ASIA’S PROPERTY MAGAZINE - final Magazine SM.pdfEven amid stiff competition and rising costs, Hong...

ASIA’S PROPERTY MAGAZINEJANUARY 2009 | ISSUE 1

INDIAN REALITY Ebbing Favourably - a review of the market

GREEN BUILDINGSMake green work for you

The best of building design

MAKE SPACE FOR LUXURYDesign your dream at Jakarta’s The Keraton

HONG KONG’S LOGISTICS FUTUREHow Goodman paves the way

MIXED-USE DEVELOPMENTSThe best from Beijing and Singapore

CUBIC CoverDec08.indd 1 5/1/09 11:22:08 AM

CUBIC ADS.indd 2 10/22/08 11:47:16 AM

CUBIC ADS.indd 3 10/22/08 11:47:18 AM

ASIA’S PROPERTY MAGAZINEJANUARY 2009 | ISSUE 1

INDIAN REALITY Ebbing Favourably - a review of the market

GREEN BUILDINGSMake green work for you

The best of building design

MAKE SPACE FOR LUXURYDesign your dream at Jakarta’s The Keraton

HONG KONG’S LOGISTICS FUTUREHow Goodman paves the way

MIXED-USE DEVELOPMENTSThe best from Beijing and Singapore

CUBIC CoverDec08.indd 1 5/1/09 11:22:08 AM

CUBICBY COLLIERS INTERNATIONAL

EDITORIAL DIRECTORGAVIN VERCOE

EDITORSHERALYN TAY

DESIGNERJOHNSON LIM

ACCOUNT MANAGERKELVIN GOH

CONTRIBUTORSEDMUND MAK, LIM SAY LIANG,ELIZABETH KERR, NAMRATA KOHLI,WALL ACE CHAN

ADVERTISING ENQUIRESIf you would like to adver t ise in the nex t issue of CUBIC, please contact Gavin Vercoe at Colliers International,+65 62 2 3 2 32 3

CUBIC IS PUBLISHED FOR COL LIERS INT ERNATIONA L BY MEDIACORP P T E LTD, T ECHPOINT # 01- 0 6 / 0 8 , 10 ANG MO KIO S T REE T 6 5 S(5 6 9 0 5 9) . A L L RIGHTS RESERV ED, REPRODUC TION IN WHOLE OR IN PART IS PROHIBITED. COPYRIGHT 2008 © IS HELD BY COL LIERS INT ERNATIONA L . PRINT ED BY KHL PRINTING CO P T E LTD. COLOUR SEPA R ATION BY KHL PRINTING CO P T E LTD.

For all your real estate needs please phone your local Colliers International office.COLLIERS INTERNATIONAL OFFICES – ASIA

MAINL AND CHINABeijing + 8 6 10 8518 16 3 3Chengdu + 8 6 2 8 8 620 212 8Guangzhou + 8 6 20 3 819 3 8 8 8Shanghai + 8 6 21 6141 3 6 8 8HONG KONGHong Kong + 8 5 2 2 8 2 8 9 8 8 8INDIAMumbai +91 2 2 2 351 4 5 0 0New Delhi +91 11 2 3 35 6 620Bangalore +91 8 0 4132 0 320Chennai +91 4 4 2 8 3 6 10 6 4Pune +91 20 2611 4141Gurgaon +91 12 4 4 3 7 5 8 07Kolkata +91 3 3 4 4 0 0 05 0 0INDONESIAJakar ta + 62 21 521 14 0 0JAPANOsaka + 81 6 62 32 0771Tok yo + 81 3 55 6 3 2111

KORE ASeoul + 82 2 674 0 2 0 0 0MACAUMacau + 85 3 2 8 71 3 9 8 8PAKISTANKarachi +9 2 21 52 9 0101PHILIPPINESManila + 6 3 2 8 8 8 9 9 8 8Cebu + 6 3 32 2 3 3 6 42 2SINGAPORESingapore + 65 62 2 3 2 32 3TAIWANTaipei + 8 8 6 2 8101 2 0 0 0THAIL ANDBangkok + 6 6 2 65 6 70 0 0VIE TNAMHo Chi Minh Ci t y + 8 4 8 82 7 5 6 65Hanoi + 8 4 4 2 2 0 5 8 8 8

MICA (P) 2 73 / 0 7/ 2 0 0 8

January 2009 | 02

WELCOME to the fi rst issue of CUBIC, Asia’s Property Magazine – In this issue we

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 fi nancial markets have been thrown into turmoil over the last

months, quality real estate development and activity in Asia will not be stopped.

