A S I A’ S P R O P E R TY M A G A Z I N E JANUARY 2009 | ISSUE 1
HONG KONG’S LOGISTICS FUTURE How Goodman paves the way
MIXED-USE DEVELOPMENTS The best from Beijing and Singapore
The best of building design
MAKE SPACE FOR LUXURY
Make green work for you
Design your dream at Jakarta’s The Keraton
Ebbing Favourably - a review of the market
AS IA’S P R O P E R T Y MAG AZ INE JANUARY 2009 | ISSUE 1
HONG KONG’S LOGISTICS FUTURE How Goodman paves the way
MIXED-USE DEVELOPMENTS The best from Beijing and Singapore
WELCOME to the ﬁrst issue of CUBIC, Asia’s Property Magazine – In this issue we
The best of building design
take you in-depth into some of the property projects and minds that are making a difference throughout this region. Topics range from mixed use developments in Singapore and Beijing to philanthropic activities in Vietnam and Sri Lanka. Although the ﬁnancial markets have been thrown into turmoil over the last months, quality real estate development and activity in Asia will not be stopped.
MAKE SPACE FOR LUXURY
Make green work for you
Design your dream at Jakarta’s The Keraton
Ebbing Favourably - a review of the market
CUBIC CoverDec08.indd 1
5/1/09 11:22:08 AM
CUBIC BY COLLIERS INTERNATIONAL
People still need to work, live and play and those that ﬁnd creative and efﬁcient ways to house these activities will continue to be rewarded. In fact during tough times internationally, Asia usually gains global market share and comes out stronger and more invigorated than before. Colliers International is dedicated to supporting and providing knowledge to business leaders to ensure companies are located in premises that are cost effective and also ﬁt their business culture while encouraging creativity and connectivity. Our commitment is also pledged to developers to share best practices found globally and assist in the many facets of creating new buildings and environments that support the lifestyles and businesses of Asia. Even through these difﬁcult ﬁnancial times Colliers International is committed to funding initiatives that help share our knowledge and support real-estate activity in the region. We hope you enjoy this ﬁrst edition of CUBIC and look forward to adding value to your business in 2009.
“We accelerate your success by making our knowledge your property”
EDITORIA L DIREC TOR GAVIN VERCOE EDITOR SHER ALYN TAY DESIGNER JOHNSON LIM ACCOUNT MANAGER KELVIN GOH CONT RIBU TORS EDMUND MAK , LIM SAY LIANG, ELIZ ABETH KERR, NAMR ATA KOHLI, WALL ACE CHAN A DV ER T ISING ENQUIRES If you would like to adver tise in the nex t issue of CUBIC, please contact Gavin Vercoe at Colliers International, +65 6223 2323
Gavin Vercoe Regional Director – Marketing and Communications
For all your real estate needs please phone your local Colliers International office. COL LIERS INT ERNATIONA L OF FICES – ASIA M A INL A ND CHIN A Beijing +86 Chengdu +86 Guangzhou +86 Shanghai +86 HONG KONG Hong Kong +85 INDIA Mumbai +91 New Delhi +91 Bangalore +91 Chennai +91 Pune +91 Gurgaon +91 Kolkata +91 INDONESIA Jakar ta +62 JA PA N Osaka + 81 Tok yo + 81
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CONTENTS 02 FOREWORD 04 LOGISTICS FUTURE
Goodman brings a brand new era to Hong Kong’s ports
09 HOW GREEN DOES YOUR BUILDING GROW? Build green, grow proﬁ ts and generate goodwill
40 40 THE LUXURY OF SPACE The Keraton shows how to make something out of nothing
44 HUBBING UNITED United Engineers Developments turn Changi site into a mixed-use super-hub
A BEAUTIFUL WAY TO WORK How art works – for Swire
MOTORING Audi: a supercar at last
50 JEWEL AT SEA
20 ICONS OF STYLE Buildings of innovation and design
24 VIETNAM RISING Korean developer Kumho sets its sights on Vietnam’s rising star
30 ALL-IN-ONE LIVING The Landgent is helping Beijing meet those mega-city dreams
Fancy your own brewery at home? The protection of Phu Quoc, island paradise
54 COLLIERS CARES Kirinda, a community restored
56 WORLDVIEW USA Real estate in a time of change
58 PEOPLE Out and about with Colliers
60 BOOK REVIEW Tribal Leadership
34 INDIA REALTY Downturn spells gloom for Indian real estate? Not quite
14 | January 2009 03
SECURING HK LOGISTICS FU With little or no new supply coming on-stream in the next few years, demand for prime industrial space in Hong Kong has reached fever pitch. Will Goodmanâ€™s latest projects slake the thirst? BY EDMUND MAK
January 2009 |
KK’S UTURE U
LEFT: Artist’s impression of the Rambler’s Channel city-scape when MGA’s Seaview and Interlink have been completed BELOW: Daniel McDonald, Managing Director of Goodman Asia on-site at Interlink
“The continued increase in sea and air cargo throughput, strong Gross Domestic Product, export growth ﬁgures and historically low warehouse vacancy of 1.3 per cent all underpin the demand for warehouse space in Hong Kong.”
THE SCENERY overlooking Rambler’s Channel in SouthWest Hong Kong can be breathtaking. On a clear sunny day, one can see container ships chugging to and from the Kwai Chung Container Terminal. As construction on Stonecutters Bridge nears completion, two industrial sites sit across Daniel McDonald, the water from each other, Managing Director of Goodman Asia both in a prime position to take advantage of the new connectivity the bridge will bring. The names of these sites are Seaview and Interlink — both developed by Goodman, a full-service industrial property company. With a core business in fund management, development management and property services, Goodman has over 300 employees in Hong Kong and 35 ofﬁces across 18 countries around the world. Goodman operates the Macquarie Goodman Hong Kong Logistics Fund, a portfolio valued at over HK$9.0 billion and which has 18 assets located around Hong Kong – each of which has an average occupancy level of 98 percent. With years of experience and an in-depth understanding of the management of industrial properties, Goodman has identiﬁed warehouse and industrial infrastructure as a key opportunity for them, and the bustling port city of Hong Kong.
| January 2009 05
THE BATTLE FOR SPACE
STONECUTTERS BRIDGE Also known as Angchuanzhou Bridge, Stonecutters Bridge is a cable-stayed highway bridge and, when completed, will be one of the longest bridges of its kind. Due to be completed in 2009, the bridge will span almost 1.6km and will link Tsing Yi Island and Cheung Sha Wan as part of the newly constructed Route 8, which will link Lantau Island, Tsing Yi Island, Cheung Sha Wan in West Kowloon and Sha Tin in the New Territories.
ARTIST’S IMPRESSION OF INTERLINK: The new port, bridge and warehousing will help bring a new level of interconnectivity
The ofﬁce crunch has long been a matter of course in downtown Hong Kong, which has the reputation of having one of the world’s costliest rentals – especially for prime space. In 2008, the rentals in Central District hit an average of HK$100 per square foot per month. In some prime parts of Central, rentals were more than HK$200 per square foot per month. Driven by the demand for ofﬁce and residential space, companies have shifted some of their ofﬁce operations out of Central and other pricier districts, choosing more innovative sites to house operations. Since industrial property rents historically lagged behind their ofﬁce and commercial counterparts in terms of growth, local developers seized on the cheaper prices, buying existing industrial properties and converting them into ofﬁce or commercial buildings to take advantage of high ofﬁce and commercial rents. The Hong Kong government has led the way, relocating some of its ofﬁces from Wanchai to Kowloon East. Old industrial estates in areas such as Kowloon East and Kwai Chung have become hubs for businesses and residents alike as part of the local government’s urban-renewal plans. Some companies, such as Emperor Group and Far East Organisation, have also bought old industrial buildings, with plans to convert the sites into hotels. This movement has lead to a shortfall in available industrial space, and vacancies in the sector have reached a low of 1.3 percent. There is also a small supply coming on stream in the next few years. Even amid stiff competition and rising costs, Hong Kong has retained a strong grip on the business of import-export. According to government statistics, the volume of re-exported goods increased by 8.3 percent year on year in July 2008, with exports growing by 7.3 percent. An April 2008 report by Colliers International also noted that some Chinese manufacturers were looking at shifting part of their operations to Hong Kong because of the rising Chinese labour costs.
With Hong Kong being used as a stepping stone into China, combined with
Located on the doorstep of the Kwai Chung Container Port, the
its open market and sound governance (Hong Kong is consistently ranked among the top ten countries in terms of economic freedom), therefore it seems clear that demand – not only for industrial space, but also for warehousing and logistics operations as well -- is set to grow in the next few years. “The export sector is one of the main pillars of the Hong Kong economy, having grown 7.3 percent per annum year on year at July 2008. However, with no new supply during that time, there is pent up demand for high-quality, efﬁcient warehouse buildings,” noted Piers Brunner, CEO, Asia and Managing Director Hong Kong of Colliers. As Daniel McDonald, Managing Director of Goodman Asia, told CUBIC, “New industrial development in Hong Kong has been virtually non-existent for much of the past decade.”
two projects are strategically positioned to take advantage of their close proximity to both the port and transport links to the rest of the island and to Mainland China. When completed, the 25-storey buildings will dominate the landscape, adding an estimated 3.7 million square feet of leasable space to the warehousing and logistics market.
MORE ROOM TO GROW The Hong Kong government has committed itself to maintaining and strengthening Hong Kong’s role as an international transport and logistics hub in Asia with continued development of infrastructure projects. These include Route 8 (Lantau Island-Tsing Yi Island-Cheung Sha Wan-Sha Tin) and an MTR connection between Sha Tin and Central. The government is also currently considering the location of Container Terminal 10, a new addition to the existing port, to improve its competitiveness. All of these factors point to unique opportunities in the sector for developers. However, the supply of greenﬁeld sites is limited by the Hong Kong government, making new sites that are well connected by highways and infrastructure hard to come by. One of the solutions: buy older buildings and reconﬁgure them to maximise the gross ﬂoor area (GFA) available. This is exactly what Goodman has done with its latest two projects, Seaview and Interlink. “The demand behind these two projects was customer driven -- our customers wanted the opportunity to consolidate and to achieve synergy with the rest of their operations,” said McDonald.
KWAI CHUNG CONTAINER TERMINAL 10 Seen as an essential development to keep up with growing volumes of exports to and from Hong Kong, Container Port 10 is the latest planned extension to the Kwai Chung Container Terminal. The Hong Kong government and GHK (Hong Kong) Limited have commissioned a study on the feasibility of several sites, with Lantau Island and Tsing Yi Island being singled out as the two most suitable. Currently, the Tsing Yi site is seen as the more suitable site in terms of cost and providing boundarycrossing facilities from the planned Hong Kong-Zhuhai-Macau Bridge. The report by GHK also notes it is “vital to provide additional land around Kwai Chung and Tsing Yi for a container terminal and related uses as a ﬁrst priority”, providing t additional capacity at an overall lower cost.
WAREHOUSES FOR THE FUTURE Seaview is located in Tsuen Wan, and is directly linked to the Chinese border via Route 5 and the Tai Lam Tunnel. It is also linked to the Hong Kong International Airport, the River Trade Terminal and Shenzhen via Route 9. Currently undergoing demolition works to clear the site, Seaview is slated for completion in mid 2011 and will have a total Gross Leasable Area (GLA) of 1.3 million square feet. Interlink is on Tsing Yi Island, next to Container Terminal 9. With an estimated GFA of 2.4 million square feet, Interlink is the larger of the two projects and is scheduled to be completed by April 2011. Tsing Yi Island is one of two sites under government consideration for the location of Container Terminal 10, the latest expansion of the Kwai Chung Container Port. The Interlink project will be connected to Lantau Island, Tsuen Wan and Sha Tin via Route 8. Both buildings will contain 14 levels of ramp-up warehousing and a mixture of 12-and 16-metre deep unloading bays to cater to all vehicle sizes up to 45 foot containers. Each ramp is 15 metres wide to allow two 45-foot container trucks to pass by comfortably. Seaview and Interlink will be the ﬁrst warehouse/logistics buildings rated with HKBEAM, and will include a plethora of environmentally friendly features. Both buildings will feature energy-efﬁcient glass and light ﬁttings, and use natural ventilation where possible. Goodman is looking to recycle 75 percent of demolished materials, reduce the amount of construction waste, and use sustainable timber such as bamboo for some ﬂoor ﬁnishes.
A STABLE OUTLOOK Even in an uncertain global economic environment, customer-led demand for prime industrial warehousing and logistics space will continue to result in modest rental growth in the industrial property sector, said McDonald, because of the lack of new space due to limited land released by the government and the redevelopment of obsolete space for commercial uses. The growth of the export sector in China, which is still expected to be strong in the coming years, will also drive demand for industrial space and the need for warehousing and logistics support. As one of the gateways to China, and a major player in the Asian transport and logistics arena, Hong Kong will beneﬁt from China’s growth. “Whilst the completion of Goodman’s two developments will ease some demand pressures, we anticipate steady but lower market rental growth to continue well into 2012 and 2013,” said McDonald. “The continued increase in sea and air cargo throughput, strong Gross Domestic Product, export growth ﬁgures and historically low warehouse vacancy of 1.3 percent all underpin the demand for warehouse space in Hong Kong.” For more information on this developement, please contact Piers Brunner, Managing Director, Colliers International Hong Kong. email@example.com
| January 2009 07
The urban jungles of Asia are going green — and in a big way. Cubic takes a look at some of the leaders of this modern-day revolution and finds out how they make green grow for them. BY SHERALYN TAY
AS THE SPECTRE OF CLIMATE CHANGE makes itself felt across the world, the call for environmental protection is being heard with more urgency, gaining recognition from society at all levels. Far from being just the battle cry of environmentalists and governments, corporations are now taking on the ﬁght for the environment. In Asia, the importance and value of making buildings more sustainable is increasingly being embraced. According to Mark Clifford, Executive Director of the Asia Business Council, in a presentation given in Beijing in June, there’s been a “notable increase” in the attention paid to the energy efﬁciency and sustainability of buildings in at least 11 major East and South Asian economies in recent years. These observations were also made by Michelle Boyd, Conference Director at Cityscape Asia 2008 held recently in Singapore. Asian countries,
led by Japan, Singapore, Hong Kong and India, are introducing green building ratings along the lines of systems operating in Britain and the United States and the concept is catching on." One such rating is the Leadership in Energy and Environmental Design (LEED) used to benchmark the sustainability of buildings. The accreditation programme looks at the design, construction and operation of buildings from their site development, use of materials, water and energy efﬁciency to the quality of the indoor environment. Signalling the commitment of individual nations, Clifford also noted that there are at least six economies – including Japan, Singapore, Taiwan, Korea, Hong Kong, and recently, China – that have initiated government-led green building programmes, such as Japan’s Top Runner programme, which began in 1998.
| January 2009 09
GREEN BUILDINGS Another instance is Singapore’s Green Mark Incentive Scheme. Started in 2005 by the Building and Construction Authority (BCA), its aim is to encourage best practices in green building design. More recently, Hong Kong proposed mandatory building energy efﬁciency standards. “All this adds up to clear evidence of a transformation that will change the practices of the building industry,” said Clifford. For all the advances, gaps remain. Taken at an international level, the overall numbers of green buildings in Asia are still very small and “piecemeal”, noted Christian Kornevall, Director of the Energy Efﬁciency in Buildings project for the World Business Council for Sustainable Development (WBCSD). “Of course it will come; it is a question of time. However, the pressure will have to come from many different parts,” he told CUBIC, emphasising that governments, cities, businesses, citizens and NGOs need to work together to build critical mass. Clifford also noted that industries in Asia have been slow to take ownership and play a leading role, leaving the government to initiate regulation. At the same time, governments have been “too cautious”, he said, “reﬂecting worries that pushing too hard, too fast would cause economic damage”. He warned that caution has a price. “Today’s inefﬁcient buildings require more power plants. This will needlessly undermine energy security and damage the environment and the economy for decades.”
