Reference no: EM132585739

BPM303 Project Development and Finance - Singapore University of Social Sciences

Question 1

Singprop Ltd a local developer, wants to enter the Vietnam property market to diversify their asset portfolio. This is their first Vietnam venture and you are a property agent who provides the market research. You are required to write a market report to Singprop Ltd to be included in their feasibility study:

(a) Economic Scene of Vietnam

(b) Vietnam industrial property market

Question 2

In project development, there are mainly two types of development funding; Corporate Financing and Project Financing. Discuss and appraise the differences and risks encountered in these two types of financing.

Question 3
"Federal Reserve Cuts Interest Rate to Near Zero in Response to COVID-19 Outbreak". With the reduction of interest rate, discuss the impact to Singapore property market.

Question 4

The Urban Redevelopment Authority (URA) has launched the commercial site at Paya Lebar Road for sale by public tender. It was available for sale on the Reserve List of the 1st Half 2020 Government Land Sales (GLS) Programme. The site is intended predominantly for office development with a site area of 21,000 sqm and plot ratio of 4.2.

Macland Holding Company (Macland) is interested in this land. Macland has worked out a land price of S$ 800,000,000.00 (Dollars Eight Hundred million). Macland plans to hold the building for a period of 36 months after completion of the construction and thereafter, they will sell the building to an investment fund.

Market research indicates that the net rent after the holding period is estimated to be S$ 100 per m2 per month for a comparable commercial building. A bank has agreed to provide a short-term financing scheme at an interest rate of 7% p.a. The project team has also advised the construction cost to be S$ 3,000.00 per m2 on Gross Floor Area (GFA) and the Net Lettable Area (NLA) is 90% of the GFA. The development schedule for design and construction stage is 6 months and 30 months respectively.

Analyse the data and apply the Profit Evaluation Analysis (risk/return) to determine the profit margin of the project.

(You are to use Appendix 1 for the computation and submit it together with the assignment.)