People still need to work, live and play and those that fi nd creative and effi cient 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 fi t 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 diffi cult fi nancial 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 fi rst edition of CUBIC and look forward to adding

value to your business in 2009.

“We accelerate your success by making our knowledge your property”

Gavin Vercoe

Regional Director – Marketing and Communications

FOREWORD

02-03 Foreword Contents.indd 2 5/1/09 11:26:17 AM

04 09

3020

02 FOREWORD

04 LOGISTICS FUTUREGoodman 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

14 A BEAUTIFUL WAY TO WORK How art works – for Swire

18 MOTORING Audi: a supercar at last

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

34 INDIA REALTY Downturn spells gloom for Indian real estate? Not quite

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

48 GADGETS Fancy your own brewery at home?

50 JEWEL AT SEA 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 REVIEWTribal Leadership

40

14

CONTENTS

03 | January 2009

02-03 Foreword Contents.indd 3 5/1/09 11:26:39 AM

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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 Goodman’s latest projects slake the thirst?

GOODMAN:

BY EDMUND MAK

January 2009 |

SECURING HKLOGISTICS FU

04-07 CUBIC GOODMANS.indd 4 5/1/09 11:28:14 AM

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LOGISTICS FUTURE

THE SCENERY overlooking

Rambler’s Channel in South-

West 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

the water from each other,

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 offi ces 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 identifi ed

warehouse and industrial infrastructure as a key opportunity for them,

and the bustling port city of Hong Kong.

LEFT: Artist’s impression of the Rambler’s Channel city-scape when MGA’s Seaview and Interlink have been completedBELOW: 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 fi gures and historically low warehouse vacancy of 1.3 per cent all underpin the demand for warehouse space in Hong Kong.” Daniel McDonald, Managing Director of Goodman Asia

| January 2009

KUK’S UTURE


THE BATTLE FOR SPACEThe offi ce 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 offi ce and residential space, companies have shifted

some of their offi ce operations out of Central and other pricier districts,

choosing more innovative sites to house operations.

Since industrial property rents historically lagged behind their offi ce and

commercial counterparts in terms of growth, local developers seized on the

cheaper prices, buying existing industrial properties and converting them

into offi ce or commercial buildings to take advantage of high offi ce and

commercial rents.

The Hong Kong government has led the way, relocating some of its

offi ces 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.

ARTIST’S IMPRESSION OF INTERLINK: The new port, bridge and warehousing will help bring a new level of interconnectivity

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.

STONECUTTERS BRIDGE


With Hong Kong being used as a stepping stone into China, combined with

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,

effi cient 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.”

MORE ROOM TO GROWThe 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 greenfi eld 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 reconfi gure them to maximise the gross fl oor 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.

Located on the doorstep of the Kwai Chung Container Port, the

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.

WAREHOUSES FOR THE FUTURESeaview 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 fi rst warehouse/logistics buildings

rated with HKBEAM, and will include a plethora of environmentally friendly

features. Both buildings will feature energy-effi cient glass and light fi ttings,

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 fl oor fi nishes.

A STABLE OUTLOOKEven 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 benefi t 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 fi gures and historically low warehouse

vacancy of 1.3 percent all underpin the demand for warehouse space in

Hong Kong.”

LOGISTICS FUTURE

07

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 boundary-crossing 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 fi rst priority”, providing additional capacity at an overall lower cost.

KWAI CHUNG CONTAINER TERMINAL 10

t

| January 2009

For more information on this developement, please contact Piers Brunner, Managing Director, Colliers International Hong [email protected]


CUBIC ADS.indd 15 12/23/08 11:39:00 AM

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

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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 fi ght 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

effi ciency 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 effi ciency 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

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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 effi ciency 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 Effi ciency

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, “refl ecting worries that pushing too hard, too fast would cause

economic damage”.

