Housing market set for prolonged downturn: Daiwa

  November 18, 2011

The housing market in Singapore is heading for a prolonged downturn and overall private home prices are forecast to fall between 22 and 26 per cent in the next three years, Daiwa Research said. “We believe the residential property market could remain depressed for several years, triggered initially by a likely forthcoming gross domestic product slowdown (in 2012) and lingering global economic uncertainty,” it said.

From late next year, Daiwa said, structural issues such as the rapid build-up in unsold inventory in the primary market and vacant rental units will take centre stage and keep home prices and rents in check for several years.

The mass-market segment will hold up slightly better than high-end properties, supported by better affordability and the resilience in the resale prices of Housing and Development Board flats, Daiwa said.

The house has downgraded its view of Singapore’s property sector to “Negative” from “Neutral”, adding that “it is hard for us to see the developer shares outperforming the Straits Times Index over the next six months” despite their underperformance in the year to date.

Source : Today – 18 Nov 2011

Market Street Car Park venture secures S$890 million loan facility

  November 18, 2011

CapitaLand’s joint venture with CapitaCommercial Trust and Mitsubishi Estate Asia has secured a loan facility with OCBC Bank for up to S$890 million to fund the purchase and redevelopment of the Market Street Car Park site.

 

The loan has a five-year tenure and will be due in November 2016. It is secured by, among other things, a mortgage over the Market Street Car Park development.

 

The site will be redeveloped at an estimated cost of S$1.4 billion into a 40-storey office project with a gross floor area of about 887,000 sq ft.

 

CapitaLand, South-east Asia’s largest developer by market capitalisation, holds a 50-per-cent stake in the joint venture, CapitaCommercial Trust holds a 40-per-cent interest, while Mitsubishi Estate Asia – a unit of Mitsubishi Estate – holds the remaining 10 per cent.

 

Source : Today – 18 Nov 2011