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Property Press Briefing
发布时间:2020-10-10 13:54:23 来源:

Sales commentary, not BofA research

 

Headlines

l  Y’day: HSI -0.98%, SHCOMP -1.29%, KOSPI -2.38%

l  Overnight: Dow +0.52%, SPX +1.05%, Nasdaq +1.71%

l  UK: Govt tells public to work from home if possible

l  UK: Coronavirus furlough program cost rises to £39.3bn

l  GR: BaFin: Banks need high lvls capital for payouts; recommends banks avoid divs; but can’t forbid it

l  US: Congress reaches deal on stopgap funding to avert shutdown

l  US: Kudlow says Trump optimistic a/b TikTok bid, not done deal

l  US: Brookfield Properties to Cut 20% of Employees in Retail Unit

l  SK: 110 more coronavirus cases… back above 100

l  CN: China jails outspoken property tycoon Ren Zhiqiang for 18 yrs (SCMP)

l  CN: GDS Holdings announces accepted offer to acquire Beijing data center

l  CN: Merchants Shekou to halt trading pending asset purchase review

l  CN: Mortgage quota shortage seems to have emerged in Tier 2-3 cities, which cld weigh on prop sales

l  HK: 3 local virus cases on Tuesday

l  JP: Reopens after holidays

l  JP: Cases fall to 312 / 319 on 21/22 Sept, from 480 on 20th

l  SG: Capitaland Mall Trust EGM to be held on 29 Sep

l  AU: IWG to open 10 Regus coworking spaces in Queensland, Australia

 

Today.  50% of my kids are back at school!!  UBS CEO says it’s hard to sustain culture working at home… & I got the call up to go back to the office in a month.  So – today I think we focus on recovery names (HK retail – take your pick but Wharf REIC has now widened its underperformance to the group) & office.  This is the 1st day Japan is trading since news of PAG planning to deploy US$8b in Japan property assets (& their target with Spring REIT was office) so I continue to think some of the beaten up Japan office small caps are interesting (Invesco office a clear underperformer, -38% ytd, with no sponsor & higher volume on Friday than we’ve seen in months).  I’m also told DXS & SCG both said y’day they’d be taken out if they continue to trade at such discounts.  Let’s see – its never that easy – but for now equities are trading very cheap to the physical assets in most cases.  Lastly press around mortgage quota shortage for T2-3 cities AND around off balance sheet debt etc being counted in LTV calcs for the (yet to be confirmed) 3-4-5 rules keep me cautious on the more highly levered China props.  Let me know if you want to talk to Eric re Jinmao as a short on these themes.  While its underperformed, its still on >6x ’20 PE per BBG.

 

 

Finally: Do Schools Kill Creativity? Sir Ken Robinson makes an entertaining & profoundly moving case for creating an education system that nurtures (rather than undermines) creativity.  We know 3 things a/b intelligence.1st is diverse. We think a/b the world in all the ways that we experience it. 2ndly, intelligence is dynamic. If you look at the interactions of a human brain, intelligence is wonderfully interactive. The brain isn't divided into compartments. In fact, creativity -- which he defines as the process of having original ideas that have value -- more often than not comes a/b through the interaction of different disciplinary ways of seeing things. 3rd 1 is distinct.  Our education system has mined our minds in the way that we strip-mine the earth for a particular commodity. & for the future, it won't serve us. We have to rethink the fundamental principles on which we're educating our children. (Ted)

 

China

 

Devrs seek to dodge new rules w/ shift of debt off balance sheets: 1) moving debt off books by setting up ventures w/ other devrs to purchase land is already common practice & will intensify; 2) investing in a project w/ a financial entity which gets guaranteed returns & an agreement for their stake to be bought back. (Reuters)

Some banks in tier 2-3 cities tighten approval of mortgage loan due to quota shortage. (The Paper)

China jails outspoken property tycoon Ren Zhiqiang for 18 yrs. (BBC)

GDS accepted offer to acq Beijing data center, enterprise val ~Rmb3.8b. (Cmlviz)

Evergrande buys 45,000m2 mixed-use proj behind Shanghai’s Int’l cruise terminal for Rmb2.3b ($339m). (Mingtiandi)