He warned that caution has a price. “Today’s ineffi cient buildings require

more power plants. This will needlessly undermine energy security and

damage the environment and the economy for decades.”

LEADING ASIAN DEVELOPERSBucking 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 fi rst 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 eco-

friendly 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 offi ces are one of

the fi rst LEED-rated interiors in the country.

According to Simon Carter, Colliers International’s Regional Head of

Sustainability in the Asia Pacifi c, 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

January 2009 |


11

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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 zero-

energy 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 award-

winning development, which features restored shikumen (or stone gate)

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 fi rst 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.

“The winners in the emerging ‘carbon economy’ will typically be those who prepare early.” Simon Carter, Regional Head of Sustainability, Asia Pacifi c, Colliers International

| January 2009


Another example is the Wuhan Tiandi project, a registered LEED

Neighbourhood Development (ND) pilot project in Hankou, along the

Yangtze riverfront, comprising residential, offi ce, 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-effi cient, 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

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 redefi ning 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 DIRECTIONThere may still be some reticence among developers about wholly

embracing sustainable building, given the higher fi nancial 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 benefi ts – with little or no cost.

“Developers who approach going green as an opportunity to rethink

how they produce buildings often fi nd that such innovation helps them fi nd

cost savings in other places,” said Carter. “On the other hand, developers

January 2009 | 12


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 offi ce 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

say about their occupants and investors. In a 2007 McKinsey Quarterly

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 confi rm 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

benefi ts. For CDL, eco-friendly practices have raised the developer’s public

profi le. Mr Kwek told BT: “Going green equates to value for home buyers,

and enhances our reputation and goodwill.” In terms of fi nancial 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 signifi cantly 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.VOLUTIONGiven 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 ineffi ciencies,” 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 Offi ce if you would like a copy of r.e.Design.

“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

From left: Shanghai Xintiandi, Shui On Plaza

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14 January 2009 |

In the usually staid commercial and retail spaces of Hong Kong, Swire Properties

brings a fresh perspective, a little artistry and flair.

A BEAUTIFUL WAY TO WORK

BY ELIZABETH KERR

14-16 SwireArt.indd 14 3/1/09 11:40:14 AM

ART SCEN

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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 offi ce 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 graffi ti 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 Pacifi c,

one of Hong Kong’s oldest trading companies with roots dating back to the

early 1800s, and whose larger holdings also incorporate aviation (Cathay

Pacifi c), marine services (Swire Pacifi c 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, Pacifi c

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 ARTSwire 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 fi gurative 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 BEAUTYDoes 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 fi rst-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

ANTI-CLOCKWISE FROM LEFT: Transcient, Suspense, The Watcher, Watergarden

15 | January 2009

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ART SCEN

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we see and use in our

businesses.”

Fung says

compliments from

tenants, shoppers and

residents are common.

Swire notably often

commissions pieces for

specifi c spaces, giving

its collection a decidedly

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 fi nancial elements at play, chiefl y 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.

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 diffi cult. 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 offi ce 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 benefi t.”

Danny Lane’s Shan Shui, an outdoor sculpture located at Island East

“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. “Babby Fung , Head of Marketing Island East Swire Properties Limited

16 January 2009 |

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M1nt ad.indd 1 12/5/08 10:38:34 AM

18 January 2009 |

AUDI HAS DONE ITBY GAVIN VERCOE

18-19 Motoring.indd 18 3/1/09 12:36:43 PM

THE FIRST INKLING that Audi may have fi nally

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 fi nal result is a front end with

the ubiquitous Audi grille fl anked 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 fl uid, stiffening the suspension

for certain driving conditions.

Also, when it comes to safety systems, the R8

benefi ts 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.

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

Mo

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19 | January 2009

VITAL STATISTICS

18-19 Motoring.indd 19 3/1/09 12:36:50 PM

Tall, taller, tallest – 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.