10 January 2009 |
LEADING ASIAN DEVELOPERS Bucking the inertia of many industry players, some developers have long made sustainability a core value. For example, leading Singapore developer City Developments Limited (CDL) has integrated sustainable features in its projects since the mid 1990s – one of the ﬁrst developers in Singapore to do so. For its long-standing efforts, CDL has obtained the most Platinum and Gold Plus awards of any private developer in Singapore. According to Managing Director Kwek Leng Joo, this is a way for CDL to be a responsible corporate citizen as well as to achieve long-term outcomes. He told Singapore’s The Business Times (BT): “The fundamental motivation behind our green practices is our care for the environment and our future. “Building a green development is more than just placing a couple of ecofriendly features within a property. It takes concerted and sustained efforts that cut across the entire development chain and its stakeholders.” Another developer, Shui On Land – a major property developer headquartered in Shanghai – is one of those at the forefront of the green wave in China. Underscoring its commitment, Shui On Land makes sustainability a core organisational practice. Its Shanghai ofﬁces are one of the ﬁrst LEED-rated interiors in the country. According to Simon Carter, Colliers International’s Regional Head of Sustainability in the Asia Paciﬁc, the green building movement in China is very young, but is beginning to unfold very quickly. “We are seeing multinational and local corporations alike procuring green buildings and the
GREEN BUILDINGS KIC Plaza, Shanghai
uptake of LEED ratings for new developments is climbing rapidly." Some signs of the building momentum in China are in pace-setting projects such as the Dongtan eco-city near Shanghai, the huge zeroenergy Pearl River Tower in Guangzhou and the Tianjin eco-city. And, while the numbers of green developments are still a small proportion of total construction activity in China, Carter said it is still “comparable” to many other Asian economies. In addition, China is becoming a manufacturing powerhouse for technologies used in green building and is now one of the world’s biggest producers and installers of photovoltaic solar panels, Carter noted. Believing in the long-term commercial and societal merits of sustainability, Shui On Land is motivated by what it calls “sustainable urbanism” — the integration of ecologically sound principles into modern living. “Our key reason for doing this is that it is the right thing to do,” said David Nieh, General Manager of Business Development (Yangpu Projects). “We like to see ourselves as community builders, rather than just as building developers.” Each development is built on a large scale to achieve critical mass and to integrate mixed-use elements for a work-live-play model, as well as lots of pedestrian areas “to get people out of their cars”, he explained. For example, Xintiandi – a car-free leisure spot in the heart of downtown Shanghai – integrates shopping, dining and entertainment. The awardwinning development, which features restored shikumen (or stone gate)
“The winners in the emerging ‘carbon economy’ will typically be those who prepare early.” Simon Carter, Regional Head of Sustainability, Asia Paciﬁc, Colliers International houses, underscores Shui On Land’s commitment to the community. “We adaptively reused historic architecture and cultural resources so that the community is not disconnected from its heritage,” said Nieh. Shui On Land’s sustainability strategy also capitalises on its strengths and know-how. It was one of the ﬁrst Chinese developers to embrace environmental protection, issuing a Sustainable Development Policy to all staff in 2006. A member of the Hong Kong Green Council, Shui On Land was also one of the founding members of the Hong Kong Green Purchasing Charter, undertaking a green procurement policy to only engage suppliers and vendors that use material accredited with the environmental label from the National Environmental Protection Bureau. “By building and creating a market for these developments, we are helping to grow the sector and the demand for it to our advantage,” said Nieh. Each development is built according to an integrated vertical chain model that places as much emphasis on the planning and design as on the building and management of each project. “The building and construction is only a third of the process – and the savings,” he said.
| January 2009 11
Another example is the Wuhan Tiandi project, a registered LEED Neighbourhood Development (ND) pilot project in Hankou, along the Yangtze riverfront, comprising residential, ofﬁce, hotel, retail, F&B and entertainment facilities. Employing an intelligent orientation to optimise access to wind and light while lowering sun exposure, the development also features district-wide centralised heating and cooling, water source heat pumps, rainwater collection and recycling facilities, and is poised to attain a LEED-ND Gold rating. Apart from just building physical structures, Shui On Land also operates and manages its buildings. “By being energy-saving and water-efﬁcient, we can achieve long-term gains in the entire life span of the building,” said Nieh. This in turn adds to the value of the development. “The idea is to tie sustainability to a solid economic agenda,” said Nieh. “In the end, we are a business and need to be commercially viable. We believe our model is commercially viable and it makes a lot of sense.” It also helps that Shui On Land is riding on an overall thrust by the central Chinese government. “The government believes that, if they do not start embracing sustainability, they will eventually lose out on the gains and competitive edge that have been made in the past two decades,” said Nieh. That other Asian powerhouse, India, is also seeing green take root in the real estate sector. The Indian Green Building Council has recorded that, in
12 January 2009 |
2008, there were some 239 green building projects that made up a total of about 147 million square feet. According to an Indian Realty News (IRN) report, the growing environmental consciousness among MNC tenants is redeﬁning the way buildings are being marketed. Increasingly, requests for proposals include questions about a building’s green quotient, a fact echoed by K Raheja Associate Vice-President Shabbir Kanchwala, who told IRN: “Many of our customers are Fortune 500 companies that understand and prefer green buildings.”
GROWING IN THE RIGHT DIRECTION There may still be some reticence among developers about wholly embracing sustainable building, given the higher ﬁnancial outlay and effort, but greening offers much greater rewards in the long term, the most obvious being savings on energy and water. Based on developers’ feedback, green strategies comprise 2 to 10 per cent of a project’s total cost. But innovative forethought on passive design elements such as ventilation, use of materials and building layout can reap green beneﬁts – with little or no cost. “Developers who approach going green as an opportunity to rethink how they produce buildings often ﬁnd that such innovation helps them ﬁnd cost savings in other places,” said Carter. “On the other hand, developers
say about their occupants and investors. In a 2007 McKinsey Quarterly
From left: Shanghai Xintiandi, Shui On Plaza
survey of more than 2,100 global executives, 68 per cent felt climate change was a “somewhat or very important factor” to consider when managing corporate reputation and brands. This means that a building is an important part of a responsible corporation’s branding, explained Carter. “They can conﬁrm to stakeholders that a company uses high-performance facilities, is forward-thinking and innovative, is concerned about the well-being of its employees, understands changing sentiments in the market about sustainability and wants to make a measured difference.” In fact, a recent survey found that, out of 414 companies surveyed globally, 12 per cent in Asia stated that they were willing to pay premiums of over 10 per cent for sustainable buildings, compared with just 3 per cent of the companies surveyed in North America and Europe. Making sustainability a part of a company’s core principles also has other beneﬁts. For CDL, eco-friendly practices have raised the developer’s public proﬁle. Mr Kwek told BT: “Going green equates to value for home buyers, and enhances our reputation and goodwill.” In terms of ﬁnancial value, it also helps – CDL is the only Singapore developer listed on the FTSE4Good Index series. And, in the search for talent, even buildings matter. “To an occupant, green buildings provide healthier, comfortable and more productive work environments that are soon recognised in markets as signiﬁcantly more desirable than non-green ones,” noted Carter. In Australia, for example, employers are racing to offer these work environments in order to compete for the best talent.
THE GREEN R.E.VOLUTION
that try and ‘bolt on’ green features late in a development process or do not invest in good expertise and experience to help them will often incur additional costs.” Given the force of the green wave, ignoring the environmental costs now could mean losses in the future. For example, the demand for green buildings in Australia has reached tipping point, so “green is now standard for all new investment-grade ofﬁce buildings,” Carter pointed out. “This means that a non-green building being offered to the market will be less attractive and most likely will be penalised rent-wise and subsequently in terms of asset value.” In addition, there is a premium placed on green buildings for what they
“The idea is to tie sustainability to a solid economic agenda,” said Nieh. “In the end, we are a business and need to be commercially viable. We believe our model is commercially viable and it makes a lot of sense.” David Nieh, General Manager of Business Development (Yangpu District), Shui On Land
Given Asia’s fresh entry into the sustainability game, practical challenges do remain. According to Carter, “(Tenants) often like the general green proposition, but may not be prepared to adjust their budgetary model to accommodate spending extra”. This, he said, calls for a lot of education to help tenants understand the real value proposition behind green buildings. Support in the form of skills and materials, too, must be available to drive the growth of green buildings. Engineers, designers and contractors must have the knowledge and commitment to ensure sustainable practices across the entire building process. “Designers need to be able to model the performance of new systems accurately, engineers need to know how to avoid construction waste and building managers need to know how to carefully monitor the performance of buildings to identify any inefﬁciencies,” said Carter. At the same time, regulations must facilitate the growth of green buildings, such as allowing for the collection and use of rainwater or the use of renewable energy. To help drive and support the industry, Colliers has launched a green real estate guide for the creation of sustainable built environments. Called r.e.Design, the Green Real Estate Guide for Asia emphasises the need for such buildings so that the industry can “r.e.design” its approach to real estate practices. According to Carter, who penned the Green Real Estate Guide, “r.e.Design is intended to assist owners, developers and occupiers design strategies that manage the risks and leverage the opportunities associated with the change in real estate.” This is because, ultimately, “the winners in the emerging ‘carbon economy’ will typically be those who prepare early.”
Please contact a local Colliers Ofﬁce if you would like a copy of r.e.Design.
| January 2009 13
A BEAUTIFUL WAY TO WORK
In the usually staid commercial and retail spaces of Hong Kong, Swire Properties brings a fresh perspective, a little artistry and flair. BY ELIZABETH KERR
January 2009 |
ANTI-CLOCKWISE FROM LEFT: Transcient, Suspense, The Watcher, Watergarden
A QUICK LOOK INTO HISTORY reminds us that being an artist at one time was a job like any other, and the world’s great artists (Michelangelo, Picasso, Delgado) were often commissioned to create paintings and sculptures for public spaces. Often those were churches and rulers’ palaces but, later, those spaces began to include government structures, educational institutions, pedestrian shopping districts and eventually ofﬁce complexes. Some of the greatest single works of art are in public spaces. The glorious frescos of the Sistine Chapel were a commissioned public piece; British sculptor Henry Moore is renowned largely for his public works; and Banksy blurred the distinction between public art and grafﬁti with his irreverent humour. Enormous canvasses now dot corridors, atriums and lobbies in commercial buildings all over the world, and works by contemporary artists can be found in the unlikeliest of locations. Until recently, art has not been a driving force in commercial design in Asia, but that’s starting to change and Swire Properties is leading the way. Swire Properties is the wholly owned real estate subsidiary of Swire Paciﬁc, one of Hong Kong’s oldest trading companies with roots dating back to the early 1800s, and whose larger holdings also incorporate aviation (Cathay Paciﬁc), marine services (Swire Paciﬁc Ship Management), industrial and agricultural trading (TaiKoo Sugar) and beverage processing (Swire Coca-Cola). Incorporated in 1972, Swire Properties has built a portfolio that spans commercial, residential and retail properties, and has developed or
manages some of Hong Kong’s most notable addresses: Island East, Paciﬁc Place and Festival Walk. It’s no secret that writer James Clavell based one of the “houses” in Noble House on Swire. Swire currently has interests in the US, the UK, Singapore, Taiwan, Australia, Canada and China.
DRIVING ART Swire has long been at the forefront of the public art movement in Hong Kong. Not only does the group often include art in its spaces and support independent exhibitions, but also Island East has long been the location for free outdoor concerts on weekends – Friday Fest – the company founded Artwalk in 2002 and has sponsored countless theatrical and music events over the past decade. There are many that would say art is a waste of time and (particularly public) money, but Swire disagrees, as would anyone strolling through the halls of Island East (home of TaiKoo Place) who caught a glimpse of Hong Kong artist Michael Lau’s stunning Watergarden series. “Swire Properties consciously connects its properties with the surrounding environment and visual art serves as one of the bridges for this initiative,” explained Babby Fung, Head of Marketing at Island East Swire Properties Limited. “Our aim is to produce an innovative and creative environment for the community and engage with the people in it via lively and diverse arts programmes and public art collections that provide enjoyment and fresh cultural experiences.” Some of those fresh experiences are coming from China, as there is very “strong demand” for Chinese contemporary art, in the Asia region and the Western art market, observed Bobby Mohseni, Director of MFA Asia Ltd, a Hong Kong art consultancy that serves both individual and corporate clients. Far from being a “waste” of public money and space, Fung points out that art doesn’t necessarily belong in museums and galleries and was never intended to be concealed from public view – Shakespeare was, after all, a playwright who catered to popular themes. Instead, at a time of great artistic diversity and shrinking public funds, Fung noted that the nurture and promotion of art is a corporate social responsibility that more corporations should take on. “We take the view that art, or public art, is not something that should be left entirely in the hands of governments.” The private sector has to be more active and a sustained commitment to commissioning diverse modern art is important, so that we form an eclectic collection in which a number of wide-ranging aesthetic, functional and educational purposes co-exist,” she added. Among some of Swire’s more notable pieces are ﬁgurative sculptor David Williams-Ellis’s The Watcher and glass sculptor Danny Lane’s Shan Shui, both sculptures also at Island East. The latter makes waiting for a taxi just a little bit more pleasant.
