Real News‎ > ‎2014‎ > ‎October 2014‎ > ‎

20th October 2014

Singapore Economy

Gearing up for tomorrow's super cities

The cities, infrastructure and industrial solutions industry, nurtured by the Economic Development Board, help make Singapore and other cities a smarter and greener place to live, work and play in. In the second of a seven-part series, Arti Mulchand profiles some of the people working in it.

Source: Straits Times / Singapore

THE numbers are staggering - according to the United Nations, 70 per cent of Asia's population will live in cities by 2050, and more than half the world's 20 mega cities will be in the region.

Already, 44 million people are being added to Asia's urban population every year - that's 120,000 people a day who will need more than 20,000 new homes, 250km of new roads and the necessary infrastructure to supply an additional 6 mega litres (6 million litres) of potable water.

This puts an inordinate strain on finite resources.

"These new cities are keen to address potential challenges such as overcrowding, traffic congestion, rising energy consumption and environmental degradation. This will in turn drive demand for infrastructure investments," explains Mr Goh Chee Kiong, executive director, cities, infrastructure and industrial solutions, at the Economic Development Board (EDB).

Just last month, Singapore's Minister for Foreign Affairs, Mr K. Shanmugam, delivering his speech to the United Nations General Assembly, said that unless cities developed sustainably, they could spiral into poverty and overcrowding.

"By 2030, two billion could live in urban poverty. They will be at risk of overcrowding, epidemics, crime and pollution. The challenge is therefore really to manage urbanisation well," he noted.

The Asian Development Bank estimates that Asia requires US$8 trillion (S$10.2 trillion) worth of infrastructure investments in the current decade ending in 2020.

The good news is that Singapore is well placed to help support the development of smart and sustainable cities, infrastructure and industries, through engineering services such as urban planning, and controls and automation solutions.

In fact, Singapore is viewed as a reference city for urban sustainability and green growth.

A whole-of-government effort has positioned the country as a living laboratory, allowing for the development, testing and commercialisation of innovative solutions, while meeting Singapore's domestic needs.

These solutions can be exported to regional and global markets, explains Mr Goh.

The country boasts a good mix of engineering, procurement and construction firms, engineering consultancies and specialist engineering service providers.

They range from large multi- nationals, like Jacobs Engineering and CH2M Hill, to local players like Surbana and Jurong Consultants.

The sector employs 37,000 people, and more is being done to create professionals with a deep understanding of Asia's particular infrastructure challenges and opportunities.

Among these initiatives is EDB's Asia Leaders Programme in Infrastructure Excellence (Alpine), an executive education programme which will start its inaugural run this year. It will groom "Asia-ready" project-development talent.

Hosted by the Singapore Management University with support from the Lee Kuan Yew School of Public Policy, it is the first of its kind in the region.

Tomorrow's leaders are also being nurtured for the controls and automation sector, which supports the operation of industrial plants, infrastructure and buildings. Nine of the world's top 10 controls and automation companies have a significant presence in Singapore, including Yokogawa, ABB and Emerson Electric, each of which employs more than 1,000 people.

The sector as a whole employs about 9,000 people.

It is a crucial talent pipeline that can help support rapid urbanisation and industrialisation, and create a better tomorrow for the region, says Mr Goh.

Singapore Real Estate

CPG inks 83,000 sq ft lease at Westgate Tower

Source: Business Times / Real Estate

In the biggest office leasing deal for a new suburban project so far this year, CPG Corporation has taken a lease of 83,000 sq ft at Westgate Tower next to Jurong East MRT Station. The group will move out from Novena Square, where it occupies its present office of about 80,000 sq ft under a lease that expires in Q1 2016. The infrastructure and building development and management services provider, formerly the Public Works Department (PWD) of Singapore, is expected to move into Westgate Tower in the fourth quarter of next year. CPG is said to have inked a 10-year lease.

-By Kalpana Rashiwala

Lawrence Wong to helm Jurong Lake District committee

It will study plans for the Jurong Lake District area to ensure its vibrancy and opportunities for jobs, learning and recreation, says DPM Tharman

Source: Business Times / Real Estate

A steering committee comprising members of the public and private sectors has been formed to oversee developments in the Jurong Lake District and its surrounding areas. The 14-member committee will be headed by Lawrence Wong, Minister for Culture, Community and Youth and Second Minister for Ministry of Communications and Information, said Deputy Prime Minister Tharman Shanmugaratnam.

