GIC chief executive Lim Chow Kiat
Singapore sovereign investor GIC sounds the alarm on dangers posed by climate change to the real estate industry, with that red alert leading today’s headline roundup. Also in the news, Perennial opens its transit-oriented complex in the Chinese city of Tianjin and troubled casino operator Star Entertainment secures a funding lifeline.
GIC, S&P Report Warns of $500B in Climate Damage to Real Estate
From intensifying storms to wildfires and droughts, physical risks from climate change could cost the real estate industry well over $500 billion by 2050, according to a new report co-authored by the sovereign wealth fund of Singapore.
Researchers at GIC and S&P Global analysed the potential impact of climate hazards on more than 50,000 real estate assets held by companies in the S&P Global REIT Index. Those properties could face some $110 billion in excess costs by the end of the decade, without investments in adaptation infrastructure. By 2050, total costs could rise to $559 billion or 28 percent of the asset value of the index as of July 2024. Read more>>
Singapore’s Perennial Launches Tianjin Hospitality and Healthcare Complex
Perennial marked the official opening of its hospitality cluster and the construction completion of its medical cluster at its transit-oriented development in China’s Tianjin on Wednesday.
The S$1 billion ($780 million) project spans more than 3.5 million square feet (325,161 square metres) and integrates elder care, medical and hospitality facilities. It sits adjacent to the Tianjin South high-speed railway station. Read more>>
New World, FEC-Backed Star Secures $137M Bailout
The Queensland government has pulled out of plans to provide tax relief for troubled Star Entertainment, only hours after the debt-laden group secured A$200 million ($137 million) in emergency funding. Premier Steven Miles said the government had no role in securing Star’s lifeline, and it was unlikely to reach any kind of agreement on a deferral of tax payments. The payment of generous executive bonuses has emerged as a sticking point for any tax relief.
“There’s been no agreement whatsoever reached there, and we’re unlikely to reach one,” Miles said. “Frankly, I find it astounding that they would be asking the state to defer taxes, to delay the payment of taxes while paying themselves performance bonuses. We’re going to put the taxpayers of Queensland ahead of those executives.” Read more>>
Daiwa Energy Division to Invest in Japanese Data Centre Operator
Energy investor Daiwa Energy & Infrastructure is to invest in Japanese data centre specialist Highreso Kagawa. The companies did not disclose details of the transaction. Highreso Kagawa is a subsidiary of Highreso, a GPU-based cloud service provider, and was formed for the parent company’s data centre operations.
The subsidiary will now build and operate a data centre in Kagawa prefecture on the Japanese island of Shikoku. Details of the proposed data centre have not been shared. Read more>>
Tokyo Home Prices Predicted to Withstand BOJ Rate Hikes
Tokyo residential property prices are likely to hold up after the Bank of Japan’s interest rate increases, though some areas may see declines, industry experts say.
This year’s rate hikes — bringing the central bank’s benchmark to 0.25 percent — are not so large that wealthy people are reluctant to buy, according to Takeshi Ide, senior chief researcher at Tokyo Kantei, a real estate data and consulting firm. Capital gains from short-term resales are likely, he said. Read more>>
South Koreans Expect Housing Costs to Continue Rising
South Koreans expect the housing market to keep getting hotter, according to a central bank survey that’s likely to keep policymakers wary about the risk that an interest rate cut might amplify consumer appetite for mortgage loans.
An index measuring the one-year outlook for home prices edged up to 119 in September from 118 last month, marking a fourth straight rise, the Bank of Korea said Wednesday in its consumer confidence data. Still, it was a more moderate increase than in the two previous periods. Read more>>
China Policy Moves Seen Falling Short of Market Needs
China’s mortgage rate cut for existing properties will hardly make any impact for Ivy Cai, as the Shanghai-based homeowner is facing the burden of a RMB 15,000 ($2,131) monthly repayment.
She is expected to save a few hundred RMB per month once the rate cut, announced on Tuesday as part of a bumper round of measures to support the world’s second-largest economy, is implemented. Read more>>
Country Garden, Sunac Seek to Further Delay Debt Repayment
Despite previous debt restructurings, sluggish sales and tight financing conditions are forcing some Chinese developers such as Country Garden Holdings and Sunac China Holdings to seek to further roll over debt.
Country Garden and Sunac agreed with creditors last year to delay the payment of some bonds to this year. They now plan to extend the deadlines once more. R&F Properties, which finished restructuring its onshore and offshore debts in 2022, has delayed the interest payment on over $4.5 billion in maturing bonds, extending it to next March from this month. Read more>>
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