Tuesday, 31 October 2017

REIT IPO - Keppel-KBS US REIT

26 Oct 2017: Keppel-KBS US Reit, sponsored jointly by Keppel Capital and KBS Pacific Advisors, is issuing 262.77 million units at US$0.88 a piece in an initial public offering (IPO).

1. Sponsors:
The sponsors for this US Reit a JV between KBS Pacific Advisors and Keppel Capital.

Keppel Capital is the asset management arm of Keppel Group and currently manages 3 Singapore-listed Reit/Business Trust.
  1. Keppel REIT - Office/Commercial Asset
  2. Keppel Infrastructure Trust - Utilities Infrastructure
  3. Keppel DC REIT - Data Centers
They're also managing Alpha Investment Partners Limited and manager of several private equity funds.

KBS Pacific Advisors is one of the largest US commercial real estate manager with about US 11.3 billion assets under their management. KBS is jointly owned by 4 partners - Peter McMilan III, Keith D.Hall, Rahul Rana and Richard Bren with Peter McMilan III serving as the chairman. Along with Keith, they hold one-third of the stake in KBS.

2. What type of real estate do they hold?
Keppel-KBS US Reit will hold a total of 11 freehold offices properties in the United States with an aggregate of 3,225,739 sqft spanning across the West Coast, Central Region and East Coast.  Yes, free hold. I love the properties that are freehold. This is also a pure US-play Reit.

Page 164 of KKREIT Prospectus
Summary:
West Coast:
  1. The Plaza Buildings - situated at the CBD of Bellevue (Seattle). Consist of 2 Class A office buildings with a NLA of 490,994 sqft.
  2. Bellevue Technology Center - situated at the sub market of Seattle-Bellevue region office market with a NLA of 330,508 sqft.
  3. Iron Point - situated at Folsom, Sacramento, Consist of 5 Class A office buildings with a NLA of 211,887 sqft.
Central Region:
  1. Westmoor Center - situated in Northwest Denver, it's situated near the downtown of Denver and Boulder. Consists of six Class A office buildings with a NLA of 607,755 sq ft of NLA.
  2. Great Hills Plaza - situated in Northwest Austin, Texas. Consist of a three-storey Class B office building that contains 139,252 sq ft of NLA.
  3. Westech 360 - situated in Northwest Austin, Texas. Consist of 4 three-storey Class B buildings with a NLA of 173,058 sq ft. 
  4. 1800 West Loop South - situated in Houston’s Galleria West Loop submarket, and consist of a 21-storey, Class A office tower with a NLA of 398,490 sq ft. 
  5. West Loop I & II - situated in Bellaire, suburb of Houston, Texas. Consists of 2 Class A office buildings with 313,873 sq ft of NLA and a high concentration of its tenant base from the healthcare and professional services sectors.
East Coast:
  1. Powers Ferry Landing East - situated in the Cumberland/I-75 submarket of the Atlanta Office Market. Consist of a six-storey, Class B office building with a NLA of 146,352 sq ft. 
  2. Northridge Center I & II - situated in Atlanta, Georgia, in the Central Perimeter, one of the largest office submarkets in Atlanta. Consists of two Class B office building with a NLA of 186,580 sq ft.
  3. Maitland Promenade II - situated in Orlando, Florida. Consists of a five-storey Class A office with a NLA of 226,990 sq ft.

 
Tenant Mix:
From below, we can see that there is no heavy concentration of tenants. In another words, the departure of the biggest tenant will only contribute to a loss of 3% of their cash rental income.

It also seemed that among the biggest tenants, the sector that contributed most belong to the Finance and Insurance sector. This may not exactly be a good thing. During a financial crisis, where finance company will be taking a big blow, KKREIT might be impacted adversely when the finance companies are not able to pay for the rental.

Page 170 of KKREIT Prospectus

3. WALE:
The IPO portfolio has a WALE of 3.9 years with most of their leases expiring from 2022 and beyond.


Page 171 of KKREIT Prospectus

Current occupancy rate is standing at 88.1% and the table below shows the occupancy rates across the 11 properties.