TOWERING AMBITIONS

BY SHERALYN TAY

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20 January 2009 |

20-22 Iconic Buildings.indd 20 3/1/09 11:43:56 AM

Left: Taipei 101 Right: Precinct 4 residences

TAIPEI, TAIPEI 101Recalling 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 fulfi l this promise – the tower

was the fi rst 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-of-

the-art technology.

Eight, the number of sections in the tower, represents luck while bamboo

symbolises growth, strength and learning. Even the number of fl oors – 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 fulfi lment, 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 fl oors at once also hold a

Guinness World Record as the World’s Fastest Passenger Elevators.

www.taipei-101.com.tw

MALAYSIA, PUTRAJAYA, PRECINCT 4These 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 fi rst 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 fl oat like a fl eet

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

refl ect the spirit of Malaysia, “which is culturally modern, Islamic and tropical

in nature”. The Italian fi rm 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

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21 | January 2009


HONG KONG, INNOVATION TOWERIn true Zaha Hadid vision, the Hong Kong Polytechnic University’s new

campus extension is a gleaming fl uid 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 fi rst permanent

work in Hong Kong – her fi rst award-winning design for The Peak Club in

Hong Kong was never built. However, the designs that were built – such as

the Vitra fi re station and the Rosenthal Center for Contemporary Art – have

earned Hadid much recognition and respect, making her the fi rst woman to

receive the Pritzker Architecture Prize.

With the same dramatic deconstructionist fl air, 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

DUBAI, WAVE TOWERLike 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 fl ow. 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, energy-

effi cient technology and a purifi cation plant for the tower’s water needs, this

“seascraper” is as green as its blossom-like design. When ready, the 92-fl oor

building will contain offi ces, commercial malls and high-end residences.

www.a-cero.com/

Left: Innovation Towers Right: Wave Tower

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CUBIC ADS.indd 13 12/12/08 10:32:42 AM

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January 2009 |

24-27 CUBIC Kumho-Vietnam.indd 24 5/1/09 11:33:36 AM

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LEFT: Vietnam’s construction sector still rises amid tough times

VIETNA

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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 affi liates, 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 affi liate, 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 profi le, 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 SPOTSLocated in a prime location along the Le Duan Boulevard, the Kumho

Asiana Plaza – consisting of a 21-storey A Grade offi ce building, a

21-storey international hotel, a 32-storey apartment building, and a

trade centre area – will be fl anked by other high-grade buildings such

as Diamond Plaza, the Sofi tel Hotel, the Prudential building, Saigon

Tower and the Metropolitan. It also lies in close proximity to embassies,

shopping areas and the Notre Dame Cathedral.

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.

THE KUMHO

BY SHERALYN TAY

“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

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 non-

permanent member of the United Nations Security Council in 2008.

Even as dire predictions resounded across the world when fi nancial 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

Offi cer 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 fi nancial 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 fi gures bear this out. About half of the US$47 billion in Foreign

Direct Investments (FDI) pumped into the country in the fi rst 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.

A SYMBOL OF COOPERATIONOne 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.

COMMITMENT

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26 January 2009 |

Set to welcome its fi rst guests in 2009, the 350-room

InterContinental Asiana Saigon and its 250 serviced residences will be

managed by InterContinental Hotels and will be the fi rst 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 fi ll 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 fi rst 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 refl ected 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 fi ve 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 fi rst true fi ve-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 fl ourish 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.

As for commercial space, there is a real lack of Grade A offi ces, 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 offi ce space, Jakarta (population, 15 million people) with 4 million sq m

of offi ce 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 fi rst 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 INVESTMENTThe Kumho Asiana Plaza project has not been without its challenges.

The fi rst 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 fi nancial crisis stalled the project – twice.

BELOW: Work in progress at the building siteRIGHT: Artist’s rendition of the completed

Kumho Asiana Saigon


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-to-

date 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 offi ce space, accommodation and apartments would

be an ongoing trend, especially given the infl ux 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 offi ce 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 offi ce buildings, hotels and luxury apartments.” The complex

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, offi ces 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 profi ts tax in the future from the business of

Kumho Asiana Plaza.”

RAISING THE BARKumho 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 fi rst 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 fl oors 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 Asiana-

Vietnam 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 Vietnam-

Korea 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.”

