INSUFFICIENT’

New Straits Times - - Business World -

Prop­erty sub­mit­ted the win­ning bid above S$1 bil­lion (RM3.08 bil­lion) for a land par­cel in Stir­ling Road, the first time that a purely res­i­den­tial site on the GLS pro­gramme has ex­ceeded that price quan­tum.

In May last year, Chi­nese de­vel­oper Qingjian Realty bought the 358-unit pri­va­tised Hous­ing and Ur­ban De­vel­op­ment Co es­tate Shunfu Ville for S$638 mil­lion, mark­ing the first large en bloc deal in nine years.

Within a cou­ple of weeks of the a we­b­cast.

China might no longer get an “A1” rat­ing if there were signs that debt was grow­ing at a pace that ex­ceeded Moody’s ex­pec­ta­tions, said Li Xi­u­jun, vice-pres­i­dent of credit strat­egy and stan­dards at the rat­ings agency, in the same we­b­cast.

Moody’s ex­pects China’s growth to slow to around five per cent in com­ing years, from 6.7 per cent last year, com­pound­ing the dif­fi­culty of re­duc­ing debt. But Diron said the econ­omy would re­main ro­bust, and the like­li­hood of a hard land­ing was slim.

Govern­ment-led stim­u­lus has been a ma­jor driver of China’s eco­nomic growth over re­cent years, but has also been ac­com­pa­nied by run­away credit growth that has cre­ated a moun­tain of debt — now at nearly 300 per Shunfu Ville deal, Qingjian sent in the high­est bid of S$301 mil­lion for a mixed res­i­den­tial and com­mer­cial site in Bukit Ba­tok.

“Along with emerg­ing signs of re­cov­ery in Sin­ga­pore, com­pe­ti­tion for res­i­den­tial land is set to heighten as both Sin­ga­pore­based and for­eign developers jump on the band­wagon, pos­si­bly prompt­ing the un­wind­ing of GLS sup­ply and spurring col­lec­tive sale ac­tiv­i­ties,” said Alice Tan, di­rec­tor and head of con­sul­tancy and re­search at Knight cent of gross do­mes­tic prod­uct (GDP).

UBS es­ti­mates that govern­ment debt, in­clud­ing ex­plicit and quasi-govern­ment debt, rose to 68 per cent of GDP last year from 62 per cent in 2015, while cor­po­rate debt climbed to 164 per cent of GDP last year from 153 per cent the pre­vi­ous year.

The Moody’s down­grade was seen as largely sym­bolic be­cause China has rel­a­tively lit­tle for­eign debt and lo­cal mar­kets are in­flu­enced more by do­mes­tic fac­tors.

Still, the rat­ing de­mo­tion high­lighted in­vestor wor­ries over whether China has the will and abil­ity to con­tain ris­ing risks stem­ming from years of cred­it­fu­elled stim­u­lus, with­out trig­ger­ing fi­nan­cial shocks or damp­en­ing eco­nomic growth. Reuters Frank Sin­ga­pore.

Last year, some S$2.6 bil­lion worth of trans­ac­tions were re­ported in the Sin­ga­pore res­i­den­tial GLS space, of which 58 per cent com­prised Sin­ga­pore developers while Ja­panese in­vestors made up 24 per cent.

How­ever, so far this year, China and Hong Kong developers ac­counted for S$1.3 bil­lion out of the S$2.1 bil­lion trans­acted in res­i­den­tial GLS ten­ders, or a share of 62 per cent, the Knight Frank re­port showed. To­day

BLOOMBERG PIC

From 2012 to last year, Sin­ga­pore made up 15.4 per cent of to­tal in­vest­ments by main­land Chi­nese developers, ac­cord­ing to prop­erty con­sul­tancy Knight Frank.

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.