Singapore and emerging market real estate

Royston Foo

Thematic (Sector/Industry)

Singapore’s Urban Redevelopment Authority released the full statistics for the Singapore property market in 4Q 2018.Private Residential Property Price Index decreased by 0.1% in 4Q18 to 149.6. This was in line with the flash estimate released earlier this month. For the full year, prices of private residential properties gained 7.9%.One positive takeaway from the data is the declining vacancy rate in the private residential segment. Vacancy rate fell from 6.8% in 3Q18 to 6.4% in 4Q18. This could give support to private residential rents.Total number of unsold units increased by 3,974 units or 12.5% QoQ to 35,886 units in 4Q18, reaching a 4-year high.With an expected 12 years to clear inventories, developers of high-end properties are at high risk of paying the penalties. Developers may reduce their selling price to move inventories, but this would translate to write-downs in their P&amp;L and reduction in NAV.Developers with significant landbank exposure in CCR will face the highest risk. Among the listed Singapore property developers, <a href="https://www.smartkarma.com/entities/1928" target="_blank" data-smartkarma-citation="entities:1928:1">Low Keng Huat Singapore (LKH SP)</a>  may face significant risk going forward. Developers with high exposure to the mass market residential properties are in a better position to ride out the weakness in the residential market. <a href="https://www.smartkarma.com/entities/3498" target="_blank" data-smartkarma-citation="entities:3498:1">Sing Holdings (SING SP)</a> is one such developer.

Singapore’s Urban Redevelopment Authority released the full statistics for the Singapore property market in 4Q 2018.Private Residential Property Price Index decreased by 0.1% in 4Q18 to 149.6. This was in line with the flash estimate released earlier this month. For the full year, prices of private residential properties gained 7.9%.One positive takeaway from the data is the declining vacancy rate in the private residential segment. Vacancy rate fell from 6.8% in 3Q18 to 6.4% in 4Q18. This could give support to private residential rents.Total number of unsold units increased by 3,974 units or 12.5% QoQ to 35,886 units in 4Q18, reaching a 4-year high.With an expected 12 years to clear inventories, developers of high-end properties are at high risk of paying the penalties. Developers may reduce their selling price to move inventories, but this would translate to write-downs in their P&amp;L and reduction in NAV.Developers with significant landbank exposure in CCR will face the highest risk. Among the listed Singapore property developers, Low Keng Huat Singapore (LKH SP)  may face significant risk going forward. Developers with high exposure to the mass market residential properties are in a better position to ride out the weakness in the residential market. Sing Holdings (SING SP) is one such developer. 

Singapore Property – 4Q18 Residential Statistics Support View of Weakness in High-End Segment

Top Singapore property news this week that you need to know.Developers remained active in land acquisitions this week with 1 collective sale transaction concluded and 2 other land acquisitions announced. More prime district sites are released for collective sale tender this week, seeking a total of S$1.85 bil. New launches over last weekend reported lukewarm take-up rates. This is due to new launch prices exceeding buyer’s threshold. Underlying demand should still remain strong if new launches…

Top Singapore property news this week that you need to know.Developers remained active in land acquisitions this week with 1 collective sale transaction concluded and 2 other land acquisitions announced. More prime district sites are released for collective sale tender this week, seeking a total of S$1.85 bil. New launches over last weekend reported lukewarm take-up rates. This is due to new launch prices exceeding buyer’s threshold. Underlying demand should still remain strong if new launches…

Singapore Property Weekly Recap (2nd Jun to 8th Jun 2018)

Transport Sector, China and Asia-focused Research

Charles De Trenck

Another report of potential suitors made it to market on Friday, forcing NOL to disclose there have been talks with French carrier CMA and global leader Maersk. NOL&rsquo;s shares rose some 6% to $1.05 and closer to book NAV per share around&nbsp;S$1.4 (and higher when the US dollar drifts higher). But what would make a potential transaction more interesting, if at all, keeping in mind the Hapag IPO pricing was about 25% below the original high end of the range?

Another report of potential suitors made it to market on Friday, forcing NOL to disclose there have been talks with French carrier CMA and global leader Maersk. NOL&rsquo;s shares rose some 6% to $1.05 and closer to book NAV per share around&nbsp;S$1.4 (and higher when the US dollar drifts higher). But what would make a potential transaction more interesting, if at all, keeping in mind the Hapag IPO pricing was about 25% below the original high end of the range?

NOL's Latest Potential Merger Discussions... Where is the [Partial] Exit for Temasek?

