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WHEELOCK Properties yesterday said that it has awarded a $168 million main contract for the construction of its retail-cum-residential development Scotts Square to Shimizu Corporation of Japan.

Construction work is expected to begin in the third quarter of this year, and to be completed by 2010.

Shimizu, which is listed on the Tokyo Stock Exchange, was chosen because of its track record in constructing high-end condominiums including Ardmore Park and Grange Residences, said Wheelock in a statement.

Shimizu was also behind the construction of Orchard Road mainstay Ngee Ann City and is now involved in the building of Changi Airport’s Terminal 3.

Wheelock said: ‘The company has established a strong reputation in its field and is renowned for its high quality work.’

Located on Scotts Road between the Grand Hyatt and Marriott hotels, Scotts Square will be a ’super luxury’ residential and retail development.

It will comprise two residential towers - one with 43 storeys and the other with 34 - and an 80,000 sq ft retail podium.

The freehold development will offer 338 luxury one, two and three-bedroom apartments.

Wheelock acquired the site, comprising the freehold Scotts Shopping Centre and the 23-storey The Ascott Singapore Serviced Residences above it, for $345 million in June 2004.

David Lawrence, chief executive of Wheelock Properties, said that Scotts Square will be built with the highest construction standards.

‘Once completed, it will be one of the most ’sexy’ buildings in town with every apartment offering an astounding view of Scotts Road, Orchard Road and beyond,’ he said.

In the stock market yesterday, Wheelock shares closed three cents up at $2.76.

Source : Business Times - 3 Feb 2007

Price set to drop to $20-$30 per tonne soon from current $40 high

The government will release sand from its stockpile from today to make up for any immediate shortfall in the supply of building sand, it said yesterday.

The price of sand, which has climbed from about $20 a tonne last year to more than $40 a tonne yesterday, will be fixed by the government for the next few months, the Singapore Contractors Association Ltd (SCAL) said.

With the price fixing, the cost of sand is expected to drop to $20-$30 a tonne soon, before inching up gradually after a few weeks.

The announcements follow reports of work disruptions at construction sites here as the price of ready-mixed concrete climbs and supply continues to tighten after Indonesia said last week it was banning the export of land sand.

Singapore used to get almost all of its land sand, which is used to make concrete, from Indonesia. Since the ban, the price of ready-mixed concrete has jumped by about 50 per cent to about $120 per cubic metre, from about $80 per cubic metre before.

The government’s stockpile is set to give the industry price and supply stability for the next few months while allowing it to make adjustments, the Building and Construction Authority (BCA) said yesterday.

For the longer term, the industry regulator is looking for new sources of sand. In the meantime, industry players are working together to come up with a cost sharing formula to help contractors and concrete suppliers hit by increased sand prices.

Both BCA and SCAL urged developers to bear a significant part of the increased construction cost since the price rise is caused by factors beyond the control of contractors. Typically, developers lock in construction costs in the contract, which means that the burden of increased raw material costs falls almost fully on contractors.

The BCA said: ‘As contractors and concrete suppliers with ongoing projects may not be contractually protected against this sudden increase in price, developers are urged to work out a cost-sharing arrangement with the contractors and concrete suppliers. Government agencies will take the lead to bear part of the increase in the cost of sand for its existing projects.’

SCAL is in favour of employers and developers bearing the greater part of the construction cost increase as construction companies are less equipped to handle price increases than developers, who are able to pass on rising costs to home-buyers.

Construction companies welcomed the release of the government’s sand stock, hoping that it will bring down the price of ready-mixed concrete quickly. ‘If they (the government) release the stockpile, then it will definitely help with the shortage,’ said chief executive officer of construction company KSH Holdings, Choo Chee Onn,

Even with the release of the government’s stock and new sand sources, sand prices will not fall to pre-ban levels. The BCA said the price of sand is expected to rise due to higher costs involved in shipping sand from distant sources. Industry players also said that the sand price fixed by the government could climb after a few weeks.

