20160510-高盛-A_glance_at_the_Asia_property_market_11页_289kb

Asia Property Weekly Summary

Core Content

This document provides a comprehensive overview of the Asia property market performance for the week ending May 8, 2016, highlighting key data across residential and commercial segments, along with market ratings, target prices, and upcoming events.

Main Points

Market Performance Overview

• China Property (offshore):

  • 1-week: -4%
  • 1-month: -2%
  • 3-month: +11%
  • 6-month: -8%
  • PIE: 7.9x
  • Dividend Yield: 5.0%
  • % +/- Fwd. NAV: -32%

• China Property (onshore):

  • 1-week: -1%
  • 1-month: -4%
  • 3-month: +5%
  • 6-month: -13%
  • PIE: 8.5x
  • Dividend Yield: 3.0%
  • % +/- Fwd. NAV: -4%

• Hong Kong Properties:

  • 1-week: -4%
  • 1-month: -0%
  • 3-month: +12%
  • 6-month: -8%
  • PIE: 13.3x
  • Dividend Yield: 4.0%
  • % +/- Fwd. NAV: -46%

• Japan Property Developers:

  • 1-week: +1%
  • 1-month: +3%
  • 3-month: +4%
  • 6-month: -16%
  • PIE: 21.2x
  • Dividend Yield: 0.9%
  • % +/- Fwd. NAV: -12%

• Japan REITs:

  • 1-week: +1%
  • 1-month: +10%
  • 3-month: +18%
  • 6-month: +18%
  • PIE: 24.0x
  • Dividend Yield: 2.9%
  • % +/- Fwd. NAV: +32%

• ASEAN Property:

  • 1-week: -4%
  • 1-month: -4%
  • 3-month: +3%
  • 6-month: -7%
  • PIE: 18.2x
  • Dividend Yield: 2.1%
  • % +/- Fwd. NAV: -41%

Key News and Updates

• China:

  • Residential transaction volume dropped 23% week-over-week (wow), but rose 22% year-over-year (yoy).
  • Tier-1 cities underperformed with a -38% wow decline.
  • Inventory months fell to 8.8 months.
  • Land sold volume was -3% wow, but land sold value rose +25% wow.
  • CMI/CAI increased by +0.4% / +0.8% wow.
  • New home prices in 100 cities rose 1.5% month-on-month (mom) in April, compared to +1.9% in March.
  • The Chinese Academy of Social Sciences expects slower growth in tier-1 and selected tier-2 cities, while tier-2 cities will see general price increases and tier-3 and -4 cities will experience slow price declines followed by stabilization.
  • The Ministry of Housing and Urban-rural Development is implementing new policies to regulate housing listings and brokers.

• Hong Kong:

  • 196 primary residential units were sold in the week ending May 8, a 44% drop from the prior week and 3% below the 3-month average.
  • Secondary market prices declined 1.1% wow as of May 2, with a year-to-date (ytd) drop of 5.5%.
  • Retail sales fell 9.8% yoy in March, marking the 13th consecutive monthly decline.
  • Supermarkets were the only category with growth (+0.1% yoy).
  • Wharf reported a -19% drop in retail sales at Harbour City and a -20% drop at Times Square in 1Q16, underperforming the overall HK retail decline of -12%.
  • SHKP won a commercial land tender in Kwai Chung with a record price of HK$6,039 per square foot (psf).

• Japan:

  • Service sector activity declined for the first time in over a year in April.
  • PMI dropped to 49.3 from 50.0 in March.
  • Composite index fell to 48.9 from 49.9 in March, the lowest in 2 years.
  • Average occupancy at 18 major Tokyo hotels increased slightly to 83.8%.

• Singapore:

  • The Parc Life Executive Condominium project in Sembawang sold only 50 units out of 628, indicating a muted response.
  • 200,000 sq ft of office supply will be released at the Vision Exchange, with average rents ranging from S$6.80 to S$7.20 psf per month.
  • Ascendas REIT reported a 6.6% yoy increase in distributable income, with 7% average rental reversions in FY16 and a slight drop in occupancy to 87.9%.

Ratings and Target Price Changes

• Hysan Development (0014.HK):

  • Downgraded from Sell to Neutral.
  • Target price: 27.45 HKD (previous: 36.70 HKD).
  • % change: -25.2%

• China Lodging Group (HTHT):

  • Downgraded from Buy to Neutral.
  • Target price: 39.00 USD (previous: 33.00 USD).
  • % change: +18.2%

• Cheung Kong Property (1113.HK):

  • Upgraded to Buy.
  • Target price unchanged at 70.00 HKD.
  • % change: 0.0%

• Kerry Prop (0683.HK):

  • Downgraded from Buy to Neutral.
  • Target price: 25.70 HKD (previous: 27.35 HKD).
  • % change: -6.0%

• New World Dev (0017.HK):

  • Downgraded from Buy to Neutral.
  • Target price: 9.00 HKD (previous: 11.00 HKD).
  • % change: -18.2%

• Swire Properties (1972.HK):

  • Downgraded from Buy to Neutral.
  • Target price: 28.30 HKD (previous: 30.70 HKD).
  • % change: -7.8%

• Shangri-La Asia (0069.HK):

  • Target price: 9.00 HKD (previous: 8.25 HKD).
  • % change: +9.1%

• Sun Hung Kai Prop (0016.HK):

  • Target price: 123.90 HKD (previous: 135.50 HKD).
  • % change: -8.6%

• Hang Lung Prop (0101.HK):

  • Target price: 21.10 HKD (previous: 23.50 HKD).
  • % change: -10.2%

Top and Bottom Performers of the Week

Top Performers

• CapitalMalt Trust: +3% (1-week), +0% (1-month)
• Japan Retail Fund: +2% (1-week), +1% (1-month)
• Morri Holdings REIT: +2% (1-week), -2% (1-month)
• Shanghai Shimaq: +2% (1-week), -6% (1-month)
• Sekisui House Rent Inc.: +2% (1-week), +0% (1-month)

Bottom Performers

• Champion REIT: -0% (1-week), -5% (1-month)
• ORIX, JREIT: -2% (1-week), -6% (1-month)
• Hysan: -27% (1-week), -27% (1-month)

Largest Upsides/Downsides for Buy/Sell-rated Stocks

• Buy-rated stocks (Market cap > US$2bn):

  • Sino-Ocean Land: +77%
  • Ameren: +75%
  • Mitsubishi Estate: +69%
  • Mtai Fudosan: +67%
  • Sunuc: +65%

• Sell-rated stocks (Market cap > US$2bn):

  • Everande: -27%
  • Bam Siemens: -27%
  • Gemdale Corp: -21%
  • Champion REIT: -16%
  • Hysan: -15%

• Buy-rated stocks (Market cap < US$2bn):

  • Yanford Land: +44%

• Sell-rated stocks (Market cap < US$2bn):

  • Ciputra Development: -16%
  • Far East Hospitality Trust: -6%

Upcoming Events

Key Market Insights

• The residential market in China showed mixed performance, with a decline in transaction volume and price growth in some cities.
• Hong Kong's real estate sector is transitioning from a value trap to a yield appeal, with a focus on rental income.
• Japan's service sector activity declined for the first time in over a year, indicating economic challenges.
• Singapore's real estate market saw a muted response to a new condominium project and a release of office supply.
• The market is expected to continue with a focus on rental yields and the impact of regulatory changes on property prices and sales.