MND slashes development charge rates

However, it leaves untouched DC rates for landed residential and industrial uses throughout Singapore

THE government yesterday announced bigger cuts to development charge (DC) rates, which are payable for enhancing the use of some sites, compared with the previous revision six months earlier. It used lower condo/apartment prices and weaker office rentals as evidence, given the dearth of land transactions.

The average DC rate was chopped 15 per cent for non-landed residential use, 10 per cent for hotel and hospital use and 4 per cent for commercial use. The average rate was also trimmed 4 per cent for business zone commercial use (which covers the warehouse retail scheme).

However, the Ministry of National Development (MND) left completely untouched DC rates islandwide for landed residential and industrial uses, and for this reason, some market watchers described yesterday's adjustment as 'conservative'.

'More corrections are expected in future DC rate revisions in light of the economic climate and sentiments,' said Chua Yang Liang, Jones Lang LaSalle (JLL) head of research (SE Asia).

Colliers International director Tay Huey Ying too reckons that 'we could see adjustments made to those areas which did not see corrections this round'. She was also disappointed that the government had stuck to its DC calculation formula, which creams off 70 per cent of the enhancement in land value, instead of reverting to its pre-July 2007 formula of 50 per cent.

MND reviews DC rates in consultation with the Chief Valuer, taking into account current property market values.

A spokeswoman for the Chief Valuer said: 'As there was very little land sales evidence during the past half-year, we had to look at other indications of property values such as sales of apartments/condos and office rents, and use the residual valuation method to derive the land values - in the case of non-landed residential and commercial use DC rates.'

In trimming hotel use DC rates, the Chief Valuer looked at the price fetched for a hotel site at Kallang/Jellicoe roads at a state tender that closed in October last year, which was about 10 per cent lower than the land value implied by the Sept 1, 2008 DC rate for the location, and proposed an average 10 per cent islandwide drop in the DC rate for hotel use, she added.

DC is payable to the state in exchange for the rights to enhance the use of some sites or to build bigger projects on them. DC rates are revised twice yearly, on March 1 and Sept 1. They are specified according to use groups (such as landed residential, non-landed residential and commercial) across 118 geographical sectors or locations across Singapore.

For yesterday's revision, which takes effect tomorrow, non-landed residential DC rates fell in 115 geographical sectors by between 7.1 per cent and 30 per cent. The Ardmore/Draycott, Leonie Hill and Oxley areas saw 30 per cent reductions, followed by Sentosa, with a 29.4 per cent decrease, according to JLL's analysis.

Noting the big corrections in Districts 9 and 10 and Sentosa, JLL said that these are the areas with luxury residential projects that have also seen the greatest price correction over the past six months.

Hotel DC rates were slashed across all 118 sectors. The falls ranged from 7.1 to 11.1 per cent.

However, commercial DC rates were cut in just 48 sectors by between 4 and 17.6 per cent, with the largest reduction in the area around Somerset MRT Station. Office strongholds in the CBD - including Raffles Place/Golden Shoe, Marina Centre, Marina Bay and Fullerton Road - all saw commercial use DC rates ease 16.7 per cent.

Colliers' Ms Tay wondered why commercial DC rates were not cut islandwide, unlike the case for hotel use. 'That's not very balanced.'

She also said that the government was being conservative in not trimming DC rates for industrial use at all, despite the fact that JTC Corp has revised downwards its land rent and land premium since the start of the year.

DC rates are tracked in property circles as they reflect land values. However, the latest DC revision is not expected to have much market impact as developers are unlikely to have much appetite for buying sites in the near future.

Says JLL's Dr Chua: 'Despite the large revisions to non-landed residential DC rates, there's unlikely to be a sudden rush by developers to reinitiate en bloc deals or change their development plans.

'Our market understanding is that most developers had locked away the earlier DC rates when they made their planning applications to capitalise on the exemption of bay windows and planter boxes from gross floor area calculation prior to rescission of policy on Dec 31, 2008. The savings in DC rates is not sufficient to warrant such a move.'

Colliers' Ms Tay said yesterday's revisions indicate that 'the government has recognised the market has taken a turn for the worse, but it probably took the approach of erring on the side of caution'.

During the last DC rate revision effective Sept 1, 2008, MND left DC rates largely unchanged, except for an average 6.3 per cent cut for non-landed residential use.

At the time, property consultants said that there may not be sufficient evidence yet of declines in property values, and that rates could be cut at the next revision if stronger evidence emerges of falling values.

The last revision also saw MND change boundaries for eight sectors in three precincts - the Race Course Road area, Jurong Lakeside area and Pulau Brani.

Yesterday's revision saw no change to sector boundaries. However, some industry observers reckon that changes could be on the cards in future for locations in the vicinity of new MRT stations opening this year and next.

Source: Business Times, 28 Feb 2009

PM sketches scenario of 8 per cent GDP contraction

PRIME Minister Lee Hsien Loong has said it again - the economy could shrink more than 5 per cent this year. And this time he said the contraction could be as sharp as 8 per cent - much more than the official forecast of -2 to -5 per cent.

'People have asked me, 'Can it be worse than minus 5?' he said in a half-hour interview with business news channel CNBC. 'Yes, it is possible, because it depends on the global situation.'

If Singapore's exports were to fall by a third, its manufacturing output, which accounts for a quarter of gross domestic product (GDP), would also go down by a third 'because we export nearly everything we make', Mr Lee said.

'And that means GDP will go down by one-twelfth, which is about 8 per cent, unless you can make up and grow some other part - construction, for example. So I think we brace ourselves for a tough year ahead.'

This is the second time in a week that PM Lee has raised the possibility of the economy shrinking more than 5 per cent.

At a Singapore Tripartism Forum dialogue last Sunday, he told an audience of 550 employers, unionists and government representatives: 'Our GDP growth is forecast to be between minus 2 and minus 5 per cent. It could be worse if the global economy worsens, even lower than minus 5 per cent is possible.'

The International Monetary Fund last month slashed its forecast for 2009 global growth to 0.5 per cent, from a forecast of 2.2 per cent it made in November last year.

Some private-sector economists here have already started revising their growth forecasts, after the Ministry of Trade and Industry released figures on Thursday showing the economy shrank 4.2 per cent in the fourth quarter of 2008, worse than the 3.7 per cent decline estimated last month.

OCBC Bank, for example, now believes the economy will contract 4.8 per cent this year, compared with its previous forecast of a 2.8 per cent decline.

Mr Lee said that the current growth forecast of minus 2 to minus 5 per cent for 2009 - made after two revisions - is the worst since Singapore's independence. 'I think it is a realistic estimate because, if you look at the trade figures, all the countries in Asia now are having dramatic reductions in their trade,' he said.

Japan is down 45 per cent, Taiwan 40 per cent plus and South Korea more than 30 per cent. Singapore's total trade plunged 36 per cent in January.

Mr Lee also said that Singapore's unemployment rate could hit 5 per cent this year - up from 2.3 per cent in 2008. 'We see the retrenchment figures going up in the first quarter already,' he said. 'I don't know what the latest numbers are. But the last one, which the unions mentioned, was almost 5,000 in the first quarter. So the retrenchment numbers will go up, the unemployment numbers will go up.'

The government is prepared to dig deeper into the national reserves if need be, but spending money is not the answer to Singapore's current economic woes, Mr Lee said.

'(It) depends on the situation. We have to see,' he said. 'We don't want to spend all of our reserves. Neither is this a situation where (if) you spend money you will solve your problem. This is a global problem. We have to go through it.'

He said what the government can do is minimise the harm the downturn could do to Singapore's economy.

'And that's what we have done with this (recent) Budget,' he said. 'We've had a very big Budget.

And if we need to do more, we will do more. We have the resources, we can do it. But it is not a problem where spending the money will cure you.'

Source: Business Times, 28 Feb 2009

Tax cut will enhance value

Move will give developers relief but effect will not be significant: Analysts

THE Government has responded to the weakening property market by slashing the charges developers pay when they enhance the value of a site by such things as building a bigger project on the land.

The move to cut development charges, or DC as the fees are called, will give developers some relief but the effect will not be significant, given the weak market.

Dramatic reductions were made for non-landed homes - mainly private condominiums - with cuts of up to 30 per cent in prime areas and an average of 15 per cent islandwide.

Rates for this segment were also cut in the previous six-monthly review last September, when they were reduced by an average of 6 per cent. The rates for other property segments were largely unchanged then.

