Macquarie expects Singapore’s low interest rate environment to remain in 2011, with office sector the clear winner, says Dow Jones.

Macquarie says further government action will depend on reaction of asset markets to property cooling measures this year, policy response will still be major theme in 2011. 

Expects developers, S-REITs to grow via acquisitions, both locally, overseas, as gearing levels remain comfortably low.

“We expect prime office rents to increase by 50% between end-2010 and end-2013, reflecting strong pre-leasing, which we expect to chip away at 2011 supply. Given a projected supply bottleneck in 2012 and 2013, a clear upward rent trajectory appears likely.” 

Favours office REITs: rates CapitaCommercial Trust (C61U.SG) at Outperform, target at $1.66, K-REIT (K71U.SG) Outperform, $1.55 target. Also upgrades Keppel Land (K17.SG) to Neutral from Underperform, ups target to $4.43 vs $3.59, “to reflect clear preference for exposure to office sector.”

Mainboard-listed Transcu says wholly-owned subsidiary Nanomizer Inc. has formed a jpint venture with Nedo (New Energy and Industrial Technology Development Organization) in Japan to undertake development of a new type of bio-fuel using crude palm oil.

If the project is successful and goes into commercialisation, Transcu’s subsidiary, Transcu Green Fuel will have the exclusive rights to promote, market, distribute and sell this system and its related products around the world.

As announced previously, Transcu also has an option to purchase up to 10% of the shares in Nanomizer.

By using Nanomizer’s core micronisation technology, the project aims to process crude palm oil for direct use in internal combustion engines by first degumming it, i.e. removing its impurities, in particular phosphorous, in a low-cost and effective manner and then subsequently emulsifying the oil using water to produce degummed and emulsified palm oil.

Bio-diesel from palm oil produced by the conventional esterification process requires the use of expensive methanol and the removal of glycerin, which results in a loss in calorific value of the processed palm oil. On the other hand, degummed and emulsified palm oil using Nanomizer’s technology requires less energy and other materials for processing and it maintains the calorific value.

It is comparatively much faster and simpler than the esterification process. Moreover the use of Nanomizer’s technology allows processing to be carried out on-site where it can be used directly, thereby further reducing logistics costs, as compared to the esterification process where processing needs to be carried out in a specialized processing plant.

Under the agreement, NEDO will fund the research and development expenses of up to about 50 million yen (0.8 million) over a period of one year ending in the third quarter of 2011.