Land Banking
- Thread starter jonsuta
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niteblu
Well-Known Member
Re: Land Banking
Some wisdom for you.
Go, spread the word.
Tan Kin Lian's Blog: Is all landbanking a scam?
jonsuta;556144 said:
Some wisdom for you.
Go, spread the word.
Tan Kin Lian's Blog: Is all landbanking a scam?
Re: Land Banking
As with any other investments, there will always be risks involved. The main thing is how much of a risk can you afford to take and of course weighing in the returns.
Landbanking of course has its pros and cons just like any other. Unfortunately, the mere mention on this industry I believe has caused much bitterness to many people in Singapore. The reason which of course is posted in the link by niteblu. However with this being said, it does not mean that all companies in this trade are dodgy. Sales presentations will always be at its best whenever possible, be it a fancy ballroom or a lady giving "halfball".
Look at track records, company history, worst case scenarios (what are you left with in the event everything goes south) and of course your level of affordability. Don't just because nearing 90mins you dump in your "geh huay" and poh the winning team up by 1 goal.
I was with Walton, I've got a little bit of money there but it does NOT mean that I am endorsing them in anyway. Speak to someone in that company and get all your queries answered by them. Dig as much information as you can and then decide whether to eat ball or give ball.
As with any other investments, there will always be risks involved. The main thing is how much of a risk can you afford to take and of course weighing in the returns.
Landbanking of course has its pros and cons just like any other. Unfortunately, the mere mention on this industry I believe has caused much bitterness to many people in Singapore. The reason which of course is posted in the link by niteblu. However with this being said, it does not mean that all companies in this trade are dodgy. Sales presentations will always be at its best whenever possible, be it a fancy ballroom or a lady giving "halfball".
Look at track records, company history, worst case scenarios (what are you left with in the event everything goes south) and of course your level of affordability. Don't just because nearing 90mins you dump in your "geh huay" and poh the winning team up by 1 goal.
I was with Walton, I've got a little bit of money there but it does NOT mean that I am endorsing them in anyway. Speak to someone in that company and get all your queries answered by them. Dig as much information as you can and then decide whether to eat ball or give ball.
niteblu
Well-Known Member
Re: Land Banking
Good balanced reply rex7_vtec.
see halfball. eat halfball, or give halfball?
I believe the concept of landbanking in itself is not ill-intentioned.
Nor are the fundamentals flawed, in theory.
Efficient distribution of a land parcel.
With the potential for redevelopment.
Into smaller bite-sized chunks for the retail investor.
With the primary supplier taking a premium for the service.
However. in practice, it seldom happens as described.
Do your research, you'll find out how this widespread phenomenon has affected many across the globe. Not just in Singapore. In fact, it almost feels like they've run out of carrots in UK/US.
Hence, Asia/S'pore is ripe for the picking. Especially with Asians' intrinsic belief in the value of land/property.
Again, if you believe it.
Buy it. No one is stopping you.
Caveat emptor.
rex7_vtec;556186 said:
Good balanced reply rex7_vtec.
see halfball. eat halfball, or give halfball?
I believe the concept of landbanking in itself is not ill-intentioned.
Nor are the fundamentals flawed, in theory.
Efficient distribution of a land parcel.
With the potential for redevelopment.
Into smaller bite-sized chunks for the retail investor.
With the primary supplier taking a premium for the service.
However. in practice, it seldom happens as described.
Do your research, you'll find out how this widespread phenomenon has affected many across the globe. Not just in Singapore. In fact, it almost feels like they've run out of carrots in UK/US.
Hence, Asia/S'pore is ripe for the picking. Especially with Asians' intrinsic belief in the value of land/property.
Again, if you believe it.
Buy it. No one is stopping you.
Caveat emptor.
Re: Land Banking
Hi rex7_vtec,
Thank you for your reply and your advice.