THE VALUES OF BEAUTY Does art in fact make a noticeable difference to property values? There are naysayers, but Fung sees value in art. “For a value-creating business like ours, it is important to ensure that our goods and services are clearly differentiated and that they do not compete as commodities traded solely on price,” she said. “We have developed ﬁrst-class properties in tandem with discriminating audiences who, through exposure to the arts or art, are able to recognise excellence and quality, and appreciate the values that
| January 2009 15
ART SCENE Danny Lane’s Shan Shui, an outdoor sculpture located at Island East
we see and use in our businesses.” Fung says compliments from tenants, shoppers and residents are common. Swire notably often commissions pieces for speciﬁc spaces, giving Babby Fung , Head of Marketing Island East its collection a decidedly Swire Properties Limited monumental scale. “This is deliberate and something you will rarely encounter in Hong Kong outside of a museum,” she said. “It stretches the artist and offers them a rare chance to work on a large scale. For those whose works are still emerging, our commissioning of a piece can offer validation, as well as an opportunity for it to be shared with a wider segment of the population,” she added. While Mohseni is one of those who does not see art contributing to property values, he does recognise other factors that his corporate clients – organisations like Swire – would look at as an advantage. “Corporate clients are looking for works to present a certain corporate image; to provide cultural and aesthetic input into the community [where] the public artwork is placed … and make a corporate location aesthetically more pleasing,” he said. Whether or not that translates into a healthier bottom line on rentals is debatable, but there are concrete ﬁnancial elements at play, chieﬂy tax incentives. “In certain countries, the government provides tax incentives for artworks placed in public spaces by corporations. This gives the corporations a good reason for donations,” Mohseni added.
“As a property developer, good visual awareness is vital to our business, whether in town planning, interior decoration or spatial design, as it affects every aspect of what we are about. “
16 January 2009 |
Whatever the reason, Swire currently has a collection of over 70 pieces on permanent display that lends itself to a larger public service. Fung contends that “visual awareness” is not something that is taught in schools the way written text is, but is key to our collective lifestyles. “We know this as a property developer. Good visual awareness is vital to our business, whether in town planning, interior decoration or spatial design. It affects every aspect of what we are about. Being conscious of the relevance that art plays in society is one way in which we can educate and inspire people to see things differently – or dare I say – better.” Swire leans towards commissioned pieces, but there are plenty of landlords that will simply buy art and source their fresh experiences that way. A glance through the window of any gallery in Hong Kong is testament to the sheer volume of work making its way onto the international art scene from China. Contemporary masters such as Zhang Daqian and Fu Baoshi are renowned for their heady selling prices around the world, and there is a complementary youth movement that is also making headway. Trying to pin down one movement or aesthetic is difﬁcult. About emerging trends, Mohseni says, “This is a very broad question… A broad answer is that many new works in traditional media (painting, drawing, sculpture) and new media (photography, video, installation) are emerging from China. “The approach of the Chinese contemporary artist differs from the Western artist. Therefore, the imagery, content and techniques are new to the contemporary art scene.” Perfect for Swire’s collection. But Fung said Swire’s short-term goal is more prosaic, one that feeds both the bottom line and the demands of corporate responsibility. “In attempting to foster a critical tradition, we hope to transform Hong Kong audiences from passive consumers to active participants and arbiters of taste – to help them overcome insurmountable cultural barriers and deep-seated fears of modern art,” she said. “If the display of the art pieces in our ofﬁce premises can help generate public interest in art and trigger imagination, as well as expression of feelings, from our perspective that’s already a proven beneﬁt.”
AUDI HAS DONE IT BY GAVIN VERCOE
January 2009 |
VITAL STATISTICS Model Audi R8 Engine 4163cc, eight cylinders Power 414bhp @ 7800rpm Torque 317 lb ft @ 4500rpm Transmission Six-speed manual Fuel 19.3mpg (combined cycle) CO2 349g/km Acceleration 0-62mph: 4.6sec Top speed 187mph
THE FIRST INKLING that Audi may have ﬁnally produced a true supercar with the Audi R8 comes when you read the impressive vital stats. Add to this the fact that Audi owns Lamborghini and that the Audi R8 uses the same aluminium Spaceframe construction as the Lamborghini Gallardo with its double wishbone suspension, and you begin to understand that this is a different Audi from any ever before. Powered by its V8 engine, the R8 can accelerate to 62mph in just 4.6 seconds – reaching a top speed of 187mph – and can roar all the way to an 8250rpm red line. At the same time, it is also very comfortable. It is a supercar that you can actually drive around town. It’s even won high praise from Jeremy Clarkson of Top Gear fame, who likens the Audi R8 to the Porsche 911, calling it a car “you really could live with every day”. Clarkson notes: “The R8 is spookily quiet, and that’s just the start of it, it is also spectacularly comfortable. I don’t mean comfortable . . . for a sports car. I mean it’s so comfortable you can run over anything up to a medium-sized fox and not even notice.” Apart from the Audi in-car entertainment – sat nav, a hi-ﬁ from Bang & Olufsen – Clarkson also waxes lyrical over the engine. “You needn’t even worry about the engine. It’s not a W16 with eight turbos and plugs that foul themselves at every set of lights. It doesn’t run on fertiliser and grated tiger chippings. Instead, it’s the 414bhp 4.2 V8 from the RS 4. I’ve described this as one of the best engines made today and a drive in the R8 has not changed my mind. It does everything, brilliantly.” High praise indeed from the man that said of the Porsche Cayman S: “There are many things I’d rather be doing than driving it, including waiting for Bernard Manning to come off stage in a sweaty nightclub and then licking his back clean – and that telling people you drive a Nissan Almera is like ‘Telling people at a dinner party
you’ve got the ebola virus and you’re about to sneeze’.” Ouch. Above all else, the R8 is a great looking car. With the experience of the Le Mans-winning R8 as a basis, although the road version looks nothing like it, this R8 still has the power to turn heads, even when it is stationary. The designers had the task of combining typical Audi design characteristics of elegance through simple but strong lines with the need to force huge volumes of cooling air to the engine and brakes. The ﬁnal result is a front end with the ubiquitous Audi grille ﬂanked by two large air intakes, just above the front sill. The designers didn’t want to ruin sleek lines with a large, rear spoiler, so an underbody diffuser was created and a discreet, narrow spoiler pops up when the car reaches 62mph. It drops down again below 22mph but can be locked in its extended position via a button on the central tunnel so speed-abiding drivers still get to see it. The cabin is divided into two separate areas. This can be said of most cars – by necessity, the driver’s side is different to the passenger’s - but in the R8 it is more pronounced. For instance, the driver has a completely different door handle. This is part of the so-called, “monoposto”, which creates the feeling of being in a single-seater cockpit. There is also plenty of room inside. Even Clarkson – who is a giant of a man – had these comments; “You can see out, there’s room for your head, even if you have truly enormous hair, and there’s space for briefcases and whatnot on a shelf behind the seats. It’s big in there; much bigger than you’d believe”. That sounds like more praise from JC. Along with these good looks comes some great new technology to keep this car stuck to the road. The R8 offers the option of “magnetic ride”, a system that applies varying currents to electromagnets on the dampers to change the viscosity of the ﬂuid, stiffening the suspension for certain driving conditions.
Also, when it comes to safety systems, the R8 beneﬁts from a lexicon of initials: Version 8 of the Electronic Stability Control (ESP), which networks with the ABS, plus EBD, Anti-Slip Regulation (ASR) and Electronic Differential Lock traction control or EDL. The ESP has two settings: “standard” allows a bit of leeway before intervening and “sport” is for more spirited driving. For track-days, the ESP and traction control can be de-activated and, of course, the Quattro system plays a large part in keeping the car on the road. The R8 is a brave car – with it, Audi is positioning itself away from BMW and Mercedes, and alongside Porsche, Maserati and Aston Martin. Though Audi insists the R8 will make money in its own right, its real purpose is to add that supercar appeal to the entire brand. From a company that has a bit of a reputation for making cars better to look at than they are to drive, the R8 is little short of astonishing. By combining the aluminum chassis and body with a 420bhp 4.2 litre V8 motor, Audi hit the formula of big power in a lightweight package spot on. And the performance is astounding – with commentators saying this car is as at home on the race track as it is on the roads. Audi anticipates that the majority of R8 customers will be men aged between 40 and 49 years of age. Furthermore, the company tells us that it is classed as a classic sports car, rather than a small one, such as the TT. Built in Germany, largely by hand with the help of a few robots, the R8 is produced at a rate of 20 per day (only 3,000 will be made each year, less than a third of the 911s produced), so you’d better choose from the six colour combinations, pick your optional extras and place an order now.
| January 2009 19
TOWERING AMBITIONS Tall, taller, tallest â€“ the measure of a building lies not just in its stature but in its ability to take innovation to greater heights of style and form. CUBIC takes a look at some of the most breathtaking structures in Asia that are taking to the skies. BY SHERALYN TAY
20 January 2009 |
Left: Taipei 101 Right: Precinct 4 residences
TAIPEI, TAIPEI 101
MALAYSIA, PUTRAJAYA, PRECINCT 4
Recalling the resilience of a stalk of bamboo and the grace of a traditional Chinese pagoda, the Taipei 101 tower rises regally within the Taipei CBD. Like other spire structures, Taipei 101 also evokes the symbolism of an axis where the earth and sky meet. And in a way, it does fulﬁl this promise – the tower was the ﬁrst record-setting skyscraper constructed in the 21st century and is among the tallest inhabited structures in the world. Rising on eight canted sections, the tower’s design is an intriguing mix of Chinese cultural themes that evoke luck, wealth and longevity, and state-ofthe-art technology. Eight, the number of sections in the tower, represents luck while bamboo symbolises growth, strength and learning. Even the number of ﬂoors – 101, or 100 plus 1 – evokes a sense of renewal and longevity. Curlicued cloud-like ruyi – curved decorative objects that topped ceremonial Chinese sceptres – also appear throughout the building adorning entrances and roofs. Associated with healing, protection and fulﬁlment, these heavenly clouds are a talisman of good fortune in Chinese folklore. The tower’s design is not all aesthetic – the segmented, gently slanted exterior walls reduce the effects of wind on the mega-building and specialised construction stabilises it from high winds. Wired with optical cables for ultra-high-speed connections, the tower’s double-deck elevators that serve two ﬂoors at once also hold a Guinness World Record as the World’s Fastest Passenger Elevators. www.taipei-101.com.tw
These stunning nautical-inspired residences give new meaning to seafront living. Part of a new residential project along the Putrajaya waterfront, Precinct 4 is a breathtaking study of light, space and innovative design. Spanning across almost 5,000 hectares of lush and green landscape, Putrajaya – the new federal administrative centre of Malaysia located 30km south of Kuala Lumpur – is a showcase city that literally means “princes’ (putra) success (jaya)”. The name also pays homage to Malaysia’s ﬁrst Prime Minister, Tunku Abdul Rahman Putra. In contrast to the rather imposing structures in the city, the Precinct 4 residential project is a subtly elegant addition. Seeming to ﬂoat like a ﬂeet of graceful sailboats in formation, the residential project was designed by Studio Nicoletti Associati in collaboration with Malaysian architects Hijjas Kasturi Associates, which provided the masterplan of Putrajaya. The sustainable housing design is, according to the Italian architects, intended to reﬂect the spirit of Malaysia, “which is culturally modern, Islamic and tropical in nature”. The Italian ﬁrm also incorporated sustainable strategies such as natural ventilation, green areas, sunshades, terraces and alternative energy sources into the design. Together, these elements are expected to halve the carbon footprint of the development. http://www.hijjaskasturi.com
| January 2009 21
ICONIC BUILDINGS Left: Innovation Towers Right: Wave Tower
HONG KONG, INNOVATION TOWER
DUBAI, WAVE TOWER
In true Zaha Hadid vision, the Hong Kong Polytechnic University’s new campus extension is a gleaming ﬂuid structure that describes movement and grace, suggesting all the energy and potential in its students. The building, which looks a little like a tilting stack of shiny CDs, is Hadid’s ﬁrst permanent work in Hong Kong – her ﬁrst award-winning design for The Peak Club in Hong Kong was never built. However, the designs that were built – such as the Vitra ﬁre station and the Rosenthal Center for Contemporary Art – have earned Hadid much recognition and respect, making her the ﬁrst woman to receive the Pritzker Architecture Prize. With the same dramatic deconstructionist ﬂair, Hadid’s take on the Innovation Tower is a dynamic one. Made of dark glazed glass and steel, the tower of translucent layers – expected to be completed in 2011 – has also integrated a spacious column-free public foyer on its podium that can act as a showcase forum. Clearly forward-looking, and symbolically apt for a school of design, the Innovation Tower also promises to project a vision of the future of the Hong Kong Polytechnic University. www.polyu.edu.hk/ www.zaha-hadid.com
Like a delicate sea blossom, the Dubai Wave Tower is yet another amazing addition to the Dubai skyline – or seafront. Rising like an elegant stem from the waters of the Dubai waterfront and linked to the shore with an undulating bridge, the 370-metre tall tower – designed by Spanish architects A-cero – will be located on the coastline of the Madinat Al Arab District, the downtown and central business district of Dubai. Architects Joaquin Torres and Rafael Llamazares envisioned a building that evoked movement and ﬂow. Indeed, the soft curves of the tower and its bridge appear in concert with the waves of the Gulf Sea. “A-cero’s design is based on the concept of the intervention between sea and land. The tower ‘grows’ gently inland to create the forceful sight of a tall building that mimics the waves of the Gulf Sea,” says Torres. Built at a cost of some US$170 million, the mixed-use Tower has been constructed to be opaque in the day but transparent at night, resembling a lighthouse. With interior sky gardens, silk-screened glass skin, energyefﬁcient technology and a puriﬁcation plant for the tower’s water needs, this “seascraper” is as green as its blossom-like design. When ready, the 92-ﬂoor building will contain ofﬁces, commercial malls and high-end residences. www.a-cero.com/
22 January 2009 |
January 2009 |
LEFT: Vietnam’s construction sector still rises amid tough times
THE KUMHO COMMITMENT The construction sector may be losing its boom around the world, but Korean developer Kumho Asiana has its sights set on providing for the continued growth and expansion in Vietnam, proving that, even amid the gloom elsewhere, Vietnam’s star still shines. BY SHERALYN TAY SHE may be a late-bloomer among South-east Asia’s economies but, if there’s one thing Vietnam has going for it, it is the sheer tenacity and drive of its people. In just 30 years, the nation has gone from war survivor to bustling economy. Emerging like a phoenix to take its place in the global fold, Vietnam joined the World Trade Organisation in 2007 and became a nonpermanent member of the United Nations Security Council in 2008. Even as dire predictions resounded across the world when ﬁnancial giants Lehman Brothers and Merrill Lynch crumbled as a result of the subprime crisis, Vietnam looks set to hold its own, albeit cautiously. While the country will not emerge unscathed, Don Lam, Chief Executive Ofﬁcer at Vinacapital, noted in a letter to investors that the fallout in Vietnam will be a lot less than in other economies because the Vietnamese currency is not traded outside the country and the level of foreign investment in local companies is restricted, buffering the economy from the effects of global ﬁnancial turmoil. In fact, just days after the subprime fallout, foreign and local investors cited Vietnam as one of the most attractive markets for real estate developers in Asia during a seminar on developments and opportunities in the Vietnamese market. According to an Asia Pulse report, some 70 local and foreign real estate groups said that the property market in Vietnam still offered “lucrative opportunities despite volatile prices”. And the ﬁgures bear this out. About half of the US$47 billion in Foreign Direct Investments (FDI) pumped into the country in the ﬁrst eight months of 2008 went into property development projects. In Ho Chi Minh City alone, 90 per cent of its US$7.9 billion in FDI from January to August was invested in the real estate sector. Property commentators, too, are predicting promising outlooks for 2009 as the property market correction is seen to have bottomed out.