In the latest review, on average, cuts of around 10 per cent were made for development charges in the hotel and hospital sector and about 4 per cent for commercial property projects.

The National Development Ministry sets the rates every March and September, taking into account market values, in consultation with the Chief Valuer. The new rates apply from tomorrow.

While the cuts mean developers will save on developing sites, the impact will be muted.

The savings are not enough to warrant any rush by developers to reinitiate collective sales or change their development plans, said Jones Lang LaSalle's local director and head of research, South-east Asia, Dr Chua Yang Liang.

The lower DC for commercial sites would also have little impact in the next six months as developers will be concentrating on office and retail projects already under construction rather than acquiring land, said CBRE Research's executive director, Mr Li Hiaw Ho.

The biggest cuts in the non-landed homes segment are in areas with luxury residential projects that have seen the greatest price correction over the past six months, said Jones Lang LaSalle.

Areas in District 11 and the Marina Bay vicinity have seen prices plunge around 20 per cent, it said.

'While transactions have been few and far between in the light of the present poor market sentiment, it is widely understood that land values have become depressed and will start to moderate during the course of this year,' said Mr Li.

The comparatively lower prices for new residential launches in the past six months were probably the main reason for the cuts in DC for non-landed residential use, he said.

In the commercial use segment, the core central business areas of Raffles Place, Marina Bay and Marina Centre saw DC cuts of 15 per cent to 16.7 per cent, said CBRE.

In the Orchard Road and surrounding areas, the DC has fallen by around 15 per cent to 17.6 per cent. However, islandwide, the average cut is only 4 per cent.

Charges for the hotel and hospital use segment have been cut by 7 per cent to 11 per cent. There were no cuts six months ago. The current cut was expected, due to the likely fall in demand for hotel rooms, given the drop in tourism, said Mr Li.

Two property segments have had no changes to their DC - industrial land and landed homes - but they are unlikely to remain untouched for long.

Knight Frank's director of research and consultancy, Mr Nicholas Mak, said the DC for the landed homes and industrial segments are 'very likely to come down' the next round.

Further DC cuts are also expected in the non-landed homes, commercial and hotel sectors, he said.

Source: Straits Times, 28 Feb 2009

Boon for Boon Lay

Two new MRT stops to ease crowding at western station

THE twice-daily chaos that grips Boon Lay MRT station during the morning and evening peak hours on weekdays will soon quieten down.

The station, a popular pick-up and drop-off point, is where private buses wait bumper-to-bumper in public bus bays, taxi stands and along Boon Lay Way to pick up or drop off a crush of scurrying
commuters, mainly those working in Tuas and Jurong.

Relief has appeared in the form of two new MRT stations west of Boon Lay, which will also cut travelling time to other parts of the island by up to 15 minutes for the area's residents.

Boon Lay, which used to be the western-most station on the East-West Line, will, from 5.30am today, have a track extending further out west to the pair of new MRT stops, Pioneer and Joo Koon, which will now bear some of the commuter load and spread out the crowds.

Their opening means that the buses chartered by factories to ferry their workers to and from Boon Lay can now stop elsewhere, perhaps at Joo Koon station.

The Land Transport Authority (LTA) has paved the way for this by building a sheltered bus bay along Benoi Road, about 200m from Joo Koon station.

The bus bay can take up to seven 40-seater buses and is linked to Joo Koon station by a covered walkway.

Already, private bus operators have indicated that they are willing to pick up or drop off commuters there instead of at Boon Lay.

Mr Chitson Yap of Chitson Transport, for instance, said at least one of his clients has already approached him to discuss the matter.

The factories and companies in the area are also positive about the change, partly because having their workers picked up or dropped off at Joo Koon will cost less.

Ms Melissa Lau, the human resource manager at plastics factory Superpet Plastic in Tuas, said that if transport companies could 'give a better discount', moving the pick-up/drop-off point to Joo Koon would be good.

She added: 'Boon Lay is definitely messy in the mornings. Moving to Joo Koon will solve the problem.'

Pioneer and Joo Koon stations, declared open yesterday by Transport Minister Raymond Lim, are part of the 3.8km long Boon Lay Extension, which cost $436 million and took 31/2 years to build.

The extension is the first of $40 billion worth of new rail projects aimed at coaxing more people to use public transport.

The 35,000 people living or working west of Boon Lay station will be glad for the extension.

Instead of having to first make it to Boon Lay station by public or private bus, car, taxi, bicycle or on
foot for onward journeys elsewhere, they will now be linked to the rest of the rail network by the two new stations.

Mr Lim called the opening of Pioneer and Joo Koon stations a significant milestone, as they are the first new stops since the Government unveiled its ambitious plan last year to revamp the public transport system.

The extension of the East-West Line will 'help to improve the attractiveness of public transport as a choice mode of travel', he said at the extension's opening ceremony at Pioneer station.

Pioneer sits along Jurong West Street 63, while Joo Koon, the East-West Line's new terminal station, is at Joo Koon Circle, near the Tuas industrial area, the Singapore Discovery Centre and the Safti Military Institute.

At the official opening of the extension yesterday, Mr Lim led hundreds of LTA officials and guests in a countdown.

At the count of zero, a train pulled into the station, honking its horn loudly.

The new disabled-friendly stations each have four lifts and four escalators.

Commuters who use them can also expect to do a spot of shopping along the overhead bridges leading to them.

Source: Straits Times - 28 Feb 2009

Hotel occupancy plunges to 60%

January tourist arrivals down by 12.9 per cent, with most markets affected

HOTELS bore the brunt of the impact from a steep slide in tourist arrivals last month, with average occupancy tumbling to the 60 per cent mark - the lowest level since the 2003 Sars outbreak.

Average hotel room rates, which had been on the uptrend for the past two years, also took a beating, and are now at levels not seen since 2007.

The cause of the fallout: A 12.9 per cent drop in tourist arrivals for January compared to the same month last year.

In all, Singapore saw just 771,000 visitors last month, compared to 883,000 in January last year.
Visitor numbers from all but four of Singapore's top 15 markets fell, with Indonesia - the Republic's
best 'customer' - dropping 24 per cent.

The only ones that grew were Vietnam, Hong Kong, the Philippines and Germany.

The Singapore Tourism Board (STB) said the overall decrease was due to the 'impact of the current global economic slowdown on consumer sentiments and discretionary spending'.

January's fall was swift but not unexpected. Though Singapore had been bracing itself for the impact of the global recession on tourism, numbers had been falling since last June, sparked by what STB referred to as 'challenging global economic environment'.

As a result, expectations for a record-breaking year fell meekly by the wayside in July, and last month, the STB predicted that the number of visitors to Singapore this year will drop to 2005 and 2006 levels of between nine million and 9.5 million.

Hoteliers interviewed said that things might get worse.

Grand Mercure Roxy's general manager Kevin Bossino said the real test will come in March and April, when business travel usually picks up.

He said corporate travellers curtail their travelling during festive periods like Chinese New Year, which fell in January this year.

But, once the festivities are over and people go back to work, they are expected to travel to make deals and attend meetings and conferences.

If the numbers stay bad this month and next, he said, they will point to a really bad year ahead.
Established hotels are also looking over their shoulders at new kids on the block, who are expected to make competition for the shrinking market even more cut-throat.

Rendezvous Hotel general manager Kellvin Ong is taking no chances. He has lowered rates from $200 to $190.

Such moves may mean that a price war might break out among hotels, said Shatec Institutes chief executive officer Steven Chua.

However, he advises against manic price-cutting as this could compromise service levels.
Instead, his advice for hoteliers is to focus more on adding value for the same price.

The knock-on effects of tourism's downward spiral are being felt elsewhere too, such as at attractions, restaurants and nightspots.

Mr James Heng, chief executive officer of Singapore Duck & Hippo Leisure Group, said business has dropped by 30 per cent since financial markets began going south last September.

He said: 'For the first time since our inception, we are not expecting to turn in good numbers.'

Source: Straits Times, 28 Feb 2009

8 per cent growth decline possible

THE Prime Minister does not rule out the possibility of Singapore's economy shrinking by as much as 8 per cent this year.

That would be a sharper contraction than the current official forecast of a decline of between 2 per cent and 5 per cent.

Countries across Asia have experienced sharp reductions in trade, with Singapore's trade having fallen by a third last month. Manufacturing accounts for a quarter of Singapore's economic output and almost all that is made here is exported.

If exports fall by a third, manufacturing output will also fall by a third.