You have mentioned that you were with Walton and got a little bit of money there. Sorry for me to sound a bit speculative, but seems that you will not invest with Walton anymore in the future when you allocated some fund for investment, as you use past tense.
If my speculation is correct, can you share with me on the reason that you will not invest further with Walton for landbanking?
rex7_vtec;556186 said:
Hi rex7_vtec,
Thank you for your reply and your advice.
You have mentioned that you were with Walton and got a little bit of money there. Sorry for me to sound a bit speculative, but seems that you will not invest with Walton anymore in the future when you allocated some fund for investment, as you use past tense.
If my speculation is correct, can you share with me on the reason that you will not invest further with Walton for landbanking?
Re: Land Banking
Hi niteblu,
Thank you for sharing with me on your opinions and your knowledge with landbanking.
If you don't mind me asking, please kindly share with me on either your personal experience or the experience of someone you know for investing into landbanking.
Thank you.
niteblu;556228 said:Good balanced reply rex7_vtec.
see halfball. eat halfball, or give halfball?
I believe the concept of landbanking in itself is not ill-intentioned.
Nor are the fundamentals flawed, in theory.
Efficient distribution of a land parcel.
With the potential for redevelopment.
Into smaller bite-sized chunks for the retail investor.
With the primary supplier taking a premium for the service.
However. in practice, it seldom happens as described.
Do your research, you'll find out how this widespread phenomenon has affected many across the globe. Not just in Singapore. In fact, it almost feels like they've run out of carrots in UK/US.
Hence, Asia/S'pore is ripe for the picking. Especially with Asians' intrinsic belief in the value of land/property.
Again, if you believe it.
Buy it. No one is stopping you.
Caveat emptor.
Hi niteblu,
Thank you for sharing with me on your opinions and your knowledge with landbanking.
If you don't mind me asking, please kindly share with me on either your personal experience or the experience of someone you know for investing into landbanking.
Thank you.
Re: Land Banking
I did some research on Walton and these are the facts that I've found, as follows:
1) Walton is the largest corporate land owner in Canada and 3rd in USA (owns 50,000~60,000 acres).
2) 30 years of history with consolidated 300 years of experience.
3) Their purchased lands are still raw (grass patches), but are along the path of near future development and growth, as they do their own survey for 2~4 years before actual decision on the purchasing of the particular land.
4) Instead of hiring 3rd party for planning toward the future growth and development, they have their own planning department to do this.
5) Government bodies, local developers, and private institutes (like HSBC, AIG, Manuel Life, and etc.) are purchasing lands from Walton for either actual development or adding to their portfolio.
6) Average annual return for investors are around 15~20%, as the land takes an average of 4~6 years to exit with around double the return for investor, when the land exits. (These values have past track records, which all audited by Price Waterhouse Cooper.)
7) So far, 38 of their lands has either fully or partially exited.
These info that I've found sounds attractive, but I will still like to hear everyone's opinions on this.
Thank you, in advance.
I did some research on Walton and these are the facts that I've found, as follows:
1) Walton is the largest corporate land owner in Canada and 3rd in USA (owns 50,000~60,000 acres).
2) 30 years of history with consolidated 300 years of experience.
3) Their purchased lands are still raw (grass patches), but are along the path of near future development and growth, as they do their own survey for 2~4 years before actual decision on the purchasing of the particular land.
4) Instead of hiring 3rd party for planning toward the future growth and development, they have their own planning department to do this.
5) Government bodies, local developers, and private institutes (like HSBC, AIG, Manuel Life, and etc.) are purchasing lands from Walton for either actual development or adding to their portfolio.
6) Average annual return for investors are around 15~20%, as the land takes an average of 4~6 years to exit with around double the return for investor, when the land exits. (These values have past track records, which all audited by Price Waterhouse Cooper.)
7) So far, 38 of their lands has either fully or partially exited.
These info that I've found sounds attractive, but I will still like to hear everyone's opinions on this.
Thank you, in advance.
