Monthly Archives: March 2010

CapitaLand says boom in China property not a bubble

Posted on 11 Mar 2010 | Comments Off on CapitaLand says boom in China property not a bubble

CapitaLand, which has Chinese properties valued at more than US$14 billion ($19.6 billion), said demand in China is “strong” and the real-estate boom can’t be called a bubble.

Still, the Singapore-based developer said it was “comforting” that the Chinese government is taking steps to rein in the market, according to a CapitaLand presentation filed to the Singapore Exchange today. CapitaLand, Southeast Asia’s biggest developer, has said it plans to expand its China business to 45% of its operations within 5 years.

China’s property prices rose at the fastest pace in almost two years in February, adding urgency to the government’s efforts to damp speculation and increase the amount of affordable housing. Residential and commercial real-estate prices in 70 cities climbed 10.7% from a year earlier, the statistics bureau said on its website yesterday, topping a gain of 9.5% in January.

To cool speculation, China is requiring a down payment for land purchases equal to 50% of a plot’s price, the Ministry of Land and Resources said on its website late yesterday. The government in January also re-imposed a tax on homes sold within five years of their purchase, after having cut the taxable period to two years in January 2009 to bolster a then-flagging market.

Bank of China, the nation’s third-largest lender by market value, said Feb. 3 that it had reduced discounts for some mortgages, citing concern about rising property-market risks.

Source : The Edge – 11 Mar 2010

Comments Off on CapitaLand says boom in China property not a bubble

Posted in Developers, Overseas Property

Tagged ,

S-Reits outperform peers for total returns in 2009

Posted on 11 Mar 2010 | Comments Off on S-Reits outperform peers for total returns in 2009

They posted returns of 85.6%; Asian Reits performed well as a region: study

REAL estate investment trusts (Reits) in Singapore have outperformed their counterparts in other major markets in terms of total returns in 2009, according to a report released yesterday.

Ernst & Young’s study showed that Reits Singapore and Hong Kong posted returns of 85.6 per cent and 64.5 per cent respectively in 2009.

Malaysia (38.6 per cent) and South Korea (28.4 per cent) also put up strong showings.

By contrast, total returns in the more mature Reit markets were much lower. Returns for Australian Reits were 10.4 per cent in 2009, while Japan’s Reits came in at 6.7 per cent. The largest single Reit market in the world, the United States, witnessed returns of 27.9 per cent.

‘Asian Reits performed well as a region because the Asian economies have generally been more resilient to the financial crisis, underpinned to some extent by China’s economic performance and favourable long-term growth outlook,’ said Liew Choon Wai, assurance partner and head of Singapore real estate for Ernst & Young.

The performance of each country’s Reit market appears to reflect the broader economic sentiment, he added: ‘For Singapore, the economy was seen as particularly vulnerable during the financial melt-down, and it was not surprising that we saw a plunge in Reit returns in 2008 to early 2009, which has subsequently rebounded strongly since March as financial markets stabilise.’

But only Singapore recorded a negative three-year rate of return – of minus 4.15 per cent – of the Asian countries outside of Japan. Rates of return for South Korea, Malaysia and Hong Kong are all in positive territory over the last three years. Japan, a mature economy, had a three-year rate of return of minus 19 per cent.

Ernst & Young also noted that since March 2009, many Reit markets around the world have seen significant increases in share prices and Reits have raised billions of dollars by going back to the stock market for secondary (or follow-on) equity offerings to reduce debt, recapitalise their balance sheets and prepare their businesses for the next wave of growth.

Source : Business Times – 11 Mar 2010

Comments Off on S-Reits outperform peers for total returns in 2009

Posted in Funds

Tagged ,