That means Singapore's economy will shrink by a twelfth, or 8 per cent, unless that loss is made up by growth in another sector, such as construction, Mr Lee said in response to a question on how much worse the economic outlook could get.

'People have asked me, can it be worse than minus 5? Yes, it is possible because it depends on the global situation,' he said in an interview with CNBC.

He was also asked if the unemployment rate could rise from the current 2.7 per cent to 5 per cent, as projected by some private-sector economists.

That, too, was possible, he said, as retrenchments are on the rise.

The labour movement estimates that there will be 5,000 layoffs in the first three months of this year.
He said the Government is helping workers in two key ways.

It has put in place a Jobs Credit scheme to reduce wage costs, help companies stay viable and keep workers in jobs.

It has also launched a very big push to encourage companies and workers to use this time for training and skills upgrading.

'We have the courses, we have the grants, we have the incentives...we believe that this is a slack time, it's a good opportunity to upgrade their skills and prepare for new jobs or in case they lose their jobs, to be able to get back into employment again,' he said.

Source: Straits Times, 28 Feb 2009

HDB launches BTO project in Woodlands

THE Housing & Development Board (HDB) has launched its first 2009 build-to-order (BTO) project at Woodlands.

Champions Court, at the junction of Champions Way and Woodlands Avenue 1, has 815 units,
comprising 224 studio apartments, 182 three-room, 224 four-room and 185 five-room flats.

About 50 per cent of the units are studio apartments and three-room flats, in line with the government's commitment to provide a greater supply of smaller dwellings this year, HDB said.

The studio apartments will have elderly-friendly features such as grab bars and non-slip flooring.

Three-room flats cost from $118,000 to $142,000, four-room flats from $194,000 to $227,000 and five-room flats from $247,000 to $296,000.

The units are being offered at less than equivalent market prices so they are affordable for first-time buyers, HDB said.

Eugene Lim, associate director for ERA Asia-Pacific, said: 'HDB seems to have deliberately priced the flats well below resale flats in the area.'

Likewise, PropNex chief executive Mohamed Ismail said that based on HDB's Q4 2008 figures, flats at Champions Court are priced 27 to 40 per cent lower than resale flats in the area.

The project is expected to be well received and could be about five times over-subscribed, Mr Ismail said.

Both analysts also reckon the location will be a draw.

'Woodlands is a mature estate,' said Mr Ismail. 'Besides being within walking distance of Woodlands Regional Centre and the MRT station, Champions Court is within 1km of a good number of schools. So I expect it to be quite popular.'

Source: Business Times, 27 Feb 2009

Accor launches Ibis hotel, eyes another in 2011

HOSPITALITY group Accor officially launched its economy hotel Ibis Singapore on Bencoolen Street yesterday, and it already has a second one slated for completion in 2011.

The second one, Ibis Novena, is being developed - and will be owned - by Cockpit International.

Work will commence on the 241-room hotel next month. There are currently over 800 hotels under the Ibis brand worldwide. In the Asia-Pacific region, Accor has 62 Ibis hotels in operation, with a further 100 under development.

'The announcement of the Ibis Singapore, Novena reflects our targeting of the economy and mid-markets for development around the region. Ibis is growing very strongly in China, India, Thailand and Indonesia,' said Michael Issenberg, chairman of Accor Asia Pacific.

He also raised the possibility of having up to six Ibis hotels in Singapore. He expects to see a 'positive return' for Ibis Singapore 'by this year'. Rates for the 538-room hotel are in the region of $145-150.

And despite the downturn, the launch of the Ibis hotel comes at an opportune time, highlighted Senior Minister of State for Trade and Industry S Iswaran. 'Travellers are likely to switch from long-haul travel to shorter-haul holidays as they seek to maximise value from their travel budget,' he said at the hotel's launch yesterday morning.

In addition, the hotel will benefit as, now more than ever, both leisure and corporate travellers are looking for better value for money, said Accor's vice-president (Singapore, Indonesia, Malaysia) Gerard Guillouet, adding that he is confident Ibis Singapore will outperform the market this year.

'People are trading down. A lot of corporations are becoming cost conscious,' he emphasised.

The $145 million Ibis Singapore is expected to fill a gap in the market, as an 'internationally branded economy hotel'. Since its soft launch some two weeks ago, the hotel has been virtually full, Mr Guillouet said. However, only 300 of the 538 rooms are up and running presently.

Mr Guillouet also broached the possibility of Accor introducing its other brands here, such as Sofitel and Pullman. Its Novotel and Mercure brands are already in Singapore.

Source: Business Times, 27 Feb 2009

Accor launches Ibis hotel, eyes another in 2011

HOSPITALITY group Accor officially launched its economy hotel Ibis Singapore on Bencoolen Street yesterday, and it already has a second one slated for completion in 2011.

The second one, Ibis Novena, is being developed - and will be owned - by Cockpit International.

Work will commence on the 241-room hotel next month. There are currently over 800 hotels under the Ibis brand worldwide. In the Asia-Pacific region, Accor has 62 Ibis hotels in operation, with a further 100 under development.

'The announcement of the Ibis Singapore, Novena reflects our targeting of the economy and mid-markets for development around the region. Ibis is growing very strongly in China, India, Thailand and Indonesia,' said Michael Issenberg, chairman of Accor Asia Pacific.

He also raised the possibility of having up to six Ibis hotels in Singapore. He expects to see a 'positive return' for Ibis Singapore 'by this year'. Rates for the 538-room hotel are in the region of $145-150.

And despite the downturn, the launch of the Ibis hotel comes at an opportune time, highlighted Senior Minister of State for Trade and Industry S Iswaran. 'Travellers are likely to switch from long-haul travel to shorter-haul holidays as they seek to maximise value from their travel budget,' he said at the hotel's launch yesterday morning.

In addition, the hotel will benefit as, now more than ever, both leisure and corporate travellers are looking for better value for money, said Accor's vice-president (Singapore, Indonesia, Malaysia) Gerard Guillouet, adding that he is confident Ibis Singapore will outperform the market this year.

'People are trading down. A lot of corporations are becoming cost conscious,' he emphasised.

The $145 million Ibis Singapore is expected to fill a gap in the market, as an 'internationally branded economy hotel'. Since its soft launch some two weeks ago, the hotel has been virtually full, Mr Guillouet said. However, only 300 of the 538 rooms are up and running presently.

Mr Guillouet also broached the possibility of Accor introducing its other brands here, such as Sofitel and Pullman. Its Novotel and Mercure brands are already in Singapore.

Source: Business Times, 27 Feb 2009

Retailers seek rental rebates for 'survival'

Squeeze could lead to big job cuts, says SRA; CapitaLand to 'customise' solutions

(SINGAPORE) Up to 20,000 retail employees - 20 per cent of the sector's workforce - could be retrenched unless store rents are slashed, the Singapore Retailers Association (SRA) said yesterday after an emergency meeting.

Members' income has dived 20-30 per cent in the past few months, said SRA, which represents close to 300 retailers.

The main issue - and of critical concern - is high rents demanded by landlords 'who apparently lack an understanding of the plight retailers are facing', SRA said. But CapitaLand, which is Singapore's biggest retail landlord, listed out the steps it had taken to help retailers and said it would work with its tenants individually to customise solutions for them.

SRA, meanwhile, said that occupancy costs have climbed 50-80 per cent over the past three years. But with sales margins shrinking, landlords have been slow to acknowledge or respond.
'Initiatives offered to date are inadequate as they do not address the main concern of the retailers - that of cost containment in these difficult times,' SRA said.

Rent cuts of at least 20-30 per cent are an 'absolute necessity', it said in a statement. 'The industry is asking only for this, as the bare minimum, to ensure survival.

'Landlords and tenants exist symbiotically. It has to be understood that a strong partnership is necessary to ensure the survival of all parties in this current period, so there is a future to look forward to.'

Members' margins are now 'almost negligible, if not negative', the SRA statement said. 'With such a contraction, the industry is seriously concerned about the possibility of store closures. Unless occupancy costs are reduced, we are fearful that up to 20 per cent of our employees may be retrenched as a result of store closures.

'This could mean 20,000 people out of work - a major concern for retailers, and Singapore, and something the industry would not want to happen.'

SRA said other industries that feed off the retail sector - such as the media, food and beverage, and advertising - could also face job losses as a result of retailers' woes.

SRA said its members have agreed to share information more frequently and more openly - as a 'result of landlords' continuing reluctance to accede to the retail industry's pleas for rental rebates, with some even proposing rent increases'.