-By Lynette Khoo

New Jurong gardens will retain heritage

Challenge is to inject new life while keeping natural feel, history: Tharman

Source: Straits Times / Top of The News

THE new Jurong Lake Gardens will not be developed in a rush, assured Deputy Prime Minister Tharman Shanmugaratnam, promising to maintain the area's special character and heritage.

To drive this patient rejuvenation of a "people's garden" is a steering committee led by Culture, Community and Youth Minister Lawrence Wong, said Mr Tharman yesterday.

Its challenge, he said, is to retain the natural feel and history of the place, and yet inject life and enable many more Singaporeans to enjoy what he hopes will become "an endearing place".

"Jurong Lake Gardens and its surroundings will give a new face to our neighbourhood, something to be enjoyed by residents and Singaporeans everywhere on the island," he said, before joining over 700 families in an event to clean up Jurong Lake.

The Jurong Lake Gardens, which covers more than 70ha by combining the Chinese Garden, Japanese Garden and Jurong Lake Park, will be completed in phases, said Mr Tharman, who is also Finance Minister and an MP for Jurong GRC.

The makeover was announced by Prime Minister Lee Hsien Loong during the National Day Rally in August. It will begin with Jurong Lake Destination Park, which will be done by 2017.

Following that, Science Centre Singapore's new home near Chinese Garden MRT station is expected to be ready by 2020.

Mr Wong said his committee wants to put in place a long-term masterplan that will guide development in Jurong Lake District for many years. "This is not a typical (Urban Redevelopment Authority) planning committee. We should look at it more broadly."

This is especially since the Kuala Lumpur-Singapore High Speed Rail terminus might be built in Jurong East, and Pandan Reservoir could also be integrated into the area, he said.

An example which the committee - which will be supported by the URA - can learn from is Marina Bay, said Mr Wong.

"If you looked at what we did for Marina Bay, it went on for a number of years... We had a vision and we worked very hard to make the plans happen," he said.

The 15 members in the new committee will come from the Government, the private sector and the community.

"We deliberately put together people with a range of expertise in design, urban planning... as well as representatives from the local community," said Mr Wong, who is an MP for West Coast GRC, which is adjacent to Jurong GRC where the gardens are situated.

The members include Senior Minister of State for Finance Josephine Teo; Minister of State for National Development Desmond Lee; Nature Society president Shawn Lum; Centre for Liveable Cities executive director Khoo Teng Chye; and Taman Jurong Citizens Consultative Committee chairman Goh Peng Tong.

They will look at ideas and possibilities, gather feedback before the plans are finalised, and also put on roadshows.

"We will certainly want to hear from Singaporeans (on) what they would like to see for Jurong Lake District," said Mr Wong, referring to the plans as a national project.

Mr Habibui Hasim Matbar, 42, who was cleaning up the lake with his seven-year-old son yesterday, said his family, who lives in Boon Lay, is looking forward to the changes. "My family comes here about two or three times a month, and we are very excited," said the Keppel Shipyard project manager.

-By Aw Cheng Wei

New steering committee to drive development plans for Jurong Lake District

Source: Channel News Asia / Singapore

SINGAPORE: A steering committee has been set up to drive the development plans for Jurong Lake District and its surrounding areas, Deputy Prime Minister Tharman Shanmugaratnam said.

The committee will be headed by Culture, Community and Youth Minister Lawrence Wong. It will comprise members from the public and private sectors, as well as the community.

Mr Tharman, who also a Member of Parliament for Jurong GRC, said the committee will look at all the options and gather ideas and feedback before the plans are finalised. The plans include merging the Japanese Garden, Chinese Garden and Jurong Lake Park into the Jurong Lake Gardens.

"The new Jurong Lake Gardens will not be developed in a rush. We will take care that it retains its special character," Mr Tharman told residents at a community cleanup of Jurong Lake on Sunday morning (Oct 19).

"The challenge that we have is to ensure that we retain the natural feel and sense of heritage of this place, but inject life and enable many more Singaporeans to enjoy the place. It must be - as Prime Minister Lee put it - a 'people's garden' filled with activities and community events, and where the spirit of community gardening comes alive."

