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A prime destination mainly for bankers and businessmen, Singapore also has started drawing tourists with a slew of new attractions, the most popular being two casino-complexes built at a cost of over $10 billion that opened earlier this year.

The two casinos and their related attractions represent the new face of a city that wants to transform itself from regional trade and financial centre into a place for both work and play.

“I’m looking out of my window at the new skyline. What has developed over the last five years has been amazing,” Hanspeter Brummer, CEO for Asia at Swiss private bank BSI, said from his office which overlooks the new Marina Bay financial district.

“Singapore is more than just Monte Carlo, which is a bit artificial. Singapore doesn’t just have one industry but a number of industries. People really have good reasons to come here,” said Brummer, a Swiss national who worked in the city-state from 1997 to 2000 and returned in 2006.

Unlike the existing central business district, Marina Bay, built on reclaimed land around the mouth of the Singapore River, comprises not just office skyscrapers but also shops, residences, theatres and the towering $5.5 billion Marina Bay Sands built by U.S. casino giant Las Vegas Sands.

Marina Bay is also home to the world’s biggest ferris wheel, restaurants fronted by Michelin-starred celebrity chefs and the world’s first night-time Formula One circuit.

Over at Sentosa, to the west of the central business district, Genting Singapore’s Resorts World casino and its Universal Studios theme park opened in February. The $4.8 billion complex earned S$503.5 million ($369.9 million) before interest, tax and depreciation in the three months ended June 2010.

Should Resorts World continue to rake in similar amount of money in subsequent quarters, it would surpass all rivals in Las Vegas and Macau in terms of profitability, analysts say.

Las Vegas Sands has not yet reported earnings for the June quarter but CEO Sheldon Adelson has said he expects Marina Bay Sands to generate gross earnings of over $1 billion annually.

TOURISTS AND TAXIS

Although both casinos have yet to complete all their attractions, which include what will be the world’s largest oceanarium, they have already created new business for hoteliers and taxi drivers.

Visitors to the city-state of 5.1 million people rose by over a-fifth to around 6.5 million in the seven months to July from a year ago. Hotel occupancy hit 90 percent in July, up 10.2 percentage points, while room rates rose 20 percent on average from a year earlier.

Taxi drivers say their takings are up by as much as 30 percent, helped by increased business in the wee hours of the morning from casino patrons.

“The integrated resorts are a catalyst to bigger and brighter things. We are seeing more entertainment centres popping up… We are in the incipient stages of what we call a change in the structural demand for such services in Singapore,” said Vincent Yeo, CEO of CDL Hospitality Trusts which owns M Hotel.

“There are still many attractions that are not opened yet,” he added, citing the two casinos’ unfinished projects as well as government initiatives such as new landscaped gardens, a river safari and an area for motorsports.

CDL’s Yeo said the 90 percent occupancy levels will continue for several months until new hotels open, meaning visitors may have difficulty finding rooms from time to time.

PROBLEM GAMBLING

Singapore’s transformation began in 2005 when the government legalised casinos as part of a plan to double visitor arrivals to 17 million by 2015. Singapore attracted 9.7 million visitors last year, and the number could rise to just under 12 million this year if the growth pace continues.

The figures do not include the thousands who cross over from Malaysia daily by land. In the past, many came to work and returned the same day but a growing number are here to gamble as seen from the large number of Malaysian-registered cars in casino carparks.

Tourism currently accounts for about 7 percent of Singapore’s economy but could grow to around 12 percent by 2015 based on government projections on visitor spending, economists’ estimate.

The transformation has detractors though — from Singaporeans unhappy about the large influx of foreigners who have contributed to soaring property prices and crowded roads to those who fear the casinos will bring with them crime and other vices.

The tiny city-state has long been a centre of trans-shipment and regional finance, coupled with strict government control over its people. It has near-zero crime and sparkling clean streets but also flogging, the death penalty, and a ban on chewing gum.

While Singapore appears to have successfully prevented a rise in prostitution and loan sharking, there has been an increase in problem gambling.

According to local TV station Channel NewsAsia, Singapore’s National Council for Problem Gambling has seen almost as many problem gambling cases in the first half of 2010 as it did for the whole of 2009.

JOBS, OPPORTUNITIES

Economists such as Citigroup ’s Kit said Singapore had little choice but to develop tourism, as it needs to create relatively low-skilled hotel, restaurant and retail jobs to replace those lost at factories that move to China and other cheaper places.