Misinformation has resulted in some retailers committing to lease agreements they otherwise would have thought about twice, or even three times, SRA said.

The shared information is expected to make retailers more aware of what their peers are doing.

A spokesman for CapitaLand pointed out, meanwhile, that after this year's Budget, the group had committed to pass on the 40 per cent property tax rebate to CapitaLand Retail and CapitaMall Trust tenants in full. A part of staff bonus was paid in the form of shopping vouchers to support tenants across 12 CapitaLand malls.

The spokesman also said that the most scientific way to look at sustainable rent was to look at each retailer's occupancy cost (rent/gross revenue).

'As a landlord, we are mindful that it is important that our tenants do a viable business so as to create a win-win situation. Thus all renewals are reviewed on an individual basis, based on their sustainable occupancy cost,' the spokesman said. 'We continue to stay close to our retailers, work with them individually to better understand the specific issues that they are facing, so that we can customise a solution jointly with them.'

Source: Business Times, 27 Feb 2009

That shrinking feeling gets more acute

Q4 contraction of 4.2% is worse than expected; services sector badly hit

(SINGAPORE) Singapore's economy shrank 4.2 per cent in the fourth quarter, worse than the 3.7 per cent decline estimated last month, as financial services performed even more poorly than expected.

The Ministry of Trade and Industry in its annual economic survey released yesterday said that the financial sector contracted 8.1 per cent, substantially worse than the 1.8 per cent drop forecast in January, on the back of significant declines in trading activities in foreign exchange and stock brokerage, fund management and Asian Currency Units.

On the whole, services producing industries were down 1.3 per cent in the quarter, substantially below the MTI's previous estimate of a 0.1 per cent fall. Services make up roughly 60 per cent of Singapore's $257 billion economy.
Manufacturing - a quarter of the economy - contracted by 10.7 per cent in the three months to December, in line with earlier government estimates.

'The manufacturing weakness story is well known, but the main thing is the speed and severity with which the services sector rolled over,' said OCBC economist Selena Ling. 'When two of your engines fall off, you can't see the economy flying at all.'

The only pleasant surprise came from the construction sector, which increased by 18.5 per cent in the quarter, up from the 14.1 per cent previously estimated.

On a seasonally adjusted annualised quarter-on- quarter basis, Q4 gross domestic product (GDP) declined by 16.4 per cent, the sharpest drop on record. Full year GDP growth came in at 1.1 per cent, marginally below the 1.2 per cent estimated by the MTI in January and sharply lower than the 7.8 per cent growth recorded in 2007.

Manufacturing was down 4.1 per cent for the year, but construction gained 20.3 per cent and services 4.7 per cent, driven by strong growth in the first three quarters of the year.

'Broadly speaking, 2008 was a year to forget,' said Standard Chartered economist Alvin Liew. 'The data revision was minimal. It was already bad but it got a little bit worse,' he said.

DBS Bank, in a note, said 'the minor revision to last year's GDP growth figures has not changed our view on the economy and hence we maintain our 2009 GDP growth forecast at -4.8 per cent.' It had cut its estimates from -3.8 per cent only on Wednesday.

But the latest estimates prompted OCBC to cut its 2009 full year forecast, from -2.8 per cent to -4.8 per cent. 'Frankly, we don't see any light at the end of the tunnel for financial services. It will be the main drag on services,' said Ms Ling. 'And we think consumption will fall off the cliff once we get the retrenchment numbers.'

Stanchart's Mr Liew noted that much of the fall-off in total demand was due to a 9.6 per cent drop in external demand in the fourth quarter. Private consumption expenditure and private sector investment fell by 1.2 per cent and 13 per cent respectively.

'The recovery process - if we see any at all - needs to come from the external sector. If that doesn't recover, we are looking at a very protracted downturn,' he said. Non-oil domestic exports fell 17.8 per cent in the fourth quarter, while total exports were down 12 per cent.

The decrease was sharp over almost all of Singapore's main export markets, with only Indonesia recording a minor increase.

For the whole of 2008, inflation as measured by the consumer price index (CPI) rose 6.5 per cent, compared to 2.1 per cent in 2007, on the back of price increases in housing, food and transport and communications.

The seaonally adjusted overall unemployment rate rose to 2.6 per cent in December 2008 from 2.2 per cent in September 2008 and the decade low of 1.7 per cent a year ago, MTI said.

But labour productivity fell for the second year running, to -7.8 per cent in 2008 from -0.8 per cent in 2007.

OCBC's Ms Ling said unemployment could rise a quarter of a percentage point for every percentage point fall in headline GDP. 'We expect 4 per cent unemployment (from 2.3 per cent in 2008) by the end of the year,' she said.

On Wednesday, DBS said 99,000 jobs could be lost while unemployment may peak at 5 per cent in mid-2010.

Source: Business Times, 27 Feb 2009

‘It’s not the time to buy’

End ‘09, early nextyear could be better, says CDL chief

CITY Development Limited (CDL) believes it is too early for it to start snapping up property in the downturn.

“The buyer-seller price gap is too wide still, so it’s not time to buy. The end of the year, early next year could be better,” said City Developments Limited’s (CDL) executive chairman Kwek Leng Beng at the group’s annual results briefing yesterday. Asset prices, he said, have not fallen to levels that are attractive enough.

CDL yesterday announced an after-tax profit of $580.9 million, almost a 20-per-cent dip from a year earlier. Even so, that was the group’s second-highest earnings since inception.

It attributed the fall partly to a 5.2-per-cent decline in revenue and lower contribution from its hotel operations under London-listed Millennium and Copthorne Hotels (M&C). This was mostly due tocurrency conversion, given the Singapore dollar’s recent strength against the British pound.

“Not unexpectedly, 2008 was a challenging year for the Singapore property market with downward pressure on both transaction volumes and sale prices after blistering performance in the previous two years, weighed down by global financial woes,” the company said.

“The group is aware of the many challenges that lie ahead.”

CDL said its balance sheet remained healthy, and it was not planning any rights issue to raise capital. It expects to stay profitable this year.

In the coming year, CDL said it would “exercise prudence” on expenses. It would “keep staff as much as (it) can” in Singapore.

CDL’s net borrowings stood at $3.4 billion, or 32 per cent of assets if fair value gains are taken into account, said chief financial officer Goh Ann Nee.

In the first half of this year, it will launch 60 units at the 724-unit Livia, 100 units at the 336-unit The Arte at Thomson, and 100 units of the 228-unit The Quayside Isle @ Sentosa Cove.

The group has 142 unsold units from projects previously launched projects, with less than 10 per cent of those high-end.

CDL is holding back its South Beach project. It added that based on a recent valuation for the year ended Dec 31, there was no impairment required for the development.

Mr Kwek refuted rumours about consortium partners pulling out of the project.

The company is planning to issue the second tranche of Islamic Sukuk in the first quarter of this year. It is likely to be three or four times larger than the first one. In January, CDL issued $100 million worth of notes under its $1-billion Islamic note programme.

Source: Today, 27 Feb 2009

GDP growth slowed to 1.1% last year

Manufacturing, services hard hit; construction sector only bright spot

THE verdict is finally in.

Singapore's economy grew a dismal 1.1 per cent last year, as the worldwide recession dealt severe blows to its key manufacturing and services sectors.

Both shrank in the fourth quarter - services for the first time since 2001 - and pushed the economy into the red with a worse-than-expected 4.2 per cent contraction in the quarter.

The final figures, released by the Ministry of Trade and Industry (MTI) yesterday, capped a tumultuous 12 months that saw the official growth estimate for 2008 being revised seven times.

Just last month, MTI had estimated that the economy grew 1.2 per cent last year. At its most optimistic, in November 2007, MTI expected economic expansion of between 4.5 per cent and 6.5 per cent last year.

This brand of economic uncertainty looks set to continue well into this year. MTI's official forecast is for the economy to shrink between 2 per cent and 5 per cent, although Prime Minister Lee Hsien Loong recently hinted worse might be in store.

While economists largely stood at the brighter end of the spectrum last month, many of them have since downgraded their forecast for the year's growth to be nearer to the worst-case scenario.

DBS Bank and OCBC Bank now think the economy will shrink 4.8 per cent while Credit Suisse puts it at 5 per cent.

'It is hard to envisage a recovery scenario earlier than late 2009,' said OCBC economist Selena Ling.

There is 'no light at the end of the tunnel' as yet, with regard to the financial sector returning to normal and economic growth in the United States, Eurozone, Japan and China stabilising.