According to Chang Bok Sang, Chief Executive of Strategic Management Division at Kumho Industrial Engineering and Construction (E&C) and Chief Executive of Kumho Asiana Group, the company, with its afﬁliates, is also expanding investment on a more global level, and has a keen eye on Vietnam. The Group has had a presence in Vietnam since 1993 in the form of its afﬁliate, Asiana Airlines. From then until 2007, the Group injected some US$940 million into the country in areas such as real estate, car tyres and its airline services. One of the Group’s most recent and prominent projects is the Kumho Asiana Plaza, an extensive mixed-use development that is expected to be a huge boost to the city’s socio-economic proﬁle, and has been called a symbolic representation of the economic cooperation between Korea and Vietnam. “In the past, the group concentrated its investment in China,” Chang told CUBIC, but, increasingly, Vietnam, has become a strategically important partner. “Along with strong economic growth and its natural resources, Vietnam is an attractive country with many advantages such as its excellent geographical position,” added Chang, who also cited the close cultural connection between the two countries. “Kumho E&C has considered Vietnam the centre of the South-east Asia market and a bridgehead for aggressive investment expansion in this area,” he said.
HITTING THE RIGHT SPOTS Located in a prime location along the Le Duan Boulevard, the Kumho Asiana Plaza – consisting of a 21-storey A Grade ofﬁce building, a 21-storey international hotel, a 32-storey apartment building, and a trade centre area – will be ﬂanked by other high-grade buildings such as Diamond Plaza, the Soﬁtel Hotel, the Prudential building, Saigon Tower and the Metropolitan. It also lies in close proximity to embassies, shopping areas and the Notre Dame Cathedral.
A SYMBOL OF COOPERATION One foreign company that has staked its commitment to the Vietnam real estate market is South Korean chaebol, the Kumho Asiana Group. Once primarily involved in petrochemicals and the manufacture of automobile tyres and rubber products, the conglomerate has been expanding its business interests aggressively and now owns a wide range of businesses across the chemical, automobile, logistics, airline and leisure sectors.
“Kumho E&C has considered Vietnam the centre of the South-east Asia market and a bridgehead for aggressive investment expansion.” Chang Bok Sang, Chief Executive, Kumho Asiana Group
| January 2009 25
BELOW: Work in progress at the building site RIGHT: Artist’s rendition of the completed Kumho Asiana Saigon
Set to welcome its ﬁrst guests in 2009, the 350-room InterContinental Asiana Saigon and its 250 serviced residences will be managed by InterContinental Hotels and will be the ﬁrst luxury hotel to open in Ho Chi Minh City since the Park Hyatt in 2005. According to Peter Dinning, Managing Director of Colliers International in Ho Chi Minh City, the project will also help ﬁll two crucial areas in the sector – those for more rooms and luxury accommodation. With only about 6,000 star-rated hotel rooms and about 10,000 rooms of other grades to serve an ever increasing number of annual visitors, occupancy rates in the city remain close to 100 per cent throughout the year. In the ﬁrst three months of 2008 alone, there were some 843,000 foreign visitors, a 20 per cent increase compared to the same period in 2007. This demand has been reﬂected in room rates for star-rated hotels, which have increased from around US$130 a night in 2006 to US$250 a night in 2008. While the new Intercontinental alone may not entirely satiate the voracious demand for hotel accommodation, it will be able to ride high on the wave of growth, said Dinning, as it is very likely to be the only luxury hotel project to come on board in the next ﬁve years. “(The Park Hyatt) was very well received by foreigners and locals,” noted Dinning. “We feel that the Intercontinental, as a well-known international brand, will raise the bar in terms of quality and standards, providing the ﬁrst true ﬁve-star hotel facilities in the city.” With tourist arrivals expected to hold steady or even grow, the sector is likely to keep doing well and will continue to ﬂourish until more hotel rooms are completed and brought to the market. The project’s serviced apartments will also be a welcome addition to the number of serviced accommodation in the city. At around 3,000 units, the number is small in comparison to other regional cities. “Rents are therefore maintained at a high rate and occupancy is very strong,” said Dinning, pointing to the timely entrance of more high-grade serviced apartments like the InterContinental’s.
January 2009 |
As for commercial space, there is a real lack of Grade A ofﬁces, which account for only 75,000 sq m from a total stock of 650,000 sq m in Ho Chi Minh City (population, 9 million), explained Dinning. This is in comparison with Manila (population, 10 million) which has 5 million sq m of ofﬁce space, Jakarta (population, 15 million people) with 4 million sq m of ofﬁce space, and Bangkok (population 8 million) which offers some 3.5 million sq m. This dearth explains why rents in Ho Chi Minh City are double those of any other regional centres, with occupancy rates of around 95 per cent. “Even with Kumho’s extra 30,000 sq m of Grade A space coming to the market during 2009, this is very small compared to the dynamics of the other regional centres,” said Dinning. “Demand is still very high and will continue to be high until the market becomes much more mature.” In another strategic move, the Kumho Asiana Plaza is also looking to attain ﬁrst mover advantage in the retail sector. “Retail has really taken off in Ho Chi Minh City over recent years since the signing of WTO for Vietnam,” noted Dinning. The very young population – 70 per cent are under the age of 35 – with much higher levels of education, income and exposure than the previous generation, has a thirst for foreign goods. But unlike Bangkok, with its 5 million sq m of air-conditioned retail space, Ho Chi Minh City has a mere 200,000 sq m. “The market is very young and demand in this sector is only going to continue to rise as the urban middle class population grows,” Dinning added. Ultimately, Kumho’s vision to tap the potential in Ho Chi Minh City goes far beyond the limits of its physical building. Not only does the complex provide an integrated mixed-use model, but it is also a benchmark for things to come.
A PATIENT INVESTMENT The Kumho Asiana Plaza project has not been without its challenges. The ﬁrst overseas project by Kumho E&C after a lengthy hiatus in global investments in the 1980s, the Asiana Plaza was given the go-ahead in 1996. But the Asian ﬁnancial crisis stalled the project – twice.
would also help set the pace for the development of tourism, retail and leisure in the city, he added. Already, the construction of the project has generated a big demand for local services and labour. “The total invested capital for construction is around US$270 million,” Dinning noted, “which of course provides substantial business for construction companies.” After the project is completed, Dinning estimates that its management staff will be in excess of 200, not including hotel employees. Ultimately, the entire project will be able to provide continuing jobs for a great number of local workers, as well as attract foreign tourist dollars. The boost to the overall economy, too, will be substantial, Dinning added. “All of the income from the hotel, ofﬁces and serviced apartments as well as the retail will attract VAT for the government of around US$5.5 million a year, as well as proﬁts tax in the future from the business of Kumho Asiana Plaza.”
RAISING THE BAR
Despite these setbacks, Kumho retained the right to invest in the project, waiting patiently for market forces to return to their favour. In October 2006, construction on the complex resumed. It is not common for a developer to show so much patience, said Dinning. “The unique way in which Kumho has dedicated itself to the long term in Vietnam sets it apart from other developers who may just be interested in building and then selling. “They have shown everyone in the market how professional their construction techniques are and have not been afraid to use the most up-todate technologies. This has raised the level of expectations of the Vietnamese population and government alike in terms of how and what to build.” It has also won the respect of the Vietnamese people. But their forbearance underscores the faith that Kumho has in the Vietnamese and their economy. Taking a long-term view of the economy, Chang noted that the demand for ofﬁce space, accommodation and apartments would be an ongoing trend, especially given the inﬂux of foreign investors to Vietnam over time. “After the reform policy, Vietnam is now being recognised as a country with a continuously high economic growth rate, attractive resources with highly skilled people and an abundant labour force,” he said. Continued demand is also evident in cities such as Ho Chi Minh City, he noted. “The economic development of Ho Chi Minh City is growing rapidly and there is a shortage of hotels and ofﬁce buildings.” With these prospects, Chang added, “Kumho E&C believes that there will be a lot of opportunities for carrying out many development projects such as ofﬁce buildings, hotels and luxury apartments.” The complex
“The unique way in which Kumho has dedicated itself to the long term in Vietnam sets it apart from other developers who may just be interested in building and then selling.” Peter Dinning, Managing Director of Colliers International in Ho Chi Minh City
Kumho E&C is also setting a benchmark in construction techniques and processes. For example, the project is employing a top-down method of construction, a technique that enables any high-rise structure and its basement to be built simultaneously. By ﬁrst installing underground foundation walls along the perimeter of the structure and placing a supportive roof slab across the area to be excavated, the basement for the building can be dug – with the roof slab acting as a massive support and a noise barrier. Above ground, construction can also proceed as the perimeter retaining walls act as the building’s structural support. “Because the construction of the basement and the above-ground ﬂoors can be carried out at the same time, the construction period can be shortened,” explained Chang. At the same time, Kumho has taken pains to ensure that the construction site, from its hoarding design to its surroundings, remains well-kept. “The trucks are washed to avoid the wheel tracks’ imprint in the area,” said Chang. “Flower pots are placed around the hoarding in order to create a different atmosphere from other construction sites and to attract people’s attention.” It is by setting these standards that Kumho E&C hopes to position itself as a leading international contractor in Vietnam and impact the construction culture, he added. Kumho has also been heavily involved in a range of cultural and community projects in Vietnam. One of them is the Kumho AsianaVietnam Scholarship and Culture Foundation (KVSC) in Hanoi, which offers scholarships and study exchange opportunities to bright art college students from disadvantaged backgrounds. Taken in its entirety, it is clear that the commitment of Kumho Asiana is more than just business. “With investment projects, together with such contributions to social, art and cultural activities, Kumho will play a role as an enterprise that is responsible for the enhancement of the VietnamKorea relationship,” said Chang. Going forward, Kumho is invested in the future of the Vietnamese economy, weathering good times and bad. “Despite the global economic challenges, developers still view Vietnam as one of the most attractive real estate markets in Asia.”
For more information on lease opportunities, please contact Peter Dinning, Managing Director, Colliers International Vietnam. firstname.lastname@example.org
| January 2009 27
Kumho Asiana Plaza Saigon & Kumho E&C present
Grade A Ofce Coming to Ho Chi Minh District 1 September 2009
Exclusive Marketing & Management Agent Colliers International Vietnam Tel: Email:
(08) 3827 5665 Scott.Crawford@colliers.com Kp.Singh@colliers.com Anh.Nguyen@colliers.com
Grade A ofce space set amongst a ve star hotel, serviced apartments and a trade centre.
Giving new meaning to the idea of CBD living, one Beijing development seeks to add value to the prospect of city-living – and appeal not just to expatriates, but to their families too.
CITY WITHI A CITY – BUILT FOR WORK, LIFE AND PLAY
January 2009 |
THE LANDGENT PROJECT
LIVING LARGE IN THE CBD The various residential offerings in the Landgent project means residents have a choice of housing options to suit personal and family needs
N The megacity is here to stay – and with it the convergence of working, living and leisure spaces. Joining the fraternity of prominent urban centres is Beijing – once one of the four great ancient capitals of China, and now regarded as the cultural, political and commercial heart of the nation. The rise of China’s economy, coupled with the awe-inspiring spectacle of the 2008 Olympics, has driven the emergence of spectacular skyscrapers and innovative buildings that have, over just a few years, changed the Beijing skyline drastically. One such towering structure is the Landgent Centre, a sparkling duo of towers located at the northeast corner of the “Gold Cross”, about 1km from the World Trade Bridge and situated on the fringes of the bustling Beijing CBD. As far as ofﬁce towers go, the Landgent Centre may seem like any other. But beyond the gleaming glass and steel facade, the Landgent Centre is actually part of a bigger overall project that aims to integrate work, leisure and living in one compact and functional community. It joins the ilk of similar “all-in-one” developments such as Jianwai SOHO, Wanda Plaza and Shin Kong Place – but in a much more comprehensive fashion.
“We believe that the Landgent is a project that will grow with Beijing’s development and, in the long term, will be able to meet the city’s growing needs.” Wang Long, General Manager of Landgent Real Estate
| January 2009 31
THE LANDGENT PROJECT
LANDGENT INTERNATIONAL APARTMENTS (乐成国际公寓) These residential blocks in the CBD are home to one of the biggest expatriate communities in Beijing
A DESIGN FOR THE TIMES Rather than just meeting the working needs of the CBD worker, the intention of the Landgent project was to creare a living environment within the development so that residents can work, live and play all around the same area, said developer Landgent Real Estate. According to General Manager, Wang Long, the concept of a “a city within a city” was aimed at providing elements that would attract expatriate workers and big employers such as Fortune 500 corporations. Having multiple amenities also raises the proﬁle and premium of the entire development, said Wang. Each element – retail, transport, ofﬁce space – can leverage the strengths of the other, adding more value to the project, he added. “For example, below the ofﬁce blocks, we have retail outlets, making shopping convenient,” Wang told CUBIC. The Landgent City Mall is a 20,000 sq m space located in the podium building of Landgent Centre with retail, dining and entertainment outlets. Underground, a new subway serves the transport needs of the workers and residents in the area. Nearby, residential blocks built by Landgent offer homes for local and expatriate professionals who work for the multi-national ﬁrms housed in the ofﬁce towers. And the Beijing City International School (BCIS), the largest international school located in Asia, is also close by.
32 January 2009 |
LANDGENT CHATEAU (乐成公馆) These ﬁve high-rise residential buildings offer spacious and luxurious living and, with only 484 suites in all, lots of privacy,
According to urban geographer Thomas Hahn, the “city within a city” concept has long been a prevalent theme in China and has had many variations. From the 60s to the early 90s, such contained communities formed a good part of Chinese cities. Looking at it from China’s political roots, there is the work unit model (or danwei), he explained. “This is a socialist approach to labour equity and social engineering that manifested itself in walled enclosures of factories, residential housing, schools, kindergartens, medical care centres, guest houses, etc,” he said, forming self-contained work units that would see to the needs of their workers in a holistic fashion. In a sense, the Landgent project and other new developments that integrate multiple functions replicate this model. Instead of the strict focus on “practical” needs – work, shelter, education and medical care – these modern multi-function developments add an even more important aspect, said Hahn – that of leisure spaces. Calling multi-function developments such as the Landgent similar to “superblocks” – large buildings that integrate a highly diverse range of functional activities – Hahn noted that one key rationale driving the rise of these developments is the cost of transportation. “I do not only mean monetary costs, but time costs. It is a highly efﬁcient way of engineering people’s daily time schedule,” he said.