Page 133 of KKREIT Prospectus

4. Net Asset Value (NAV)
NAV of KK-US Reit properties stand at US$ 0.84 with their portfolio size at US$ 804 million. At the IPO price of US$ 0.88, it translates to a premium of 4.7% with a P/B ratio of 1.047. However, comparing to the nearest peer (Manulife US REIT), they're also trading at a premium of 7.7% at the price of 0.90 today. Hence, this IPO is not exactly a cheap IPO and at 1.047%, they're fairly priced.

 

5. Gearing:
Currently, the gearing is currently standing at 36%, which is not exactly low and is 9% away from the MAS ceiling of 45%. This also means that there is a slight headroom for KKREIT to take up debt for future acquisition. However, as REIT is to pay out 90% of their earnings as distribution, at 36% gearing, this will mean that not much debt can be taken for acquisition in the future.

Page 34 of KKREIT Prospectus

 
6. Dividend yield
The DPU forecast for FY2018 is estimated to be at 6.8% and 7.2% for FY2019 with a 5.8% growth in DPU from rental escalation and organic growth.

KK REIT's distribution is slightly higher than the average DPU for SG Office REIT.
The higher yield serves as a compensation for being exposed to more risks such as forex movements and the US economy.

Page 32 of KKREIT Prospectus

7. Principal Unit holders:
As seen from the table below, the issuance is pretty well supported from cornerstone investors such as Affin Hwang, Credit Suisse, DBS and Hillsboro amounting to almost 40% of the total units issued! Sponsor interest is also nice at 14-19% from Keppel Capital (KCIH) and KBS depending on over-allotment exercise.

Page 111 of KK REIT Prospectus
8. When will their IPO takes place?
The following table shows the timetable and important dates for the listing.

Page 74 of KK REIT Prospectus
9. Closest match and comparison: 
The closest match for this is no doubt Manulife US Reit. Both Manulife US Reit and KKREIT are pure US asset play and consist of offices. So based on some metrics mentioned previously, let's have a closer look (as of 31/10/17).


Latest financial report from Manulife USD Reit (ended on 30/06/17):

Manulife USD 1H2017 Key Highlights Slide 5


10. My take:
Similar to the REIT IPO of Cromwell and Manulife US REIT, KK US REIT is dominated in a foreign currency, USD in this case. This acts as another layer of risk or reward. Should the USD recover against SGD, the reward from KK REIT might be amplified, and likewise if it were to deteriorate, the gains might be wiped out/loss might be amplified.

The issue price of US$0.88 and P/B ratio of 1.04 suggest that is is fairly priced and trading at a 4% premium. No margin of safety in this case. Gearing of 36% also means that, there is limited headroom available for them to acquire more properties without rights issue.

It's good to know that there is a fairly decent support from the cornerstones investors and sponsors. After reading from the prospectus, if you're someone that is looking for diversification, positive on US growth and comfortable with the metrics mentioned, you might wish to take a closer look at KK REIT.

More information can be found here from Straits Time.
And IPO prospectus for Keppel-KBS US Reit can be found here
Latest Manulife 2Q2017 Financial Results Slides can be found here

Hakodate, Hokkaido (Autumn 2017) - Part 2

This is the second part to exploring Hakodate.

This second day started relatively early as I made a trip to the Hakodate Morning Market for some fresh seafood.

Hakodate Morning Market:
Address: JR Hakodate Station, Hakodate, Hokkaido Tel:+81 120-858-313

The morning market is located just a minute walk away from the JR Hakodate Station. This is a more "touristy" place and is filled with tourist. This place here is filled with the freshest seafood. They offer a great variety of seafood that you'll be able to see and buy here. There's also restaurants here where you'd be able to eat in as well. Be sure to try their seafood and melons here!!


Hakodate Morning Market Square
Hakodate Morning Market
The cute little squids on their sewage cover

Some food:


Their honeydew melon here is very nice!
If one entire honeydew is too big, you can consider getting this at 300 Yen!