“Rebranding Singapore as a global city and tourism hub fits in very well with its natural advantage, which is its strategic location in the centre of Southeast Asia and good transportation links,” said Kit.

“If well managed, services can be a more sustainable source of competitive advantage than manufacturing, which is footloose and very price-sensitive,” he said.

Singapore’s manufacturing sector, which accounts for one quarter of the economy, shed jobs in the second quarter of 2010 despite expanding at a 44.5 percent year-on-year pace. The services industries, in contrast, continued to create jobs despite growing at a much slower pace of 11.2 percent.

The government has warned manufacturing will slow in the second half, although growth for the full year will come in at 13-15 percent, which will make Singapore the world’s fastest-growing economy.

“Manufacturing is going to slow down, but you’ll see stronger contributions from services in the second half as the integrated resorts ramp up,” said Endre Pedersen, who helps manage $16 billion in fixed income assets at MFC Global, the asset management arm of Canadian insurer Manulife.

Pedersen is betting on Singapore dollar-denominated bonds as he sees the local currency rising faster than most other Asian currencies against the dollar.

DTZ, meanwhile, says Singapore commercial property are undervalued by 9-12 percent, given the strong demand for offices and mall space that has arisen as Singapore attracts more banks and tourists. It ranks Singapore as the third most attractive city for investments in retail and number eight for offices on a risk-adjusted basis.

As for stocks, most analysts see few opportunities, noting the share prices of Genting and hoteliers such as CDL have already rallied this year.

Nomura analyst Tony Darwell warns of potential downside arising from slowing visitor growth as the novelty factor of two casinos wear off. CDL’s Yeo argued, however, that casinos are more likely to attract repeat visitations than other attractions.

To Citi ’s Kit, the risks facing Singapore’s shift to services and tourism are more long-term.

“We’ve developed the hardware but we’ve not got the software yet. At the lower level, Singapore still needs to develop a more service-oriented culture,” he said, referring to high turnover of staff at hotels and restaurants.

“To be a global city also requires a more open mindset and willingness to accept alternative views even if they are poorly formed.”

Stock futures surged Wednesday after upbeat signs of growth in China and Australia lessened worries about a global economic slowdown.

Overseas markets rose sharply after reports showed the pace of growth in China’s manufacturing sector rose in August for the first time in four months and Australia economy grew by the fastest pace in three years during the second quarter.

The sharp jump in U.S. stock futures is surprising given the domestic economic reports due out later in the morning. Traders in the U.S. are waiting for the Institute for Supply Management’s monthly manufacturing report and payroll company ADP’s report on private employment.

Often investors don’t make big bets heading into key economic reports, particularly in recent weeks as data has consistently showed growth is slowing. Both the ISM manufacturing and payroll reports are expected to follow that trend.

Stocks have been volatile over the past month because traders are unsure about the direction of the economy. Data continues to point to meager growth, but exactly where the pace of growth settles remains a major question. By sending stocks lower throughout August though, traders were betting that weak growth will eventually be a drag on corporate earnings.

Ahead of the opening bell, Dow Jones industrial average futures rose 98, or 1 percent, to 10,104. Standard & Poor’s 500 index futures rose 12.50, or 1.2 percent, to 1,060.80, while Nasdaq 100 index futures rose 24.50, or 1.4 percent, to 1,791.00.

With stock markets rising worldwide, U.S. Treasury prices dropped and interest rates rose. The yield on the 10-year Treasury note, which moves opposite its price, fell to 2.52 percent from 2.47 percent late Tuesday. Its yield is often used as a gauge to set interest rates on mortgages and other consumer loans.

Economists polled by Thomson Reuters forecast the ISM manufacturing index slipped to 53.0 in August from 55.5 a month earlier. Any reading above 50 indicates expansion in the sector.

Regional surveys of manufacturing activity in recent weeks also pointed to slowing growth in the sector, which had been among the strongest during the first half of the year.

Economists expect the ADP report will show private employers added just 19,000 jobs last month after hiring 42,000 new workers in July. The slowdown in hiring during August is further evidence that the jobs market remains weak.

Employers are avoiding making any new hires in large numbers because of the uncertain direction of the economy. They are also worried about the potential impact of government health care and financial regulation reforms as well as possible increases in taxes.

With unemployment still high, people concerned about their jobs have cut back on spending, which has further slowed growth.

The ADP report is often considered a gauge for the government’s monthly employment report, which is due out Friday. The Labor Department’s data also includes government employment so it is a broader reading on the jobs market.

