SGHOUSING.COM 新加坡房地产网

CAPITACOMMERCIAL Trust, the office landlord run by CapitaLand, will pay investors 23 per cent more in dividends for the second quarter, as it earned more rental income.

Shareholders will receive $36.1 million, or 2.6 cents a share, for the three months ended June 30, from 2.12 cents a year earlier.

CapitaCommercial also expects to post higher income for the rest of the year, as it increases rents on leases expiring in 2008 and as it lowers interest costs.

Said its chairman Richard Hale: “Given Singapore’s attractiveness as a global city and tight office supply, we are confident of exceeding our forecast distribution per unit of 10.61 cents for the financial year ending 2008.”

The trust may follow CapitaLand in seeking to invest more in faster growing economies such as China and Vietnam.

“We will continue, though even more deliberatively given the current market environment, to seek quality and yield accretive assets,” said chief executive Lynette Leong. “A continued key focus is also the proactive and prudent management of our capital requirements.”

To finance its $1.17-billion purchase of a 23-storey office block called 1 George Street, CapitaCommercial will use debt such as convertible bonds.

“The trust’s gearing is at a prudent level of35.7 per cent and the interest cost for 2008 is about 95-per-cent fixed,” Ms Leong said. Bloomberg

Source : Today - 24 Jul 2008

Luxury retail rentals enter unfamiliar territory with new benchmark

A new benchmark for retail rents on Orchard Road has been set at Ion Orchard with tenants paying a base rent of up to $80 psf per month. This is 60-80 per cent higher than the current average prime, first-storey Orchard Road rents.

Orchard Turn Developments CEO Soon Su Lin also revealed that Ion Orchard, a joint project of CapitaLand and Sun Hung Kai Properties, is now 50 per cent leased, with more than 30 per cent of the retailers setting up flagship stores.

‘We have to-date, 45 confirmed new-to-market brands and newly created concepts by established operators,’ she added.

Ms Soon was speaking at a press conference to announce its newest tenants as well as to reveal Ion Art - an art and design programme which will introduce new and multi-media art into the ‘integrated mall experience’.

With less than a year to go before Ion Orchard opens, Ms Soon said that the construction is still on schedule. Ms Soon did not reveal a fixed date for completion, but said that the mall will open in time for retailers to showcase their Spring/Summer ‘09 collections.

While luxury retailers at Ion Orchard like Louis Vuitton and Prada are going to have to sell a lot of handbags and shoes to cover the luxury rents, sources say that $80 psf appears to be the new asking rent for prime space at other new malls including Orchard Central.

DTZ Debenham Tie Leung senior director (research) Chua Chor Hoon believes that while it appears that a new benchmark has been set, ‘the $80 psf rental rate is likely to apply only for very prime shop units on the ground floor with good frontage’.

According to DTZ, the current average for prime, first-storey retail space in Orchard Road/Scotts Road area is $42.40 psf per month and $23.80 psf per month for prime upper storey retail space.

But Ms Chua did add: ‘For a new mall like Ion, sitting on top of the MRT station and sitting at a busy junction, the average rent would be higher.’

Rents at Ion Orchard do start at $20 psf per month and this is likely to be for units at the basement levels, which will include F&B outlets and bridge brands.

Still, Knight Frank director (research and consultancy) Nicholas Mak says that even at $20 psf per month, some tenants, especially those in F&B, could find the going tough.

As such, Mr Mak notes that while the Ion Orchard is 50 per cent leased, ‘Some could ask if the glass is half full or half empty’.

According to Knight Frank, current prime, first-storey rents are about $49 psf per month on Orchard Road and Mr Mak adds that only big luxury fashion and jewellery stores can afford rents at this level.

Mr Mak does, however, point out that not all retailers need to be location specific. ‘Mid- and mass-market brands can go to any of the new malls coming up along Orchard Road. There will also be landlords competing for certain types of tenants.’

Ms Chua adds that retailers will need to weigh the pros and cons of where they choose to locate their shops. ‘The positioning of the mall, variety and type of tenants, advertisements, events, promotions, layout and design concept of the mall will help to pull in crowds,’ she says, adding: ‘Tenants that require high shopper traffic will mainly be the ones who will not mind paying the higher rentals or a percentage of their turnover, if the traffic volume would translate into higher revenue for them.’

Source : Business Times - 23 Jul 2008

THE former Ministry of Home Affairs complex at Phoenix Park, off Tanglin Road, has been awarded to LHN Group for $368,888 a month - a huge 124 per cent more than the guide rent of $165,000 a month.

The site, with a gross floor area of 143,195.4 sq ft, is managed by the Singapore Land Authority (SLA). The tender attracted 11 bids - 10 of them at or above the guide rent.

Bidders included United Engineers Developments (UE) which put in the second-highest offer of $315,033 per month.

Teo Cher Hian, director of land lease (private) with SLA’s land operations group, said LHN offered the ‘best value for the state’ based on allowable uses, business concept, track record and corporate financial health.