Contractors have said that sand suppliers from new sources such as the Philippines have contacted them and offered sand, but at higher prices. BT understands that industry body SCAL has asked companies to alert the organisation about any profiteering.

Construction stocks continued to take a beating yesterday, with the Singapore Exchange’s Construction Equities Index shedding 16.9 points, or 3.1 per cent, to close at 531.3 points. The index has dropped some 7.6 per cent since news of the sand ban on Jan 24.

Source : Business Times - 1 Feb 2007

The Singapore government said on Wednesday that it will release sand from its stockpiles to ensure that the construction industry has a steady supply, after Indonesia banned all sand exports to Singapore last week.

Singapore’s property market is booming, giving a boost to the construction sector which has slumped for several years. However, Indonesia’s ban on sand exports is expected to lead to higher costs as Singapore will need to find new suppliers.

‘The Building and Construction Authority expects the price of sand to rise due to higher transportation cost involved in shipping sand from distant sources,’ the Ministry of National Development said in a statement, adding that the release of sand from government stockpiles would help to stabilise sand prices.

Singapore said last week that Indonesia had decided to ban all sand exports due to environmental concerns and the need to protect its borders. The ban in sand exports has hit Singapore-listed construction stocks on fears of a slowdown in the construction sector, which is recovering after years in the doldrums. — REUTERS

Source : Business Times - 31 Jan 2007

CapitaLand, South-east Asia’s biggest property firm, said on Monday that its business had not been hit by higher sand costs after Indonesia last week banned sand exports to Singapore.

Singapore is among the biggest importers of Indonesian sand, once used for land reclamation and now in strong demand as Singapore’s construction industry recovers after years in the doldrums.

‘Over the past couple of years we had anticipated that construction cost would rise. In addition, we had also earlier sealed the construction contracts for all our ongoing projects,’ Patricia Chia, chief executive of CapitaLand Residential Singapore, said in a presentation to journalists.

Neighbouring Indonesia has banned all sand exports, citing environmental concerns and the need to protect its borders.

The Singapore Government said it does not expect the ban to have a significant impact on the construction sector thanks to other suppliers.

CapitaLand plans to launch 1,000 to 1,200 residential units this year, after selling 954 units worth $1.23 billion (US$800 million) last year, Ms Chia said. The firm sold 882 units worth $1.09 billion in 2005. — REUTERS

Source : Business Times - 29 Jan 2007

Some hope to find new sources, others are prepared to shut down business

BARGES carrying thousands of tonnes of sand are unloaded every day at landing terminals in Pasir Ris and Tuas.

But in just over a week, this could grind to a halt as Indonesia’s ban on land sand exports kicks in after Feb 5.

After that date, the fate of the sand importers here - there are fewer than 10 of them - remains to be seen, but they are likely to be hit hard.

Some are already preparing for the worst.

The manager of Bee Huat Sand & Granite, Mr Steven Neo, said: ‘If there is no sand, our operations will cease.’

He added that it is still too early to say how badly the company will be hit, but the firm is ‘prepared’ to shut down its sand business and let go some 40 to 50 employees.

It is unclear whether these companies will have a role in selling or trading sand from the stockpile belonging to the Government, which will be released if necessary to meet any temporary shortage.

The Building and Construction Authority (BCA) is now looking into sourcing sand from other countries in the region.

Meanwhile, Mr Neo’s company is not just sitting around. While waiting for the Government to prepare the ground, it is making its own contacts with suppliers.

‘We don’t wait for the Government to give instructions. We approach companies and ask them to speak to the authorities there,’ he said.

The BCA is also meeting sand importers and explaining the situation to them to allay their concerns.

Singapore’s construction industry imports between six and eight million tonnes of sand a year, almost all of it from Indonesia.

In the longer term, the BCA hopes to wean the industry from its reliance on sand to make concrete for construction and get it to use steel in a bigger way instead.

Steel is now more common in high-rise buildings here.

If reliance on sand can be cut back by 60 to 70 per cent, these importers may end up with much less to work with.

Source : Straits Times - 26 Jan 2007