CDL: Property investment can help narrow income gap

[reporter2]

http://www.straitstimes.com/archive/...e-gap-20150514

CDL: Property investment can help narrow income gap

Firm hopes Govt will tweak cooling measures; posts 2.8% rise in profit

Published on May 14, 2015 1:18 AM

By Rennie Whang


PROPERTY investment can help fight income inequality as it gives people a viable asset that they can add to their portfolios, said City Developments (CDL) yesterday.

The firm also said it hoped the Government would tweak some of the property cooling measures that have "stamped out speculation" in the market. It believes one way to help narrow the income gap "is to enable people to invest in different classes of assets so that they can diversify their investment portfolio - and property should be part of the basket of assets", it said in remarks as part of its first-quarter results.

CDL noted that it has seen "the majority of property buyers follow the 'herd instinct'". When prices fall, they tend to "wait and see", but when there is increased activity and prices start rising, more people are eager to buy. "Quite often, this psychology of property buyers and other factors outweigh the fundamentals of supply and demand projections."

But while statistics provide part of the overall market assessment, "investors must realise that the property market is cyclical in nature", it added. "History has shown that real estate assets in a safe and stable environment like Singapore remain a good investment when viewed with a medium- to long-term perspective."

CDL announced a rise in first-quarter net profit to $123.03 million, a 2.8 per cent increase on a year earlier, thanks to contributions from property development and hotel operations.

Revenue for the three months to March 31 was up 11 per cent to $814.94 million. Turnover from development, including projects such as Coco Palms, D'Nest and Jewel @ Buangkok, rose 16 per cent to $298.57 million.

Despite headwinds in the local residential market, the firm noted, quality projects in good locations will still attract discerning buyers. It will launch two new projects in the second half of this year - The Brownstone, a 638-unit executive condominium in Sembawang, and Gramercy Park, a 174-unit freehold condo in Grange Road.

Revenue from hotel operations rose 6.2 per cent to $375.98 million, thanks to income from new hotels acquired last year and better performance from refurbished outlets. Revenue from rental properties rose 4.3 per cent to $99.19 million while turnover from other sources was up 47.3 per cent to $41.21 million.

Earnings per share was 13.5 cents for the quarter, up from 13.2 cents a year back. Net asset value per share was $9.43 as at March 31, up from $9.25 as at Dec 31. A dividend of 1.93 cents per preference share was declared, to be paid out on June 30.

CDL shares closed up nine cents to $10.19 yesterday.

[email protected]

[MrTan]

Lol. Sugar coated sales talk. True aim is to remove CMs so as to increase sales and hence fatten profit margins.

[rook]

http://www.thegramercypark.com/news.html

CDL is hoping to make a 'killing' from the above premium property site. With the foreigners and speculators currently 'cut off' from the market, its hard to imagine this project getting any traction from the market. Unlike the other recent CDL launches, they cannot rely on smaller sized studios and squeezed 1bdrm/2 bdrm units to give some traction to this project.

[MrTan]

http://www.thegramercypark.com/news.html

CDL is hoping to make a 'killing' from the above premium property site. With the foreigners and speculators currently 'cut off' from the market, its hard to imagine this project getting any traction from the market. Unlike the other recent CDL launches, they cannot rely on smaller sized studios and squeezed 1bdrm/2 bdrm units to give some traction to this project.

No wonder. Now we know the true objective already. Going to TOP soon, right? I wonder how much extension charge CDL has to pay. This will be on top of the Nouvel 18 one. [quote]Nouvel 18, a luxury project along Anderson Road, a 50-50 joint venture between CDL and Wing Tai, has not been launched yet and so has no sold units. It has until November 2016 to sell the units. In the worst-case scenario where all the units remain unsold, the JV will have to pay up to S$38 million in extension premiums. [unquote]

http://business.asiaone.com/property...r-unsold-units

If CDL really want to narrow the income gap, perhaps can sell these properties at $1 to community chest and other charity organizations so that they can really help the poor and the needy by setting up a trust fund and give this group a monthly steady stream of passive income. This will really be putting the money where the mouth is. CDL can also avoid paying extension charges. Win win situation.

[rook]

Actually, I am still unclear about QC charges and ABSD for developers. The former says all Sporean owned company and GLS sites are exempted. The developers' ABSD says all types of companies and all types of land purchases are included.

Please see the following link.

http://forums.condosingapore.com/sho...for-developers

CDL is the last company that will give anything to charity...I hope Warren (Buffet) will approach Quek and ask him to join his 'billionaire's estate pledge' which Warren and Bill Gates are championing...

[Amber Woods]

http://www.straitstimes.com/archive/...e-gap-20150514

CDL: Property investment can help narrow income gap

Firm hopes Govt will tweak cooling measures; posts 2.8% rise in profit

Published on May 14, 2015 1:18 AM

[email protected]

The Straits Times
www.straitstimes.comPublished on May 21, 2015

Property investment won't narrow income gap


I WAS surprised to read that real estate developer City Developments (CDL) suggested that property investment could help fight income inequality ("CDL: Property investment can help narrow income gap"; last Thursday).
It seems that CDL, like most developers, is hoping that the Government will tweak its property cooling measures to boost sales and raise its profits.