THE TALENT DRIVE In the past few years, many have been attracted to China for its unrivalled opportunities and the rate of growth. Before the global ﬁnancial slowdown LANDGENT HOLI APARTMENT (乐成豪丽公寓 ) Serving both corporate and residential needs, these holiday apartments combine the comfort of a home with the impeccable service of a hotel
For the developers, the strategic vision behind the Landgent project was to maximise the use of land in the dense Beijing CBD and meet the needs of a rising population of multi-national companies and their mostly expatriate workers. Wang believes that the high demand for land and space in Beijing will continue to grow and the Landgent will serveto address current and future concerns. “The potential for how we use the land has yet to be realised,” said Wang. “We believe that the Landgent is a project that will grow with Beijing’s development and in the long term, will be able to meet the city’s growing needs.”
“Developments such as the Landgent in Beijing will allay many fears about relocation and will provide a ‘comfortable and familiar zone’ for overseas migrants to adjust to their new home.” Tim Hird, Managing Director of Robert Half Singapore
in 2008, China’s and its key cities enjoyed rosy growth. In Beijing, the past ﬁve years have seen great economic strides. In 2001, Beijing’s per capita GDP stood at US$3,200 but, by 2007, that ﬁgure had more than doubled to US$7,500. With the success of the Olympics, Beijing expects to see per capita GDP reach US$8,000 by the end of 2008. Even with the global slowdown, China still expects to post a postive – if moderated – economic numbers. The allure of cities such as Beijing is reﬂected in the popularity entrance of large multi-national organisations and a diverse workforce, leading to an immense population boom. The number of Beijing residents grew from about 14 million in 2000 to 17 million in 2008. Currently, Beijing is also home to some 1.1 million foreigners. According to Mr Tim Hird, Managing Director of recruitment consultancy Robert Half Singapore, Beijing continues to be sought after by job-seekers. “We are receiving an increasing number of enquiries from overseas candidates about opportunities in mainland China,” he told CUBIC, driven by the slowdown of banking sectors in other markets such as the UK and the US. “Many employees are seeking better job security in more stable ﬁnancial environments.” But expatriates, particularly those with families, usually have concerns about cultural integration challenges when moving to developing countries, said Hird. “Developments such as the Landgent in Beijing will allay many of those fears and will provide a ‘comfortable and familiar zone’ for overseas migrants to adjust to their new home.” Ultimately, the decision to relocate is not always job-related, he added, as housing conditions, educational infrastructure, lifestyle and cost of living are some of the other key components that act as a “tipping point” for professionals to choose one location over another. “Employers will respond well to locations that make it easier for them to ‘package’ the destination to interested employees,” he said, “(as) relocating staff is a time-consuming and costly exercise so you want to be sure you can ensure a smooth transition.” The Landgent Group has a keen understanding of the needs of the expat community, said Wang. “As one of our target groups is expatriates, many of the features of the development have been designed to meet their needs, especially in terms of education. When foreigners come to Beijing to work, education for their children is a perennial concern, and is a key factor in attracting foreign workers and investment. With the school, it helps to bridge a crucial gap.” In 2004, the Landgent Group invested some RMB500 million to build the BCIS, which can accommodate some 1,600 students from kindergarten to grade 12. Right now, almost all the students – some 95 per cent – are from overseas. With the ability to provide a completely new location option for companies with high consideration for “employee convenience”, the Landgent project has an upper hand in attracting high-value corporations, noted Jim Serstad, Director of Colliers Commercial Agency Department in Beijing. “In a market like Beijing where the demand for talented employees is very competitive, companies must provide a higher level of amenities to their employees, including transportation, dining, residences, shopping and recreation,” said Serstad, “Our experience is that our clients who visit Landgent discover a new option that they previously would not have thought possible.” And while Beijing has room for more international mixed-use developments like Landgent, it still has ﬁrst mover advantage, he added. “There is a critical mass that needs to be reached and Landgent has already achieved that. It will be hard for others to duplicate.” For more information on Landgents Developements, please contact Amanda Gao, Managing Director, Colliers International Beijing. email@example.com
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January 2009 |
Mr Magar – against the backdrop of Magarpatta Township – believes there’s a silver lining in the Indian real estate sector despite the global recession
Certainly, the global real estate sector will be hard hit in a global slowdown, but not everyone in the Indian real estate sector is getting cold feet. In fact, market observers see opportunities even amid the global credit crunch and Indian slowdown. BY NAMRATA KOHLI
RIDING HIGH on the back of a booming economy, favourable demographics and liberalised Foreign Direct Investment (FDI), the real estate market in India has enjoyed heady times thanks to the red-hot wave of demand and investment. But, like all good things, the end came too soon for the sizzling market. When the ﬁrst warning signs appeared in the middle of 2008, an HSBC report predicted that house prices would fall between 25 and 30 per cent in most Indian cities. At the same time, other signs portended the doom that all too predictably follows the euphoria of boom times. In a similar pattern to the United States, the Indian real estate market saw easy home ﬁnancing with slashed interest rates between 2003 and 2007 as banks entered a race to win more customers. With cheap borrowing came heightened speculative investments, artiﬁcial escalation of housing prices and an oversupply of housing in some segments. Add to this soaring inﬂation, surging oil prices and increasing construction costs – it all signalled an unsustainable boom headed for trouble. And then Wall Street’s ﬁnancial tsunami hit and the global effect was immediate, leaving markets rattled. And even India was not spared.
“We have a lot of genuine buyers in India who need homes and the stable market will weed out speculators, instill more conﬁdence and entice more genuine buyers to buy. This will help sustain the market in the next few years.” Mr Satish Magar, Chairman & Managing Director of Magarpatta Township Development and Construction Company
| January 2009 35
“It’s a place that speaks to my spirit. From there comes the willingness and commitment to the island.”
THE SILVER LINING However, there is good news. Among the optimists is Bharti Gupta Ramola, transactions leader at PricewaterhouseCoopers India, who believes that the slowdown in real estate will do “unforeseen good”. She noted that the country was in the fortunate position of not having a “prime” crisis situation. “In home loans, there will be higher prepayments and higher defaults but I don’t expect this to take the proportions of a crisis,” she said. “The reason is that, in a large percentage of cases, home buyers still put in a large proportion of equity in homes – much higher than in developed economies – and our mortgage market is very different in terms of debtor liabilities.” Another factor that has cushioned the Indian economy is its banking norms. “We are relatively conservative in the way we determine loan eligibility in terms of the income of the borrower, as well as the loan to value (LTV) of the property ratio,“ says Balaji Raghavan, Business Head of Home Loans at ICICI, India’s top ﬁnancial institution, which has a big home loan division. Satish Magar, Chairman and Managing Director of Magarpatta Township Development and Construction Company Limited, is taking
36 January 2009 |
the impending slowdown in his stride. “Growth in 2007 was very fast and paced at about 10 per cent, but in 2008 it moderated somewhat to 7.5 to 8 per cent. I expect to see such growth for the next few years.”
said Magar. “A lot of malls and organised retail spaces are coming up. For example, Walmart and Tesco are moving in a big way across cities. While organised retail is very new to India and many people are not used to it, it is doing quite well and is attracting quite a lot of interest and
BANKING ON THE TIERS
development.” And, with the growth of Tier II and Tier III towns comes the need for supportive infrastructure. “The biggest opportunity is in building infrastructure, such as roads, metro railways and highways, as the government strives to improve the conditions of the cities and attract more investment, and support growing industries,” said Magar. “In turn, these roads and highways that connect these cities offer a lot of opportunities for the growth of support communities, residential developments, stop-over towns that will serve these Tier II and III cities, and the commuters who travel through.” As more people in smaller towns aspire to a better quality of living in new age modern homes complete with amenities, this rise of the middle class will increasingly drive the future of real estate in India.
Magar believes there will be continued – if moderate – growth driven in part by the bright spots in the Indian market, the Tier II and III cities located in the suburban and peripheral areas of metros. “The residential sector will be the primary driver of real estate in Tier II and III cities in 2009, with the demand likely to come from the under-served resident population of the city,” said Amol Shimpi, National Director of Colliers International. As prices and interest rates zoom upwards in Tier I cities, the appeal of these Tier II and III cities is growing, Magar noted. The boon for developers is that, with the growth of communities and townships in these areas, other opportunities such as retail and leisure will follow. “Generally, the growth of each sector – residential, retail and leisure is interdependent,”
RESIDENTIAL HOPES The current slowdown, ironically, is also reason for aspiring homeowners to have hope. In the past ten years, economic growth, the rise of the real estate and construction sector and interest rates as low as 7.5 per cent fuelled property buying, resulting in more young buyers – the average age of a new homeowner was 32 compared with 45 a decade ago. Economic prosperity also brought a change of mindset among the young working population – from “save and buy” to “buy and repay”. This led to a rise in speculative investors, pushing the end user out. Instead of meeting the shortfall of homes, the environment became a parallel stock exchange in which huge apartments were mere commodities sold at exorbitant rates to those who already had houses to live in. “In the past couple of years, there was so much happening that was against the natural demand,” noted Magar. “We saw a lot of investors and speculators in the market, and this was partly driving the phenomenal growth. But, in the long term, this is not sustainable because we cannot continue to have a purely investor-driven market, but a market that is acceptable to people.”
However, with the crunch, developers are starting to focus again on affordable housing rather than high-end developments, enabling the middle and lower middle classes to ﬁnally aspire to own their own private homes, said Ramola. Ramani Shastri of Sterling Developers, who also noted, “Earlier, a customer was able to buy a 50 lakh (USD100,400) unit at 8.5 per cent interest rate. (But) with an increase in interest rates, he is able to buy only a 35 to 40 lakh (USD70,280 to USD80,320) unit now. Because of this, developers who were focusing on the top end and niche segment will be forced to shift their attention to the mid market.” Magar welcomes this new direction. “We have a lot of genuine buyers in India who need homes and the stable market will weed out speculators, instil more conﬁdence and entice more genuine buyers to buy. This will help sustain the market in the next few years.” A spokesperson from national developer Parsvnath – a group with residential projects across smaller cities – says that there is a change of attitude. People are moving from renting a house in metros to owning a house in Tier II and III towns, as good quality homes are now affordable.
For instance, in Delhi’s peripheral areas such as Kundli, Sonepat or Panipat, real estate developers are coming up with projects in a price range of 15 to 30 lakhs (USD30,122 to USD60,245). According to Magar, cities such as Pune, Madpur, Jaipur and Hyderabad are also seeing sustained growth, in part driven by the IT sector. “The more IT space you create, the more residential space is needed,” he explained. Many people living in metros are also investing in a second home, a vacation home, a retirement nest or a rental-generating property. No longer do development authority ﬂats ﬁt the bill of today’s home buyer – “lifestyle homes” are the new must-have. Era Group COO Deepak Aggarwal noted that the increase in small nuclear families, change in lifestyle, higher disposable income and purchasing power of people coupled with a high standard of living has seen a paradigm shift in people’s aspirations. “Today, there are many takers for our township projects where we offer schools, entertainment avenues, ofﬁces within close proximity and ensure the security of the residents in Tier II & Tier III towns,” said Aggarwal. Magarpatta City is one major development set to tap this demand for suburban living. Located 7km from the Pune Railway station and 5km from the Pune CBD, the sprawling 400-acre development is the ﬁrst planned township of its kind in India, said Magar. Employing an integrated all-inone living concept, the city took a “holistic approach” to cover every aspect of living well for a rising middle class, he said. “From roads to education, workplaces, amenities, security and community development, we took all these into consideration when planning the city.” Raj Arora, a 32-year-old home buyer, said, “I am more than willing to pay a premium for this kind of accommodation, which offers features of lifestyle living such as a gym and swimming pool. It should be a small unit that is manageable and that gives a sense of pride in owning a home and not a compromise in the name of a small apartment.” For more information on the India Market, please contact Joe Verghese, Managing Director, Colliers International Mumbai.
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No walls; No cells; No gridlock – life’s new at BY LIM SAY LIANG
January 2009 |
LEFT: Artist’s impression of possible living space overlooking Jakarta’s CBD BELOW: Artist’s rendering of Plaza Indonesia Complex
AS EXTENSION PLANS GO, the ones for Plaza Indonesia Realty (PIR) – one of Indonesia’s premier mall developers – are whoppers, with 220,000 sq m of chic space in the middle of Jakarta’s CBD that includes an expansion of the mall; an ofﬁce tower (The Plaza); and, at the heart of what’s been called one of Asia’s most prestigious mixed-use developments, The Keraton. Back in the mid-‘90s, the luxury residence would have been the stuff of pipe dreams. The economic crisis put PIR’s grandiose plan on the backburner and construction came to a standstill in 1998. Those who had money down for a unit at The Keraton were refunded. “We are very conservative,” said Dinna Muskita, General Manager of The Keraton and The Plaza. “Other developers, high-risk takers, will forge ahead,” she said, “but we wait.” For seven years, all PIR had to show for its residential development were foundation works. The project seemed to languish, but, even during the lull, the honchos at PIR huddled and decided to ride out the storm, but not passively. The site became a way station as former buyers were consulted; they wanted larger units and the freedom to design their homes. “It’s our ﬁrst residential tower. We have to have the best – the best trends and lifestyle for high society,” said Muskita. But there were no ﬁtting projects on which to model their vision, she recalled. This meant coming up with something completely new. Being ﬁrst with the concept meant neither contractors nor consultants had experience with this approach, said Brian Laurence, Project Manager for the Plaza Indonesia Extension Project. Heads down, PIR got to work: layouts plans were scrapped, the number of units halved and apartment sizes doubled. Designs were updated in 2004 and construction began again in 2006.
| January 2009 41
LUXURY LIVING Site plan of Plaza Indonesia Complex
THE ESSENCE OF NOTHING A strange irony presents itself when one walks into any of the 68 “completed” Keraton penthouses, located on Jalan M.H. Thamrin – the most expensive real estate in Central Jakarta. Inside each Grand Palace penthouse, with its USD4,000 per sq m price tag, is 500 sq m of bare screed under a 4-metre-high ceiling and nothing else. No bedrooms. No toilets. No kitchen. “Buyers are limited only by their own imagination,” said Muskita. According to Ferry Salanto, Research Manager at Colliers International, it took a more personal approach to sell The Keraton. Former buyers were invited back. Prospective occupants were whispered-in. And all were screened by the shareholders of PIR. “It’s like head-hunting,” Muskita explained. “They have to be in the business community, move in the same circles and value their privacy,” she said as the subset shrank. “They are the rich-rich ... They are the members of high-high society.” The Keraton’s concept was presented to dinner guests. They were shown the panoramic view of the Jakarta skyline from every penthouse in the 48-storey building. No advertisements were placed. No showrooms were put up. They would be “misleading”, Muskita deadpanned. “Such developments are usually targeted at a speciﬁc group of afﬂuent people,” noted Ivan Hoh, Executive Director of PropNex International. “I believe PIR was less concerned with what unit mix to build than how unique and creative they could be. They wanted to create something that is ‘the talk of the town’.”It was certainly that. As of October, 70 per cent of the units at The Keraton have been sold. Pretty impressive for nothing. Calling Keraton buyers “discerning”, Victor Lee, lecturer at the department of Architecture at the National University of Singapore (NUS), said that it will
42 January 2009 |
take a unique mindset to see potential in these “non-cellularised” residences. The Keraton buyers are not the type to simply put up walls to divide the “shell” into as many rooms as possible, he said. “They appreciate how the immediate home environment is a reﬂection of a lifestyle, how open-plan spaces and other means of deﬁning ‘rooms’ could work.” By forgoing tastes and penchants, buyers are limited by their own imagination. One bedroom? Four? Hang up a Jackson Pollock? It’s completely up to them. Though they bear the additional costs of ﬁtting out their shells, it’s not uppermost on their minds. “Most of them are quite excited because it will be the ﬁrst time they can design their own homes,” said Muskita. “They have the freedom to do anything they want.” “Most people who buy expensive property tear out previous owners’ preferences anyway,” said Mark Knowles, Executive Blogger for online portal Luxury Property. “The afﬂuent tend to have speciﬁc ideas. They will not settle for anything less – or different.” “Our goals,” said Laurence, “were to ensure that each apartment has inﬁnite possibilities in terms of layout, is self-contained in terms of services … and has access to the highest quality of service.” For noise-insulation, there are sandwich ﬂoors. For privacy, zoned elevators. For commuting Jakarta’s gridlock, an adjacent helipad. At the pool deck on the 6th ﬂoor, Keraton residents will also have private access to Grand Hyatt Jakarta.