Some shopping?
Uniqlo/GU:
Address: 〒041-0812 北海道函館市昭和1丁目29−8 函館 昭和 タウン プラザ 内
Tel: 0138-62-2737
Right here, in Showa, there's a big Uniqlo, GU (a shop that sells fashion items just like Uniqlo), a gigiantic drug store, book store, Best Denki, supermarket and sports shop! It's not very far from Goryokaku. There's so many so many things here. Just along the stretch, in walking distance you'll be able to find more shops. 




Goryokaku Park/Tower:
Address: 43-9 Goryokakucho, Hakodate 040-0001, Hokkaido. Tel: +81 138-51-4785
Unfortunately, the time when we reach Goryokaku, the sun has set and there goes my good view and all the things I'd be able to see here at Goryokaku. Goryokaku is star-shaped western style citadel,  built in the 17th century to serve as the defense for Hakodate. There's a shop located at the first floor of Goryokaku Tower which sells some local souvenirs like Shiroi Koibito and more.

Goryokaku Tower
Former Magistrate Office


Afterwhich, we've proceeded to Yunokawa, where there is a huge number of onsen (hotsprings) there. And after a day, it's time for some dinner and I've decided that a BBQ dinner would be good.



Yunokawa-Onsen:
There's a good number of hot springs in Japan and Yunokawa, Hakodate is one of the most famous place in Japan for their hotspring resorts. There's a number of inns and hotels with hotspring around Yunokawa vicinity. You'd be able to stay in the inns/hotels or pay a small fee to enjoy their onsen facility.

More details about the different inns and hotel can be found here.

Yunokawa Hot Spring Foot Bath:
Address: 1-16-5 Yunokawa-cho, Hakodate
If you're not a fan of soaking your whole body into the hot spring, there is another hot spring foot bath called Yumeguributai, which is situated at a minute away from Yunokawa Onsen Tram Stop. Not to worry, this is free-of-charge. Having to soak your tired legs into the foot bath in a cool weather... Nothing beats the feeling of it!!

Yunokawa Hot Spring Foot Bath







Friday, 27 October 2017

Cryptocurrency? I'm in too

Cryptocurrency has been hottest thing over the past few years and most famously argued by gurus about crypto being the next big thing and when the "bubble" is going to pop. With Bitcoin surging pass the 6000 mark and Etherum surging pass the 300 mark. Those that bought into Bitcoin in the starting of the year will really be laughing to the bank now (provided that they're selling them now!)


Bitcoin as of 01/01/17 at price of $997.69! Today at $5,835.22!! This is a 584% increase YTD!
Look at it!
So what is cryptocurrency?? Let's take a look at the definition from Investopedia.
Adapted from Investopedia

Investing in cryptocurrency? Wait.. Is cryptocurrency an investment?

Let's take a look at what exactly an investment is!
Investment is an asset or item purchased with the believe/hope that it will appreciate or generate income in the future.

Ha.. So is cryptocurrency is an investment? 
Hmm.. maybe. But wait. Cryptocurrency has no value tied to it.. No dividends and I couldn't perform any FA on Crypto! Shit. So what exactly is a good investment? Will cryptocurrency be one of them?

Read: 
What is a good investment? - B
What is a good investment? - Uncle CW8888
 
I've been reading very much on Cryptocurrency lately and have decided that with a "bigger risk appetite", I'll dip my toes into the sea of crypto. I've placed a small bet of 500 USD into the world of cryptocurrency. Having that said, I'm prepared to lose every single cents. Hopefully, in time soon, I'll be able to write more on Crypto.

The initiation of Crypto-investing/trading comes with 2 intention - to build a bigger war-chest and at the same time learning from the crazy and volatile alternative market. (Though, there's no guarantee that it will be assisting me with building a bigger war-chest.)


Youth, my strength, is that I don't know what cannot be done.
Call it diversification maybe..? Is anyone else in?

Note: Investing in cryptocurrency is very risky. Please do your due-diligence before any actions. Having that said, I'm prepared to lose every cents that I've input into the crypto world should anything fall through.

Wednesday, 25 October 2017

Buy and Hold - Who sold you that idea?

(UPDATED: 28/10/17 - example changed to Creative Technologies for a better illustration. Thanks SMOL. Apologies for the poor example cited previously that had caused confusion in readers.) 
 