LHN plans to configure the site into separate tenant clusters, he said. The adjacent former Education Ministry headquarters now houses the Youth Olympic Games headquarters. And with more office set-ups pending, Phoenix Park ‘completes the area as an office hub’, said Mr Teo.

LHN is the master tenant for other state properties, including the former Gan Eng Seng School and CID Training Centre.

LHN managing director Kelvin Lim said the investment cost at Phoenix Park is expected to be about $4 million. He estimates that rents could be around $6 psf per month when it opens at the year-end.

Rising office rents are forcing more businesses to consider alternative office space like Phoenix Park. UE, for instance, had intended to use most of the space to house its own engineering operations, and to lease the rest to other tenants. ‘The existing structures and layout would also allow rather quick occupation with minimal works,’ a UE spokesman said.

Marine engineering firm Allbest Equipments, which was awarded the former Monk’s Hill Secondary School site by SLA, also expects to relocate its corporate offices there.

Allbest put in the highest bid of $211,328 per month for the site, which has a GFA of 83,889.5 sq ft.

Seven bids were received, with Allbest’s 43 per cent higher than the guide rent of $147,300.

Allbest general manager Chan Cheong Hoy said it will lease the remaining space at $7.50-$10 psf a month and expects to complete the first phase of renovations within four months.

Cushman and Wakefield managing director Donald Han said that as well as getting such properties ready to let as quickly as possible, developers have to keep construction costs under tight control to ensure their projects are feasible.

Mr Han says that in the Newton area transitional office space is going for $7.50-$8 psf a month, while the former Gan Eng Seng School could achieve $4.50-$5 psf a month.

Source : Business Times - 18 Jul 2008

THE former Ministry of Home Affairs complex at Phoenix Park is set to be transformed into an ‘iconic integrated office complex’ with restaurants and other facilities.

The plans were unveiled by LHN Facilities Management, which was awarded the right to lease the Tanglin Road site by the Singapore Land Authority (SLA) yesterday.

LHN’s managing director, Mr Kelvin Lim, added that perks like a shuttle service to the nearby Redhill MRT station would help to attract government agencies and private companies which need space outside the Central Business District. The property comprises 24 low-rise blocks.

LHN, which specialises in converting old properties for new uses, offered $368,888 a month - more than double the $165,000 guide rent. A total of 11 bids were received for the site.

Another state-owned site awarded for lease by the SLA, the former Monk’s Hill Secondary School at Winstedt Road, is also set for a makeover.

The top bid came in from marine engineering firm Allbest Equipments at $211,328 a month - 40 per cent more than the guide rent of $147,300.

Allbest is retaining only 5 to 10 per cent of the built-up space for its own office needs and will rent out the rest.

The company will spend about $4 million doing up the building and expects to lease space to medium-sized businesses at $8 to $10 per sq ft, said Mr Chan Cheong Hoy, general manager of Allbest.

The strong interest in the two state-owned sites shows that despite the torpor in the property market, demand for office space in the prime area appears to be going strong.

The two buildings pulled in offers that were well above their guide rents, SLA said.

Both companies plan to sub-lease most of the space in these buildings, believing that office demand will remain healthy.

These two properties are the first that SLA has leased out this year. The agency will put up another two sites, also for office use, in the coming months.

One is a former police post at 11 Kelantan Road, which has a gross floor area of 1,905 sq ft. The other is the former Pacific Can Building at Cecil Street, a vacant two-storey property with a total floor area of 19,482 sq ft.
 
Source : Straits Times - 18 Jul 2008

THIS is what the Ministry of Home Affairs’ former Phoenix Park headquarters (picture) may look like when it temporarily switches to private-sector office use.

The sprawling Tanglin Road complex, which also once housed the Internal Security Department, has been awarded to :LHN Group to run as a master tenant.

LHN tendered at a rent of $368,888 per month, or $2.58 per square foot, beating10 other bidders. That was more than twice the indicative rent.

At about 641,860 square feet, it is the largest site offered by the Singapore Land Authority (SLA) thus far for short-term office use to help ease Singapore’s current supply crunch.

Vacant since 2006, the 31 low-rise buildings there can yield a gross floor area of 143,160 square feet.

“We understand that LHN Group plans to configure the site into separate tenant clusters,” said SLA’s director of private land lease Mr Teo Cher Hian. “With nearby office buildings such as the adjacent former Ministry of Education headquarters at 1 Kay Siang Road which now houses the Youth Olympic Games headquarters, and more impending office set-ups, this site completes the area as an office hub.”

SLA has also awarded the former Monk’s Hill Secondary School site at Winstedt Road to Allbest Equipments at a rent of $211,328 per month, or $2.52 psf. Allbest will retain some 5 to 10 per cent of the built-up space for its own corporate office and sub-let the remaining area.

Meanwhile, the authority is offering two more properties for temporary offices: A former police post site at Kelantan Road and the former Pacific Can Building in Cecil Street.

Source : Today - 18 Jul 2008