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NOON Capital Launches Southeast Asia’s First Blockchain-Backed Real Estate Project

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NOON Capital, a Southeast Asia-based property investment platform, has announced plans to establish strategic real estate investments in tier-two Southeast Asia cities.

Its first two properties have an accumulated value of US$20 million. One has been completed and is fully operational, while the second is due for completion in 2019. NOON Capital is also shifting the financing and management of new investments onto blockchain – making it the first real estate developer in Southeast Asia to build, manage and drive individual and institutional investment through blockchain technology.

NOON Capital’s investment mantra is to focus on tier two Southeast Asian cities, where there is more room for bringing market efficiencies, lower barriers to entry and more room for growth and value creation for shareholders.

“Thailand has a stable currency, low inflation, a strong banking system, and is embracing blockchain technology. It has great infrastructure for both our investors and tenants,” said Luca Dotti, Managing Partner of NOON Capital. “This makes rapidly developing cities such as Phuket an attractive proposition, because it has the safety and structure of a developed country, while also having immense real estate potential for investment and development.”

According to The World Bank, Thailand has moved from a low-income country to an upper-income country in less than a generation. The country has articulated its long-term economic goals in its 20-Year National Strategy (2017 – 2036) focused on growth of Tier 2 cities, including Phuket and Chiang Mai. These cities are particularly interesting for the country’s rapidly growing middle-class.

The domestic disposable income is growing at 5 per cent a year, and the strong demographics is likely to foster further urbanization dynamics and wage increases. With its increased spending power, Thailand’s middle-class is looking towards convenient, pricier housing solutions that still offer value for money.

A Track Record in Innovation
Claudia Zeisberger Academic Director of INSEAD Global Private Equity Initiative, has also joined NOON Capital’s advisory board to support its business expansion with her vast experience in private equity, and her insights around blockchain developments. This follows other senior appointments at NOON Capital as it builds its portfolio and grows from strength to strength.

NOON Capital’s Tower Phase I was the first project completed in December 2016, featuring a 74-unit condominium tower located at the heart of Chalong, the main residential district of Phuket. In its first ten months, it has reached an impressive 90 per cent occupancy rate.

Following this, the company is also venturing into the development of Spazio NOON, a network of co-living spaces in Thailand which won the Patrick Turner Award at the INSEAD Venture Capital Competition – awarded to projects with large potential social impact. The construction of its first outpost in Phuket is due to commence in the second part of the year.

By integrating blockchain technology into its investment processes and housing upkeep, NOON Capital is aiming to secure funding from investors through digital certificates backed by its project. The interconnectivity of these applications onto the same blockchain (Ethereum) creates a seamless, efficient and transparent investment process.

It also provides quick updates, such as distributing a small dividend to investors in real-time every time NOON Capital receives a monthly rental payment. For housing purposes, tenants can also use digital wallets to pay regular monthly bills such as basic utilities and rental.

Singapore Downturn Continues, But Investors Begin to Look for Deals

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Several experts predict that the city state will see moderate, if any, upward rent adjustments in the next 12 months.

Several experts predict that the city state will see moderate, if any, upward rent adjustments in the next 12 months.

Although a soft economy and weak fundamentals continue to affect Singapore, investors are now beginning to look for a turnaround in a market with an abundance of the type of core assets that are currently in demand across the region, according to Emerging Trends in Real Estate® Asia Pacific 2017, a real estate forecast jointly published by the Urban Land Institute (ULI) and PwC.

The beaten-down core space in Singapore has seen revived interest, although prices have yet to fall enough to attract serious buyers. As the only major market in Asia currently in a down cycle, funds are looking for reasons to invest there. A single big purchase has boosted transacted values from an otherwise low base, while Chinese investors were rumoured to be looking in Singapore and may be early buyers given their relatively low level of price sensitivity.

On a total-return basis, benchmarks are proving more resilient across the region, although they have registered significant declines in China, Hong Kong (where mainland capital is active), and Singapore. Several experts predict that the city state will see moderate, if any, upward rent adjustments in the next 12 months.