I've read the 2 recent posts from 2 wise seniors - Uncle CW8888 and SMOL recently. Allow me to induce some flavors of this 2 seniors into this blog post.

Everyone knows what buying and holding is.. So what exactly is buy and hold?? Being curious.. I went online to google about the exact definition.

From Investopedia
Hmm.. but buying and holding does not only applies to stocks!!

Is buying and holding a "sure-win" strategy?  
Buying and holding might increase your winning odds. But there's no guarantee!!
The asset you're buying and holding is important too!!

Let's take a look at 2 example.

Buying SGX in 2004 Jan?

$1.83..

Hmm..



How about buying Creative Technology in 2004 Jan?

$20.10..

Both also inside STI and accepted by investors wor.













Wanna see some real examples??


Read:
Buy and Hold - Who sold you that idea? - Uncle CW

Buy and Hold - Who sold you that idea? - SMOL



Tuesday, 24 October 2017

A lookback into 1997 Asian Financial Crisis

This post today is another study on the financial crisis from before.

Remember on 19 October 1987... The Black Monday strikes? Let's fast forward to 10 year later, in the summer of 1997. In the beginning of July 1997, the East Asia is battling with a rising fear of worldwide economic meltdown. This Asian Financial Crisis is a series of currency devaluations. This had it turn caused the stock market to collapsed.

The Asian Miracle is a name used to describe the economic growth of East Asia. For 30 years, the growth rate of Thailand, South Korea, Hong Kong, Singapore, Taiwan and Indonesia had maintained a very high growth rate of 8-12%. This is attained by high interest rates which is used to attract foreign investments. The foreign investment also allows rapid industrialization.

The high exposure to foreign investments also brings them a bigger risk to forex movements. As the US economy recovered from a recession and aftermath of Black Monday in early 1990s, U.S begins to increase the interest rates. This inevitably caused a problem for countries in Asia that are exposed to foreign investments and the U.S becomes a more attractive investment destination.

Bubbles are formed and fueled by hot money (money that are flowing regularly and quickly between financial markets for investors to capitalize on the gain in shortest time on the highest interest rates)

Background/Causes - Thailand
It all started in Thailand. In 1985 to 1996, Thailand's economy grew at an average of 9% per year. The highest economic growth rate of any country at the time (Japan is knocked out by the popping of their asset bubble. Inflation was however kept reasonably low between 3.4-5.7%. The Real Estate sector is also booming with speculations. However in early 1997, the exports decline. Exports is an extremely sector that contribute to a significant portion of Thailand's economy.

In May 1997, the Thai Baht was hit by massive speculative attack in view of the weaker economy. In spite, of the attack the Prime Minister of Thailand announced that they will not devalue Baht. Thailand, however, lacked in foreign reserve to support the peg between USD and Baht and the government was forced to float the Baht allowing the Baht to be set by the currency market.

The currency market failed in Thailand as a result of the government's decision to no longer peg the local currency (Baht) to the U.S dollars due to insufficient reserves. Since the U.S is now a better destination for investment, investors withdraw from their investment in Thailand and flock to the U.S. This event had caused the baht reached it's lowest point at 56 to 1 USD.

From 25 to 1USD to 56, it had made foreign loan extremely costlier for Thailand. This event had caused the biggest financial company in Thailand - Finance One to collapse. Fear has strike and investors are in a panic and started pulling money from the Thailand market.

As a result, Thailand had accumulated a heavy bag of foreign debt that effectively bankrupted the country. This event had ended Thailand's booming economy.

In short, using a simple diagram:




Indonesia
Indonesia, a country that has the largest economy in the Southeast Asia, is next to feel the wave. Just before the AFC, Indonesia is in good shape due to the low inflation and huge foreign reserve along with the good banking systems. Rupiah has also appreciated from the loans taken by foreign institute. However, just after Thailand floated baht, Indonesia responded by floating the rupiah too and had widened the band from 8 to 12%.

Unfortunately, rupiah is next in the severe speculative attacks which devalued Rupiah to a greater extent. Similarly, the cost of foreign debt and investments becomes costlier and Rupiah has dropped from 2600 to 1USD to 11000 to 1USD. As a result of the falling Rupiah, the Jakarta Stock Exchange is also affected and touched it's historic low.