Changsha saw heated land auctions. A land parcel was sold w/ 42% land premium over reserve price, another hit land price cap. (Netease)

Shandong deepened the scrutiny over the construction quality of resi projects. (Guandian)

KWG anncd last record date for conditional distribution & assurance entitlement of shrs in prop mngt arm will be on 9 Oct. (Co)

CMSK trading halt, b/c CSRC will review CMSK’s M&A scheme on Nanyou Group. (Co)

Times issued US$350m 6.2% senior notes due 2026. (Co)

COLI repurchased 500k shrs @ avg price HK$19.92/sh. (Guandian)

Hong Kong/Macau

CKA puts 285 units in Sea To Sky resi proj up for sale this Sat. (HKET)

SHKP puts 192 units in Wetland Seasons Park phase 3 resi proj up for sale this Sat. Co sod total 2110 units YTD for HK$16.78b. (HKET)

Wheelock sold 934 units for HK$10.66b YTD, 448 units (HK$4.57b) from Ocean Marini proj. (HKET)

Topspring / Chun Wo to launch 128 Waterloo proj for sale b/f Sep-end, comprises total 110 units. (HKET)

Vanke puts 87 units in Lepont proj up for sale this Sat. Co sold total 1067 units (95%) for HK$7b. (HKET)

YTD New home sales volume 40% YoY to 9,341 units (HKEJ)

8 projects w/ 726 units will fight for buyers this w/e –highest since 3rd Covid wave in July. (HKEJ)

HK’s Grade A office spot rent 1.7%MoM in Aug, slowdown vs 2% avg monthly in 1H. Vacancy reached 8.1%, 0.2%MoM, Central @ 6% (up 0.3% - a 15-yr high).  Central also recorded largest monthly drop in office rent in Aug among the submarkets at 2.5%.  (HK01)

Billion Devt asking for HK$24/ft2 for office, HK$50-60/ft2 for retail of its new project Plaza 88 in Tsuen Wan. The 642k ft2 GFA project is currently ~20% leased. (HKEJ)

ITC Props / URA start sales of 1st batch of 50 units in Hyde Park resi proj this w/e, price HK$17,975-22,542/m2. (HKET)

Singapore

SLB ag’d to buy 5,952m2  Thye Hong Centre freehold industrial site for S$112.5m ($83m). (Mingtiandi)

Capitaland Mall Trust EGM to be held on 29 Sep. CMT & CCT engage retail investors on merits of proposed merger at SIAS dialogue sessions. (Co)

CapitaLand CEO Lee Chee Koon gets 593,791 sh awards, now holds 1,278,338 rights/options/warrents. (Co)

Everton Road shophouse in District 2 for sale w/ S$7.5m guide price. (BT)

Mapletree’s subsidiary Oakwood launches day-use workspaces at 17 Asia-Pacific props. (BT)

Australia / New Zealand

IWG to open 10 Regus coworking spaces in Queensland, Australia. (AFR)

Aust Prelim Retail Sales Fell 4.2% in Aug. on Victoria (BBG) “result was driven by a fall of 12.6% in Victoria” said Ben James @ ABS.  Ex VIC, retail trade across rest of Aust 1.5% from July to Aug

Japan

New apts supply across greater Tokyo in Aug 8.2%YoY to 1,669 units. (JPC)

India

Uttar Pradesh RERA urges state govt to stamp duty on property registration by 2%. (India Times)

Value of RE under construction to $243b from $94b in ‘09, per FICCI / Anarock report. (India Times)

Korea

Doosan sells Doosan Twr in central Seoul to a RE invsmt co for KRW800b ($687m). (Korea Joongang Daily)

 

 

* My pa holdings: BAC US, 1 HK, 6 HK, ST SP, TEAM US, GOOGL US, AMZN US, 9988 HK

Sarah Cooper

Managing Director

Global Head, Real Estate Equity Sales
BofA Securities
55/F Cheung Kong Center, 2 Queen's Road Central, Hong Kong

T 852.3508.4938 M 852.9301.1149
sarah2.cooper@bofa.com

 

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  Property Press Briefing 2020-10-10
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