SERVICE STANDARDS PIR, which also undertook the development of the ﬁve-star hotel, reached an agreement with its former charge to manage The Keraton’s 68 penthouses and
“very established upper-segment property and has proved this for years”. The shopping mall hosts some of the biggest fashion houses in the world and their ﬂagship stores in Indonesia. Think Gucci, Lanvin, Prada. Artist’s impression of a possible “bedroom”
“It’s all there, it’s on their doorstep,” said Muskita. They can even attend regularly held fashion shows. Cartier, Hermes, Yves Saint Laurent. “It’s the same target market.” Let’s not forget “eX”. Billed as “a unique fusion of art, retail and recreation”, Plaza Indonesia Entertainment X’nter will capture the market segments that fall through the cracks. “It will complement a more mature ambience in Plaza Indonesia with its focus on younger wealthy shoppers,” said Salanto, “while maintaining the upper-class atmosphere.” “Everything,” said Muskita, “has to complement everything.”
TAPPING THE LUXE VEIN
20 serviced apartments. A personal butler, in-room spa treatments and roundthe-clock room service from the Grand Hyatt are some perks enjoyed by a charmed circle of apartments in the world – and the Sultan of Brunei’s palace. “Our residents are busy people,” said Muskita. “They don’t have to go anywhere.” For laundry runs, catering a swanky luncheon, booking a private jet, “just call the concierge”. The “Hyatt input”, said Knowles, makes all the difference. The residents at The Keraton can expect a higher quality of life, he said. The staff at Grand Hyatt Jakarta will pay meticulous attention to what they want and provide it. “They quickly get to know their guests and anticipate their needs.” For Patrick Grove, Executive Chairman of the iProperty.com group, the location sells itself. “Within walking distance, you have a world-class ofﬁce tower, a world-class shopping centre and a world-class hotel. This deﬁnitely places the property at a premium, particularly in Jakarta where people can spend a lot of time stuck in trafﬁc.” It might be PIR’s ﬁrst venture into residential development but its track record speaks volumes, said Colliers’ Salanto, as Plaza Indonesia is a
“(The Keraton buyers) are quite excited because it will be the ﬁrst time they can design their own homes. They have the freedom to do anything they want.” Dinna Muskita, General Manager, The Keraton
If PIR didn’t set a benchmark with Grand Hyatt Jakarta and Plaza Indonesia Shopping Centre (which it did with numerous awards), it has now. “The developments of the past are not as sustainable; they run the risk of overbuilding,” said Knowles. “People are starting to realise that it makes more sense to consider and meet the needs of the community. Plaza Indonesia Complex is deﬁnitely one of Asia’s most prestigious mixed-use developments. It is comparable with huge projects in Shanghai, Hong Kong and Tokyo.” Not all is on the up-and-up in Jakarta. Colliers’ research shows that the supply of strata-titled apartments outstrips demand. “In the second quarter of 2008, the overall take-up rate of Jakarta’s apartments for strata titles decreased by 1.1 per cent to 72.3 per cent, leaving approximately 16,800 units unsold.” But Muskita isn’t fazed. She admits there is no guarantee that the remaining penthouses will be sold by the projected move-in date next July. But the former Managing Director of Colliers International questions the relevance of the report, pointing at the spectrum of strata titles covered. “We believe there is still a market there for high-end residences like The Keraton,” she said. The housing surplus may be a problem, but there will always be a demand for up-market apartments, agreed Knowles. But he does have a quibble with PIR’s use of the word penthouse. “By deﬁnition, a penthouse is on the top ﬂoor, solely on the top ﬂoor.” But the quintessence of a penthouse is exclusivity – something that no one else has, explained Muskita. “It is generally the one differentiated by size, by high ceilings, by layout, by exclusiveness. Our penthouses meet these criteria.”
Penthouse isn’t the only byword invigorated by The Keraton. “I would think the notion of ‘luxury’ needs to be redeﬁned”, said NUS’ Lee, “not so much material luxury but rather, a kind of ‘spatial’ luxury – quality, uninterrupted spaces with spatial character – able to embody the functional needs of the home buyer.” An empty shell is a boon for The Keraton residents, said design psychologist Dr Toby Israel. “It gives them the chance to participate in the creation of a home that ﬁts their unique emotions, wants and needs. When we don’t have a blank canvas, we have architects, developers and marketers between us and our sense of home,” he said. “The materials, colour schemes and space layouts they choose may be ﬁne in terms of selling the ‘home’ product, but it may not be individualised to a person’s sense of home. The story of your house is like the story of your life.” For more information, please contact Mike Broomell, Managing Director, Colliers International Indonesia. firstname.lastname@example.org
| January 2009 43
North facade of the UED BIZHUB
44 January 2009 |
United Engineers Developments plans to turn the grey urban “wilderness” of the Changi Business Park in Singapore into a vibrant and interconnected mixed-use super-hub where work, play and leisure converge. BY SHERALYN TAY THE BEATING HEART of any economy is in its ﬁnancial district, but the backbone is in its industrial and business parks – where the engines of the economy churn away from the glitzier Central Business District areas. But far from the hustle of city life, business parks have a bleak – and sometimes undeserving – reputation of being faceless. However, more and more developers are seeking to overturn this image of bland efﬁciency and add more to the bare-bones functionality of business parks. Situated in the east of Singapore, the Changi Business Park is a strategically located site by JTC Corporation (JTC) – the lead agency in the planning, promotion and development of industrial space in Singapore. Comprising a diverse mix of knowledge-intensive businesses, from technology, data and software enterprises to ﬁnance and R&D, Changi Business Park is one of the key industrial and business park spaces in the east of the city state.
ADDING BUZZ TO BUSINESS A unique mixed-use development will bring a new vibrancy to the Changi Business Park. This project by United Engineers Developments (UED) will enhance the area’s allure as a prime business location. UED is an engineering, construction and integrated facility management company with a strong focus on end-to-end capabilities in design, building, management and operations in property and environmental-related projects. The UED BIZHUB will comprise a business centre, an IT training hub featuring exhibition and convention halls, an auditorium and seminar rooms. More signiﬁcantly, it will also include a 300-room business hotel – the ﬁrst business hotel and serviced apartments in the area – as well as ofﬁce and retail space. It also has the distinct advantage of being located just across the road from the Singapore Expo -- the largest convention and exhibition venue in Singapore – and parallel to the existing train line.
| January 2009 45
UED BIZHUB Artist’s impression of an overview of the completed UED BIZHUB
According to UED’s Managing Director, David Liew, this integrated development is part of JTC’s master plan to build Changi Business Park into an active urban area with two separate hubs linked by an attractive green garden environment complete with kiosks, sculptures and performing venues. The idea is to inject recreation, retail and relaxation into an otherwise straitlaced business community. Since its launch in 1997, the Changi Business Park has been served sporadically with various amenities and facilities, but these came and went as the smallish population and catchment could not sustain these businesses and services. But what a difference a few years make. The area is now in great need of more services, such as retail and leisure as the business community expands. According to UED, the project enables the company to further tap into its accumulated years of experience in engineering and construction, in particular in the niche area of built-to-suit real estate services, an area required by many multi-national corporations
46 January 2009 |
looking for asset light alternatives for their operations. The vision for Changi Business Park is for it to
and light shelves to reduce heat have also been planned into the design.
be developed with the principle of integrated living showcased by the JTC development, One -North, Singapore’s high tech and R&D science hub. “The Changi Business Park will comprise a fusion of various mulit-faceted activities to cater to the needs of the modern business community,” said Liew. Like One-North, the UED BIZHUB is being developed to be an integrated mixed-use development of retail, apartment, ofﬁces and hotels with state-of-the-art aesthetic design and sustainability. The gleaming glass and steel faceted structures integrate several environmentally sound strategies and technologies. A district cooling system has been integrated into the development to reduce the use of electricity for cooling purposes. Green features such as the use of plants on vertical green walls to minimise heating,
THE NEW CBD The move to enhance this area is timely said UED. “The new Changi Business Park in recent years has grown at an incredible rate,” said Liew, “especially with the recent real estate boom and the tremendous speed at which CBD rental prices are escalating, causing many ﬁnancial-related back-of-house functions to take a great interest in relocating to the Changi Business Park. With this increase of interest and the site’s close proximity to the intersection of two MRT lines, UED sees tremendous potential in this site.” With its existing infrastructure, thoroughfares and links to key transportation nodes, the Changi Business Park site has the ability to consolidate accommodation, F&B, retail and MICE activities, added Liew, calling the development a “CBD away from the CBD”. Given the supply crunch on ofﬁce space that
Artist’s impression of the completed UED BIZHUB
THE MICE PLAYGROUND
has seen rental prices skyrocket in the prime commercial areas of the Shenton Way and Rafﬂes Place, UED thinks the UED BIZHUB will be an ideal and conducive location for companies or business units that do not require the prestige and prominence of prime commercial areas. One key target market will be end-users in the IT and ﬁnancial sectors, particularly back-ofhouse operations and information storage. “We will also be targeting overseas multi-national corporations who are looking for large seamless
ﬂoor plates and with business park speciﬁc technical needs and requirements,” said Liew. The integrated facilities mean that business travellers beneﬁt too. The short-term business traveller in town for a whirlwind industry seminar can ﬂy in, arrive at his or her hotel in less than 15 minutes, attend a seminar, eat, rest and network all in the same area before ﬂying back home. And this does not need to be done in the pricier CBD area – saving costs for exhibition organisers and their partners.
The UED BIZHUB will also be prime for what industry experts believe will be a steady – if moderated – growth in the Meetings, Incentive Travel, Conventions and Exhibitions (MICE) arena. According to a Straits Times (ST) report, things are still looking up for the trade show and conventions business in Singapore, despite the economic downturn. About 18 exhibitions and conferences have been conﬁrmed in 2009 alone. According to Michael Tay, Director of Operations, at Meetings Professionals International Asia Paciﬁc, the UED BIZHUB will plug an important gap in the area. Its excellent location near the airport, hotel, shopping and entertainment facilities bring “life and energy” to the area and create excitement, he said. At the same time, being surrounded by MNCs and important industry networks will make the Changi Business Park a compelling MICE location. Calling the vision of the new CBP “excellent”, Tay added, “I think it is all heading in the right direction to take advantage of the expo halls and ofﬁces there.” For more information on UED BIZHUB, please contact Dennis Yeo, Managing Director, Colliers International Singapore.
A bird’s-eye view of the development
“With the recent real estate boom and the tremendous speed at which CBD rental prices are escalating, many ﬁnance-related back-of-house functions have taken a great interest in relocating to the Changi Business Park. With this increased interest and the site’s close proximity to the intersection of two MRT lines, UED sees tremendous potential in this site.” David Liew, UED Managing Director
| January 2009 47
DIGITAL WATERPROOF CAMERA Technology and nature aren't exactly best friends: expensive electronics and outdoor watersports are not the most compatible of elements. But what if you want to capture the action digitally while snorkeling, snowboarding or mountain biking? The Hero 3 Digital Wrist Camera "makes nice" with the great outdoors by sporting a durable exoskeleton that pretty much goes anywhere. Strap the Hero 3 to your wrist and snap some sweet shots while skiing, biking or diving up to 100 feet. This mini camera locks ﬂat to your wrist for storage then pivots up to capture crisp digital photos or 30 fps movies. A 3 Megapixel, Internal Memory – 16MB expandable to 2GB with SD card, Video – 640 x 480 with sound (54 mins from 2GB SD Card) Price: USD 119 www.thinkgeek.com
AUTHENTIC GUINNESS® HOME PUB There are plenty of reasons to raise a pint to the Irish. One of the greatest occurred in 1759 when young Arthur Guinness founded a brewery at St. James's Gate, crafted a hearty, distinctive stout, and won a place in our hearts forever. Celebrate the 250th anniversary of that ﬁrst delicious keg every day at home with your own Guinness Pub. This fully functional, traditional Irish pub can be built in your home. It is crafted from historic Irish architectural elements and authentic Guinness artifacts. The price tag comes with fresh Guinness Stout for your pub for an entire year! Currently this little bit of paradise will set you back a cool quarter million. Price: USD 250,000 www.neimanmarcus.com
- for the person who has everythingg BY GAVIN VERCOE
AK ICE TRAY Have the most “gangsta” drinks at your next party, Cool that killer drink with a round of these ice cubes shaped like AK-47 bullets. Each AK Ice Tray magazine produces 12 bullet shaped pieces. Got an “acquaintance” coming around for a drink? Put a few AK ice bullet rounds in and maybe then he will take you seriously!
THE TITANIUM SPORK
Price: USD 15 www.uncrate.com
DRESS FOR DINNER NAPKINS Protect your best tee and look good as you stuff your face with the help of a Dress For Dinner Napkin. These paper napkins come in four styles, letting you pick between stripes, solid or polka dots, depending on your mood or potential stains. Price: USD 6 (20-pack) www.spoonsisters.com
Every mythic hero normally has an equally mythic weapon. Zeus had his thunderbolts. Thor had his hammer and King Kong had his bananas … you get the idea. It's time for you to join the ranks of the heroes as you wield your own legendary weapon in your battle against a very powerful foe: hunger. Herald the Titanium Spork, the utensil of heroes! Titanium is known for its great strength, corrosion resistance, and light weight – which makes this a valuable asset around feeding time. Imagine how much more you could shovel in at your local buffet if you didn't have to strain yourself using both a fork and spoon. Your food consumption can become the stuff of legends. It is perhaps the greatest gastronomic invention since lickable wallpaper. Hunger, beware – your end is near! Price: USD 8.99 www.thinkgeek.com
November 2009 2008 48 January | |
Price: €1 943.00 (excluding taxes and shipment) www.dddxyz.com
We already know that your desk probably looks like a disaster area ... why not turn it into a crime scene instead? Not only does repeatedly stabbing your pen into Fred reduce your stress levels, it helps you to keep that pesky pen from getting lost under the edge of your computer keyboard. Need someone to take out your aggression on? Well, Dead Fred is the man!
