HK firms flex their muscles
Local developers see the city state as a way to diversify their Chinese exposure, writes Tama Lung
From the glittering office towers of Marina Bay Financial Centre to the luxurious 54-storey Orchard Residences and the restored colonial-era buildings of the Fullerton Heritage precinct, Hong Kong property developers have become a prominent fixture on the Singapore skyline. Hongkong Land, Sun Hung Kai Properties, Cheung Kong Property Holdings and Wheelock Properties are also looking to expand their reach in the city state through land acquisitions or new projects.
"Hong Kong developers have expanded significantly in the mainland over the past decade given the attractive investment returns, size of the market and their familiarity with the market. They see Singapore as a way to diversify their Chinese exposure, and
one which offers similar characteristics to Hong Kong which makes it a viable alternative," explains Tan Min Lan, head of the Apac Investment Office at UBS CIO Wealth Management.
In addition to diversification, Tan sees many advantages for Hong Kong and other foreign developers despite Singapore's declining property prices.
"Firstly, Singapore has a stable government and political backdrop," she says.
"Secondly, Singapore offers an established regulatory environment for investors.
"Thirdly, Singapore continues to attract foreign home buyers and investors thanks to its status as a financial and wealth management hub in Asia, and robust macro fundamentals which underpin the long-term value of the Singapore dollar as a store of wealth," she says. "While the property price correction is still ongoing, strategically, Singapore remains attractive as a key gateway city and Asian hub."
