Wing Tai

Wing Tai: Chairman Cheng Wai Keung interviews with the Business Times. Cheng says, just as pent-up demand saw housing prices shoot up over the past few years, a reverse situation could be at play now. With people bringing forward their decision to buy property as they fear prices may rise, demand in subsequent years may be lower than what is projected based on current demand, which could worsen an oversupply situation. A weak economy at that time would further compound the problem. Cheng also acknowledges that global liquidity is a problem, as a country, we have no way of preventing that. Says he understands the govt's measures to cool the property market but suggest, govt policies, especially tactical policies, must have a sunset clause because in the case of temporary issues, if the policy is not removed as fast as possible when the problem no longer exists, a distortion is created in the opposite way. He cites the example of the introduction last Dec of the 10% additional buyer's stamp duty on foreigners buying any residential property here. Says these foreigners instead go to strata industrial, office, shops and shophouses, popping up a new hole on the other side. Cheng also questions why a wide gap exists in high-end home prices between Spore and other cities such as HK and London, despite Spore becoming a lot more vibrant and cosmopolitan in recent years. He estimates that high-end homes in Spore are priced at ~$3,000 psf and above, while those in HK are at the equivalent of ~$6,000 psf and above. Given the attractiveness of living in Spore, he believes this implies that luxury homes here are undervalued. Wing Tai is developing Le Nouvel Ardmore and Nouvel 18 (both in the posh Ardmore Park area), Ascentia Sky near Redhill MRT Station and Foresque Residences at Petir Road in the Upper Bukit Timah area. Its past developments include mass-market projects such as Kovan Melody and Casa Merah. Recall the Cheng family recently concluded a partial cash offer for 15% of shares it does not own, at $1.39/sh. The stock trades at 0.5x P/B.