DEAD FRED PEN HOLDER
XYZ COMPUTER DESK This is for the neatfreaks among us. However sleek a computer or laptop is, wires inevitably create an unsightly mess. But the XYZ computer desk is – quite literally – the computer itself, doing away with cable tangles in a compact and shiny Mac-inspired design. Computer parts and cables are tucked within the desk and the CDRW/ DVD, USB port and hot keys are located on the side. When it’s time to upgrade, simply ﬂip the lid up and replace the parts. Neat.
Price: €9.99 www.thinkgeek.com
MYVIC ELECTRONIC CIGARETTE This revolutionary device can be used anywhere where traditional smoking is forbidden. It completely simulates the sensation of smoking ordinary cigarettes, even producing "smoke" that is actually water vapour. The Electronic Cigarette uses nicotine reﬁlls, which come in different nicotine concentrations. Each reﬁll contains nicotine and propylene glycol. When "smoked", 98 percent of the nicotine contained in the inhaled mist is absorbed, leaving only propylene glycol which is exhaled and disappears in seconds – making it harmless to people around you, so no more passive smoking. That's it – new year's resolution, take up smoking. Price: €39 www.myvic.co.uk
ASTON MARTIN ONE-77 Excuse me, Mr Bond, your new car has arrived Okay, now this is the ultimate in art and engineering – the Aston Martin One-77. The UK automaker's latest ﬂagship model is a rare beauty with only 77 of these wonders made. It boasts a 7-litre V12, 700hp, carbon ﬁbre chassis with handcrafted aluminum body. It has the performance to match, going from zero to 60 in just 3.5 seconds, and a top speed of over 200 mph. Q would approve ... and at only USD1.9million – “I’ll have two”. Coming soon: check out www.one-77.com for details.
LIGHT EMITTING WALLPAPER As far as walls go, this one’s a bright spark. Designed by Dutch designer Jonas Samson, this luminescent wallpaper glows with subtle shapes to bring life and whimsy to your walls. Incorporated with revolutionary sheetlike optics, this wallpaper is part art, part high-tech wonder. Each sheet can cover a maximum area of 300 cm to 150 cm and you can have your own custom designs imprinted on the paper. Prices vary www.jonasamson.com
| January 2009 49
Credit Nguyen Vu Khoi and www.discoverphuquoc.com
January 2009 |
From left: Bal Sao Beach; a ﬁshing boat off the coast of Bal Thorn beach; a crab farmer shows off his catch
THEY call it the Emerald Island – and it’s easy to see why. Surrounded by the warm turquoise waters of the Gulf of Thailand, Phu Quoc is an Eden of pristine coastlines, lush rainforests, rugged mountains and abundant wildlife. Just an hour’s ﬂight from the frenetic energy and clamour of Ho Chi Minh City, Phu Quoc is located just off the south-western tip of Vietnam and 15 km from the Cambodian coast. The tear-dropped shaped island – once home to sea cucumber traders, French missionaries and rubber plantations – is Vietnam’s largest offshore territory and home to some of the world’s
most beautiful and secluded beaches. Blessed with a glorious coastline, the island inland boasts majestic sandstone ridges that span it from north to south – giving Phu Quoc its other moniker of “99 mountains”. Abundant rain gives life to forests that cover most of the island, making it a haven for exotic wildlife and plant species. For all its beauty, this tropical island remains relatively under the tourist radar and sees little of the human trafﬁc of other getaways such as Phuket. But ambitious plans by the Vietnamese government to develop the island into a major eco-destination may change the idyllic pace. While this may be good for the economy, some environmentalists are concerned about the impact an inﬂux of tourists and unchecked development will have on this largely untouched island haven.
Dominic Scriven OBE – the Director of Dragon Capital – has co-founded Wildlife At Risk (WAR) to help protect this tropical island eco-paradise BY SHERALYN TAY
| January 2009 51
PHU QUOC PROTECTORS One organisation working to help balance the demands of progress with the preservation of the Island’s natural resources is Wildlife at Risk (WAR), a Vietnam-based non-government organisation co-founded by Englishman Dominic Scriven, OBE, and conservationist, Julia Shaw. As the Director of Dragon Capital – the largest and among the most experienced asset managers in Vietnam – Scriven explained to CUBIC that the decision to be a part of conservation efforts in Vietnam was based on a desire to give back and be a part of his adopted country. “Everybody, wherever they live, has to be part of their society. For me I choose to be part of Vietnamese society and I want to give back to be part of Vietnam. There are any numbers of ways to give back, but I choose to give back to the wildlife and ecology, which is extremely rich.” With overriding priorities in the fast developing country, such as economic progress and escape from poverty, issues such as wildlife and ecological conservation tend to be overlooked, noted Scriven. He acknowledged that it is crucial that conservation work takes place now, in a more proactive rather than reactive manner. “In Britain, there are virtually zero areas that have not been trodden over and massacred,” he said, “A place like Vietnam still has its virgin areas and the natural tendency for humanity is to exploit these resources. Phu Quoc has not been exploited yet, but it will be, and the question is how to manage this process.” Being an isolated land mass means that Phu Quoc is somewhat protected from external forces and has its own unique ecology of rare plants and animals. For example, a species of dog called the Phu Quoc ridgeback is found only on the island. But the island is also vulnerable at the same time precisely because of its special and delicate island ecosystem. CEO of WAR, Nguyen Vu Khoi, explained that the island has a wide range of habitats. From swampy mangroves to sandy beaches and arid dry highlands, forests on the varied terrain of the island are a study in diversity. Coconut and palm trees, and other coastal species thrive on the sandy soils of the beaches, while mangroves
Left from top: WAR at work rehabilitiating the Dao Long; A Phu Quoc gem – the Paphiopedilum callosum, an orchid listed as an endangered species; a golden dragonﬂy recorded among WAR’s insect surveys
January 2009 2008 22 November 52 | |
“It’s a place that speaks to my spirit. From there comes the willingness to commit to the island.” and other wetland trees inhabit the swampier mangrove areas, and hardy conifers take root on the rugged slopes of the island’s loftier territories. These various forest habitats support an even greater abundance of ﬂora and fauna, from rare plants to butterﬂies, insect life, reptiles and birds. But little is understood about the island’s great range of natural reserves, and plant and animal inhabitants. In acknowledgement of the value of the island’s biodiversity, Vietnamese authorities such as the State Forest Enterprise, which has managed Phu Quoc’s forests since 1975, have upgraded Phu Quoc’s status from Nature Reserve to National Park. “(It had) the objective of conserving the natural resources of the island and protecting the endemic gene pools of the Phu Quoc forests,” said Khoi, a trained forester and expert in conservation biology.
TREASURES OF THE EARTH Apart from its conservation activities, WAR also has a vital presence in Vietnam because of its awareness and protection programmes, noted Chris Jones, Acting Trustee of WAR and one of its valued sponsors. “As the only organisation of its kind in the southern region of Vietnam, the NGO also acts as a role model for other local conservationist activities,” he added. On a national level, WAR has initiated protection work, cooperating with local authorities and national park rangers to put a curb on wildlife poaching in Vietnam that fuels the illegal wildlife trade. Awareness work in the form of picture postcards and books featuring the island’s wild creatures and plants, and a butterﬂy reserve on Scriven’s Mango Bay ecoresort also serves to educate and cultivate an appreciation of the rich and valuable diversity of the Island. For the past two years, WAR has been undertaking studies to bridge the knowledge gap and document the natural wonders of Phu Quoc. Endorsed by authorities, WAR’s studies have unearthed some great ﬁnds on the island, including rare and beautiful orchids. One discovery was a valuable and heavily traded slipper orchid species called Paphiopedilum
callosum, a stunning purple and white ﬂower that is listed as an endangered species. WAR’s plant surveys have also recorded two more orchid species never seen before on the Vietnam mainland – the Malaxis calophylla and Aphyllorchis montana, two rare orchids that bloom in tiny and delicate blossoms. “These discoveries have been absolutely extraordinary; nobody knew that we would ﬁnd such species (on the island),” said Scriven. According to Khoi, “Additional surveys of insects, reptiles and ﬁsh are also proving ‘fruitful’.” They are uncovering more new species on the island such as dragonﬂies, the snake-like Banna Caecilian and the Olive Tree Skink.
FINDING A BALANCE Environmental work aside, WAR has also been bridging the gap between preserving natural resources and economic development. Scriven noted that, while the idea of sustainable development is recognised as being a good thing, “there are different understandings of what sustainable development actually is; the issues are different across countries and cultures”. “In Phu Quoc, we had to ﬁnd a means of livelihood that is suitable for the local people and sustainable for the environment.” Other creative ways to provide sustainable livelihoods have been to farm butterﬂies and breed rare plants, said Scriven. One WAR project is to rehabilitate a locally endangered broad-leafed plant species known as Dau Long, or the Dipterocarpus intricatus. Another has been to support farmers in the transition from ﬁshing to the sustainable cultivation of mud and swimmer crabs. It’s not an easy task, said Scriven, but one that is worth trying as it provides gainful employment and sublimates activities away from environmentally harmful occupations such as overﬁshing, which is already wreaking havoc on marine populations in Phu Quoc and many parts of Vietnam. In a way, Scriven’s commitment to managing a balance of long-term economic growth with responsible activity is not something new to
him. His investment ﬁrm, Dragon Capital – which manages around USD2 billion of funds in Vietnam – is one of the leaders in socially responsible investing (SRI), making decisions on investment based not only on returns but also its social good. SRI is a booming market in both the US and Europe. According to the Report on Socially Responsible Investing Trends, assets in such portfolios climbed to USD2.71 trillion in 2007, up from USD2.16 trillion in 2003 in the United States. Research estimates by ﬁnancial consultancy Celent predict that the SRI market in the US will reach USD3 trillion by 2011. Ethical investment in Europe has also reached signiﬁcant amounts, with the SRI market growing from USD1 trillion in 2005 to USD1.6 trillion in 2007. According to the Ethical Investment Research Service (EIRIS), £9.8 billion is invested in ethical and environmental investment funds in the United Kingdom alone. But Scriven noted that the assets class of SRI has still not yet proved itself commercially. “One of the reasons is that the cost of development
and pollution is not properly priced,” he said. Nevertheless, “there are people in the world who will invest not necessarily because of investment merit but because of their personal commitment. They wish to be responsible. Dragon Capital is one of those companies that are trying to learn to be responsible.” It’s a movement that’s taking off as global citizens seek to address and make an impact – albeit indirectly – on social issues, such as environmental concerns, consumer protection, human rights and social equality. Just like his reasons for giving back to Vietnam and its wildlife, ethical investing is an issue of playing a responsible role in the society in which one lives. “Business and success are increasingly judged not just by economic and ﬁnancial means, but by their corporate responsibility,” said Scriven. In Phu Quoc, the work may be painstaking and the road ahead long, but WAR is still dedicated to preserving its natural heritage for the future of Vietnam. It’s also a labour of love. Scriven sums it up poetically, “It’s a place that speaks to my spirit. From there comes the willingness to commit to the island.”
Dominic Scriven, Director of Dragon Capital
| January 2009 53
KIRINDA, A COMMUNITY REBUILT
With vision and compassion, Colliers International rebuilt the village of Kirinda — winning awards for excellence in sustainable building and healing a community torn by disaster BY SHERALYN TAY THE CHAOS lasted mere minutes. But when the devastating Boxing Day tsunami in 2004 – triggered by a massive undersea quake – unleashed its deadly force on the coasts of Asia, it wiped out entire towns and villages in Indonesia, South India and Thailand, and claimed an estimated quarter of a million lives. The low-lying ﬁshing town of Kirinda, located on the southern end of Sri Lanka, was defenceless against the 30-metre-high onslaught of raging water and more than 200 of its people perished in what is now called one of the deadliest natural disasters in modern history. But the residents of Kirinda have rebuilt their town – and their lives – thanks to a generous fund set up by Colliers International. Moved by images of destruction and driven to reach out to those whose lives had been so tragically affected by the tsunami, Colliers International announced the establishment of a US$1 million trust just days after the disaster to design and construct 67 homes for displaced families in the community. At the helm was Philip Bay, the Regional Director of Colliers Southeast Europe, who had proposed the ambitious project. Without a clear plan or professional track record in disaster relief, but guided by a sense of doing what was right, Bay ﬂew to Sri Lanka and, in consultation with the central government, made the decision to help Kirinda, a minority community of Malay Muslims in largely Buddhist Sri Lanka. It was a move to ensure that help was distributed evenly to all the victims. In the same spirit, world-renowned Japanese architect Shigeru Ban took on the project – despite offers of 10 other projects – stating that “it was for a smaller community and a minority group in a more difﬁcult situation”. It was to be the beginning of a three-year project that has won admiration and awards for its high standards, sustainable masterplan and holistic consideration of the community’s
54 January 2009 |
needs. Working with the senior advisors of President Mahinda Rajapaksa, the Colliers Kirinda project has also become a benchmark for other organisations, such as the United Nations, the US Agency for International Development (USAID) and numerous NGOs. Far from hastily built emergency structures to provide for the most basic of needs, Shigeru Ban Architects – hailed by TIME magazine as one of the Top 100 innovators of the 21st century – designed sturdy and sustainable residences suited to the needs and climate of the town and its residents. Researching the materials, styles and history of residential construction in Sri Lanka, Shigeru Ban Architects resolved to use traditional practices suited to tropical climates. Each spacious house has two bedrooms, two rooms of living space, a roofed court, a kitchen and a bathroom – ample space for the families of the community. “I am so lucky to receive a mansion like this,” said one resident, M.R. Riyvaldeen, a ﬁsherman whose house and boat were completely destroyed in the ﬂoodwaters. Created from natural and renewable material that came from the community’s own tree farms, wood from rubber trees, coconut palms and teak, together with sun-dried earthen
blocks, the spacious and airy homes have been built to breathe in the heat, making them comfortable and liveable even in the searing weather of the dry seasons. Previously without power, running water or sanitation, the new homes have hydro-electric energy, water and septic tanks. The community even has bragging rights to the ﬁrst fully solar-powered street lighting ever introduced in Asia. Recognising the empowering value of grassroots participation, the project team made sure that Kirinda residents were actively involved in the rebuilding process, holding ﬁve town hall meetings to gain their feedback and insight, as well as listen to concerns and needs. Because of this personal relationship and communication, the Colliers project is the only one to have masterplanned the community based on original property lines and according to genuine title deeds. The village was also restored to its original layout, with the mosque as the focal point. Interior partitions were included in the homes to allow gender separation according to the level of religious orthodoxy of the families. Villagers themselves pitched in to help in the construction of the new homes. Project Manager Anthony Benjamin also noted, “While a majority of post-tsunami projects were implemented away from the original dwellings and relocated, Colliers’ Kirinda project was done in the exact location, thereby enabling the community to get back to their day-to-day activities.” More importantly, rather than just being a one-off charity project, Colliers continues to provide infrastructure facilities and sustainable programmes, he added. To help the community be more self-sufﬁcient and resilient, Colliers has implemented income-generating projects that include the participation of the community’s women. Microﬁnance has also been arranged to seed fund small businesses.
