Category Archives: Office / Retail / Industrial

Commercial property boom in Asia-Pacific

Posted on 27 May 2011 | Comments Off on Commercial property boom in Asia-Pacific

Commercial property leased out by investors in the Asia-Pacific, or invested stock, increased 14 per cent last year, displaying the region’s flourish while markets in Europe and the United States languished, according to the yearly Money into Property report by real estate consultancy DTZ.

The Asia-Pacific’s invested stock is also forecast to match current global leader Europe’s level by rising to US$4.4 trillion (S$5.47 trillion) by next year, after taking the place of the US as the world’s second-largest commercial property market this year, DTZ said.

The Asia-Pacific region’s growth has been led by China and Australia, which reported gains of 25 and 24 per cent, respectively, last year. Overall transaction levels in the region rose to US$158 billion last year, indicating increasing development activity and rising capital values. Global investment volumes were up 76 per cent at US$342 billion – the highest since 2007. DTZ also forecast global investment volumes to increase 9 per cent this year.

Mr David Green-Morgan, DTZ head of Asia Pacific Research, is optimistic about the region. “We expect Asia-Pacific’s momentum to continue on the back of strong economic growth, lack of legacy debt issues and strong investor interest.”

Liquidity in the Asia-Pacific commercial property market continued to grow last year. The amount of private debt funding such investments grew 17 per cent to US$257 billion, while private equity funding grew 13 per cent to US$139 billion. However, DTZ said rising interest rates may make bank loans less popular.

“On the debt side, some of the government policy will reduce the amount of debt going forward, for the growth of private debt in particular. Also some of the debt is being priced higher now and becomes less attractive,” said Mr Hans Vrensen, global head of research at DTZ.

“But there’s a lot of development still in the pipeline. You are not going to stop building a building. People will continue to deliver these properties to the market and that is a big momentum that the Asia-Pacific has,” said Mr Vrensen.

Source : Today – 27 May 2011

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CapitaLand submits highest bid for white site at Jurong Lake district

Posted on 26 May 2011 | Comments Off on CapitaLand submits highest bid for white site at Jurong Lake district

Southeast Asia’s largest property developer CapitaLand has submitted the highest bid of S$968.99 million for a vast “white site” property in the Jurong Lake district.

The Urban Redevelopment Authority (URA) closed the tender for the site, after receiving five bids in total.

The top bid also translates to about S$1,012 per square foot per plot ratio.

The next highest bid of S$917 million came from the joint-venture between United Engineers and Singapore Press Holdings.

Analysts said they expect the 1.8-hectare site to be turned into a vibrant commercial hub that will rival the one in Tampines.

The “white site”, the second to be put up for sale by the URA, gives developers the flexibility to change the mix of use or the quantum of each use stipulated in the conditions of tender, without having to pay a differential premium.

The sale site at Boon Lay Way is ideal for sizeable mixed-use development with a potential gross floor area of about 88,980 square meters.

CapitaLand’s offer is approximately double the S$510 million trigger bid, according to Li Hiaw Ho, executive director at CBRE Research.

The bid was launched through JG Trustee and JG2 Trustee, a joint venture between CapitaMalls Asia, which has a 50 per cent stake, and HSBC Trust Services (30 per cent) and CapitaLand (20 per cent).

If successful, the property would be near CapitaLand’s IMM Building and its upcoming JCube.

CBRE estimates an average monthly rent of S$15 per square foot (psf) and S$6 psf for the retail and office space respectively.

“It is likely that a pure commercial development with a high proportion of retail element will be developed on this 1.8 ha parcel,” Mr Li said.

A successful award of the property would hasten the development of Jurong East as a vibrant commercial hub, he added.

“Given the sizeable amount of retail pipeline supply from the neighbouring Lend Lease’s and JCube projects as well as existing retail amenities in this area, it would offer residents/workers a retail experience rivalling that of Tampines in the east,” Mr Li said.

The other bidders for the site were the partnership of JL Retail Management and JL Office Management, as well as a consortium composed of the Far East Civil Engineering, OPH Marymount, Sekisui House and China Construction (South Pacific) Development Co.

Lowest bidder Aquamarine Development and FC Commercial Trustee, meanwhile, has put its offer price at S$639.88 million.

Source : Channel NewsAsia – 25 May 2011

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