South Korea:
The domino effect has spread from Thailand to Indonesia and South Korea is next. They've great conglomerates owned by government. However, as many of the corporations are busy with building great conglomerates to compete on world stage, the Koreans are not left out. They've been aggressively expanding their businesses, funded by loans. The conglomerates does not earn sufficiently to pay off their loan. This has resulted in non-performing loans and is burdening to the banking sector.

The shortage of foreign currency caused the value of won to devalue from 800 to a low of 1700. And due to low reserves that South Korea has, the devaluation of won and non-performing assets, South Korean market plunged and many countries bankrupted. IMF stepped in to provide US 57billion as bailout package, with conditions of the Koreans to adhere to. An example of company that has bankrupted in AFC is Daewoo Motors and they're taken over by General Motors.

Philippines:
In response to the crisis in Thailand, the country's central bank raised interest rates to defend the peso. Stock market crashed and fell from 3000 to 1000 points. Huge outflow of money


Hong Kong:
The Hong Kong dollars come under speculative pressure soon after. Due to the inflation rate in Hong Kong being significantly higher than the U.S. As Hong Kong had a huge foreign reserve, they manage to maintain the peg. To protect the currency, the interest rates increased from 8% to 23$ overnight. This in turn caused the stock market to be extremely volatile and in 3 days, Hang Seng Index dropped 23%. The rate hike had caused the market to spiral downwards and many speculators had shorted the shares on Hang Seng Index. The HKMA and Donald Tsang (Financial Secretary of HK) since declared war on speculators with government buying US 15 billion worth of stocks in many companies. 


Malaysia:
Similarly, the Ringgit Malaysia is attacked by speculators after the Thai Baht. Overnight rate jumped from 8%-40%. This has caused the massive sell down in the stock market by which it fell by 50% from 1200 to 600.

Malaysia prime minister, Mahathir had introduced strict capital control, stopping of overseas trade by making the RM invalid. Currency/investments aboard for residents is also controlled. The decision to make RM invalid in overseas trading has caused the short-sellers to buy back RM at a higher price. Hence, making it a bad investment for them. CLOB counters is also suspended, and $4.5 billion worth of shares is suspended, affecting many Singaporeans that are invested in CLOB.

The plunging of economy has caused the Malaysia to enter into their first ever recession. All sectors were hurt in the falling economy. Foreign investment in Malaysia since the AFC is mostly avoided from how they dealt with the CLOB counters. Till date, the economy has not recovered to pre-crisis level.

Singapore:
Singapore is less affected by the AFC. However, as the crisis is spread to Singapore, Singapore entered a short bout of recession. The MAS had allowed a 20% depreciation to SGD to cushion the economy for a soft landing. However, the STI is left unattended to, falling from 2,000 points in closing at a low of 848 points on October 1998.



U.S:
The U.S is also affected, but least affected. This is caused by the worries that arises about Asian economies with DJIA plunging 7.2% on October 1997.

Over-investment? Speculation? Panic-stricken? Bubbles?
Oh no.


Read: A lookback into 1987 Black Monday, A lookback into 1986-1991 Japanese Asset Price Bubble

Monday, 23 October 2017

The traps in stock market

Trap is a device that is used for catching animal or humans and preventing their escape. Being in a trap is an unpleasant experience and is difficult and impossible to get out of it. I've been seeing the word "value trap" pretty often and I decided to read up more about it. To my surprise, there's more than one trap in the stock market!!



Let's start with the most commonly heard trap:

Value Trap:
Everyone love to buy things at a discount don't they? Doesn't it feels awesome to buy the all new iPhone X at $300 without any contract? This beautiful piece of iPhone X is trading way below it's book value! You realize that you're able to sell this iPhone to a second-hand dealer at $800! Now..you see the opportunity. For stocks, value opportunity is identified by certain metrics, such as low P/E of the sector, trading below book value and more. So once the value opportunity is here, bargain hunter will come cashing into the stock. However, when the value is never unlocked, the value investors is trapped in the situation.