DBS economist Irvin Seah highlighted three key risks this year: The US government's restructuring of its ailing banking sector, the slowdown of the Chinese economy and the uncertainties around eastern European economies, which will affect Eurozone growth. 'All signs seem to be pointing in the direction' of the economy shrinking near to the Government's worst-case scenario, he said.

The jobless rate for last year was 2.3 per cent, up from 2.1 per cent previously. 227,200 jobs were created last year, fewer than the 234,900 seen in 2007.

Manufacturing and services are likely to stay in the red for at least the first half of the year, economists predict.

The manufacturing sector, which makes up about a quarter of Singapore's total output, shrank 10.7 per cent in the fourth quarter and 4.1 per cent over the full year last year.

But it was the services industries that led the decline. This sector, which makes up three-fifth of the economy, shrank by 1.3 per cent in the fourth quarter, much more than the 0.1 per cent contraction MTI had estimated.

For the whole of last year, services grew only 4.7 per cent, less than the 5 per cent growth previously estimated and the strong 8.1 per cent growth in 2007.

Construction, the third pillar of the economy but by far the smallest, was the only sector that did better than predicted. It grew a strong 20.3 per cent last year, up from the 17.9 per cent that was estimated last month and even outperforming 2007's growth of 18.2 per cent.

Source: Straits Times, 27 Feb 2009

Build-to-order flats in Woodlands for sale

THE Housing Board yesterday launched its first build-to-order flat sale this year, with 815 flats in Woodlands up for grabs.

Called Champions Court, the batch of flats will include 224 studio apartments, which are being offered for the first time in Woodlands. There are also 182 three-room flats, 224 four-room flats and 185 five-room flats.

By its final update for the day, at 5pm yesterday, HDB had received 205 applications, mostly for the four- to five-room flats. There were 24 applications for studio apartments and 21 applications for three-room flats.

The monthly household income ceiling for purchasing a new three-room flat is $3,000. Those with gross monthly household incomes of not more than $8,000 can buy new four- to five-room flats, and studio apartments.

Champions Court is at the junction of Champions Way and Woodlands Avenue 1, near the Woodlands Regional Centre.

In its statement, HDB said the new flats are priced below their equivalent market prices to ensure that they are affordable to first-time buyers.

Indicative prices for the three-room flats range from $118,000 to $142,000; for the four-room flats, $194,000 to $227,000; and for the five-room flats, $247,000 to $296,000.

In the resale market, comparable three-room flats go for $200,000 to $209,000 while four-room units sell for $255,000 to $278,000, according to data provided by HDB.

Comparable five-room resale flats cost $304,000 to $345,000, it said. The 60 smaller studio apartments, which are 35 sq m in area, are priced from $57,000 to $64,000 while the 45 sq m studio units cost $71,000 to $80,000.

PropNex chief executive Mohd Ismail expects the project to be about five times over-subscribed.
'There's still strong demand for HDB flats in mature estates, particularly for four-room and five-room flats,' he said.

The absolute prices for the bigger HDB flats in mature towns such as Woodlands are still more affordable than those in estates nearer town, said Mr Ismail.

The recession has already hit the cash amount that buyers have to pay over the valuation price, but the volume of resale deals is so far largely steady, he added.

The median cash-over-valuation for resale flats in Woodlands fell from $18,000 in the third quarter of last year to $15,000 in the fourth quarter.

Applications for Champions Court can be submitted online from now until March 11.

Source: The Straits Times, 27 Feb 2009

More mass market projects to launch

(SINGAPORE) Developers are planning to launch more mass market projects this weekend to take advantage of a recent surge in buying interest.

Hiap Hoe Group, a niche developer, will officially launch its 118-unit The Beverly, located at Toh Tuck Road, this Saturday. The starting selling price is $648 per square foot (psf), which Hiap Hoe says is an 'attractive starting selling price'.

'We have designed The Beverly for those looking for affordable, high-quality residential developments in a good location,' said Teo Ho Beng, the company's managing director.

The Beverly's two, three and four-bedroom apartments range from 1,120 sq ft to 4,187 sq ft, while its double-storey penthouses range from 2,099 sq ft to 3,757 sq ft and are each outfitted with a private roof garden and pool.

On the other side of the island at Pasir Ris, Sustained Land Pte Ltd will also officially launch Coastal Breeze Residences come this weekend. Two and three-bedroom units at the 63-unit development will sell for $610-$660 psf.

Sustained Land has sold 13 units in Coastal Breeze Residences since the start of 2008 in a soft launch. The units, which were mostly prime apartments on higher floors, went at an average price of $690 psf.

The remaining units are mostly three-bedders between 1159 sq ft and 1356 sq ft in size and there are also duplex penthouses. In terms of absolute value, for example, the price for a three-room 1159 sq ft unit starts at $712,000.

Meanwhile, the UOL Group is expected to launch its 646-unit Double Bay Residences in Simei sometime next week. Market talk has it that the project could be launched at $650-680 psf.

The three projects are coming hot on the heels of two successful launches earlier this month. Units at Frasers Centrepoint's Caspian condominium near Jurong Lake and Alexis @ Alexandra, a project by joint venture partners Yi Kai Group and Fission Group, sold quickly upon the projects' launches.

One market insider said that developers are taking pricing cues from each other, and making sure their newly launched projects are priced to sell. 'There is a sense that people will only be willing to buy projects in the $600-plus psf range, and also only units that don't cost too much in total. People don't really want to pay more than $600,000 or $700,000-plus in these times,' he said.

Developers are also throwing in more upmarket features into their mass market offerings to entice buyers. Each of The Beverly's 118 apartments is served by private lifts that open into the lobby of its interior. UOL's Double Bay Residences will also offer extras such as full-length windows in the kitchen, the company has said.

Source: Business Times, 26 Feb 2009

Existing home sales fall, median price down 15%

Supervision, not control, will be used to guide banks: Fed

(NEW YORK) Sales of US previously owned homes unexpectedly fell in January as plunging prices no longer attracted buyers ahead of the Obama administration's stimulus plans.

Purchases fell 5.3 per cent to an annual rate of 4.49 million, the fewest since 1997, from 4.74 million in December, the National Association of Realtors said yesterday in Washington. The median price dropped 15 per cent from a year ago, and distressed properties accounted for 45 per cent of all sales.

Americans may have been waiting for details of President Barack Obama's plans aimed at stemming foreclosures and declining home vales that are at the core of the economic slump, the group said.

The housing slump is likely to deepen as concern that record foreclosures will bring prices down even more and a lack of credit keep prospective buyers at bay.

Banks have been tightening the availability of credit after suffering massive losses from sub-prime mortgages which triggered the present global economic crisis.

Federal Reserve chairman Ben Bernanke in his testimony before the House Financial Services Committee in Washington yesterday said the government would use supervision instead of shareholder control to guide major banks, and warned against dismantling their franchises.

The remarks eased concern Treasury Secretary Timothy Geithner's financial plan would push aside private shareholders, and spurred the biggest gain in financial shares in a month.

Mr Geithner on Feb 10 provided just an outline of the Obama administration's plans for buttressing the financial industry. The lack of details led some investors to speculate on their own that a recapitalisation of banks would involve substantial government control. The Fed chairman assured markets that 'the nation's banking regulators were not proposing nationalising banks.'

Repeating testimony presented to the Senate Banking Committee on Tuesday, Mr Bernanke's remarks countered a growing drumbeat among some economists and lawmakers in favour of government takeovers of major financial firms to cleanse them of distressed assets and ensure they keep lending.

Establishing ownership control poses legal issues and could undermine banks' value with private investors, Mr Bernanke warned.

Mr Bernanke added that 'the best sign of success' will be when the 'government can start taking its capital out or the banks can start replacing the public capital with private-sector capital.' - Bloomberg

Source: Business Times, 26 Feb 2009

Do your homework

Some mortgage rates are rising; shop around before making a choice

As global interest rates fall, you would expect more homeowners to be tempted into taking up mortgages pegged to the Singapore Interbank Offered Rate (Sibor) or Swap Offer Rate (SOR).

After all, the three-month Sibor rate is currently around 0.68 per cent — just shy of its all-time low of 0.63 per cent.

However, instead of resulting in lower mortgage rates, interest payments on these pegged loans have surprisingly started to rise.

Rather than passing on savings from cheaper inter-bank lending, most financial institutions are now charging higher premiums above Sibor and SOR to reflect higher default risk, given that the economy has turned.

Banks have turned increasingly cautious over lending.