“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

For more information on lease opportunities, please contact Peter Dinning, Managing Director, Colliers International [email protected]

27 | January 2009


Kumho Asiana Plaza Saigon & Kumho E&C present

Grade A Of�ceComing to Ho Chi Minh District 1September 2009

Exclusive Marketing & Management AgentColliers International Vietnam

Tel: (08) 3827 5665Email: [email protected] [email protected]

Grade A of�ce space set amongst a �ve star hotel, serviced apartments and a trade centre.

@colliers.comKp.Singh

CUBIC ADS.indd 5 12/23/08 12:19:10 PM

CUBIC ADS.indd 9 11/17/08 7:23:20 PM

30

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 WITHIA CITY – BUILT FOR WORK,

LIFE AND PLAY

January 2009 |

30-33 Landgent.indd 30 3/1/09 11:52:52 AM

31

LIVING LARGE IN THE CBDThe various residential offerings in the Landgent project means residents have a choice of housing options to suit personal and family needs

THE LANDGEN

T PROJECT

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 offi ce 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.

N

“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

30-33 Landgent.indd 31 3/1/09 11:53:08 AM

THE LANDGEN

T PROJECT

32

A DESIGN FOR THE TIMESRather 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 profi le and premium of the

entire development, said Wang. Each element – retail, transport, offi ce space

– can leverage the strengths of the other, adding more value to the project,

he added.

“For example, below the offi ce 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 fi rms housed in the

offi ce towers. And the Beijing City International School (BCIS), the largest

international school located in Asia, is also close by.

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 effi cient way of engineering

people’s daily time schedule,” he said.

LANDGENT CHATEAU (乐成公馆)These fi ve high-rise residential buildings offer spacious and luxurious

living and, with only 484 suites in all, lots of privacy,

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

January 2009 |

30-33 Landgent.indd 32 3/1/09 11:53:42 AM

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.”

THE TALENT DRIVEIn the past few years, many have been attracted to China for its unrivalled

opportunities and the rate of growth. Before the global fi nancial slowdown

in 2008, China’s and its key cities enjoyed rosy growth. In Beijing, the past

fi ve years have seen great economic strides. In 2001, Beijing’s per capita

GDP stood at US$3,200 but, by 2007, that fi gure 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 refl ected 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 fi nancial 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 fi rst 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.”

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

“Developments such as the Landgent in Beijing will allay many fears about relocation and willprovide a ‘comfortable and familiar zone’ for overseas migrants to adjust to their new home.” Tim Hird, Managing Director of Robert Half Singapore

33 | January 2009

For more information on Landgents Developements, please contact Amanda Gao, Managing Director, Colliers International [email protected]

30-33 Landgent.indd 33 3/1/09 11:54:08 AM

34 January 2009 |

34-37 India Realty.indd 34 3/1/09 11:55:14 AM

BY NAMRATA KOHLI

35

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.

IND

IAN

REALTY

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 fi rst 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

fi nancing with slashed interest rates between

2003 and 2007 as banks entered a race to win

more customers. With cheap borrowing came

heightened speculative investments, artifi cial

escalation of housing prices and an oversupply

of housing in some segments.

Add to this soaring infl ation, surging oil

prices and increasing construction costs – it all

signalled an unsustainable boom headed for

trouble. And then Wall Street’s fi nancial 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 confi dence 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


Destin

atio

ns

36

“It’s a place that speaks to my spirit. From there comes the willingness and commitment to the island.”

THE SILVER LININGHowever, 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 fi nancial

institution, which has a big home loan division.

Satish Magar, Chairman and Managing

Director of Magarpatta Township Development

and Construction Company Limited, is taking

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.”

BANKING ON THE TIERSMagar 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,”

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

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.

January 2009 |


IND

IA

37

RESIDENTIAL HOPESThe 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 fi nally

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 confi dence 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 fl ats fi t 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, offi ces 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

fi rst planned township of its kind in India,

said Magar. Employing an integrated all-in-

one 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.”

Magarpatta Township

| January 2009

For more information on the India Market, please contact Joe Verghese, Managing Director, Colliers International Mumbai.