Mr Tharman said the Jurong Lake Gardens is a fresh vision for an area that has undergone a few transformations since the 1960s.

Mr Wong compared the development of Jurong Lake District to that of Marina Bay, which started from an empty slate. "In the same way, what we are planning to do for Jurong Lake District is very much about having conviction and faith in Singapore's future and thinking about how we can make it even better. And that was how we got here today."

"Fifty years ago, Jurong was very different, and now it's significantly improved. And just as 50 years ago, we made Jurong the frontier for industrialisation, that was the new way forward for our industrialisation push. I think now we're looking at how we can make Jurong Lake District the new frontier to create a high-quality sustainable live-work-play environment and so that we can have a much better Jurong Lake District for the future, for our next generation. So that's what this project is about."

Early next year, the National Parks Board will be seeking ideas from the public, which will be added to the brief for the masterplan competition for Jurong Lake Gardens.

A Water-Venture Committee (Jurong Lake) by the People's Association Water-Venture has also been set up to engage more residents in water and adventure sports, as well as promote greater care and love for community spaces.

Gerard Lim, 27, a member of Water-Venture Committee (Jurong Lake) and a PhD student in applied physics from NTU, said: "Jurong Lake has become more and more popular over the years. What happens is that we're having more people coming and using this area. That means more litter as well. So this initiative actually makes people more aware of this area, Jurong Lake, and to learn to keep this place clean."

- CNA/by/ir

Panel eyes longer-term plans for Jurong Lake District

Planning process will be like that for Marina Bay, which took years: Lawrence Wong

Source: Today Online / Singapore

SINGAPORE — The planning process for developments in Singapore’s largest commercial and regional district outside the city will be akin to that for the Marina Bay area, said Minister for Culture, Community and Youth Lawrence Wong, who leads the steering committee for Jurong Lake District that was announced yesterday.

While the first phase of these plans — the Jurong Lake Gardens — is expected to be completed in 2017, other developments will take longer, the way the Marina Bay district took well over a decade to develop. “This is not a routine planning process,” said Mr Wong, who was speaking to reporters on the sidelines of Project Blue WaVe, a community event at Jurong Lake yesterday morning. “This will not be a short-term thing … If you look at what we did for Marina Bay, (it) went on for quite a number of years.”

Mr Wong, who is also Member of Parliament for West Coast GRC, added: “Of course the setting here in Jurong Lake District is different, but I think in the same way, what we are planning to do for Jurong Lake District is very much about having conviction and faith in Singapore’s future and thinking about how we can make it even better.”

Planning for the extension of the financial district into Marina Bay began in the late 1990s and culminated with the official opening of Marina Bay Financial Centre last year, capping a series of developments in the area that include Gardens by the Bay.

Announcing the formation of the 14-member steering committee, Deputy Prime Minister Tharman Shanmugaratnam, who is also Member of Parliament for Jurong GRC, said the committee would drive and coordinate the developments of the Jurong Lake District. “These are ambitious plans involving many agencies and requiring close partnership with the private sector and community,” he said.

Members of the committee include Mrs Josephine Teo, Senior Minister of State (Finance and Transport), Mr Desmond Lee, Minister of State (National Development), Mr Edmund Cheng, deputy chairman and deputy managing director of Wing Tai Holdings, Dr Shawn Lum, president of Nature Society (Singapore) and Dr Tan Wee Kiat, chief executive officer of Gardens by the Bay.

First announced at this year’s National Day Rally, plans for Jurong Lake District include a new Jurong Lake Gardens created by combining the existing Jurong Lake Park, Japanese and Chinese Gardens. The Gardens will house the new Science Centre and a committee will be formed to oversee this.

Other longer-term plans for the area include better connectivity with a new integrated transport hub at Jurong East MRT Station, upgraded North-South and East-West lines and two new MRT lines. There will also be further road-widening projects to relieve congestion in the Jurong Gateway area.

The future Kuala Lumpur-Singapore High-Speed Rail terminus could be also sited in Jurong.

The challenge, noted Mr Tharman yesterday, is to ensure that the “natural feel and sense of heritage” of the area is retained while injecting life and enabling many more Singaporeans to enjoy the place.

