‘Keeping one’s word’. Schools should emphasise time-honoured values such as ‘Integrity at all costs’ to children.

Source : Straits Times - 5 Feb 2008

58 locations selected for improvement under revised schemes

ABOUT 590 Housing Board blocks in 58 locations islandwide have been picked for the next batch of improvement works under the HDB’s recently revised upgrading schemes. Areas set to benefit include Yishun, Tampines and Hougang.

These schemes include the new Home Improvement Programme (HIP) and Neighbourhood Renewal Programme (NRP) - unveiled last year - as well as the ongoing lift upgrading programme.

The HIP focuses on essential improvements within a flat, such as repairing spalling concrete. It also gives residents the choice of opting out of certain items to cut costs.

This scheme replaces the more extensive Main Upgrading Programme, which had been more expensive because work was done both inside and outside the flat.

Under the other new programme, the NRP, a few adjoining estates will be spruced up together, with the cost fully borne by the Government. The bigger budget involved makes it possible for larger items such as tennis courts and skating parks to be considered as part of the works.

Residents will also be consulted on how they want their estate improved.

The HDB, which said earlier that the HIP would be first done in two precincts in Yishun and Tampines, announced yesterday that it will double that number to four and include other towns in view of strong public support shown in recent surveys.

Meanwhile, eight estates have been selected for the NRP and another 52 for lift upgrading - where housing blocks are renovated to give residents lift access at every level.

The lift upgrading programme is still the mainstay of improvement works as the Government has pledged to give direct lift access to almost every block by 2014. In 2006, for example, the Government said it was selecting 70 precincts comprising 600 to 700 blocks for the programme. In 2005, it was 480 blocks in 64 precincts.

The Minister of State for National Development, Ms Grace Fu, said yesterday the Government was on track to meet the 2014 deadline.

Tampines GRC MP Irene Ng said that 16 blocks in Tampines Street 11 under her charge have been picked for lift upgrading in the latest list.

She added: ‘Many of the elderly fear becoming isolated in their flats as they find it increasingly hard to climb stairs. Over the years, some in wheelchairs had to move out of the estate, even though they loved the place, because they could not negotiate the stairs without help…’

Residents in about 70 per cent, or 3,600, of the eligible blocks have been offered lift upgrading so far.

Some estates in the latest list will have more than one type of upgrading work done at the same time to reduce inconvenience.

Six precincts comprising about 30 blocks previously picked for the Main Upgrading Programme under the old regime will also be switching to the new programmes, at the request of their MPs.

About 300,000 flats out of almost 900,000 islandwide will be eligible for the HIP, while 200,000 units can undergo work for the NRP.

Details of the specific locations of these selected precincts will be announced by their respective MPs later.

Work on this batch is expected to be completed within five years.

HOME IMPROVEMENT PROGRAMME

This scheme focuses on essential improvements in a flat, such as repairing spalling concrete. Residents can opt out of certain items to cut costs. It replaces the Main Upgrading Programme, which had been more expensive as work was done inside and outside the flat.

NEIGHBOURHOOD RENEWAL PROGRAMME

Under this scheme, a few adjoining estates will be spruced up together, with the Government paying the full cost. The bigger budget involved makes it possible for larger items such as tennis courts and skating parks to be considered as part of the works.

LIFT UPGRADING

This programme is the mainstay of improvement works. The Government has pledged to give direct lift access to almost every block by 2014.

Source : Straits Times - 5 Feb 2008

A total of 590 blocks in 58 sites have been selected for the next batch of HDB upgrading programmes.

The exact list has not been disclosed but HDB said these blocks would benefit from programmes such as the Home Improvement Programme (HIP), Neighbourhood Renewal Programme (NRP) and the Lift Upgrading Programme (LUP).

HDB said the number of HIP projects has been increased from two to four due to strong public support. Eight NRP and 52 LUP projects will also be offered.

Some areas will benefit from more than one programme.

HDB has also agreed to requests from some MPs for six of the Main Upgrading Programme (MUP) sites selected in previous years to switch to the new programmes as they have not undergone polling.

Residents from about 30 blocks in these sites will be able to enjoy one or a combination of the new programmes.

Details of the selected sites will be announced soon.

Source : ChannelNewsAsia - 4 Feb 2008