6 big advantages Singaporean developers can offer to Chinese market

How far can these take the developers?

According to Maybank Kim Eng, Sino-Singapore relations have come a long way, mainly since the 1990s with the G2G development of the Suzhou Industrial Park.

As ethnic Chinese make up ~74% of the Singapore population, the lack of a language barrier and the cultural similarities meant that Singapore companies have some inherent advantage in penetrating the Chinese market.

Here's more from Maybank Kim Eng:

More importantly, the likes of CapitaLand and KepLand have more to offer to the Chinese market than local developers. Here are some of the competitive advantages we identify:

1) Singapore developers tend to be more disciplined and financially prudent in China, hence they avoid benchmark pricing via land tenders, which is often detrimental to profit margins;

2) they leverage on their core competencies from their experience built in Singapore, e.g. CapitaMalls Asia was a first-mover into the retail mall scene in China;

3) Singapore developers are known to uphold product quality, which sets them apart from many local players and on par with the Hong Kong-listed ones;

4) Singapore developers usually hold long-term views particularly when it comes to commercial property developments. The longevity and viability of these projects are key considerations especially when they form a part of the asset pipeline for the REITs or private funds managed by the developers;

5) Singapore-based companies have access to more diversified capital markets and are not as highly leveraged within China as some of the local players; and

6) As Temasek-linked companies, they have an added advantage in G2G initiatives, such as KepLand’s Tianjin Eco-city project and the Raffles City Chaotianmen project.