SINGAPORE – A Land parcel in Margaret Drive that is big enough for 275 homes has been triggered for sale after a developer committed to bid at least S$185.76 million for it.

This is a Reserve List site under the government land sales (GLS) programme that can be released for sale only when the minimum price committed by a developer is acceptable to the government.

Based on the maximum gross floor area (GFA) of 22,195 square metres, this minimum price translates to S$777.54 per square foot per plot ratio (psf ppr).

The Urban Redevelopment Authority (URA) said on Thursday that it had accepted the application to put up the site for sale by public tender, which will be launched in about one to two weeks.

The tender period for the 0.48 hectare land parcel will be about four weeks.

Property consultants expect to see strong interest from developers given the site’s location and its palatable size. But their projections vary widely from five bids to 13 bids, with the winning bid likely to be in the region of S$800-912 psf ppr based on BT’s poll.

The 99-year leasehold site is nestled within an established residential enclave near the Commonwealth MRT station.

It is close to the Ayer Rajah Expressway, with nearby retail and dining options at the Dempsey Cluster, Queensway Shopping Centre, Ikea Alexandra and Alexandra Central.

There are also public amenities and schools in close proximity.

Lee Nai Jia, head of research for South-east Asia at Edmund Tie & Company, noted that the Commonwealth area is popular, given that it is a few stops to the CBD and is also near the Buona Vista area, which is a strong rental catchment area. New home prices in Commonwealth now range from S$1,400 to S$1,900 psf.

“Looking at the technical conditions of the tender, the proposed site faces several restrictions as they have to check for noise level from the neighbouring churches,” he said.

“Additionally, the site is close to MRT track and there needs to be a minimum 35m setback (from front wall). The developer may have less room to manoeuvre in terms of design. The bidder who wins is also likely to incorporate cycling amenities as they get GFA exemptions for the cycling facilities.”

SLP International executive director Nicholas Mak noted that the site was among the more attractive ones in the GLS Reserve List due to its location near the popular East-West MRT line and the plot’s relatively small and manageable size.

By comparing the trigger bid pricing of S$777.54 psf ppr for this site with the land price of S$871 psf ppr that Hao Yuan Investment paid last year for a 1.05ha parcel in Queenstown where it is launching Queens Peak, the trigger bid is “high but not ridiculously high”, Mr Mak said.

“This developer that triggered this tender may be using the same tactics as the developer who triggered the tender of the Central Boulevard white site, which is to trigger the tender at a fairly high price to discourage other developers to bid.”

R’ST Research director Ong Kah Seng noted that developers are generally running low in land inventory, and are thirsty to replenish landbank, in part to demonstrate that they have longer-term corporate growth strategies as land development is their bread and butter activity.

lynkhoo@sph.com.sg

This article was first published on NOVEMBER 04, 2016.
Get The Business Times for more stories.

SINGAPORE – De Beers, the world’s leading diamond company, is testing a new service of selling third-party polished diamonds to other businesses through its online auction platform.

The service is being launched from Singapore, where De Beers’ Auctions Sales business has been based since 2013 to allow the group to be closer to its customers in India and the Asia-Pacific, said executive vice-president of auction sales Neil Ventura in an interview with The Business Times.

De Beers, the single largest producer of rough diamonds by value in the world with a 30 per cent market share, traditionally sells only rough diamonds that it mines and produces.

Some 90 per cent of these are sold through selling events to authorised bulk buyers known as sightholders, while the rest are sold to small and medium-sized companies via online auction.

In June this year, in response to customer feedback, it started the service of selling rough diamonds produced by others on its online auction platform.

Due to customer demand, the group will from Thursday also extend the service to polished diamonds over five carats or of fancy colour, said Mr Ventura.

Diamonds sold on the platform will have to be accompanied with evidence documenting their manufacturing history and showing that they come from rough diamonds which have the Kimberley Process certification.

“This pilot is really a result of our dialogues with our customers,” he said. “What we’re offering here is a new route to market.”

De Beers customers currently sell their polished diamonds through traditional bilateral negotiations, their own networks of downstream customers, and existing online platforms, according to Mr Ventura.

What De Beers offers through the new service is exposure to a very large global customer base, he said. “We can do it in a way that differentiates the sellers – because they will be adhering to these higher standards – and provides assurances to the buyers across the world who will be bidding.”

De Beers’ Auction Sales unit is based in Singapore; of the unit’s total headcount of 34, 19 are based in the Republic. Since moving here in 2013, the group has sold US$1.3 billion worth, or 5.5 million carats, of rough diamonds through the country.

Under the auction sales channel, rough diamonds across a variety of different grades – from very high end industrial quality – are brought to Singapore where they are evaluated and sorted into batches carrying similar characteristics.

These are then taken on roadshows for viewing by potential customers in cities such as London and Antwerp, who will eventually bid for the stones in an online auction on a specific date.

With over half of De Beers sales being made in the Asia-Pacific, the move by the Auction Sales unit to Singapore is part of a long-term positioning of the group, Mr Ventura told BT.