Economists expect the government report to show 100,000 jobs were cut last month, but that was largely due to laying off temporary census workers. Private employers likely added just 41,000 jobs last month.

Overall, the unemployment rate is expected to have climbed to 9.6 percent last month from 9.5 percent in July.

Australia’s S&P/ASX 200 index jumped 2.1 percent on the upbeat growth report. Hong Kong’s Hang Seng index rose 0.4 percent, while Japan’s Nikkei stock average rose 1.2 percent.

European markets followed Asian markets higher. Britain’s FTSE 100 rose 1.5 percent, Germany’s DAX index gained 1.1 percent, and France’s CAC-40 climbed 1.8 percent.

Singapore has been ranked as the world’s 25th most expensive city for business travellers from the United Kingdom, up from 44th spot last year, according to the Global Hotel Market Survey.

The leap in Singapore’s ranking is in line with reports from the Ministry of Trade and Industry saying that the average room rates in the country have increased 20 percent this year.

Hong Kong leapt seven places to become the world’s third most expensive city for UK travellers, posting a 13 percent growth in the local currency because of increased demand from the banking and finance sector.

Among the cities surveyed, Hong Kong saw the highest growth, with an 11 percent and 17 percent increase in Q1 and Q2, respectively.

Moscow remained the most expensive city for UK travellers despite a weaker rouble.

Abu Dhabi dropped six places to rank eight this year from second spot last year. It recorded the highest average room rate decline of 25 percent in the local currency.

The latest list of Forbes wealthiest individuals and families in Singapore indicated that the top 40 richest Singaporeans are now worth US$45.7 billion (S$62 billion), up 17 percent from US$39 billion in 2009. The list is made up of popular entrepreneurs, business leaders and philanthropists.

In the number one spot again this year is the family of the country’s richest man and late property tycoon Ng Teng Fong. Mr. Ng, who passed away in February, has a net worth of US$7.8 billion, a slight drop from US$8 billion last year after a stake in HK developer Tsim Sha Tsui Properties fell 18 percent in the past one year..

The Khoo family, who has a minor stake in Orchard Parade Holdings and owns Goodwood Group of Hotels, still stays on in second place with US$5.9 billion.

Wee Cho Yaw, chairman of United Overseas Bank, came in third and has assets worth US$3.6 billion. He was among the two biggest gainers in dollar terms. Mr. Wee regained the third position after adding US$500 million to his wealth. 

According to Forbes Asia magazine, the increase in collective net worth highlights Singapore’s economic resurgence. The country is set for record growth this year after contracting by 1.3 percent last year. The official growth forecast for 2010 was revised upwards in June from 7 to 9 percent to 13 to 15 percent.

Adjusted EPS 17 cents vs estimate 9 cents

* Revenue up nearly 51 pct

* To amend $5 billion US credit facility

* Shares up 2.3 percent

By Deena Beasley

LOS ANGELES, July 28 – Las Vegas Sands Corp <LVS.N>, the casino operator run by billionaire Sheldon Adelson, posted a better-than-expected quarterly profit on Wednesday, aided by strong performances at its new Singapore resort and in Macau.

Sands, whose shares rose 2.3 percent in morning trading, earned 17 cents a share in the second quarter after adjusting for one-time items. Analysts on average expected 9 cents a share, according to Thomson Reuters I/B/E/S.

Net revenue rose nearly 51 percent to $1.59 billion.

“They had a monster quarter,” said Sanford Bernstein analyst Janet Brashear, adding that much of the outperformance was driven by better-than-expected profit margins.

Gambling revenue in Macau, the world’s largest gambling center and the only place in China where gambling is legal, has soared this year, most recently rising 65 percent year-over-year in June.

Sands said second-quarter net revenue at its three Macau properties rose 41 percent from a year earlier to $1.03 billion, while adjusted earnings before interest, taxes, depreciation and amortization increased 74 percent to $307 million.

Singapore’s Marina Bay Sands generated $94 million in EBITDA in its first 65 days of operation. The $5.7 billion casino resort began operating in April.

In Las Vegas, where a glut of hotel rooms has led to rate discounting, EBITDA fell to $66 million in the second quarter from $78 million a year earlier.

“With property performance better than our expectations in Macau and Singapore, and with the Las Vegas Strip weaker than expected, we believe Asia will be the key driver of the story, and the report is bullish for the shares,” Jefferies and Co analyst David Katz said in a research note.