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40 January 2009 |

ADVENTURES IN

SPACENo walls; No cells; No gridlock – life’s new at The Keraton

BY LIM SAY LIANG

40-43 Keraton.indd 40 5/1/09 11:43:23 AM

41

LEFT: Artist’s impression of possible living space overlooking Jakarta’s CBDBELOW: Artist’s rendering of Plaza Indonesia Complex

LUXU

RY LIVING

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 offi ce 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 fi rst

residential tower. We have to have the best – the best trends and lifestyle

for high society,” said Muskita. But there were no fi tting projects on which

to model their vision, she recalled. This meant coming up with something

completely new.

Being fi rst 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

40-43 Keraton.indd 41 5/1/09 11:43:30 AM

LUXU

RY LIVING

42

THE ESSENCE OF NOTHINGA 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 specifi c group of affl uent

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

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 refl ection of a lifestyle, how open-plan

spaces and other means of defi ning ‘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 fi tting out

their shells, it’s not uppermost on their minds.

“Most of them are quite excited because it will be the fi rst 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 affl uent tend to have specifi c ideas. They will not

settle for anything less – or different.”

“Our goals,” said Laurence, “were to ensure that each apartment has

infi nite 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 fl oors. For privacy, zoned elevators. For commuting

Jakarta’s gridlock, an adjacent helipad. At the pool deck on the 6th fl oor,

Keraton residents will also have private access to Grand Hyatt Jakarta.

SERVICE STANDARDSPIR, which also undertook the development of the fi ve-star hotel, reached an

agreement with its former charge to manage The Keraton’s 68 penthouses and

Site plan of Plaza Indonesia Complex

January 2009 |

40-43 Keraton.indd 42 5/1/09 11:44:07 AM

43

20 serviced apartments. A personal butler, in-room spa treatments and round-

the-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

offi ce tower, a world-class shopping centre and a world-class hotel. This

defi nitely places the property at a premium, particularly in Jakarta where

people can spend a lot of time stuck in traffi c.”

It might be PIR’s fi rst venture into residential development but its track

record speaks volumes, said Colliers’ Salanto, as Plaza Indonesia is a

“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 fl agship stores in Indonesia. Think Gucci, Lanvin, Prada.

“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 VEINIf 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 defi nitely 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 defi nition, a penthouse is

on the top fl oor, solely on the top fl oor.”

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 redefi ned”, 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 fi ts 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 fi ne

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.”

Artist’s impression of a possible “bedroom”

“(The Keraton buyers) are quite excited because it will be the fi rst time they can design their own homes. They have the freedom to do anything they want.” Dinna Muskita, General Manager, The Keraton

| January 2009

For more information, please contact Mike Broomell, Managing Director, Colliers International [email protected]

40-43 Keraton.indd 43 5/1/09 11:44:12 AM

44

North facade of the UED BIZHUB

UED

BIZH

UB

January 2009 |

HUBBING UNIT

44-47 CUBIC UEBizHub.indd 44 5/1/09 11:35:34 AM

BY SHERALYN TAY

45

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.

UED

BIZH

UB

THE BEATING HEART of any economy is in

its fi nancial 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 effi ciency

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 fi nance 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 BUSINESSA 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 signifi cantly, it will also include

a 300-room business hotel – the fi rst business

hotel and serviced apartments in the area – as

well as offi ce 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

TTED


46

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

looking for asset light alternatives for their

operations.

The vision for Changi Business Park is for it to

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, offi ces 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,

and light shelves to reduce heat have also been

planned into the design.

THE NEW CBDThe 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

fi nancial-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 offi ce space that

Artist’s impression of an overview of the completed UED BIZHUB

January 2009 |

UED

BIZH

UB


Artist’s impression of the completed UED BIZHUB

“With the recent real estate boom and the tremendous speed at which CBD rental prices are escalating, many fi nance-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

A bird’s-eye view of the development

has seen rental prices skyrocket in the prime

commercial areas of the Shenton Way and Raffl es

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 fi nancial sectors, particularly back-of-

house operations and information storage. “We

will also be targeting overseas multi-national

corporations who are looking for large seamless

fl oor plates and with business park specifi c

technical needs and requirements,” said Liew.

