Capitaland 01 (May 08 - May 10)

[kennynah]

hi L :

i'm just wondering...whether capland can sell away some of the land they purchased earlier and now either cannot afford to develop it or dont want to anymore...if there are rules on such land flipping in china? are you aware?

[Poles]

i heard a couple stories typical in China today....
Father >> senior party member >> communist
Son >> entrepreneur >> capitalist

Father do not see eye to eye....always in conflict....

who will win?? will there be a middle path for china??

[LenaHuat]

Hi K
China is a very big country. In the first-tiered cities, I'm not aware of land-flipping becuz todate almost every developer makes a bundle from building and selling. Right now in Shanghai, the SOEs are the ones which are bidding big time and big bucks for land. I don't think CapLand is into land-flipping. Right now, it's true that prized land in Shanghai and Tienjing is scarce. I'm more concerned abt the capex for developing their land bank. I'm monitoring if the Chinese authorities are serious abt penalizing developers who let their land bank sit idle.

[kennynah]

thanks L

i was told that chinese authorities allow land to be idle but only for a maximum period of 3 years; ie. before the end of 3 years, they are obliged under initial purchase rulings to begin piling and commence development. however, i have no way of confirming if this hearsay is accurate. i'm also unaware of punitive actions against non-compliance to this ruling.

[LenaHuat]

Hi K
The answer is here :-

。“按照一般的市场规律，开发商拿地后在9个月至1年的周期内，就应该入市预售。”

and I recall construction must generally begin within 2 years. Maybe this link will provide the answer.
From the article, the authorities are already acting against developers:-
大龙等八家开发商禁止在京拿地,打击囤地有助稳定房价

[kennynah]

thanks L

[Aspellian]

Capitaland not only break down from its S$4 mark but also undercut its 200DMA. now at $3.66

on hindsight should have shorted when China news broke out on raise in interest rate plus Capitaland's $2billion deal (potential albatross).

[millionairemind]

Capitaland not only break down from its S$4 mark but also undercut its 200DMA. now at $3.66

on hindsight should have shorted when China news broke out on raise in interest rate plus Capitaland's $2billion deal (potential albatross).

Sometimes you wonder who's dumber... the buyer of the $2B deal or the seller (hint : mkt knows best )

Capland always take big bets and if they lose, only the shareholders suffer. Just do ANOTHER rights issue lor... we are all suckers

[Aspellian]

Capland always take big bets and if they lose, only the shareholders suffer. Just do ANOTHER rights issue lor... we are all suckers

but fundamentally i think Capland is doing well. They may not need to borrow excessively from banks, they are flushed with cash.

also i wont bet against the management - so far they have delivered the goods - they are v smart on corporate finance matters
(cos all the shareholders are suckers!! - oops - which means MM is right!! )

[kennynah]

i think if you are very well familiar with developers....you might have come to realize that the primary owners of such listed companies have smaller private companies that they own as well...

and i have been told horrendous stories about how such public vehicles are made to bid for land plots and when the successful bids are low, they somehow get past on to the private holdings, leaving behind the "expensive" bids to the public company.... in other words, "heads i win, tails i win" game they play....

these are people who have been in property industry (not property agents) for >20 years... to have seen these dirty tricks being played out time and again... true or not...i oso duno... they talk...i listen...