Speech by 2M Desmond Lee at the REDAS Spring Festival Lunch

Feb 23, 2018

I am delighted to be here at the REDAS Spring Festival lunch today. Let me begin by wishing everyone a Happy Lunar New Year. 

You are an important partner in shaping our city. It has been so for many decades, and it will be so for the exciting times ahead of us. Your contributions include the many iconic structures that comprise our urban landscape, and the many quality residential developments that Singaporeans call home. 

There is a sense of renewed confidence in today’s property market. But markets move in cycles, and we expect the number of residential units available for sale to more than double in the next few years, and we will keep an eye on this. 

Transforming the BE Industry

Beyond the immediate ups and downs of the market, we should work together to secure the longer term health and well-being of our property and built environment sector. We want the property market to be healthy, also in the point of view of developers, home-owners, and potential buyers. We also want to continue to build our city well, and to be able to maintain it effectively and efficiently as our city ages gracefully.

Last year, we brought together many stakeholders from across industry, unions, academics and government agencies to set up the Built Environment Cluster sub-committee under the Future Economy Council (FEC). This looks to energise sectors that move the needle in our GDP, and ensure Singaporeans will get good jobs. That is the whole idea of the FEC. Under the FEC, the Built Environment has been identified as an important sector. We look at how to drive industry transformation in five sectors: Construction, Real Estate, Security, Environmental Services, and Landscaping. 

Together, these sectors see a building and a city through its entire infrastructure life-cycle, starting from inception and design by developers and consultants, all the way to construction, operations and facilities management. 

These five sectors are closely intertwined. Firms in the ecosystem can do much to work together across functions. 

For example, the concept of Integrated Digital Delivery (IDD) enables construction firms, architects and engineers to visualise building designs before they are actually built. One of the upsides is to resolve conflicts upstream, and to drive synergies before laying the infrastructure on site. 

In addition, IDD can also be used to factor sustainability, security and aesthetic considerations into building design, thereby helping building owners save on long-term operating costs. 

Firms in different sectors can also work together to pursue opportunities they could not otherwise have achieved alone. The built environment sector is a very broad sector. It covers development to design, to construction, to maintenance, to real estate management. Because it involves so many sub-sectors, if we want to uplift this sector, we need to come together in a tripartite fashion. This is the strength that Singapore has, where people with different interests and alignments can come together to drive win-win solutions, while also safeguarding the interests of people in their sector.

One good example is the push for internationalisation. Many of our local construction companies may not be able to compete by themselves in overseas markets if they lack sufficient financial clout and overseas experience, and hence, they may not want to necessarily invest their capital in building plants and setting up shop overseas.

However, if they partner with other companies in the BE sector and value chain, including good Singapore developers which have ventured overseas and therefore have more overseas experience, they could “hunt as a pack”, and offer a unique “Singapore-grown” way of undertaking the entire development cycle. This would increase our competitive edge overseas. 

Developers are vital partners in helping firms in the entire built environment landscape reap these synergies. 

For example, as service buyers, developers can take the lead to adopt more innovative platform solutions, such as IDD. This will in turn enable developers to better manage projects and reap cost savings downstream. 

In addition, developers, especially those with extensive international experience, are in a good position to join together with our local BE firms to pursue opportunities abroad and offer unique Singapore-brand solutions. 

Launch of Real Estate ITM

We have spent the past year articulating and planning for the transformation of our built environment. This involves a lot of conversation, sessions in the drawing room and visiting sites, but these are plans. Now, we want the rubber to hit the road and are shifting gears into implementation. 

Over the past few months, we have been rolling out the various Industry Transformation Maps (ITMs) under the BE cluster. We have launched four of the five BE ITMs to date, most recently for the Real Estate and Security sectors. We have included infographics of these four BE ITMs in your goodie bags for your reference.

These plans are roadmaps for firms in the various sectors to address current challenges and transform themselves to seize future opportunities here and around the world.

With the Real Estate ITM, our focus is on facilities management (FM), and property transactions services – two sectors not given as much attention usually, but which we have identified as having great potential for transformation. 

We want to get both sectors to embrace innovation and make fuller use of technology to grow, and to strengthen the professionalism and skills of their respective workforces. 

In the property transactions space, we want to streamline the property transaction process for greater convenience to property agents, buyers and sellers. 

To achieve this, we have set up a new Digitalised Property Transactions Workgroup under the Council for Estate Agencies, comprising government agencies and industry groups, including REDAS. 

Working together, the industry can move towards seamless, end-to-end, efficient and secure transactions. This will boost productivity and help our firms stay competitive in the midst of disruption by new entrants and competitors. 

For Facilities Management, we want to significantly improve the way we maintain our infrastructure, which is especially important as our city continues to age gracefully. We encourage the industry to adopt smarter and more efficient FM systems that can streamline processes, reduce abortive work, and reap cost savings over time. 

Beyond that, we also want our firms to systematically consider designing buildings that are easier to maintain down the road, which helps to minimise maintenance costs. 

These efforts will synergise well with other parts of the BE cluster, particularly in construction, whose emphasis on green buildings and digitalisation have an impact on FM processes. 

Therefore, BCA is convening a Tripartite FM Implementation Committee, which will involve many partners, to formulate, oversee and review our implementation plans. 

Naturally, for these two industries to transform for the future, they will also need to be supported by a skilled and motivated workforce. As part of the ITM, we are also studying ways to upskill our FM practitioners and property agents to ensure that they have the necessary skills to thrive in the sector. A lot of effort is also being put in to see how we can strengthen the pipeline of students who are graduating into these industries.

Although the focus of the Real Estate ITM is on FM and property transaction services, our efforts will also have positive effects on other sectors in the real estate value chain, including developers. 

For example, as sellers of completed properties, it is in developers’ interests for property transactions to be faster and more secure. And as building owners, developers stand to reap considerable long-tail savings from buildings that are easier and more sensible to maintain.

Conclusion

As such, I thank REDAS for being an important partner of ours, and for playing an active part in implementing our collective ITM recommendations. This will result in better outcomes all around – for Singapore, our city-state, to go forward in an uncertain future; for firms who continue to face challenges within Singapore and abroad; and for Singaporeans, both currently in the workforce and those looking forward to joining the workforce, looking at the potential opportunities.

Thank you, and have a Happy New Year!