Re: Land Banking
I've invested in Walton on some points stated by Jonsuta, pretty happy with status updates and waiting a bit for projects to exit. These are long term investment and not for punting anyway.
That said, do your homework before you go in. My posting does not qualify as advice or a suggestion for you to invest.
I've invested in Walton on some points stated by Jonsuta, pretty happy with status updates and waiting a bit for projects to exit. These are long term investment and not for punting anyway.
That said, do your homework before you go in. My posting does not qualify as advice or a suggestion for you to invest.
Re: Land Banking
Do bear in mind that this investment category is the OTC type, not exchange traded. That means the buying and selling process is only against one party - in this case the landbanker. So, counterparty and liquidity risks cannot be ignored.
As with any investment, look at RISK-ADJUSTED RETURNS as compared to absolute returns. Inherent risks must be examined.rex7_vtec said:
Do bear in mind that this investment category is the OTC type, not exchange traded. That means the buying and selling process is only against one party - in this case the landbanker. So, counterparty and liquidity risks cannot be ignored.
Re: Land Banking
Hi Ryan,
Thank you for your advise. Yes, you are correct that the investment is more toward mid to long term, which the average exiting period is around 4~6 years. However, seems that the other popular form of investment is the insurance plans that the maturity period can range from 7 years to 25 years, which the insurance company deduct a fixed amount from the clients in monthly bases for the number of years that the client has signed up on.
Let's just say that for investors who do not have a lump sum to invest, but can afford a fixed monthly amount to put aside, as a form of saving that will grow into some form of return, then the insurance plans might be suitable. However, the return, by the end of day/maturity, might not be too attractive.
For those that have a lump sum of US$10,000 (cost per unit), the return might be more attractive than insurance plans (averaging 15~20%/year), and the period required for exiting might be shorter than these insurance plans.
These are the points that crossed my mind.
ryan;556274 said:
Hi Ryan,
Thank you for your advise. Yes, you are correct that the investment is more toward mid to long term, which the average exiting period is around 4~6 years. However, seems that the other popular form of investment is the insurance plans that the maturity period can range from 7 years to 25 years, which the insurance company deduct a fixed amount from the clients in monthly bases for the number of years that the client has signed up on.
Let's just say that for investors who do not have a lump sum to invest, but can afford a fixed monthly amount to put aside, as a form of saving that will grow into some form of return, then the insurance plans might be suitable. However, the return, by the end of day/maturity, might not be too attractive.
For those that have a lump sum of US$10,000 (cost per unit), the return might be more attractive than insurance plans (averaging 15~20%/year), and the period required for exiting might be shorter than these insurance plans.
These are the points that crossed my mind.
Re: Land Banking
Hi Kenntona,
Thank you for your advise. You are correct that all form of investments have different form of risk and buying/selling process is only against one party (the landbanker), so the counterparty and the liquidity risk cannot be ignored.
However, from my research, seems that when the investor invest with Walton, seems that the investor do not own an entity of Walton, but the actual ownership of the land, as the certs will be issued by either the US or Canada government for the transfer of the land ownership from Walton to the investor. Part of the invested amount also covers the land ownership insurance. After the investor owns the land, Walton will be involved and the land management/operator for the whole invested land (both Walton's and the investor's) for the progress and the exiting of the land. The profitable return will be distributed to all investors, proportionally.
With this, the risk factor seems to be reduced, because if Walton collapse, the investor's ownership of the land still exists. (Unlike the investment with Lehman Brother)
Of course, higher return comes with higher risk, while lower returns comes with lower risk, so for Walton's landbanking, seem that the return is quite moderate with moderate risk (not as volatile as stock market). The value of raw land/grass patches will grow with time. The speed of the value growth depends on the location and the actions taken toward development (or potential of development) of the land.
These are just thoughts that crossed my mind. However, if there are other opinions (both negative or positive, or general), please kindly share.
