CapitaLand holds off spending

CAPITALAND, Singapore’s largest real-estate developer by assets, will hold back on investments until the global credit crisis shows signs of bottoming, said chief executive officer Liew Mun Leong.

CapitaLand is evaluating opportunities to invest about $4 billion of cash and will wait for signs that the rout in financial markets is nearing an end, Mr Liew said. The developer has invested about half of the $9 billion it earned from asset sales over the last two years, he said.

“There are plenty of opportunities floating in front of us,” Mr Liew said. “As I see it now, it’s still not bottoming. You may think it’s cheap but tomorrow, it’ll be cheaper.”

The slowdown has weighed on Singapore housing prices, which fell in the third quarter for the first time in more than four years.

“If the current financial crisis is prolonged, smaller companies may actually run into cash flow problems and it may make sense for them to form partnerships or be bought over by companies with stronger balance sheets,” said Mr Wilson Liew, an analyst at Kim Eng Securities, which has a “hold” rating on CapitaLand.

“That could present some opportunities and CapitaLand has made some savvy investments in the past.”

Source : Today – 25 Apr 2008

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