Opposite page: A nighttime view of the Kirinda homes Right: Philip Bay Regional Director, Colliers Southeast Europe (in garland), and Kirinda Trust trustees Charith Gunatilleke and Pradip Jayawardane at the handover ceremony on April 2006
From destruction to renewal. Kirinda residents now have spacious, sturdy – and award-winning – homes in which to rebuild their lives
To make the most of the site’s scenic beauty and tourism potential, as well as provide a sustainable income stream, a Shigeru Bandesigned eco-friendly boutique hotel staffed by villagers has been built. For its design, the Kirinda project has won three prestigious awards – a Special Tribute and the Best Residential Development award at the MIPIM real estate awards in Cannes in 2007, and, more recently, winner of the 2008 Urban Land Institute Awards for Excellence: Asia Paciﬁc. Said Kirinda ﬁsherman M.T. Ramis, 60, “This is much, much more than I ever expected.”
More information can be found at www.collierskirinda.com
COLLIERS HONG KONG
AWARDED FOR CHARITY WORK FROM bringing joy to disadvantaged children to raising funds for charities and holding community activities, Colliers has long been a prominent player on the charity and community scene in Hong Kong. In the past few years, Colliers Hong Kong has held at least 14 events for community organisations. These included Service Day in Ocean Park for the Comfort Care Concern Group – a hospice-care charity – and carnivals for the children’s charity TREATS. For its commitment to philanthropy and the community, the Colliers Hong Kong ofﬁce was awarded the Caring Company Logo by the Hong Kong Council of Social Service (HKCSS) for the ﬁfth consecutive year in May 2008. The scheme, which has been running for six years, recognises good corporate citizenship, and aims to raise public awareness of the companies and the organisations that have contributed to a caring community.
Speaking at the award ceremony, HKCSS Chairperson, the Hon Bernard Chan, expressed appreciation for the companies in the Caring Company Scheme. “To look into the future, Hong Kong society is facing all sorts of gradual, longterm challenges. We need new thinking and new concepts to mobilise all sectors to tackle them collectively,” he said. Colliers Hong Kong was one of the companies and organisations commended for their contribution to the community.
According to Colliers, the recognition of its contribution to Hong Kong gives a sense of satisfaction to the company, as well as the staff who have participated. “It also represents our important role in caring for society. The recognition also gives us encouragement to continuously make donations to charity and help those people who are in need,” said Piers Brunner, Chief Operating Ofﬁcer, Asia and Managing Director, Hong Kong. “It is a motivation to further enhance our quality of social service.” Moving forward, Colliers is committed to doing more good work and is in the process of establishing a mentorship programme administered by a local charity that will address life skills for children, such as ﬁnancial wisdom and career management.
From left: Embrace the Difference Charity Event. Service Day at Ocean Park
| January 2009 55
RED STATE, REAL ESTATE
In the visionary words of BARACK OBAMA, “it is our time” – and what a time it’s been for both the United States and the world. Leaders within the real estate industry recognise the plethora of problems, crises and tough decisions facing the 44th president, and they’re preparing for changes in 2009. Consultant CHRIS LEE shares how the outcome of the 2008 presidential election could impact the real estate industry – and what some insiders are doing to prepare themselves and their businesses.
56 January 2009 |
THE CHALLENGES AHEAD for the president are daunting and could bring a dose of reality to pre-election rhetoric and promises. For many real estate professionals, who has won is less important than what decisions will be made. To prepare for the unknown, real estate leaders and professionals at all levels are taking strategic and tactical steps now so that the impact and potential legislation of a Democratic president and a Democrat-controlled Congress in 2009 and beyond are eliminated or dramatically reduced. Here are some areas of growing concern for the US real estate industry after a historic election year.
TAXES: With the Democratic win, the real estate industry could be impacted signiﬁcantly if Congress enacts the election-year platform and promises to revise the carried interest deduction and increase the capital gains rate. Many in the industry have cashed out in 2007 or have monetised some or all of their assets rather than take a “hope certiﬁcate” chance on a Republican victory. Any tax increases will have a negative impact on gross domestic product (GDP) growth. IMMIGRATION: It now appears likely that employers, not the federal government, will become an unofﬁcial extension of the US Citizenship and Immigration Services. Many real estate companies that previously did not verify employees’ citizenship – or mandate their service provider to do so – are doing so now. There appears to be an agreement that employers are going to have an increasing burden to verify employees’ citizenship. Immigration issues could require more multifamily owners/operators to have bilingual on-site personnel. Watch for a wave of outsourcing services that will be used to verify citizenship.
to reduce trade (i.e. “revisit” NAFTA and GATT) and “support” the American worker (unions), and real estate investors believe that, despite the preelection rhetoric, American consumers will not be willing to purchase goods that are two to three times more expensive than foreign goods. Therefore, port and air cargo activity will remain strong.
GREEN: President Obama supports green initiatives, and real estate investors are betting that growth in and around colleges, universities and green technology corridors will increase signiﬁcantly as he support billions of dollars in clean energy investment. However, a growing number of real estate owners are concerned that Democratic proposals may dramatically slow redevelopment activity. Such proposals are purported to include taxing building environmental inefﬁciencies and non-sustainable construction materials, taxing or adding fees to new development projects and potentially taxing tenants to encourage energy savings and recycling.
TORT REFORM: The continued problem of litigious actions is likely to remain in the US. Frivolous lawsuits can slow real estate growth. Real estate owners are increasingly using third parties to avoid the threat of lawsuits. Watch for a wave of new legal hires within real estate companies to protect owners/operators.
LABOUR: Real estate companies were betting on changes to the employment law (regardless of election results). Human resource directors are preparing for a tsunami of new legislation and regulations. Issues will include for-cause terminations, CEO compensation and privacy matters such as ownership of e-mail and Internet governance. Re-writing employee handbooks will be fairly commonplace.
Real estate leaders are expecting a rise in funding for affordable housing and various community revitalisation grant programmes. The current focus is on establishing the skill set, capabilities and resource partners necessary to capitalise on the likely dramatic increase in ﬁnancial aid for urban housing. Service companies are now considering hiring urbanhousing and mixed-use specialists to capitalise on this opportunity.
CREDIT: Resolution of the credit crises will not occur until 2010 or beyond. Most real estate leaders are very supportive of the chairman of the Federal Reserve System, Ben Bernanke, and expect him to continue until his term expires on January 31, 2010. The current bet is that President Obama will appoint his own chairman. TRADE: The real estate industry, particularly the industrial/warehouse sector, relies on trade to grow. President Obama has indicated his preference
HEALTH CARE: This is the one area in which all real estate professionals and both candidates agree: more money will be available for, and going to, an increased focus on health care, wellness, dietary needs, research and manufacturing of medical devices. Thus, real estate investors are increasing their activity levels in and around areas with a concentration of the pharmaceutical industry, hospitals and health care facilities.
(Please note: Opinions expressed in this article are those of the author and do not necessarily reﬂect the position of CUBIC or Colliers International. CUBIC and Colliers International do not hold any political afﬁliation or intent.) Christopher Lee is President and CEO of Los Angelesbased CEL & Associates, Inc – one of the United State’s premier real estate consulting ﬁrms.
| January 2009 57
OUT AND ABOUT WITH COLLIERS & CLIENTS
L-R: Lina Wong, Mr Lv Nan Ting, Director of Shanghai District Government and Ms Sun Li Yan, Deputy Director of Shanghai District Government at a Shanghai REIW cocktail in December 2008.
R-L: Mr. Liu Ting Jun (CEO, Taikang Real Estate) and Ms. Liu Shu Qin (GM, Taikang Real Estate) with Ms Amanda Gao (MD, Colliers International, Beijing) at a Taikang Financial Tower promotional event on 23 May 2008.
R-L: Ms Maggie Lee (Colliers International, Hong Kong) and Ms Suzi Vujanovic (Australian International School) at Residential Leasing Department's International School Forum.
R-L: Mr David Lindsay (Johnson Controls) and Mr Vincent Chan (Colliers International, Hong Kong) at the r.e.Design Cocktail Launch.
Colliers International makes its presence felt at an Estate and Finance International Exhibition held from October 31 to November 2 in Hanoi.
Simon Carter with Jun Saa (Robinland) at the r.e.Design Launch, Phillippines.
November 2009 2008 58 January | |
Left: Mr Kaushik Reddy (Associate Director, Colliers International) with associates.
L-R: Andrew Miguel (Petron), Leanie Sales (Associate Director of Consultancy and Valuation), Michele Topacio (SM Investments Corporation) Phillip Ricarte (HSBC), Jen Torres (Manager Commercial Real Estate Advisory Division) at the r.e.Design Launch.
L-R: Mr Graham Sugden, Mr Ben Green, Mr Matthew Wrigley (AMP Capital Investors), Ms Christine Mount (LaSalle Investment Management) and Mr Hugh Menck at Colliers International's Racing and Boozing night in Singapore.
L-R: Dr John Keung (Building and Construction Authority), Mr Dennis Yeo and Mr Calvin Yeo at the r.e.Design launch in Singapore.
L-R: Goh York Lin (Alpha Investment Partners Ltd), Danny Phuan (Alpha Investment Partners Ltd), Tan Boon Leong at Singapore Grand Prix.
L-R: Nick Kearns (AEW Asia), Hugh Menck, Peter Wittendorp (AEW Asia), Laurent Mirepoix (Credit Agricole), David Faulkner at Singapore Grand Prix.
L-R: Evasio Barbero (CEVA Asia Pac), Rimon Ambarchi, Fritz Wyler (AMB), Jamie Horne, Dennis Yeo, Lina Wong at Singapore Grand Prix.
L-R: Hartmut Bauche (Consulate General of Germany), Doris Lam (Colliers International), Paolo Miraglia del Giudice (Consulate General of Italy) at the Colliers International (Guangzhou) Cocktail Party in July 2008.
L-R: May Fung (Colliers International), Calvin Cheung (Regal Harbour) at the annual Colliers International (Guangzhou) Office Cocktail Party in December 2007.
L-R: Paul Mercer (TESCo), Bryan Chan (Colliers International) at the Annual Colliers Guangzhou Office Cocktail Party in December 2007.
Developer Tavekiat Nakosiri (Chatsiri) at a pre-sale event of their DSign Ratchada Condominium at Esplanade, Bangkok.
GlenAsia's Mr Per-Olov Ragfelt (Executive Director), HSH Prince Ticomporn Yugala (Director and Senior Advisor), Mr Roland Svenson (Country Manager) and Mr Patima Jeerapaet (MD, Colliers International Thailand) at the grand opening ceremony of GlenAsia Resort + Residence Thailand.
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CORPORATE JUNGLE Birds flock, fish school, people “tribe.” Here is an excerpt from the Tribal Leadership, which takes a look at how managers can use tribes within an organisation to maximise their profitability and increase productivity. EVERY ORGANISATION is really a set of small towns. If you’re from a small town, think of the people there. If you’re not, think of, as Don Henley sings, “that same small town in each of us.” There are the business executive and the sheriff. There’s the town scandal—the preacher’s wife and the schoolteacher. There’s talk of who will be the next mayor, who will move away, and the price of grain (or oil or the Wal-Mart starting wage). There’s the high school, where the popular kid, the son of the town’s sheriff, throws a party the weekend his father is away. There are the church crowd, the bar friends, the single people, the book club, the bitter enemies. There are also the ones who are the natural leaders, who explain why the party at the sheriff’s house seemed like a good idea at the time and how sorry they are for the beer stains on the carpet. The people are different in every town, and the roles are never exactly the same. But there are more similarities than differences, and the metaphor itself always holds, from companies in Nebraska to ones in New York or Kuala Lumpur. We call these small towns tribes, and they form so naturally it’s as though our tribe is part of our genetic code. Tribes helped humans survive the last ice age, build farming communities and, later, cities. Birds ﬂock, ﬁsh school, people “tribe.” A tribe is a group between 20 and 150 people. Here’s the test for whether someone is in one of your tribes: if you saw her walking down the street, you’d stop and say “hello.” The members of your tribe are probably programmed into your cell phone and in your e-mail address book. The 150 number comes from Robin Dunbar’s research, which was popularised in Malcolm Gladwell’s The Tipping Point. When a tribe approaches this number, it naturally splits into two tribes. Some of the corporate tribes we’ve seen include the high-potential managers of one of the world’s largest ﬁnancial services companies; the doctors, nurses, and administrators of one of America’s most respected healthcare institutions; the research and development division of a mammoth high-tech ﬁrm; the operational executives of a major drug company; and the students of the executive MBA program at the University of Southern California. Tribes in companies get work done—sometimes a lot of work—but they don’t form because of work. Tribes are the basic building block of any large human effort, including earning a living. As such, their
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inﬂuence is greater than that of teams, entire companies, and even superstar CEOs. In companies, tribes decide whether the new leader is going to ﬂourish or get taken out. They determine how much work gets done, and of what quality. Some tribes demand excellence for everyone, and are constantly evolving. Others are content to do the minimum to get by. What makes the difference in performance? Tribal Leaders. Tribal Leaders focus their efforts on building the tribe or, more precisely, upgrading the tribal culture. If they are successful, the tribe recognises them as the leaders, giving them top effort, cult-like loyalty, and a track record of success. Divisions and companies run by Tribal Leaders set the standard of performance in their industries, from productivity and proﬁtability to employee retention. They are talent magnets, with people so eager to work for the leader that they will take a pay cut if necessary. Tribal Leaders receive so many promotions in such a short time that people often spread buzz that they will be the next CEO. Their efforts seem effortless, leaving many people puzzled by how they do it. Many Tribal Leaders, if asked, can’t articulate what they are doing that’s different, but after reading this book, you will be able to explain and duplicate their success. A Tribal Leader many of us know from history is George Washington. His single major contribution was in changing 13 diverse colonies into one people. If we look into what Washington actually did, he built a single identity (measurable by what people said) to a series of networked tribes. One was the afﬂuent class in Virginia society, perhaps fewer than a hundred people. Another was the Continental Congress, originally 55 delegates. The third was the ofﬁcer class of the Continental Army. Each time, Washington led the group to unity by recognising its “tribalness,” by getting its members to talk about what uniﬁed them: valuing freedom, hating the king’s latest tax, or wanting to win the ﬁght. As he built the common cause in each tribe, a mission gelled and they embraced “we’re great” language. Washington’s brilliance in each case was that the man and the cause became synonymous with the leader shaping the tribe and the tribe calling forth the leader. This is how Tribal Leadership works: the leader upgrades the tribe as the tribe embraces the leader. Tribes and leaders create each other.