Overseas developers set up shop to tap continued S'pore demand
MORE overseas developers are opening property galleries or sales offices in Singapore to step up their marketing in the city-state, prompted by a continued interest in overseas projects.
While most have traditionally relied on their marketing agents to hold property exhibitions in Singapore on weekends, there is a growing trend of foreign players wanting to have a permanent presence in the country.
In the course of a week, two overseas developers have joined the fray.
Australia's Crown Group opened its sales office at Suntec Tower Two, while Malaysia's UMLand opened its property gallery at Anson House in Tanjong Pagar.
The Business Times (BT) understands that London developer Galliard Homes is about to open a sales office in Singapore soon.
Together, they join several other industry peers from Britain, the Philippines, Malaysia and China which have opened shop in Singapore, including notable names such as Britain's Berkeley Homes and China's Country Garden.
The latter opened a sales gallery in Singapore to showcase its Danga Bay project in Malaysia.
"Booming Asia is an important platform for us and we want to be ahead of that trend," said Crown Group's Indonesian-born CEO, Iwan Sunito.
Overseas buyers make up 30 per cent of Crown Group's clientele, with Chinese and Indonesians forming the majority of this pool.
Sydney-based Crown Group, which achieved some A$20 million (S$23.3 million) of sales from buyers in Singapore last year out of A$300 million of group sales, hopes to reduce its reliance on agents in Singapore and derive more sales from direct marketing.
Its director of sales and marketing, Adam Sparkes, said that the Singapore office marks the start of a longer-term plan of developing residential projects globally.
Its first overseas office was opened in Jakarta last year.
The fast-growing Crown Group is also looking to set up an office in either Shanghai or Hong Kong within a year and to list the company within five years - possibly in Hong Kong.
The opening of UMLand's sales gallery is timed to coincide with the launch of its premium mixed development Star Residences in Kuala Lumpur.
"The presence of the property gallery will further enhance purchasers' confidence in UMLand," said group CEO Charlie Chia.
"If the opportunity arises, UMLand will certainly be interested to venture into property development in Singapore."
UMLand has been marketing projects in Singapore since 2003, when its tie-up with Singapore's The Ascott Limited in Somerset Seri Bukit Ceylon in Kuala Lumpur, a strata-titled serviced residence project, drew significant interest from Singapore-based buyers.
Its sales gallery will now serve as a one-stop shop for potential investors and buyers to explore projects in Iskandar Malaysia and Klang Valley.
HSR International Realtors analyst Wong Shanting said that Singapore's property cooling measures, including a loans cap under the total debt servicing ratio (TDSR), and relatively high property prices have prompted Singaporeans to look elsewhere.
The high-speed rail between Singapore and Kuala Lumpur, which is targeted to be ready by 2020, will enhance Malaysia's draw, she said.
Mr Chia said that the prices of property in new growth areas such as Iskandar Malaysia were only 30 per cent of those in Singapore.
"With this push factor of TDSR, Singaporeans ultimately throng to Malaysia to enjoy better terms and ease of end-financing with Malaysian banks for their investments," he said.
Doris Tan, head of international residential properties at Jones Lang LaSalle, said that sales of London properties to Singapore buyers have slowed recently as many bought their units in the past few years.
And with rising prices in London and a capital gains tax on non-residents that will kick in next year, investors are adopting a wait-and-see attitude, she said.
Colliers International told BT that many of its clients still preferred to continue holding property exhibitions of overseas projects in Singapore due to the cost factor.
"It's very expensive for overseas developers to set up and fit out a permanent office in Singapore. This is why most of our clients rely on Colliers as their agent to sell their schemes, without them having the added expense of a local office," said Nina Davies, Colliers' operations director for international properties in South-east Asia.
However, there are advantages to having sales representatives closer to potential buyers.
Malaysia's SP Setia has seen double-digit growth in annual sales to Singapore-based buyers since it opened a sales office here in 2009.
Having a presence in Singapore allows the developer to provide better after-sales follow-up, said Neo Keng Hoe, SP Setia general manager for Singapore.