Bear Trap:
Bear trap is a trap that incorrectly shows the signal of a stock that is in a rising trend to reversed and go down. Traders love this. They'll go shorting on stocks with expectations that the stock price to decline after they've discovered certain chart reversal pattern. However, in this bear trap, the stock price stays flat or might even recover. The shortist are now caught and trapped.

Bull Trap:
Now on the other hand, bull trap is a trap whereby it shows an incorrect signal of a stock that is declining, and is currently "bottoming out". However, the fact is, this stock will still continue to fall. Investors will then be catching a falling knife. Bullish investors that had purchased this stock will be trapped in this poor-performing stock and facing 2 choices - to cut his/her loss or average down. 

Superiority Trap:
Now this is strange. Superiority trap is a behavioral trap. This is also a very dangerous delusion. This happens when the investor feels that their investing skills are more superior than the others. I have no idea why anyone will feel this way but.. oh well. This is a some kind of cognitive bias. Confidence is a good weapon in investment however, over-confidence tends to kill. Investors with this cognitive bias will be trapped in a position that they believe will do well, but did not. As a result, they may end up losing a good sum of their monies here. 


Wednesday, 18 October 2017

Hakodate, Hokkaido (Autumn 2017) - Part 1

Welcome to the the new segment of my blog - "Travel with the devil"

I've added a new page to the blog - "Travel"

Being granted with the opportunity to explore around Japan, let's start with the first stop - Hokkaido.
Hokkaido, located at the northern most on Japan is no doubt everyone's favorite place to visit.

The best soft serve?
Shiroi Kobito?
Honeydew melons?
Freshest Seafood?
Ramen?
The background of your desktop monitor you're always looking at?
Snow-Skiing?

YES. This is Hokkaido. And I'm going to begin with the southern part of Hokkaido - Hakodate, a place I've explored over the last week.

函館へようこそ!

Hakodate, is a city and port located at the southern part of Hokkaido, Japan, also the third largest city in Hokkaido, after Sapporo and Asahikawa. I've arrived to Hakodate by plane via their airport, Hakodate Airport. I'll be splitting "Hakodate" into a few parts.
From the airport, you'd be able to board the City Shuttle Bus, which will ferry you to several different location for a price between 230-420 yen. This shuttle bus will serve you from Hakodate Airport to Yunokawa Onsen, Hakodate Station, Bay Area.

The beautiful red leafs during Autumn

The transportation system here in Hakodate is not that bad. However, it differs pretty much from Singapore. There is small fleet of buses. Missing a bus will probably get you an hour of waiting time. There's also tram that's available here. Just like in Hong Kong, they're traveling in the middle of the road, with the cars.

Traveling around will require a ICAS nimoca. This is just like the EZ-link we're using in Singapore. You can buy the card/topup the card in the buses/trams themselves for 2,000 Yen (500 Yen Deposit + 1500 Yen Stored Value). Each trip around will cost between 210-250 yen (S$2.50-3).

Alternatively, you can collect a piece of ticket and pay when you alight. Do note that they're boarding from the backdoor and alighting from the front door. Taxi is very expensive here in Japan and it will cost 550 yen upon boarding and each increment will be by 80 Yen. It will cost about S$20 for a 5km trip. Very costly..
ICAS nimoca
ICAS nimoca can be used in various different places 

For tourist. There's also Hakodate Bus One-Day Pass "Kanpass" that is for sale at tourist sites such as Hakodate Summit Bus, Goryokaku Tower etc. 1 Day passes will cost 1,000 Yen and 2 Day passes for 2,000 yen. Both buses and trams are available using that card.

I guess everyone is hungry...Let's start with some food, shall we?

Food:
Lucky Pierrot:
Address: (Hakodate Bay Area Mainstore) 23-18 Suehirocho, Hakodate 040-0053, Hokkaido 
 
Be sure to try out Lucky Pierrot at Hakodate! Lucky Pierrot is a home-grown fast food restaurant with 17 stores located only in Hakodate. The interior of each Lucky Pierrot looks slightly different and is very distinctive. I've been to 2 different outlets, one at Hitomi and another one at Hakodate Bay. They offer a wide range of food from burgers, soba, curry rice, omelette rice and more. I was told by my friends around that the Shrimp Burger taste nice. I can promise you that they're filling.

