Dubai in push to rebalance bloated property market

The committee charged with rebalancing the industry will be headed by Sheikh Mohammed bin Rashid Al-Maktoum's son and deputy, Maktoum bin Mohammed, and include representatives of top property developers in Dubai.

"Today, we formed in Dubai a higher committee for real estate planning... with the aim to achieve a balance between supply and demand," Sheikh Mohammed, who is also prime minister of the United Arab Emirates, said on Twitter.

Dubai's property market has been in a downturn since mid-2014, with sale prices and rents shedding around a third of their value.

Economic outlooks indicate that the sector, which contributes some seven percent to Dubai's gross domestic product, will slump further due to the extent of oversupply and an economic slowdown caused by low oil prices.

In an emirate where glitzy apartments line the coastline,and gated communities stretch back into the desert, Sheikh Mohammed called on the committee to ensure that property projects add value to the economy and do not duplicate each other.

He also said the panel should guarantee that giant semi-state real estate companies do not compete with private sector developers, and to draw up a 10-year strategic plan for the sector.

Standard and Poor's ratings agency said earlier this year that property prices in Dubai, where full foreign ownership is allowed, have slumped to levels close to those seen in the 2009-2010 crash.

It said prices will continue to fall until they stabiliZe either next year or in 2021.

Property prices in Dubai plummeted in the aftermath of the 2008 global financial crisis which hit the emirate’s economy hard, triggering a 2.6 percent contraction the following year.

The main drive behind the current glut of new housing projects in the market is excitement over Dubai's hosting of the global trade fair Expo 2020, which experts project will generate some 300,000 new jobs and attract over 20 million visitors.

source: news.abs-cbn.com

Sulit, Property24 team up for PH real-estate site

MANILA -- Leading South African real estate website Property24 in partnership with local buy-and-sell website Sulit.com.ph on Thursday launched Property24.com.ph to capitalize on the booming Philippine property market.

“We’re incredibly excited to partner with Sulit.com.ph on this venture, and to provide Filipino real estate agents and home hunters with innovative technology aimed at streamlining the property search process,” Property24 chief executive JP Farinha said in a press briefing in Makati City.

He said the Property24 portal will provide a more intuitive and more user-friendly experience for buyers. It will also provide a list of properties from major real estate agents around the country providing buyers comprehensive information, tools and tips.

Farinha pointed out that the property portal is currently checking the list of developers before giving the official listing to the market. He added that Property24 will also consolidate the listings of the different projects of the property developers.

To ensure a big number of Filipinos can avail of their services, he said Property24 will ensure that the barriers to entry are going to be affordable to enable users to achieve a great experience in using the different features of the website. He noted that the site will only put licensed brokers in the list to ensure professionalism and quality of service to the clients.

Steve Santos, country manager of Property24, believes there is enough room for growth in the industry as Internet penetration in the country increases and more people use the Web for their transactions.

Santos said move to put up Property24 was in response to the large hits of Sulit in terms of property transactions. “The segment receives 360,000 to 400,000 hits per month in the secondary markets such as vacant lots,” he noted.

Santos explained that revenue for the site will be sourced from the classified advertisements of developers and other postings from industry players. “But the main source would be the microsite for brokers, which will give them presence in the mobile sector,” he said.

“At the end of the day what we are after is the quality of listing,” he added.Santos said the website will have a development tab on the side that contains the latest development projects plus their advertisements. “Since the developers are heavy advertisers, we are this targeting sector,” he said.

Property24 will initially focus on residential homes and condominiums. “Eventually, we will branch out into other areas as we go along,” Santos said.

For his part, Sulit co-founder and managing director RJ David said the partnership with Property24 has given them the necessary strength to become a competitive force.

“Thanks to Property24, we have a robust and proven platform that works in several markets worldwide. This complements Sulit’s strength to generate leads for sellers, which in turn translates to more sales for brokers,” David said.

source: www.abs-cbnnews.com

Why Singapore developers are heading overseas

SINGAPORE - Singapore's mid-tier property developers are laying the first stones of their overseas business as domestic sales plunge, land prices climb, and foreign rivals bet high stakes on the city-state's long-term prosperity.

Hiap Hoe Ltd and Oxley Holdings Ltd followed sector leader CapitaLand Ltd this year by going abroad. At home, government action to slow the rise of record-high prices led to a 50 percent drop in third-quarter private home sales.

Official plans for a significant supply of new homes over the next decade make the price outlook even dimmer. Yet land prices have rallied, pushed up by foreign developers drawn by political and economic stability.

"The Singapore market is now very tough," said Teo Ho Beng, Hiap Hoe's chief executive officer. "Getting new land is a challenge, because there is so much competition."