The country is attractive for being safe and secure, and the “great availability” of talent, he added. “Singapore just really ticked all our boxes.”

sandrea@sph.com.sg

This article was first published on NOVEMBER 04, 2016.
Get The Business Times for more stories.

To rent three units to run his workshops at Sin Ming Industrial Estate, Mr Mike Keh now pays $6,000 a month per unit.

From early next year, he may have to pay $8,800 per unit at the new Sin Ming AutoCity.

It follows a move to relocate tenants of Blocks 11 to 21, 27 and 34 in the estate to the high-rise industrial building. The relocation was announced in 2010, under the Housing Board’s Industrial Redevelopment Programme which aims to make better use of land.

In all, 154 tenants will be relocated to the new Sin Ming AutoCity.

Mr Keh’s units are at blocks 19 and 21. He said although rents at the new building are cheaper on higher floors, his workshops serve heavy vehicles and have to be located on the ground floor.

Mr Bernard Sim, who runs BVO Automotive at Block 15, said higher rents will add further pressure to an industry that has been facing slow demand.

“It would be good if the authorities could do something to help the small and medium-sized firms at this point in time,” he added .

Singapore Motor Workshop Association president Francis Lim said that the HDB has been in regular dialogues with tenants, but agreed that cost pressures are a grave concern in the current market.

He noted, however, that the replacement units are larger.

In response to queries, the HDB said that existing units have a typical floor area of 123 sq m.

In contrast, the new motor workshop units come in two types: one which ranges from 216 sq m to 225 sq m, and another which ranges from 320 sq m to 345 sq m. The new heavy vehicle workshop units range from 251 sq m to 279 sq m.

Mr Keh acknowledged that the new units he will be renting at Sin Ming AutoCity are larger at 265 sq m, compared with the units he rents now which are around 185 sq m.

It is not the first time Sin Ming Industrial Estate tenants have had to move. In earlier batches of the programme, tenants were relocated to Shimei East Kitchen and Sin Ming Autocare. The eight-storey Sin Ming AutoCity complex now sits on part of the vacated site from those previous moves.

The 2.1ha complex will have a canteen, 14 heavy vehicle workshops, 117 motor workshops and 30 spray-painting units.

Tenants selected their replacement units in April last year and will receive their keys starting from mid-January next year.

Once tenancy of the replacement unit starts, they have three months to vacate their old premises.

Most motor workshops there do plan to take up the replacement units, said Mr Lim. “Those which leave are the ones (whose owners) were looking to retire or have no successor.”

One high-profile tenant that has moved out is not a workshop, but popular restaurant New Ubin Seafood.

It closed its Sin Ming premises on Oct 30 and reopened yesterday in the west instead, in the Lam Soon Industrial Building canteen at 63 Hillview Avenue.

Asked about plans for the newly vacated land, the HDB did not give details but said that based on the Urban Redevelopment Authority’s Master Plan 2014, the site vacated by Blocks 11 to 21 and 27 is zoned for residential use.

Block 34 is on land zoned for “Business 1” use, which includes light industry and warehouse use.

This article was first published on Nov 04, 2016.
Get a copy of The Straits Times or go to straitstimes.com for more stories.

SINGAPORE – Tan Tiong Cheng will step down as executive chairman of Knight Frank Singapore on March 31 next year.

However, this will not mark the end of his career with the property consulting group, where he has been for the past 35 years. Mr Tan, 66, will assume a newly created role of president – Knight Frank Asia Pacific, helping the head, Kevin Coppel, to propel the group’s business across the region.

At the same time, Mr Tan will be an adviser to Knight Frank Singapore.

Danny Yeo, 63, will become chairman of Knight Frank Singapore on April 1 next year in addition to continuing in the current job of group managing director of the local office.

From the same date, Mr Tan will work part-time, which will leave him with time to pursue personal interests. He is currently an independent director of three companies – Heeton Holdings, The Straits Trading Company and UOL Group.

“I will also have more time for reading, listening to music, and travelling. I can visit my daughter and grandson in the States more often,” he said.

Mr Tan stressed that his continuing to serve Knight Frank on a part-time basis will not be “just for the sake of working”.

“It must have some positive impact on others.”

The company has more than 600 employees in its Singapore office; in addition, it has a pool of over 700 associates, who are property brokers remunerated on a commission basis only.

Knight Frank Singapore is 55 per cent owned by Cheong Hock Chye & Co, which in turn is fully owned by AF Global, a joint venture of Aspial Corporation and Fragrance Group.

The other 45 per cent is held by Knight Frank Asia Pacific, which in turn is owned 25 per cent by Knight Frank Singapore and 75 per cent by Knight Frank UK.

The Asia-Pacific operations cover Singapore, Malaysia, Indonesia, Thailand, Vietnam, Cambodia, India, Australia, New Zealand, Hong Kong, China, Taiwan and South Korea.

“We are looking to expand our presence to other places such as the Philippines and Myanmar,” said Mr Tan.

Mr Tan obtained a diploma in urban valuation from Auckland University in 1972 under a Colombo Plan scholarship. Upon his return to Singapore, he joined the property tax division of the Inland Revenue Department as a property valuer.

