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In case you missed these news

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Main contractors for 5 BTO projects unable to continue due to financial difficulties; further delays expected: HDB

SINGAPORE: The completion of five Build-to-Order (BTO) residential projects will be delayed due to "financial

difficulties" faced by its main contractors, the Housing and Development Board (HDB) said on Thursday (Aug 26).

Greatearth Corp and Greatearth Construction informed HDB that they ran into financial difficulties and

are unable to complete the projects despite government assistance.

“HDB had also explored possible options to resolve Greatearth’s challenges, such as through advance payments, but Greatearth does not have the financial ability to continue its operations,” HDB said.

It added that all work at the five sites have been suspended since Aug 20.

“Prior to this, the progress of works was satisfactory, and there was no sign of work slow-down or any sudden reduction of supplies or workers on-site,” it said.

Two of the projects – Senja Ridges and Senja Heights – were launched for sale in 2016. They were expected to be completed in the last quarter of this year and the first quarter of 2022.

(VERY HIGH COST OF BUILDING MATERIALS PLUS LACK OF MAN POWER HAVE CAUSED PRICE OVER-RUNS EVEN IN EFFICIENT SINGAPORE)

And in Malaysia News Edgedaiy)

Prolonged Covid-19 pandemic: Risk of abandoned projects rises

PETALING JAYA (Aug 28): There is a potential rise in abandoned projects as the Covid-19 pandemic drags on with high daily cases.

Property and legal experts told The Edge Malaysia in a report this this week that there could be potentially “millions, if not billions,

of ringgit worth of projects being abandoned once the movement restrictions or bank loan moratorium is over”.

Banks can’t foreclose for now until the moratorium is over. But with the prolonged lockdown, I will not be surprised if some property developers experience cash-flow hiccups next year,” an abandoned project specialist who declined to be named said.

“As work progress is slow and sales low, the situation could get worse if they are unable to find an alternative source of funding or even a new investor,” he said.

(NOTE: WHAT HAPPENED TO SINGAPORE CAN ALSO HAPPEN IN MALAYSIA.

AS SUCH BE CAREFUL ABOUT HIGHLY INDEBTED CONSTRUCTION COMPANIES THAT ARE UNABLE TO DELIVER ITS PROJECTS ON TIME)

(IN ISKANDAR DURING THE BOOM YEARS OF 2000 TO 2015 WHEN 300 CONDO BLOCKS  WERE BUILT CONCURRENTLY  A FEW CONTRUCTION MATERIAL SUPPLIERS WENT BURST FROM NOT BEING ABLE TO COLLECT DEBTS FROM GOODS DELIVERED AFTER CONDO PRICES CRASHED. NOW SOME NEW CONDOS ARE BEING OFFERED AT 50% DISCOUNT)

SAFETY OF PALM OIL

UNLIKE CONTRUCTION COMPANIES THAT DEAL WITH LUMPY EARNINGS PALM OIL DEPEND ON THE ENTIRE CONSUMER MARKET: AND IT IS A WELL DIVERSIFIED CASH BUSINESS WITH 50% OF SUPERMARKET PRODUCTS SOLD

SO SALE AND COLLECTIONS ARE WELL SPREAD OUT WITH LITTLE RISK OF DEBT DEFAULT

Best regards

Calvin Tan

Please buy or sell after doing your own due diligence or consult your Remisier/Fund Manager