Head of Digital Services at Singapore Post Ltd, Singapore Post Limited

Bernard Leong

Head of Digital Services at Singapore Post Ltd

Singapore Post Limited

How should digital leaders advise businesses? Two ways: target the high and low ends of the market while allowing cannibalisation against their current business model in a controlled pace.&nbsp;The trick lies in capital allocation and separation of the products/services moving towards both ends. Digital products often require high cost of acquisition contrary to perception by businesses that it is cheaper against traditional channels.

How should digital leaders advise businesses? Two ways: target the high and low ends of the market while allowing cannibalisation against their current business model in a controlled pace.&nbsp;The trick lies in capital allocation and separation of the products/services moving towards both ends. Digital products often require high cost of acquisition contrary to perception by businesses that it is cheaper against traditional channels.

Digital disruption bifurcates traditional market segmentation

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>I tally 36 - mostly firm, mostly Asia-Pac - arb transactions currently being discussed and analysed on Smartkarma. Those arbs metrics and upcoming events are detailed below.</li>
<li>Four new deals were discussed on Smartkarma this week: <a href="https://www.smartkarma.com/entities/pepper-money-ltd-australia" target="_blank" data-smartkarma-citation="entities:24157:1" rel="noopener">Pepper Money (PPM AU)</a>, <a href="https://www.smartkarma.com/entities/mcj-co-ltd" target="_blank" data-smartkarma-citation="entities:14132:1" rel="noopener">MCJ Co Ltd (6670 JP)</a>, <a href="https://www.smartkarma.com/entities/br-holdings-corp" target="_blank" data-smartkarma-citation="entities:19365:1" rel="noopener">Br Holdings (1726 JP)</a>, and <a href="https://www.smartkarma.com/entities/alleanza-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:29288:1" rel="noopener">Alleanza Holdings Co Ltd (3546 JP)</a>.</li>
<li>Key updates/news also took place on: <a href="https://www.smartkarma.com/entities/dongfeng-motor-group-co-ltd-h" target="_blank" data-smartkarma-citation="entities:910:1" rel="noopener">Dongfeng Motor (489 HK)</a>, <a href="https://www.smartkarma.com/entities/mandom-corp" target="_blank" data-smartkarma-citation="entities:8353:1" rel="noopener">Mandom Corp (4917 JP)</a>, <a href="https://www.smartkarma.com/entities/yutaka-giken-co-ltd" target="_blank" data-smartkarma-citation="entities:4033:1" rel="noopener">Yutaka Giken (7229 JP)</a>. and <a href="https://www.smartkarma.com/entities/minmetals-land-ltd" target="_blank" data-smartkarma-citation="entities:1917:1" rel="noopener">Minmetals Land (230 HK)</a>.</li>
</ul>


I tally 36 - mostly firm, mostly Asia-Pac - arb transactions currently being discussed and analysed on Smartkarma. Those arbs metrics and upcoming events are detailed below.
Four new deals were discussed on Smartkarma this week: Pepper Money (PPM AU), MCJ Co Ltd (6670 JP), Br Holdings (1726 JP), and Alleanza Holdings Co Ltd (3546 JP).
Key updates/news also took place on: Dongfeng Motor (489 HK), Mandom Corp (4917 JP), Yutaka Giken (7229 JP). and Minmetals Land (230 HK).


Asia-Pac M&A Weekly Wrap: Pepper Money, MCJ, Br Holdings, Alleanza, Dongfeng Motor, Mandom

Singapore

Low Keng Huat is a diversified group engaged in property development, building construction, hotels, and investments. The company develops and invests in properties, and owns and operates hotels, serviced apartments, and restaurants. It was established in 1969 and is headquartered in Singapore.

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Low Keng Huat (LKH SP)

Singapore Property – 4Q18 Residential Statistics Support View of Weakness in High-End Segment

Singapore’s Urban Redevelopment Authority released the full statistics for the Singapore property market in 4Q 2018.Private Residential Property...

Royston Foo

Singapore Property Weekly Recap (2nd Jun to 8th Jun 2018)

Top Singapore property news this week that you need to know.Developers remained active in land acquisitions this week with 1 collective sale...

Royston Foo

NOL's Latest Potential Merger Discussions... Where is the [Partial] Exit for Temasek?

Another report of potential suitors made it to market on Friday, forcing NOL to disclose there have been talks with French carrier CMA and global...

Charles De Trenck

Digital disruption bifurcates traditional market segmentation

How should digital leaders advise businesses? Two ways: target the high and low ends of the market while allowing cannibalisation against their...

Bernard Leong

Asia-Pac M&A Weekly Wrap: Pepper Money, MCJ, Br Holdings, Alleanza, Dongfeng Motor, Mandom

This insight provides a summary of gross/annualised spreads (on deals discussed on Smartkarma) across Asia-Pacific as at the last trading date, and...

David Blennerhassett

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