Last July, someone taking out a mortgage with DBS Bank would have paid a rate of Sibor plus1.25 percentage points for an 80 per cent loan.

Today, DBS’ mortgage rates start at Sibor plus 1.75 percentage points, with no lock-in period.

That means the total interest rate paid would now be 2.43 per cent, up from 2.25 per cent last July.

Similarly, spreads over SOR have widened.

Tellingly, some financial planners Today spoke to suggested that home-buyers should consider fixed-rate loans instead.

“Personally, I would lock in for as far as possible,” said Mr Sani Hamid, Financial Alliance’s director of wealth management.

That is because Sibor rates — while now low — rose to as high as 3.1875 per cent in 2005.

At DBS, Sibor fixed rate mortgages start at 3.25 per cent for a one year lock-in period on an 80 per cent loan.

In contrast, fixed rate mortgages charge interest rates at a stable interest rate that is fixed and guaranteed in the first few years. This means that the monthly instalment amount is fixed for this period.

This brings about stability and certainty about how much you will be expected to pay in the long-run.
Another tip: Shop around for — and even ask — for the best rates possible in the competitive markets, note financial planners. You may just get a rate that is better than those published.

Source: Today - 26 Feb 2009

Singapore's economy grew by 1.1% in 2008

SINGAPORE: Singapore's economy grew by 1.1 per cent for the whole of 2008, compared to 7.8 per cent in 2007.

Releasing the fourth quarter and annual 2008 economic results in the economic survey of Singapore, the Ministry of Trade and Industry (MTI) said real gross domestic product (GDP) contracted by 4.2 per cent on a year-on-year basis in the fourth quarter of 2008, after posting flat growth in the third quarter of 2008.

On a seasonally-adjusted annualised quarter-on-quarter basis, MTI said real GDP declined by 16.4 per cent in the fourth quarter of 2008, following the 2.1 per cent contraction in the previous quarter.

The manufacturing sector declined by 10.7 per cent in the fourth quarter, similar to the preceding quarter.

Most of the clusters, particularly electronics, precision engineering and chemicals, contracted.

Growth in the construction sector slowed to 18.5 per cent, from 26.0 per cent in the third quarter, weighed down by a slowdown in industrial building activity and the deferment of several private sector projects.

The services-producing industries as a whole contracted by 1.3 per cent, down from the 5.5 per cent growth in the previous quarter. All sectors, except information and communications and business services, contracted.

Growth in the financial services sector fell by 8.1 per cent on the back of significant declines in trading activities in foreign exchange and stock brokerage, fund management and Asian Currency Units.

MTI said the sharp decline in world trade towards the end of 2008 also resulted in contractions in the wholesale and retail sector (-5.3 per cent) and the transport and storage sector (-2.4 per cent).

For the whole of 2008, MTI said the manufacturing sector contracted by 4.1 per cent, compared to a growth of 5.9 per cent in 2007.

With the exception of the transport engineering sector and general manufacturing, the majority of manufacturing sectors (electronics, chemicals, biomedical manufacturing and precision engineering) contracted in 2008.

The construction sector grew strongly by 20.3 per cent in 2008, outperforming the growth of 18.2 per cent in the previous year.

Overall growth of the services producing industries slowed to 4.7 per cent in 2008, compared to 8.1 per cent in 2007.

The slowdown was led by significantly slower growth in most of the industries, in particular, the wholesale and retail trade, hotels and restaurants, and financial services.

Source: Channel News Asia, 26 Feb 2009

Job losses could exceed 99,000

Unemployment may hit 20-year high of 5% by middle of 2010: Economist

MORE than 99,000 jobs could be lost by next year as Singapore's worst recession takes its toll on workers, according to a new prediction by DBS Bank.

Its Singapore economist, Mr Irvin Seah, said the worsening downturn would inflict more pain on employees than what they suffered in the Asian financial crisis of 1998, the 2001 dot.com bust and the Sars outbreak in 2003.

He expects unemployment to rise above 4 per cent in the second half of this year and touch a 20-year high of 5 per cent by the middle of next year.

Unemployment rose to 2.6 per cent at the end of last year.

But Mr Seah said yesterday that his figures did not take into account the recent measures implemented by the Government to try to save jobs, such as the Jobs Credit scheme and the Skills Programme for Upgrading and Resilience (Spur).

'We cannot quantify the reactions of individual employers to the government policies,' he added.

Still, he estimates the job-saving measures could prevent only between 10 per cent and 20 per cent of the net 99,104 job losses he predicts, which will affect both Singaporeans and foreigners.

The Budget measures 'are not designed to help comatose companies survive the onslaught of this recession', he said. Struggling firms will need to slash costs or be forced to wind down.

'As a result, high unemployment and more job losses will be inevitable, and the going will get tougher as the worst of the labour market cycle is yet to come.'

Mr Seah said he made his predictions partly to counter the 'overly pessimistic' layoff numbers being put out by some other banks.

A flurry of job loss predictions have surfaced recently as economists try to gauge the impact on jobs of Singapore's worst slump since gaining independence.

Credit Suisse, for instance, made headlines last month by predicting that a massive 300,000 jobs could be lost by the end of next year - a third from Singaporeans and the remainder from foreigners.

After the Budget was announced, the bank said the measures would save 60,000 jobs for Singaporeans but none for foreigners.

Citigroup economist Kit Wei Zheng recently forecast net job losses of 34,000 this year, exceeding the 20,000 to 25,000 lost in the recession years of 1998 and 2001. He said unemployment would likely average 4.2 per cent this year but ease to 3.7 per cent next year.

Barclays Capital's Leong Wai Ho is also predicting more than 30,000 retrenchments, but he said it was important to put the job loss numbers in perspective.

While a figure like 99,000 layoffs may 'conjure images of devastation at first glance, at closer inspection, this rate of decay is normal for adverse cycles of this nature and an economy of this size'.

In the last downturn of 2002 and 2003, the economy shed 79,000 jobs, or 3.9 per cent of the labour force. In equivalent terms today, that would be 106,000 jobs lost, Mr Leong said.

In fact, he expects less pain this time around because of the 'number of cushioners' today, including training schemes such as Spur.

In the meantime, the layoffs are mounting.

On Tuesday night, the National Trades Union Congress said it expects 4,300 unionised workers to be laid off in the first three months of the year, up from a previous estimate of 3,700. The bulk of these retrenchments will come from the electronics sector.

Since the end of last year, Singapore's exports have been in free fall and manufacturing output has dropped off a cliff. Prime Minister Lee Hsien Loong said on Sunday that the economy may do even worse this year than the official worst-case scenario of a 5 per cent contraction.

Mr Seah's own forecast is for the economy to shrink by 4.8 per cent this year.

Each industry reacts differently to the downturn, he said. In manufacturing, which will bear the brunt of the layoffs, an expected 10.2 per cent contraction in the sector will lead to almost 58,000 jobs lost.

Mr Seah also expects more than 69,000 people in logistics and trade services to be laid off, while retrenchments in the financial industry could exceed 16,700. Still hiring are the construction sector - although that will benefit mainly foreign workers - as well as health care, education and business services.

Source: Straits Times, 26 Feb 2009

Residents looking forward to Circle Line

Those living near five stations opening on May 30 now travel mostly by bus & face long wait

THE nearest MRT station for housewife Malika Khatri's Serangoon Avenue 3 home is just three bus stops away.

The trouble is, only one bus service plies the route to Serangoon MRT station.

'I go out during non-peak hours, and the bus can take up to 25 minutes to arrive while you sit baking in the sun,' said Ms Khatri, 29.

When Circle Line Stage 3 begins operations on May 30, she can kiss her long bus wait goodbye.

One of the line's five stations to open - Lorong Chuan - is just a five-minute walk away from her home.

Other stations that will open are Marymount, Bishan, Serangoon and Bartley. Bishan and Serangoon are existing stations but they currently serve only the North-South and North-East lines respectively.

Like Ms Khatri, residents in Lorong Chuan, Marymount and Bartley do not have an MRT station close to their homes. They have to take a bus to either Bishan station or Serangoon station, and largely rely on buses to get around.

But there are not many bus services to choose from. Fewer than 10 serve the areas where the Circle Line's new stations are situated. Waiting times can also be unpredictable, said the area's Member of Parliament Seah Kian Peng (Marine Parade GRC).

'While the physical distance is short, the waiting time can be quite long,' said Mr Seah. Some bus services can take up to 20 to 25 minutes to arrive.