HIGH HOPES

Chairman and Chief Executive Officer Adelson said during a conference call that he still expects the Singapore resort to bring in $1 billion in EBITDA next year, due in part to a broader-than-expected customer base.

“There are so many people that are coming from different countries in Asia … We have a group of Koreans flying in every week,” he said. “I think that the outer reaches of our marketing radius is wider than what we thought before.”

The company has lined up financing for development of two sites in a section of Macau known as the Cotai Strip, but construction has not yet started due to government requirements for the hiring of local workers.

Company officials said they are confident the Macau government will not let the project continue to stall, but they reported no tangible progress on a construction start date.

Chief Financial Officer Kenneth Kay said highly-leveraged Sands plans to launch later this week an “amend and extend” transaction for its $5 billion U.S. credit facility.

“The transaction contemplates a paydown of our term loans and a reduction of a revolving credit facility commitment in exchange for the extension of maturities and other modifications to the credit agreement intended to increase the company’s financial flexibility,” he said.

After payment of preferred stock dividends, Sands had a second-quarter net loss of $4.7 million, or 1 cent a share, compared with a net loss of $222.2 million, or 34 cents a share, a year earlier.

In addition to Singapore’s Marina Bay Sands, Sands owns the Palazzo and Venetian resorts on the Las Vegas Strip, three casinos in Macau and a casino in Pennsylvania. 

I was, at the end, literally licking the inside of my glass, and running my finger across the bottom of my wife’s glass to get the last precious drops of what is, without question, the finest liquid to ever coat my tongue.

Through Dave, I bought four half-bottles of the stuff at a nice discount. But the current price runs between $275 and $400 for a half-bottle depending on where you find it. Yet, as much as I love this wine, I have no intention of drinking them. (Well, I’ll drink one with my young son when he turns 21.) Instead, they now rest, properly cooled and humidified, in a small cellar I built in my home to house “investment-grade wine”.

I share this story because it speaks to the value of wine – not just the drinkable liquid, but, as the title of Dave’s book announces, the liquid asset (literally) that can juice a portfolio’s returns.

To give you an example of what individual wine prices can do over time, consider the 1961 Chateau Latour. Back in the day, you could have bought a case for £25. Today, 50 years on, that same case fetches, at the low end, £35,000.

A bit of spreadsheet work and you see the return is about 15.6% annually.

Or let’s look at something more recent: the 1990 Cheval Blanc – released at £400 a case and now trading near £9,200 an annualized return of a 37%.

Or even more recent: the 2000 Chateau Lafite-Rothschild – released at $300 a bottle, it now fetches between $1,500 and $4,300 a bottle, depending on where you find it. Either way, you’re looking at annualized returns of between 17% and 31%

RPT-Singapore’s NOL places $1.2 bln ship orders from Daewoo

The URA said the redevelopment of the 21,879-sq-ft site, which is zoned for residential use, can maintain its current height and can be redeveloped into a boutique residential development with 52 units of 82 sq ft with no development charge.

Holland Tower is located at 10 Holland Heights and sits in the Holland Park Good Class Bungalow Area. It has a maximum gross floor area of 43,691 sq ft and comprises a single 14-storey tower development with 19 units. It is well served by Holland Road, Queensway and Farrer Road, as well as major expressways including the AYE and the PIE.

The site is only minutes away from Orchard Road and the Botanic Gardens, and is close to the lifestyle facilities at Dempsey Cluster and Holland Village.

“With strong take up rate of residential new launches in the vicinity, this elevated site is expected to draw strong interest due to its locality, proximity to amenities and the potential to be redeveloped into a boutique development offering exclusivity and lush greenery. The site is totally unblocked as its surrounding area is prestigious landed housing under the ‘Good Class Bungalow’ segment,” said Ms. Stella Hoh, National Director and Head of Investments at JLL, which is the sole marketing agent for the property.

The public tender for the site will close on 25 August.

Let’s say for the sake of example that you do acquire this mystical item for a tidy $1500, and duly receive a crisp $100 note after 12 months (an initial yield of 6.67% as expected). The second year brings even greater rewards:

Over five years the box has increased its output by 35% paying out $135 in cash in the final year, which is an average increase of just over 6% each year. Based on your purchase price, you have received a total of $579 over the period, which is 39% of the initial purchase price. In regard to the 5th year only, you received a yield of 9% ($135/$1500). Few investors would be disappointed with this outcome.

But surely you would have still done better with a higher yielding, yet safer, investment in a bond. Not necessarily, as the box itself has value and can be sold to other eager investors…