When Singapore's private and public property prices rose from 2005 to 2012, CDL made record good profits for its directors. CDL should have paid out at least 75 per cent of its net profit as dividends to its shareholders.
The increase in property prices was largely due to our increased population, low interest rates, and the lack of government measures to curb foreigners, permanent residents (PRs) and even locals from buying multiple properties in land-scarce Singapore.

The Government must continue to ensure that foreigners and PRs cannot purchase freehold or 999-year leasehold landed properties, and also continue to place a tax on foreigners, PRs and corporate private and industrial property buyers.
HDB upgraders contributed to the increase in private property purchases last month, but the more worrying sign is Singaporeans and PRs buying smaller condominium units simply because they look "affordable".

If you are lucky enough to find a tenant, the gross yield is no more than 2.75 per cent a year. With increased housing loan interest rates, maintenance fees, sinking funds and 10 per cent rental property tax; it would make better sense to buy other financial products for better yield, or to keep your Central Provident Fund money for a guaranteed 4 per cent annual return.

The Government must also keep watch on developers or housing agents (both local and foreign) marketing overseas projects here. Many Singaporeans suffered in their property investments during the worldwide recession in 1985, the Asian financial crisis in 1997 and the Lehman financial crisis in 2008; some even went bankrupt.

The Government's emphasis on better education and lifelong learning is the key to better jobs and opportunities, which are the best ways to fight income inequality. Statutory boards, multinational companies, along with small and medium-sized enterprises, must play their part in training Singaporeans and in giving them a chance to rise to senior management positions.

David Goh Chee Hoe

[Jaydenlim]

it would make better sense to buy other financial products for better yield, or to keep your Central Provident Fund money for a guaranteed 4 per cent annual return.

This is what I call empty talk.

a) Financial products do comes with risk, during 2008 financial crisis, many financial products became worthless
b) Financial products are also link to property assets, so just because you are not buying the physical assets, your investment is still linked to property.
c) 4% CPF interest rate is only applicable to SA and MA, and there is a cap to how much you can deposit into your CPF account.
d) The reason why government could pay a high return on CPF is because of GIC and Temasek investment and these often include property assets as well.

[DC33_2008]

You will know if you have dealing with CDL big boss.

The Straits Times
www.straitstimes.comPublished on May 21, 2015

Property investment won't narrow income gap


I WAS surprised to read that real estate developer City Developments (CDL) suggested that property investment could help fight income inequality ("CDL: Property investment can help narrow income gap"; last Thursday).
It seems that CDL, like most developers, is hoping that the Government will tweak its property cooling measures to boost sales and raise its profits.

When Singapore's private and public property prices rose from 2005 to 2012, CDL made record good profits for its directors. CDL should have paid out at least 75 per cent of its net profit as dividends to its shareholders.
The increase in property prices was largely due to our increased population, low interest rates, and the lack of government measures to curb foreigners, permanent residents (PRs) and even locals from buying multiple properties in land-scarce Singapore.

The Government must continue to ensure that foreigners and PRs cannot purchase freehold or 999-year leasehold landed properties, and also continue to place a tax on foreigners, PRs and corporate private and industrial property buyers.
HDB upgraders contributed to the increase in private property purchases last month, but the more worrying sign is Singaporeans and PRs buying smaller condominium units simply because they look "affordable".

If you are lucky enough to find a tenant, the gross yield is no more than 2.75 per cent a year. With increased housing loan interest rates, maintenance fees, sinking funds and 10 per cent rental property tax; it would make better sense to buy other financial products for better yield, or to keep your Central Provident Fund money for a guaranteed 4 per cent annual return.

The Government must also keep watch on developers or housing agents (both local and foreign) marketing overseas projects here. Many Singaporeans suffered in their property investments during the worldwide recession in 1985, the Asian financial crisis in 1997 and the Lehman financial crisis in 2008; some even went bankrupt.

The Government's emphasis on better education and lifelong learning is the key to better jobs and opportunities, which are the best ways to fight income inequality. Statutory boards, multinational companies, along with small and medium-sized enterprises, must play their part in training Singaporeans and in giving them a chance to rise to senior management positions.

David Goh Chee Hoe

[MrTan]

You will know if you have dealing with CDL big boss.

Wat do u mean? Kindly enlighten.

[DC33_2008]

Give a dollar and expect 10 times in return.

Wat do u mean? Kindly enlighten.

[maisonjai]

Narrow the income gap by selling CCR at OCR price, CDL should help. Gov will consider removing CM since prices have fallen to affordable levels.

[MrTan]

Give a dollar and expect 10 times in return.

Lol. So that's his definition of narrow income gap. I'm now totally confused between widen and narrow already.

[august]

Who is the person making the statement? Kuek?

[MrTan]

Who is the person making the statement? Kuek?

CDL: Announcement on Unaudited First Quarter Results for the period ended 31 March 2015

http://media.corporate-ir.net/media_...CDL_Q12015.pdf

Page 19. 3rd last paragraph.