Down the garden path

FOLLOWING the trail of the Fujian money laundering syndicate took us down some interesting paths. We dived into the data and unearthed over 230 residential properties sold to buyers of certain nationalities from high-risk countries since 2016. That’s double the 105 properties seized so far by the police. The deals BT found were done by holders of passports from the same countries as those arrested earlier in August - Cambodia, Cyprus, Dominica, Saint Kitts and Nevis, Turkey and Vanuatu. 

Jessie Lim also had a chat with real estate agents who have dealt with extraordinarily wealthy Chinese clients. Are their Bentleys, Bitcoin and bungalow karaoke signs of crazy rich Asians or red flags? 

As Leslie Yee writes, it’s not surprising that people who have pocketed huge gains from illicit activities choose to park funds here. Singapore is a major financial hub and a thoroughly cosmopolitan city, known for its ease of doing business and easy connectivity to many parts of the world. The law enforcement blitz this month shows Singapore taking a stand to guard its golden reputation.  

What’s also important to note is that under-the-radar activities like money laundering can have an obviously distorting effect on the market where the funds are stashed. Asset prices get bid up. Leslie has some suggestions on how to protect the private housing and commercial property markets from such distortions.   

The aftereffects of this month’s billion-dollar bust are still rippling out. Commissions that were paid to agents for the sale or rental of property caught up in the action could be clawed back, The Straits Times reported. Some 60 agents are suspected to be involved, and the Council for Estate Agencies is investigating those who might have facilitated dodgy transactions.

The probe has also extended to dealers of precious metals and stones. The Law Ministry has flagged a list to dealers with the names of 34 individuals possibly linked to suspicious transactions, ST reported, including the 10 who were charged in court on Aug 16 with offence including forgery and money laundering.

In case you missed it or would like a primer refresher explainer, here’s our Money Laundering 101 - it really is a case of wash, rinse, repeat. 

The story’s still unfolding, so stay tuned. 

Meanwhile, Singapore real estate agents are facing a tough time after reaping bumper commissions in 2022. Several rounds of policy changes and a market slowdown took a toll on revenue, with the two largest agencies recently posting steep drops in commission income in their interim earnings reports. Samuel Oh asks agents for their take on the outlook. 

The China syndrome

New home prices in China are expected to stay flat this year, a forecast that deals a blow to confidence in an already shattered market. Beijing has worked in several support measures, but declining property investment and consumption cutbacks could drag on GDP growth.  

Distressed giant China Evergrande pushed back a plan to restructure its massive debt. Its shares lost 79 per cent of their value when trading resumed on Monday after being suspended since March 2022.

The future of Forest City, a mega-project in Johor, Malaysia, being built by Country Garden, seems uncertain. After a series of early setbacks, the US$100 billion project now looks imperilled by the financial quagmire that its Chinese developer is bogged in. 

News in Reits

Singapore-listed real estate investment trusts (S-Reits) took a hard knock from higher financial costs in the first half of 2023. Market watchers believe the worst is yet to be, writes Jude Chan. Of the 37 S-Reits and property trusts that reported results for the period ended June, only 11 managed to eke out a year-on-year improvement in distribution per unit (DPU). 

Also in the news:

Quarz: Preparatory work for Sabana Reit’s internal manager should take no more than 3 to 4 months

Keppel Corp should use private fund to buy up undervalued Keppel Reit