He was seconded to the Urban Redevelopment Authority in 1978 to help with valuation and land acquisition matters.

In 1980, he joined Cheong Hock Chye & Co as a director of valuation. In 1983, the firm merged with Knight Frank and was renamed to Knight Frank Cheong Hock Chye & Baillieu.

Two years later, Mr Tan was made deputy managing director when he was in his mid-thirties, before becoming managing director in 1987.

In 1996, the firm changed its name to Knight Frank Singapore. In 2009, Mr Tan became executive chairman and Mr Yeo, the group managing director.

Mr Yeo, the incoming chairman, said his priority will be on succession planning. “The goal is to develop a core team of leaders who will take ownership of the company’s direction.”

“We are very conscious of the changing market environment and development of technology. What we’re doing is to identify which are disruptive technologies and which are the enablers – and then harness the enablers to improve our operational efficiency and stay relevant in the evolving marketplace.

“My goal is to transform Knight Frank from being ‘good’ to being ‘great’,” he said.

Records filed with the Accounting and Corporate Regulatory Authority showed that Knight Frank Pte Ltd – the entity for the Singapore operations – saw its revenue decline to S$61.4 million in the latest financial year ended March 31, 2016, from S$67.2 million in the preceding year. Over the same period, net profit fell to S$2.8 million from S$4.1 million.

In the past, Knight Frank Singapore has overcome tough times through its practice of “common misery”, of not retrenching staff but instead introducing pay cuts – which were later restored – with bigger reductions for the senior staff and none for the most junior employees. The last time this was done was in 2008.

Mr Tan said the most important lesson learnt over the years is: “You must stay focused and fulfil your promise. At the end of the day, you must be trusted. Trust is a pre-requisite for being professional. It is also key to success.”

He also has some words of encouragement for those undergoing tough times. “In life, there are always ups and downs. The important thing is: do not give up. If you stay focused, at the end of the day, the bad times will pass.

“But if you’re a pessimist, it will take you a longer time to recover.”

Looking back at his more than three decades at Knight Frank, Mr Tan said: “I have been very blessed with an interesting and exciting worklife – seeing the ups and downs of the property cycle and bouncing back each time.

“To me, property is a fun business. A lot of people are interested in real estate in Singapore and we get to know a lot of interesting people along the way. It’s been quite a fulfilling and rewarding career for me, much more than I could have asked for. It came from all the great colleagues who believed in me, journeyed with me and clients who trusted us – many of whom are now our friends.

“I am very happy because Knight Frank Singapore is in safe hands.” kalpana@sph.com.sg

This article was first published on NOVEMBER 04, 2016.
Get The Business Times for more stories.

Another car parallel importer has failed to deliver vehicles on which deposits have been paid – the second such case in less than a month.

TLC Cars Singapore, one of several small motor firms in Turf City, off Bukit Timah Road, has closed its doors, leaving customers in the lurch.

The development comes barely a month after Exodus Global, a parallel importer in Ubi Avenue 3, did the same thing.

Like those affected by Exodus’ move, customers of TLC have lodged police reports. Police said they are looking into the matter.

Logistics manager W.Y. So, 33, said he chanced upon TLC Cars in July, and decided to buy a brand new Toyota Harrier sport utility vehicle from it for $137,800. Since then, he has paid up just over $55,000 in deposits, but has yet to secure delivery of the car. After repeated assurances by the company and as many postponements, he filed a police report on Oct 27.

Asked why he decided to buy a car from a relatively unknown firm, Mr So said it was a “random” choice. “Its price seemed all right,” he said. “And it had newspaper clippings on its wall.” Asked how he felt about the prospect of not getting the car or his money back, Mr So said: “I’ll have to suck it up. There’s nothing much I can do.”

The Straits Times understands that at least 10 customers are affected by the TLC episode, while more than 20 have been affected by the Exodus Global case.

Individual consumers are not the only ones facing losses. Fellow motor company Auto Lease has also made a police report against TLC.

TLC, it said, bought a Honda Vezel from it for about $36,000 (before COE). TLC paid about $6,000, took delivery of the car, but has made no further payment.

Mr Anthony Lim, a partner in Auto Lease, added that his firm had also secured several certificates of entitlement (COEs) on TLC’s behalf.

Auto Lease was also affected by Exodus Global’s closure. In total, Mr Lim said Auto Lease had paid $310,000 in COE deposits on behalf of Exodus Global and TLC.

Mr Raymond Tang, first vice-president of the Singapore Vehicle Traders Association, said cases such as TLC’s are “not new”.

Indeed, the industry sees similar cases almost yearly. The biggest in recent years involved Volks Auto, which misappropriated some $4.6 million in deposits in 2014.

Mr Tang said consumers should patronise “respectable firms with long track records to be safe”. Even better, go to CaseTrust-accredited dealers, he said. “Most times, they get into trouble because they go for the lowest prices,” he said.

TLC managing director Timothy Gay was uncontactable for comment.

This article was first published on Nov 04, 2016.
Get a copy of The Straits Times or go to straitstimes.com for more stories.