For the residents of Marymount, the new station will be a boon. It will help them bypass the traffic jams of Thomson Road during peak hours, said the area's MP, Mr Hri Kumar Nair (Bishan-Toa Payoh GRC).

Madam Doris Chan, 62, who lives near Marymount station, is considering giving up driving to work when the station opens. 'The jam along Thomson Road is such a nuisance to deal with,' said the businesswoman, who works near Lavender MRT station.

Madam Chan and those who live around the five new stations will not be the only ones to benefit. Bishan and Serangoon residents will also be able to use the Circle Line to switch between it and the North-South and North-East lines when the stations become interchanges.

One expectant commuter is Mr Varatharaja Nadarajan, 50, who needs to make two bus trips from his home in Serangoon to his workplace in Yishun. During the evening peak hour, the journey home can take up to an hour.

When Circle Line Stage 3 opens, he can get from Serangoon to Yishun in 25 minutes.

'It will help me save a lot of time,' said Mr Nadarajan, an army regular.

Like many commuters, local businesses are also waiting with bated breath for the new stations to open. Some are hoping that the new stations will bring in a bigger crowd.

'We might have new customers who haven't been here before,' said Madam Suzanna Toh, 40, a hawker at Shunfu market, near Marymount station.

Source: Straits Times, 26 Feb 2009

Cable cars may replace free buses on Sentosa

ZIPPING around Sentosa Island will be made easier from 2011 with the launch of a new cable car service.

The new transport link may replace the present free intra-island bus service.

The above-ground system is part of Sentosa Leisure Group's (SLG) over $250 million plan to overhaul the transport system on the island to ensure that it can handle the crowds when Resorts World at Sentosa opens next year.

Currently, Sentosa receives up to 30,000 visitors daily during the peak season. But that number is expected to rise to over 100,000 people daily with the opening of Singapore's second integrated resort.

Mr Lee Chin Chuan, director of SLG's property business development, said the cable car system will offer a greener way of travel compared to the current diesel-powered bus fleet.

The new cableway system will be at most six to seven storeys tall, a third of the height of the current cable car system which runs from Mount Faber.

It is expected to take anything from 1,400 to 5,000 passengers per hour in one direction, moving at speeds of 4m to 6m a second. It will also offer express waiting times of 12 seconds to 15 seconds instead of two minutes to three minutes for the monorail and 10 minutes to 15 minutes for the bus.

Currently, four stations have been earmarked. Mr Lee did not discount the possibility of rolling out the system to the rest of the island or even to the mainland.

The cost of the project is not known yet. SLG has hired consultants to help determine the system's capacity and cost.

One other unknown: whether visitors will be charged for rides. SLG is still mulling over this.

The group is also exploring other possibilities like electric trams, mini railways and buggies. Plans to boost links to the island include an $80 million, 710m-long second bridge, being built by the casino-resort and expected to be ready by the third quarter of this year.

SLG has invested $25 million to build a new depot extension and to buy two cars to raise the capacity of the monorail from 3,000 to 4,000 passengers per hour.

It is also building a new boardwalk so pedestrians can walk to the resort island. Construction of the walkway is slated to begin in the second half of this year. It will have travellators like those in the airport to ease the 620m walk.

Teacher Chai Jiamin, 27, welcomed the new moves. She used to play beach volleyball at Sentosa regularly, but said that on weekends, traffic congestion can get really bad.

However, other regulars like 26-year-old Benjamin Lau, who runs his own IT business, said replacing the free buses with a paid cable car will not benefit visitors.

He said: 'I don't think it's practical to invest in a cable car system when there are already free bus and trams serving Sentosa.'

SLG's Mr Lee added that another key reason that is driving Sentosa's search for new modes of transport is to minimise the system's emissions and carbon footprint.

Source: Straits Times, 26 Feb 2009

Orchard Rd sparkles after $40m facelift

Makeover to be completed this weekend; fashion show in May to celebrate

FINAL touches to the $40 million Orchard Road makeover are expected to be completed this weekend, after a 10-month-long project to rejuvenate Singapore's main shopping strip.

Workers were seen yesterday scurrying around, erecting flower totems - large pillars decorated with fresh flowers - on the pavement from Forum The Shopping Mall to Liat Towers.

By this weekend, old lamp posts and electrical boxes will be stripped out.

New benches, lamp posts, recycling bins, planter boxes and other improvements are already in place along nearly 2km of Orchard Road, between Tanglin Mall and Concorde Hotel Singapore.

The walkways have been repaved, and one road lane has been sacrificed to create a wider pavement in front of Ion Orchard, Wisma Atria and Ngee Ann City.

The extra space has been given to 25 'urban green rooms', containing benches, planter boxes and large decorative glass screens that light up at night.

This is the first time Orchard Road has been extensively improved, with the aim of elevating it to the level of famous shopping streets like Paris' Champs-Elysees.

But the project had a rocky start. An initial ambitious idea by the Singapore Tourism Board, which paid for the works, to construct a glass canopy running down the stretch was promptly shot down by mall owners, who said it would require too much maintenance.

Works were then delayed by nearly two months at the start because of stalled talks with businesses, which were concerned about how the closure of one lane would affect them. Some shops and restaurants actually saw their takings drop when hoardings went up outside Wisma Atria and Ngee Ann City and the drilling began.

But with all that in the past, and to celebrate the facelift, the Orchard Road Business Association is now planning events, including a fashion show and shopping promotions, all set to begin in early May.

One idea is to hold the fashion show on what would be Singapore's longest catwalk - a specially constructed outdoor platform on the pavement stretching from Wisma Atria to Ngee Ann City.

Retailers, restaurants and cafes are also expected to take part in promotions and lucky draws to lure shoppers and diners to the area.

Source: Straits Times, 26 Feb 2009

Solar energy to power common services piloted at two HDB estates

SINGAPORE: Singapore's public housing estates could well be powered by sunlight in future, if a pilot project currently underway proves successful.

Already, the Energy Save Programme - spearheaded by the Housing and Development Board (HDB), the National Environment Agency and the Energy Market Authority - has shown positive results.

The aim of the programme is to bring down energy consumption in all HDB estates by 10 per cent in five years.

Futuristic-looking solar PV panels were spread across 14 HDB blocks in two precincts located in Serangoon and Sembawang.

At Block 552 Serangoon Avenue 3, about 70 panels were used to capture the sun's rays, generating enough energy to power common services like lights, lifts and water pumps.

Seven such blocks generate about 220 kilowatts per hour of energy every day.

However, cost is still a factor as the technology is relatively new. Some S$600,000 was spent on buying and installing the panels for just one precinct, which covers seven blocks of flats.

Investment also went into installing the energy-efficient lights and sensors at stairwells that trigger off the lights at full capacity when someone passes through.

As this was a trial project, the money came from the Economic Development Board's Clean Energy Research and Test-Bedding Fund.

But the investment has reaped benefits - all precincts involved in the trial achieved some 40 per cent energy savings.

A 30 per cent reduction in energy translates to savings of some S$36 million a year. Common areas account for 10 per cent of total energy usage in HDB estates.

But whether the savings would translate to lower service and conservancy charges for households remain to be seen.

Deputy director, Sustainability and Building Research, HDB, Johnny Wong, said: "In terms of renewable energy, because PV panels are quite costly, we need more data to see how we can lower this cost.

And in the long run when the cost of solar power is reduced, we can see the benefits we get from this."

The Energy Save Programme also involved households.

Two four-room units which took part in the trials replaced home appliances like the fridge and washing machine with energy efficient models and adopted simple energy saving habits.

Each household saved up to S$80 a month in utility bills.

Currently, households account for 90 per cent of total energy usage in HDB estates. More than 80 per cent of Singaporeans live in HDB estates and the households consume energy at a rate of some S$1.2 billion a year.

Source: Channel News Asia - 24 Feb 2009

Fusing science, art and nature

Fusionopolis' towers house scientists and engineers working on new medical solutions and technical innovations.

DRIVING past Buona Vista it is hard to miss the futuristic towers that make up the first phase of Fusionopolis. Connected by a podium, the 24-storey Symbiosis and 22-storey Connexis reflect the daylight off their glass facades like gems, while the red circular logo at the top of one-north glows like a beacon in the night.

But these buildings amount to much more than architectural beauty. Officially launched on Oct 17 last year, they have become home to a scientific community of talent working hard on the next technical innovation or medical solution.

