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FUTURENOWGlobal Recognition for Gender Diversity and Sustainability
HEARTWORKA Christmas Gift of Love
LIVELIFEUsher in the Year of the Dog with PAW Patrol
Each new year brings fresh perspectives and exciting opportunities while also affording us the chance to reflect on the past and strive for greater improvement.
Real estate is considered by many to be the bedrock of Singapore’s economy. After several years of persistent headwinds and slower growth, there is the belief that 2018 will be a significantly better year.
In 2017, we saw the first uptick in private residential prices in Q3 and increased housing transaction volumes. This augurs well for 2018 and many analysts and market-watchers anticipate a rebound of Singapore’s property market this year. With the global economy on a reflationary path and rosier economic outlook domestically, we are cautiously optimistic that this positive momentum will gradually strengthen into a sustainable recovery.
Since 2010, we set about establishing growth platforms in our key overseas markets of China, UK, Japan and Australia. This strategy enabled us to effectively navigate the headwinds we faced in the Singapore property market.
Yet, while we grew our real estate development platforms overseas, we continued to keep our fingers on the pulse of our home market. Singapore is a market we know intimately and where we have operated for over 50 years. Over the past few years, we continued to remain active in our real estate development activities in Singapore with new launches and strategic bids to bolster our landbank.
Despite the absence of a new launch, our Singapore property development segment achieved a strong performance in 2017. CDL, together with our joint-venture (JV) partners, sold a total of 1,171 units, including Executive Condominiums (EC), with a total sales value of over S$1.9 billion last year. By comparison, in 2016, CDL and our JV partners sold 1,017 units with a sales value of about S$1.25 billion. On a consolidated basis, CDL’s parent company, Hong Leong Group again emerged as the top developer with the most number of units sold in Singapore for 2017, as reported by Lianhe Zaobao.
In January this year, we soft launched the 124-unit New Futura on Leonie Hill Road. Designed by renowned architectural firm Skidmore, Owings & Merrill LLP (SOM), New Futura — with its unique organic, curvilinear form — is an architectural icon and landmark residence which reflects CDL’s commitment to design and build excellence.
The Tampines Avenue 10 site we acquired last year will be named The Tapestry and we will be launching the 861-unit project in March. Due to our competitive pricing and compelling design, we are anticipating a strong response.
Last year also marked our re-emergence in the local land tender scene as we clinched victory for the Government Land Sales (GLS) site in Tampines that I mentioned above and for Amber Park, the largest freehold en bloc deal in Singapore’s history. Together, these two sites will provide us with a formidable pipeline for the next few years.
This year, we made further headlines by topping two more GLS tenders in January 2018. One site is located on Handy Road while the other is in West Coast Vale. Both sites have great potential and we will endeavour to offer our customers a unique buying proposition when we launch.
As we continue to build for the future, it is also a timely juncture for us to strengthen our expertise and improve our culture. We cannot remain complacent and must continually strive for improvement. We need to focus on our execution and ensure that we continually raise the bar by creating outstanding developments that offer good quality and value to our customers. Ultimately, our customers are the reason we are still in business and it is very important that we truly look after them.
In order to facilitate this, I have just announced an internal reorganisation with the ultimate aim of delivering an improved experience for all of our homebuyers, tenants and business partners. This new structure will align everyone as a team to achieve the Company’s goals and promote stronger collaboration and teamwork across the various operating departments. To strengthen our brand position and product proposition, we have also completed a strategic review of our development life-cycle.
Beyond enhancing our product value proposition, another key focus is to enhance our recurring income segment through asset repositioning, strategic investments into new economy businesses and the establishment of a strong fund management platform.
Last year, we announced a S$60 million asset enhancement initiative to rejuvenate Republic Plaza, CDL’s flagship commercial property located in the heart of Singapore’s Central Business District. Aimed at catering to the evolving business landscape, the phased enhancement works will commence this year and will increase space efficiency and inject fresh vibrancy to this prime office development.
Since 2016, we started investing in synergistic sharing economy sectors, beginning with the acquisition of a 20% equity stake in mamahome — China’s fast-growing online apartment rental platform. This was followed by a 24% equity stake in Distrii, China’s leading operator of co-working space. CDL is currently still Distrii’s second largest shareholder after our participation in a recent round of financing which saw the entry of new Chinese investors.
Our strategic investment into both these platforms allow us immediate exposure to business segments with significant potential growth and future synergies. Both the mamahome and Distrii platforms provide scalability and can effectively complement our asset portfolio.
For instance, Distrii will open its first international outpost at Republic Plaza in the first half of this year. Spanning over 60,000 square feet, the space is expected to be one of the largest co-working facilities in Singapore and will offer a comprehensive array of office, F&B, entertainment and recreational options. The opening of this new facility complements our strategic repositioning plans for Republic Plaza.
By now, you would have also seen the announcement of our new Group Chief Investment Officer, Frank Khoo, who joined our Company on 1 February 2018. I am very excited to work with such a talented individual. Frank has over 20 years of international experience in fund management, private equity, acquisition of real estate assets and the repositioning and restructuring of real estate businesses. He has an extensive network of investors, ranging from insurance companies, pension funds, sovereign wealth funds and high net worth individuals across Asia and Europe.
Aside from leading our global investment efforts, Frank will be tasked with building up a fund management business that will provide us with strong recurring income over time while also enhancing the efficiency of our capital deployment. This may include establishing new co-mingled funds or joint ventures with various risk return profiles, acquiring existing fund management platforms and managing third-party capital. With Frank’s in-depth knowledge in fund creation and management coupled with his strong network, he will be instrumental in growing this business and eventually establishing CDL as one of the world’s leading asset managers.
There is also an increasing need for innovation. We are in the age of disruption and we must constantly evolve to avoid being displaced or made irrelevant. It is very important that we continue to challenge established paradigms and come up with better ways to do things. One thing for sure — we cannot stay status quo.
To enable us to evolve with speed and keep up with the rapid pace of change, we have set up an innovation committee comprising of young and talented individuals within our Company and chaired by Kwek Eik Sheng, our Group Chief Strategy Officer. We will be placing heavy emphasis on this committee to help us brainstorm for new ideas, products and platforms so we can provide a fresh and enhanced experience to our customers and even our own staff. This committee will be extremely critical to the success of our Company.
2018 will be an exciting and transformative year ahead for us.
My vision is to see CDL remain strong for many decades to come and therefore I must start planting the seeds for the future.
I wish to thank each and every one of you for your continuous support of our Group, for standing by us during our most challenging times and also celebrating with us when we are blessed with success. I would also like to take this opportunity to wish everyone a Happy Lunar New Year.
Please join me on this incredible journey as we take the Company forward to even greater heights.
Mr Sherman Kwek
CDL Group Chief Executive Officer
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