Hiap Hoe made its first foray abroad by buying three properties in Australia in the past four months. In coming years, most of its revenue will likely come from outside the island-state, Teo said.

Oxley Holdings bought property and invested in developers in Britain, Cambodia, China and Malaysia. Sim Lian Group Ltd added to its overseas portfolio by buying property in Australia.

SingHaiyi Group Ltd SIHL.SI, which earns 98 percent of revenue in Singapore, bought two properties in the United States this year and appointed Neil Bush, brother of former U.S. President George W. Bush, as non-executive chairman. The company shifted focus to Singapore two years ago in response to property-price cooling measures in its native Hong Kong.

CHALLENGED ON HOME TURF

Seventy-two developers participated in this year's nine private residential-use land auctions, including at least eight from abroad. That made 2013 the most competitive year since at least 2008 in terms of average number of bidders per auction, showed data from the Urban Redevelopment Authority of Singapore.

Local developers outbid foreign rivals and their partners in five of the nine auctions, their lowest win ratio in at least five years.

Kingsford Development Pte Ltd, from China, bid at four of the auctions and won two. In one of the auctions it offered as much as 16 percent above the bid of the closest competitor, despite soft home sales at its maiden Singapore project on a site purchased last year.

"We have confidence in the Singapore market," said Victor Yao, Kingsford's senior business development manager and architect. "Singapore's government is very good at maintaining property market stability."

Strong rule of law, a steady economic outlook and cultural similarity made Singapore ideal for Kingsford's first sally abroad, Yao said.

China's property market has been shaken in recent years by government measures to curb runaway prices, leaving developers wary of further intervention.

"The profit margins here aren't as good as in China, but the market is more stable," Yao said.

The other two foreign winners were subsidiaries of Metallurgical Corporation of China Ltd and Malaysia's Sunway Bhd.

GROWING LAND MASS

The URA's Private Residential Property Price Index has climbed over 30 percent since the end of 2009, rising 3.9 percent in July-September from a year earlier.

Sales, however, nearly halved to 2,430 units after the government in June curbed personal housing loans. That compared with 4,538 in April-June and 5,916 a year earlier, URA data showed.

"Developers are beginning to cut their prices in existing and new projects," City Developments Ltd CTDM.SI said in its quarterly results.

Yet land prices have risen on an island smaller than New York City. Singapore has grown over 20 percent in the past 50 years and the government projects an extra 8 percent growth by 2030 to accommodate economic activity.

OVERSUPPLY

Every five years, the URA issues a land-use plan for the next 10 to 15 years. A draft last month showed land reserved for up to half a million mostly public homes, enough to house 2 million people. Public homes can be sold in the open market after varying years of occupancy.

This has exacerbated concern of oversupply as the government projects population growth of up to 1.6 million people, or 30 percent, to 6.9 million by 2030 from 2013.

The government regards current supply as "adequate" while the Real Estate Developers' Association of Singapore said it supported the government's "calibrated approach". (Full Story) (Full Story)

"For the next five years, everyone is feeling concern whether our residential supply will be too much," said Alice Tan, head of consultancy and research at Frank Knight.

source: www.abs-cbnnews.com

Property giants, insurance firm keen on SSS property in BGC

MANILA, Philippines - The Social Security System's prime Bonifacio Global City property in Taguig has attracted big property developers and an insurer.

According to industry sources, real estate giants SM, Robinsons Land, Filinvest Land, Anchor Land, the Gaisano group and top insurance firm Philam Life have signified interest in the 8,300-square meter property also known as Block 56.

The vacant lot has a minimum floor price of P2.24 billion, representing a 164-percent return from its acquired value.

Located along McKinley Parkway between 10th and 11th Avenues in Bonifacio Global City (BGC), Taguig, the property is also near commercial areas SMX Convention Center, SM Aura and Serendra.

Availability of big lot areas within BGC is limited, as it is now emerging as the country's newest financial district making it attractive to property developers keen on expanding its footprint there.

Philam Life earlier said, it is allocating a bigger portion of its investment portfolio in real estate. It now leases office space within BGC, after selling its Manila City headquarters last year.

The state pension fund hopes to ride on the booming real estate market and unlock the best possible value for the property sale.

“This is the most opportune time to sell, while land prices are at peak levels. Also, the ongoing developments in the BGC area created a high demand for land where there's a short supply of sellers,” SSS president Emilio de Quiros Jr. said earlier.

A pre-bid conference for interested parties is scheduled on July 22, while the submission of bids is on September 4.

It hopes to announce the winning bidder by October.

The SSS acquired the property in 2003, one of two blocs in the BGC back in 2003 for P850 million.

To date, it has an estimated P20 billion worth of total real estate assets.

source: www.abs-cbnnews.com