The integrated facilities mean that business

travellers benefi t too. The short-term business

traveller in town for a whirlwind industry

seminar can fl y 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

fl ying back home. And this does not need to be

done in the pricier CBD area – saving costs for

exhibition organisers and their partners.

THE MICE PLAYGROUNDThe 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 confi rmed in 2009 alone.

According to Michael Tay, Director

of Operations, at Meetings Professionals

International Asia Pacifi c, 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 offi ces there.”

UED

BIZH

UB

47 | January 2009

For more information on UED BIZHUB, please contact Dennis Yeo, Managing Director, Colliers International Singapore.


48 November 2008 |

GADGETS- for the person who hhas everythinggg

Gad

gets

DIGITAL WATERPROOF CAMERATechnology 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 fl at 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 119www.thinkgeek.com

AK ICE TRAYHave 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!

Price: USD 15www.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

AUTHENTIC GUINNESS® HOME PUBThere 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 fi rst 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 250,000www.neimanmarcus.com

THE TITANIUM SPORKEvery 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 8.99www.thinkgeek.com

January 2009 |

BY GAVIN VERCOE

48-49 Gizmos.indd 48 3/1/09 12:12:13 PM

Gad

gets 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 fl ip the lid up and replace the parts. Neat.

Price: €1 943.00 (excluding taxes and shipment)www.dddxyz.com

DEAD FRED PEN HOLDERWe 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!

Price: €9.99 www.thinkgeek.com

LIGHT EMITTING WALLPAPERAs 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 sheet-like 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 varywww.jonasamson.com

49

LIGHT EMITTING WALLPAPERAs far as walls go, this one’s a bright

ASTON MARTIN ONE-77Excuse 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 fl agship model is a rare beauty with only 77 of these wonders made. It boasts a 7-litre V12, 700hp, carbon fi bre 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.

| January 2009

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 watervapour. The Electronic Cigarette uses nicotine refi lls, which come in different nicotine concentrations. Each refi ll 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: €39www.myvic.co.uk

48-49 Gizmos.indd 49 3/1/09 12:12:24 PM

JEWEL AT

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dit

Ngu

yen

Vu

Kho

i and

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w.d

isco

verp

huqu

oc.c

om

PHU QUOC

50 January 2009 |

50-53 DestinationsPhuQuoc.indd 50 3/1/09 12:14:03 PM

BY SHERALYN TAY

51

From left: Bal Sao Beach; a fi shing boat off the coast of Bal Thorn beach; a crab farmer shows off his catch

Dominic Scriven OBE – the Director of Dragon

Capital – has co-founded Wildlife At Risk (WAR) to help protect this tropical island eco-paradiseT SEA

DESTIN

ATION

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 traffi c 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 infl ux of tourists and unchecked

development will have on this largely

untouched island haven.

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 fl ight 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 off-

shore territory and home to some of the world’s

| January 2009


Destin

atio

ns

22 November 2008 |

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 fl ora and fauna, from rare

plants to butterfl ies, 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 EARTHApart 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

butterfl y reserve on Scriven’s Mango Bay eco-

resort 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 fi nds on the island,

including rare and beautiful orchids. One

discovery was a valuable and heavily traded

slipper orchid species called Paphiopedilum

“It’s a place that speaks to my spirit. From there comes the willingness to commit to the island.”

PHU QUOC PROTECTORSOne 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 dragonfl y recorded among WAR’s insect surveys

52 January 2009 |

DESTIN

ATION

S


callosum, a stunning purple and white fl ower

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

fi nd such species (on the island),” said Scriven.

According to Khoi, “Additional surveys of

insects, reptiles and fi sh are also proving

‘fruitful’.” They are uncovering more new

species on the island such as dragonfl ies, the

snake-like Banna Caecilian and the Olive Tree

Skink.

FINDING A BALANCEEnvironmental 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 fi nd 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 butterfl ies 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 fi shing 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 overfi shing, 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 fi rm, 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 fi nancial

consultancy Celent predict that the SRI market in

the US will reach USD3 trillion by 2011.