As JTC Corporation's assistant chief executive Philip Su explains, Fusionopolis aims to create an environment that is conducive to research, especially for the infocommunications, media, science and engineering industries to incubate and test-bed ideas and products. This, in turn, will create jobs and intellectual property (IP) rights for Singapore.

JTC is the master developer of one-north, the research and development (R&D) centre in the west that includes Fusionopolis, a project that has come a long way since construction began in 2003 amid the Sars outbreak.

Mr Su says JTC believes in the development's long-term potential and went ahead with it even though market confidence was low at the time. The take-up rate since has been overwhelming. 'Now I've got a problem,' he says. 'I don't have enough space.'

Attractive co-location
Costing $560 million, Fusionopolis's 120,000-square-metre phase 1 development already houses various public and private research institutes - co-location that is attractive because it promotes collaboration and the exchange of ideas.

Private tenants include Panasonic Electric Works Asia-Pacific, Seiko Instruments, Thales Technology Centre (S) and Vestas Technology R&D.

A*Star's Science & Engineering Research Council (Serc), the Media Development Authority and Spring Singapore are also there.

And the University of Illinois at Urbana-Champaign will set up its first overseas research centre at Fusionopolis. It will run a five-year programme to study how humans can interact with the digital world as seamlessly as they do with their natural five senses - an example of new frontier research called the human sixth sense programme.

Indeed, Fusionopolis could well re-invent the way research is done, by bringing cross-disciplinary capabilities under one roof to find solutions to global challenges.

Such collaboration is already going on for treatment of attention deficit hyperactivity disorder (ADHD) - a disorder that causes children to be disruptive and makes it hard for them to concentrate and learn.

A*Star's Institute for Infocomm Research, the Duke-NUS Graduate Medical School and the Institute of Mental Health are working on non-invasive therapy that helps people concentrate. They have come up with a game that could teach children with ADHD to focus, and perhaps to pay more attention to their teachers.

'Creating this technology requires a multi-disciplinary team - it takes the expertise, experience and creativity of many individuals to identify the problem, develop a solution and the technologies to implement it,' Science and Engineering Research Council chairman Charles Zukoski said last year. 'It is solving problems in this manner that will epitomise the work conducted at Fusionopolis.'

To facilitate interaction, the first phase of Fusionopolis also integrates various live, play and learn elements for the 800 or so scientists, engineers and game developers working there.

Shopping and entertainment
Some reside comfortably in the 50 serviced apartments on the 17th to 19th floors of the Symbiosis tower after work. Managed by Frasers Hospitality, each unit is about 60 sq m.

There are also retail and food and beverage outlets such as Starbucks Coffee and Harry's Bistro and Bar. In line with the Fusionopolis vision, Cold Storage is even test-bedding ideas at the Market Place

@ one-north. The supermarket is equipped with digital price tags and trolleys fitted with LCD screens that feature the latest promotions.

Staff looking to take a break from all the heavy research can retreat to one of the 13 sky gardens spread throughout the two towers. Some include ponds and water wells in the landscaping, and one may even screen out telecommunications signals in future for visitors to enjoy undisturbed peace.

Beyond beautifying the environment, the sky gardens also help diffuse heat from the buildings and create energy savings.

For those who prefer exercise as a way to unwind, there is Fitness First. The gymnasium has an open-air swimming pool and is situated on the top-most floors of the Connexis tower.

There is even a black-box theatre to bring the arts into the scientific community. Nestled between the two towers, the Genexis theatre has more than 500 retractable seats and the space can be easily configured to accommodate conferences, exhibitions and various other events.

With all these features, phase 1 of Fusionopolis can pride itself as the first high-density mixed-use development in one-north. Activity in the area is set to mount once phases 2A and 2B take shape.

The $600 million phase 2A development will be ready in 2012 and will house various laboratories, test-bedding centres and what could be Singapore's largest R&D clean room facility across 103,600 sq m of space.

Phase 2B may be up and running in 2011 and will provide up to 50,000 sq m of space for other agencies and companies working with nearby institutes.

And more developments are set to come. The entire Fusionopolis will be a 30 ha complex comprising six phases when it is fully completed, by which time it will be Singapore's icon for R&D in interactive media, physical sciences, engineering and technology.

Source: Business Times - 24 Feb 2009

Seeing gold in California housing bust

(LOS ANGELES) California's tortured real estate market has brought heartbreak and ruin, but some investors, speculators and first-time home buyers are also dreaming big and finding opportunities - a silver lining in the Golden State's epic housing crash.


For many young couples, plummeting prices and near record-low interest rates make it possible to own a home in California for the first time.


Investors and real estate speculators, meanwhile, will be able to snap up foreclosed properties on the cheap to sell during the next boom in California's boom-and-bust real estate cycle, a boom they believe is inevitable and possibly not far off.


'This is the buying opportunity of our lifetime,' said Bruce Norris, who heads an investment group that expects to purchase some 100 homes this year in Southern California's Inland Empire region.


California - which would be the world's eighth largest economy if it were a country - saw a near-doubling in home sales in the fourth quarter, a pace surpassed only by Nevada's 133.7 per cent growth.


But experts warn that it's a dangerous game to play when nobody is really sure how low home prices will go or when they will rebound as the recession lingers, jobs dry up and residents pour out of the state in search of better prospects.


Mr Norris concentrates on the Inland Empire of Southern California, made up mostly of Riverside and San Bernardino counties, one of the fastest-growing areas of the country during the housing boom, driven partly by immigrant families who couldn't afford pricier coastal cities.


It's now one of the hardest-hit. In the past 18 months, the median home price in Riverside and San Bernardino, pummelled by the sub-prime meltdown and now recording some of the highest foreclosure rates in the state, has plummeted 55 per cent.


Norris Investment Group looks for homes built between 1980 and 1990, typically under 2,000 square feet.


Older houses come with too many maintenance 'surprises', Mr Norris says, and larger places can be tough to sell or rent in hard times.


Last month the group paid US$55,000 for a foreclosed home that was worth US$360,000 at the top of the market. Mr Norris expects to spend US$30,000 on repairs and rent it for US$1,200 a month until the market turns around.


The group also hopes to minimise risk by owning the homes free and clear, thus accruing little debt.


'You cannot have this (low) level of pricing be permanent because it costs too much to build a home here,' Mr Norris said. 'That's how you know you're making a logical decision when everything is falling around you. When you can buy a finished product someone will want to live in for US$55,000, that just has to make somebody pretty wealthy someday.'


Experts agree that California home prices will ultimately rebound but caution that real estate investing in this economy - the worst contraction since 1982 - should not be undertaken by amateurs or the faint of heart.


'You have to have a pretty strong feeling about where this is all going,' Stuart Gabriel, director of the Ziman Center for Real Estate at the University of California, Los Angeles, told Reuters. 'This cycle is so different from prior cycles that it's very difficult to extrapolate.'


'Most would argue that California is not going into the sea,' he said. 'On the other hand it's not totally out of the question that this particular period of weakness could extend for a while, and that means multiple years.'


California's roller-coaster real estate cycles can be traced to the 1970s, when home prices tripled, ignited in part by foreign investment and the end of the gold standard following decades of explosive population growth.


Home prices plunged in the early 1980s, turned around and doubled within 10 years, slumped in the mid-1990s and then blasted off again at the end of the decade. The sub-prime meltdown and recession pushed them back off the cliff.


'It's a great time to buy for people who are willing to risk a little more and be optimistic when everybody else is doom and gloom,' said Daren Blomquist, marketing and communications manager for RealtyTrac, an online foreclosure data service. But he warned: 'They will probably have to wait it out, possibly for several years.'


Chris Twoomey and his wife Jennifer illustrate the risk underlying the perceived opportunities. They moved to California from the Midwest in 2004 to pursue acting careers and had just begun to think the dream of home ownership was out of reach when the crash came and they saw their chance.


The couple pounced in January, right after Jennifer, 39, learned she was pregnant with their first child, making an offer on a small, bank-owned home in suburban Los Angeles.


But the day after the Twoomeys' offer was accepted, Chris was called into the cafeteria at his job in a cosmetics company warehouse and laid off.


'Sometimes in our dark moments we sit around and say to ourselves, 'Look, forget the acting, forget everything, this is the time to bail' (from California). We can be doing this someplace else that's still warm but doesn't cost as much,' Chris told Reuters in an interview.


'But we're sticking it out,' he said. 'It's perverse, but something inside of us does want to stay here. It's sort of a belief that because it is Southern California and because it is the kind of place where everybody wants to be, it will come back eventually.' - Reuters


Source: Business Times - 24 Feb 2009