He also announced a new Water-Venture Committee (Jurong Lake) under Project Blue WaVe yesterday, which will not only engage more residents in water and adventure sports, but also facilitate ground-up eco-themed activities and educational programmes.

The committee will also complement development plans in the area by leveraging the grassroots network to better understand and support residents’ needs.

-By Siau Ming En

Keppel to redevelop IFC Jakarta Tower 1 at a cost of S$266.4m

Project will more than double its net leasable area of premium office space

Source: Business Times / Real Estate

Keppel Land has unveiled its plan to redevelop the existing International Financial Centre (IFC) Jakarta Tower 1 which will more than double the net leasable area (NLA) of premium grade office space in the tower from 27,900 sq m to 69,800 sq m.

-By Lynette Khoo

Real Estate Companies' Brief

How Abenomics gave Parkway Life Reit a boost

It indirectly drove up nursing home demand, even as it caused the yen to slide, says CEO Yong Yean Chau.

Source: Business Times / Companies & Markets

Abenomics has given a fillip to Parkway Life Reit - which has 42 nursing homes in Japan - in more ways than one, according to the CEO of the real estate investment trust manager, Yong Yean Chau. For instance, one of the three "arrows" proposed by Japanese Prime Minister Shinzo Abe in his economic transformation programme is a set of radical structural reforms involving increasing the labour participation of women.

-By Lee Meixian

Will Reit change benefit investors in the long run? 

Proposals may put industry players off staying in sector or entering it

Source: Straits Times / Money

WHILE the new proposals to shake up the $61 billion real estate investment trust (Reit) sector in Singapore are mostly good news for investors, not everything is hunky-dory.

Some of the changes proposed by the Monetary Authority of Singapore (MAS) may deter responsible Reit sponsors and managers from staying in or entering the industry, which may not benefit unitholders much in the long run.

The proposals that do go through are expected to take effect around 2016, which also does not give much time for trusts to adapt.

These proposals were in an MAS consultation paper unveiled two weeks ago that was aimed at strengthening the Reit market in Singapore, the largest in Asia outside Japan.

For a Reit investor, there are many things to like about the raft of possible changes, which are likely to enable investors to make more informed decisions.

One proposal is a focus on improving transparency, such as requiring managers to disclose how much income support they get. Others include expanding the independent element of Reit managers' boards and changing how a manager's performance fees are structured in a bid to align them more with investors' long-term interests.

These proposals, which are part of a strategy to attract more Reit issuers and investors by boosting transparency and corporate governance, come as the industry here matures after a rocky start in late 2001.

However, some major proposals may end up deterring Reit sponsors and managers from growing the trust or even entering the market in the first place, which may narrow the range of options for investors.

A significant proposal is that Reit managers should have a statutory duty to prioritise investor interests over the sponsor's.

This is supposed to help guard against conflicts of interest, since the Reit manager is owned by the sponsor.

The sponsor, for example, may want the manager to pay more when buying an asset from it while unitholders would want the manager to pay less.

If the managing firm is found to have breached this duty, it may be subject to both civil and criminal liability and its directors jailed.

This is somewhat similar to the duty imposed on directors of listed companies on the Singapore Exchange, who could face jail time if they are found negligent, for instance.

The MAS has not yet made clear the process by which Reit managers would be found guilty of breaching their statutory duty.

However, it is likely to be a tricky path to follow because the only way to completely remove conflict of interest is to fundamentally change the management model in Singapore to one of internal management, a step that the MAS appears unprepared to take at this juncture.

Reits here are externally managed. This involves the Reit owner paying a separate manager - usually owned by the sponsor - fees to manage the trust. Of course, there are pros and cons to both models.

Although the MAS could possibly mandate a shift to internal management - where the Reit is managed by its own employees or an independent third party - that would mean that big sponsors would essentially have to relinquish control of the management.

That may remove any incentive for the sponsor to source for good assets and bear the risk of holding the properties for a few years before they can be sold to the Reit.

Without sponsors, many Reits would likely not exist in the first place, giving investors fewer avenues for yield.

Assuming that the MAS sticks with the external management model for now, this still leaves even responsible Reit managers wide open to possible jail time based on disputes about whether the Reit overpaid the sponsor.