Thank you.
kenntona;556279 said:
Hi Kenntona,
Thank you for your advise. You are correct that all form of investments have different form of risk and buying/selling process is only against one party (the landbanker), so the counterparty and the liquidity risk cannot be ignored.
However, from my research, seems that when the investor invest with Walton, seems that the investor do not own an entity of Walton, but the actual ownership of the land, as the certs will be issued by either the US or Canada government for the transfer of the land ownership from Walton to the investor. Part of the invested amount also covers the land ownership insurance. After the investor owns the land, Walton will be involved and the land management/operator for the whole invested land (both Walton's and the investor's) for the progress and the exiting of the land. The profitable return will be distributed to all investors, proportionally.
With this, the risk factor seems to be reduced, because if Walton collapse, the investor's ownership of the land still exists. (Unlike the investment with Lehman Brother)
Of course, higher return comes with higher risk, while lower returns comes with lower risk, so for Walton's landbanking, seem that the return is quite moderate with moderate risk (not as volatile as stock market). The value of raw land/grass patches will grow with time. The speed of the value growth depends on the location and the actions taken toward development (or potential of development) of the land.
These are just thoughts that crossed my mind. However, if there are other opinions (both negative or positive, or general), please kindly share.
Thank you.
longhorn
Well-Known Member
Re: Land Banking
BTW i was just approached 2 days ago by a company that spinned of from land banking. Invest in gold (and yes they deliver physical gold bars to you) and they GUARANTEE an 18 - 24% return p.a. Ai mai? If yes, I introduce to you...
Yes the above statement says it all. Just remember what Uncle Ben said, " with great returns there must come great risks...".kenntona;556279 said:
BTW i was just approached 2 days ago by a company that spinned of from land banking. Invest in gold (and yes they deliver physical gold bars to you) and they GUARANTEE an 18 - 24% return p.a. Ai mai? If yes, I introduce to you...
C3P0
Well-Known Member
Re: Land Banking
Just to clear your point on "investment with Lehman Brother".....
In the cases of Lehman Brothers, the product Minibond did NOT fail. When the arranger Lehman collapsed, the issuer Minibond collapsed too, but the underlying First-To-Default CDS-linked portfolio still exist. HSBC the trustee bank took over, and manage to return to investors between 21.5% to 70.8% of the initial investment notional:
MAS: MAS Welcomes Announcement of The Distribution of The Recovery Values of The Minibond Notes
Here's the interesting comparison which you might not be aware. If you had bought a Lehman Bro corporate bond rated A- by respective credit rating agencies before it collapsed, you would have gotten only 8 cents for every dollar invested. At this point, DBS and UOB are rated A+ by S&P and A by Fitch. Is that safe or unsafe?
On a product basis, a bond is supposed to be "safer" than the CDS product, but redeemed lesser?
Fact is - complexity did not equate risk. There are hidden liquidity risks which could not be comprehended until a certain event happens.
In the cases of Pinnacle series, Jubilee 3 and DBS High notes, the product failed, hence full capital wipeout. Even within them, there is distinction between how individual product failed.....
Yes, but can you trade your portion of the aggregate land like a property owned by yourself? Is there even a market for "partial" land in the case Walton collapses?jonsuta said:
Just to clear your point on "investment with Lehman Brother".....
In the cases of Lehman Brothers, the product Minibond did NOT fail. When the arranger Lehman collapsed, the issuer Minibond collapsed too, but the underlying First-To-Default CDS-linked portfolio still exist. HSBC the trustee bank took over, and manage to return to investors between 21.5% to 70.8% of the initial investment notional:
MAS: MAS Welcomes Announcement of The Distribution of The Recovery Values of The Minibond Notes
Here's the interesting comparison which you might not be aware. If you had bought a Lehman Bro corporate bond rated A- by respective credit rating agencies before it collapsed, you would have gotten only 8 cents for every dollar invested. At this point, DBS and UOB are rated A+ by S&P and A by Fitch. Is that safe or unsafe?