“Singapore’s low ranking in this year’s report has been attributed to various factors including over-capacity in office space, falling retail sales and a residential market correction ” said Dr. Seek Ngee Huat, Chairman of ULI Asia Pacific, and Chairman, Global Logistic Properties. “However, the report findings indicate that Investors still believe in the long term fundamentals of Singapore and are on the look out for investment opportunities.”

“Singapore’s decline in ranking, largely due to over-capacity and decline in demand, is not unexpected. Focusing on the positive, we could be close to the bottom of the cycle and we are seeing opportunities to invest. I hope, given the uncertainties in local and global economy, there will be an increase in transactions across asset classes over the next 12 months,” said Yeow Chee Keong, Real Estate and Hospitality Leader, PwC Singapore.

This year’s Investment Prospects survey shows a strong shift away from last year’s favorites, which featured core markets in Japan and Australia, in favor of emerging-market destinations, with two Indian cities topping a list, which also includes Vietnam and the Philippines and Shenzhen in 5th position. Other major survey findings include steep declines in the popularity of gateway cities with the exception of Shanghai, which has seen a resurgence in foreign investment over the last couple of years, despite high prices. This overarching shift reflects the difficulty in sourcing core assets in an environment where owners have few other places to invest their capital if they sell, together with the growing urgency of investors’ ‘quest for yield’ as returns are squeezed ever lower.

Emerging Trends, which is being released at a series of events across Asia over the next several weeks, provides an outlook on Asia Pacific real estate investment and development trends, real estate finance and capital markets, and trends by property sector and metropolitan area. It is based on the opinions of 604 internationally renowned real estate professionals, including investors, developers, property company representatives, lenders, brokers and consultants.

The full report is available HERE.

ULI, PwC survey ranks Singapore as fair for investment, development prospects

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Emerging Trends in Real Estate® Asia Pacific 2016, a real estate forecast is jointly published by the Urban Land Institute (ULI) and PwC.

Emerging Trends in Real Estate® Asia Pacific 2016, a real estate forecast is jointly published by the Urban Land Institute (ULI) and PwC.

Real estate activity in Asia next year will reflect a continuation of trends seen in 2015 – an abundance of capital flowing to core space, as well as a flight to safe havens in the region’s most developed and liquid markets, according to Emerging Trends in Real Estate® Asia Pacific 2016, a real estate forecast jointly published by the Urban Land Institute (ULI) and PwC. Japan and Australia remain the favorite countries for investment and development, with Tokyo, Sydney, Melbourne and Osaka taking four of the top five spots for promising markets in the Asia Pacific region. Ho Chi Minh City, rated fifth, rounds out the list of most favored markets.

“Asia’s real estate markets are the product of almost eight years of easy money from the world’s central banks. Although easing in the U.S. may be ending, both Japan and the European Union continue to provide liquidity, while interest rates in many Asian countries are lower than one year ago,” said ULI North Asia Chairman Raymond Chow, Executive Director, Hongkong Land Limited in Hong Kong. “

Emerging Trends, released during ULI Singapore’s 2015 Annual Meeting, provides an outlook on Asia Pacific real estate investment and development trends, real estate finance and capital markets, and trends by property sector and metropolitan area. It is based on the opinions of 343 internationally renowned real estate professionals, including investors, developers, property company representatives, lenders, brokers and consultants.

Survey respondents ranked Singapore eleventh for investment prospects and ninth for development, placing the city in the middle of the list of the 22 markets covered by the report. It attributes Singapore’s rating to the market’s loss of traction in 2015 following a surge in commercial rents in 2014. The report notes that businesses in the city are having problems expanding due to a tight labour market and ongoing restrictions on hiring foreign staff.

In addition, it points to a slow residential market, mainly due to government actions in 2013 to stem soaring home prices. Still, despite the tepid enthusiasm, “Singapore is always a market where institutions are looking to buy,” says Emerging Trends, adding that a number of major property purchases are expected to be complete before the end of 2015.

Click HERE to read more about the top five markets for 2016 plus other findings.

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