The cost of a plate of curry rice, blueberry milkshake, onion rings and gyoza cost about 1,300 Yen (about S$16) and the plate of soba cost about 750 yen (S$9.10)
Lucky Pierrot Carbonated Can Drink
Lucky Pierrot - Curry Chicken Rice
Lucky Pierrot - Pork Soba Noodles

Shopping:
Kanemori Red Brick Warehouse:
Address: 14-12 Suehiro-cho, Hakodate 040-0053, Hokkaido.
If you're taking local tram, please alight at Jujigai. Kanemori Red Brick Warehouse is in walking distance from Jujigai Tram Station.


Just opposite of the Lucky Pierrot at Hakodate Bay, lies a row of red brick houses which now serves as a shopping mall that sells souvenirs - Kanemori Red Brick Warehouse. This row of red buildings is originally the first commercial warehouse of Hakodate.

Kanemori Red Brick Warehouse


Sightseeing:
Hakodate Bay: 
Address: 23-18 Suehirocho, Hakodate 040-0053, Hokkaido
If you're taking the local tram, you can alight at Jujigai Tram station and the few places are all within walking distance from the tram station.
The Hakodate Bay area offers an extensive view of the harbor. I was strolling along the bay along Hakodate Port. Just after the Kanemori Red Brick Warehouse, I found a Starbucks and decided to settle down for a moment and enjoy my frappe with the beautiful scenery. I do not drink atas coffee back in Singapore, but now.. Let me enjoy myself first :p

Starbucks in Hakodate Bay. Featuring the great view

Motomachi-District:
Address: 33-14 Motomachi, Hakodate 040-0054, Hokkaido

This is located at the foot of Mount Hakodate. The Motomachi neighborhood is filled with historical buildings such as the Old British Consulate. You'd be able to find a wide variety of beautiful western style building here. Do not forget to take more photo here!!
Gothic-style Roman Catholic Church in Motomachi

Mount Hakodate: 
Address: Hakodateyama, Hakodate 040-0000, Hokkaido

The sun here sets at around 5pm. So just before it sets, I took the opportunity to go up to Mount Hakodate. Mount Hakodate is also in walking distance from the Bay Area. However, there's a steep slope that you'll have to walk up before taking a bus/ropeway to the top of the Mountain.

The steep slope preceding the Rope ways/Buses on Mount Hakodate



It will be the best for you to get onto Mount Hakodate just before the night falls so you'd be able to catch all the 3 views of Hakodate - with the sun, the sunset and the night view. However, please take note of the timing of sunset! Sun will start to set pretty early at about 5pm.

The view of Mount Hakodate is rated with a three star rating in the Michelin Green Guide Japon. So when you're around Hakodate. Don't forget to go up there!! There's 4 way of which you'd be able to reach the top of Mount Hakodate - Hiking, Driving, Bus and Cable Car. The cost of tickets for cable car for a return trip will cost around 1,200 Yen (S$14) and 800 Yen (S$9.75) for bus. Unfortunately, the cable car is closed for maintenance and is due in November. As such, I've went up by bus. It's truly a pity that the cable car is closed as there's many more things that I'd be able to see if I'm in it. But well..

Bus to Mount Hakodate. Time for buses is here too.
Mount Hakodate
View of Mount Hakodate before Sunset
View of Mount Hakodate after Sunset

There's also a souvenir shop at the top of Mount Hakodate with a restaurant. You'd be able to get some Shiroi Kobito, Calbee Jaga Pokkura and more there. Just another thing.. the weather up there is much colder especially when the wind is blowing at you, so don't forget to wear more! At the same time, the queue for bus back down is horribly long. So if you're getting up here by bus, be prepared to miss at least one bus.

Doraemon sold in the shop too!

This is my itinerary for 1 day in Hakodate. Now.. how much do I spend? I can assure you.. it's less than S$50 (this amount includes transportation, Mt Hakodate bus, food and beverages)

Places covered: Motomachi-district, Mount Hakodate, Kanemori Red Brick Warehouse, Hakodate Bay.

Link to Part 2 here