On a product basis, a bond is supposed to be "safer" than the CDS product, but redeemed lesser?
Fact is - complexity did not equate risk. There are hidden liquidity risks which could not be comprehended until a certain event happens.
In the cases of Pinnacle series, Jubilee 3 and DBS High notes, the product failed, hence full capital wipeout. Even within them, there is distinction between how individual product failed.....
Re: Land Banking
Hi Kenntona,
Thank you for your share with me on the comparison. Your input and clarification has helped me to see a wider picture.
Overall, liquidity of the investment is still an important factor to be taken into consideration, as the future of the investment is still unclear, and we should leave ourselves an option to pull out when necessary to our own judgment, instead of bonded to the discretion of the decision of other for a mid to long period of time.
Again, thank you.
Hi Kenntona,
Thank you for your share with me on the comparison. Your input and clarification has helped me to see a wider picture.
Overall, liquidity of the investment is still an important factor to be taken into consideration, as the future of the investment is still unclear, and we should leave ourselves an option to pull out when necessary to our own judgment, instead of bonded to the discretion of the decision of other for a mid to long period of time.
Again, thank you.
Re: Land Banking
Whether or not will I invest with Walton again depends on 2-3 factors which are of personal reasons. One of them is simply do I want to sit on the proposed timeframe for it to mature because I do have some plans for the future and cash on hand may come in handy.
In my personal opinion in regards to the risk factor, is that in the event if the company does fail ( as with any other investments) at least I am still left with an "asset". As to how fast and how much I can liquidate this asset is very subjective; economic value, market sentiments, etc. In simple words, I do not have to go to the extent of saying I was ill-informed by the sales rep and hopefully based on my education level and age I can get a refund on my investment (although this would be awesome if every investment can be refunded should it go southerly!).
The bottom line however is that I do still have an asset somewhere perhaps near developing cities which may or may not have been annexed into city limits and without much explanation, one knows that if within city limits it would more or less have increased in value. At this point I would again like to reiterate that there is no one best instrument in the market for wealth creation and that every financial product has been catered for different individuals.
Points to ponder,
i) Are the audited returns of Walton in this case credible (since they do bang alot on this I believe)?
ii) Has there been cases of successful returns?
iii) Are the land transactions legit ( as in a proper documented ownership of the land)?
vi) Do I have the time to sit out on stipulated time frames?
v) Does this product fit into my appetite for risk?
vi) Are the returns satisfactory to me?
There will be for and against in every product , here we can share our personal opinions and I believe at the end of the day decision lies with you.
Whether or not will I invest with Walton again depends on 2-3 factors which are of personal reasons. One of them is simply do I want to sit on the proposed timeframe for it to mature because I do have some plans for the future and cash on hand may come in handy.
In my personal opinion in regards to the risk factor, is that in the event if the company does fail ( as with any other investments) at least I am still left with an "asset". As to how fast and how much I can liquidate this asset is very subjective; economic value, market sentiments, etc. In simple words, I do not have to go to the extent of saying I was ill-informed by the sales rep and hopefully based on my education level and age I can get a refund on my investment (although this would be awesome if every investment can be refunded should it go southerly!).
The bottom line however is that I do still have an asset somewhere perhaps near developing cities which may or may not have been annexed into city limits and without much explanation, one knows that if within city limits it would more or less have increased in value. At this point I would again like to reiterate that there is no one best instrument in the market for wealth creation and that every financial product has been catered for different individuals.
Points to ponder,
i) Are the audited returns of Walton in this case credible (since they do bang alot on this I believe)?
ii) Has there been cases of successful returns?
iii) Are the land transactions legit ( as in a proper documented ownership of the land)?
vi) Do I have the time to sit out on stipulated time frames?
v) Does this product fit into my appetite for risk?
vi) Are the returns satisfactory to me?
There will be for and against in every product , here we can share our personal opinions and I believe at the end of the day decision lies with you.