On their part, sponsors tend to continue to hold a significant and, sometimes, majority, stake in their Reits, which would make them less likely to try to push sub-par assets to the Reit.

Sponsors also have to preserve their long-term reputation in the marketplace, which is reason enough to stay honest.

Rather than unnecessary regulations, surely there are other ways to motivate Reit managers to act in investors' interests, such as having investors vote with their feet.

-By Melissa Tan

A view at the top of the NY real estate market

There is a growing segment of buyers who are capable of spending so much money that they pay prices that have no bearing, really, on the usual rules of supply and demand

Source: Business Times / Real Estate

London Home Asking Prices Rise Most in Year

Source: Bloomberg / Luxury

London home sellers raised asking prices by the most in more than a year this month as a seasonal surge in demand led a rebound in the capital’s property market.

Values in the city increased 7 percent from September to a record average 596,692 pounds ($960,000), the biggest jump since October 2013, property website Rightmove Plc said today. The gain left prices 0.6 percent higher than in May, when they were at their previous high, after falling in three of the previous four months.

“This is not a resurgence of the London boom,” said Miles Shipside, a director at Rightmove. “Prices have effectively stood still over the last four months, an indication of the slowing market in some parts of the capital.”

Some reports have indicated a loss of momentum in the London market in recent months after prices surged more than 20 percent in the preceding year, twice the national average, and Bank of England financial-stability officials took measures to prevent overheating. Shipside said demand is showing signs of slowing and may continue to weaken during the winter.

Nationally (UKRMNAPM), prices rose 2.6 percent in October from the previous month, taking the annual gain across Britain to 7.6 percent, compared with 7.9 percent in September. Out of the 10 regions tracked by Rightmove, seven posted monthly increases, led by London, while three saw declines.

The southeast of England overtook London as the region with the fastest annual increase, with asking prices in the area surrounding the capital up 10 percent from a year earlier compared with the city’s 9.6 percent.

U.K. gross home loan lending fell 1 percent to 17.8 billion pounds in September from August, the Council of Mortgage Lenders said today. That’s up 10 percent from a year earlier.

“Recent indicators and policy actions corroborate our view of a gentle easing in market conditions,” said Bob Pannell, chief economist at CML. “There is growing evidence that mortgage lending activity, and the housing market, are sitting on a plateau.”

-By Scott Hamilton

Investors abuzz over property in London

Interest in the English capital has led to more launches here, with three taking place this weekend

Source: Straits Times / Invest

Local property investors have taken a shine to London real estate with increasing numbers of launches being held here, including three new developments that are showcasing their wares this weekend.

Barts Square

Barts Square is a mixed-use development in London's financial district, nestled between St Paul's Cathedral and Smithfield market.

It is also near the upcoming Farringdon Crossrail station, which is set to open in early 2018. The station will be the only one in London that will provide direct connections to three of the city's airports and quick transit to the West End, Canary Wharf and beyond.

Developed by Helical Bar, a London-based property investment and development firm, Barts Square comprises 236 apartments, including one-, two- and three-bedders and penthouses.

Prices start at about £775,000 (S$1.58 million).

There is also 230,000 sq ft of offices and 23,000 sq ft of retail space.

Construction of Phase 1, or the first 92 units, will be completed in June 2017.

London Dock 

This central city residential project is near Tower Bridge, St Katharine Docks, Canary Wharf and the Thames.

The site is part of the London Docks, which ceased operations in 1969.

The 1,800-unit project, comprising one-, two- and three-bedders, is being developed by London-based St George. It also features a 375m promenade. Prices for units, which are at least 450 sq ft, start from £700,000.

London Dock is expected to be completed in early 2017.

Queen's Wharf

This waterside development next to Hammersmith Bridge in west London is also close to the bustling suburbs of Fulham, Chelsea and Knightsbridge.

It will have good transport links given its proximity to Hammersmith Underground station.

Queen's Wharf is being developed jointly by London developer Mount Anvil and Fabrica by A2Dominion.

The 999-year leasehold residential project is part of a mixed-use development that features amenities such as a cinema.

It will have 165 residential units, including studio, one-, two- and three-bedroom apartments and penthouses. Prices for units start from £540,000.

The project is expected to be completed in the second quarter of 2017.