Ethical investment in Europe has also

reached signifi cant 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 fi nancial 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

53

DESTIN

ATION

S

| January 2009


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 fi shing 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 fl ew 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 diffi cult 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

COLLIERS CA

RES

54

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 fi rst 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 fi ve 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-suffi cient and resilient, Colliers has

implemented income-generating projects that

include the participation of the community’s

women. Microfi nance has also been arranged to

seed fund small businesses.

BY SHERALYN TAY

KIRINDA, A COMMUNITY REBUILT

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 fi sherman whose house and boat were

completely destroyed in the fl oodwaters.

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

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

January 2009 |

54-55 Colliers Cares Kirinda.indd 54 3/1/09 12:15:00 PM

55

To make the most of the site’s scenic beauty

and tourism potential, as well as provide a

sustainable income stream, a Shigeru Ban-

designed 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 Pacifi c.

Said Kirinda fi sherman M.T. Ramis, 60, “This

is much, much more than I ever expected.”

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

COLLIERS CA

RES

COLLIERS HONG KONG AWARDED FOR CHARITY WORKFROM 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 offi ce was

awarded the Caring Company Logo by the Hong

Kong Council of Social Service (HKCSS) for the

fi fth 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.

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

Offi cer, 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 fi nancial wisdom

and career management.

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, long-

term 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.

From destruction to renewal. Kirinda residents now have spacious, sturdy – and award-winning – homes in which to rebuild their lives

From left: Embrace the Difference Charity Event. Service Day at Ocean Park

More information can be found at www.collierskirinda.com

| January 2009

54-55 Colliers Cares Kirinda.indd 55 3/1/09 12:15:05 PM

CUB

IC WO

RLDVIEW

56

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.

BLUESTATE, RED STATE, REAL ESTATE

January 2009 |

56-57 CUBIC Worldview.indd 56 3/1/09 12:19:05 PM

57

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 signifi cantly 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 certifi cate” 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 unoffi cial 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.

HOUSING: 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 fi nancial

aid for urban housing. Service companies are now considering hiring urban-

housing 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

to reduce trade (i.e. “revisit” NAFTA and GATT) and “support” the American

worker (unions), and real estate investors believe that, despite the pre-

election 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 signifi cantly 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 re-

development activity. Such proposals are purported to include taxing building

environmental ineffi ciencies 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.

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 refl ect the position of CUBIC or Colliers International. CUBIC and Colliers International do not hold any political affi liation or intent.)

Christopher Lee is President and CEO of Los Angeles-based CEL & Associates, Inc – one of the United State’s premier real estate consulting fi rms.

| January 2009

56-57 CUBIC Worldview.indd 57 3/1/09 12:19:59 PM

November 2008 |

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.

Colliers International makes its presence felt at an Estate and Finance International Exhibition held from October 31 to November 2 in Hanoi.

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.

Left: Mr Kaushik Reddy (Associate Director, Colliers International) with associates.

Simon Carter with Jun Saa (Robinland) at the r.e.Design Launch, Phillippines. 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.

58 January 2009 |

OUT AND ABOUT WITH COLLIERS & CLIENTS

58-59 people section.indd 58 5/1/09 11:38:49 AM

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.

59 | January 2009

CU

BIC

PEOPLE

58-59 people section.indd 59 5/1/09 11:39:07 AM

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 fl ock,

fi sh 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 fi nancial 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 fi rm; 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

infl uence is greater than that of teams, entire companies, and even

superstar CEOs. In companies, tribes decide whether the new leader is

going to fl ourish 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 profi tability 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 affl uent class in Virginia society, perhaps fewer than a hundred

people. Another was the Continental Congress, originally 55 delegates. The

third was the offi cer 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 unifi ed them:

valuing freedom, hating the king’s latest tax, or wanting to win the fi ght.

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.

CORPORATE JUNGLEBirds flock, fish school, people “tribe.” Here is an excerptfrom the Tribal Leadership, which takes a look athow managers can use tribes within an organisation tomaximise their profitability and increase productivity.

November 2008 | 60 January 2009 |

BO

OK REVIEW

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