MODUS Asia Edition Q1 2015 by ROF Media

MODUS ASIA Q1 2015 RICSASIA .ORG

Q1 2015 ricsasia.org/modusasia

IN THIS ISSUE COVER STORY

Are the world’s cities growing too quickly? / 16

GETTING IN SHAPE

Tokyo’s Olympic gains / 24

ACES OF SPACE

The surveyors for whom it is rocket science / 30

Contents MODUS ASIA Q1 2015 RICSASIA.ORG

“30 million visitors is a big number from where we stand today. But the Olympics will be a fantastic opportunity to demonstrate what Japan has to offer”

06 DIFFERENCE OF OPINION Should China’s residential developers branch out into commercial projects? We hear two points of view 07-15 NEWS IN BRIEF Essential industry news, advice and information for RICS members 08 THINKING: THOMAS LAM FRICS Outflows of capital from China will continue to increase while the domestic market continues to underperform 13 PRESIDENT’S COLUMN Inspiring the brightest and best from all backgrounds to join the profession requires powerful role models, says Louise Brooke-Smith FRICS

16 MARCH OF THE MEGA CITY The relentless spread of the urbanisation 24 RETURN OF THE RINGS Tokyo is preparing to host its second Olympic Games. How is it shaping up? 30 SPACEMAKERS Meet the RICS members who are literally reaching for the stars 36 THE FALL (AND RISE?) OF THE MALL Stunted growth and poor asset management has left India with scores of empty or underused shopping centres 40 STAYING POWER Record tourist numbers encourage investors to check-in to UK hotels market 42 CLEARING ALL THE HURDLES Hong Kong Jockey Club reins in sprawling estate with facilities management plan

Foundations

Features

Intelligence

PAUL WATKINSON MRICS, RICS JAPAN COUNCIL TOKYO 2020, P24

44-45 CAREERS Help your job prospects take flight abroad; RICS UK & Ireland Chair Dr Fiona Grant FRICS 46 BUSINESS Web conferencing opens up world of remote working, collaboration and training 47 LEGAL 101 Assessing the benefits and legal risks in using cloud-based BIM software 48 BRAIN GAIN Keep disputes out of court through mediation 50 MIND MAP ULI and LaSalle chief Lynn Thurber on building a healthier lifestyle PLUS 49 Events

Views expressed in Modus are those of the named author and are not necessarily those of RICS or the publisher. The contents of this magazine are fully protected by copyright and may not be reproduced in any form without the prior permission of the publisher. All information correct at time of going to press. All rights reserved. The publisher cannot accept liability for errors or omissions. RICS does not accept responsibility for loss, injury or damage or costs that result from, or are connected in any way to, the use of products or services advertised. All editions of Modus are printed on paper sourced from sustainable, properly managed forests. This magazine can be recycled for use in newspapers and packaging. Please dispose of it at your local collection point. The polywrap is made from biodegradable material and can be recycled.

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Join the debate REACTIONS AND RESPONSES FROM PREVIOUS ISSUES

Do you have a comment about this issue of Modus? Email editor@ricsmodus.com, or tweet us using #RICSmodus JAZZ YOU LIKE IT Sir, I have just read the latest edition of Modus [Asia, Q4 2014]. First, the RICS is such a diverse international organisation that trying to please all different sectors is actually mission impossible. Second, as a respected professional organisation, our journal has to reflect that and not be too jazzy as that would send the wrong message. I suggest perhaps the jazzy bits can be done electronically rather than in paper form, as the younger generation are more attuned to electronic communications and may prefer this approach. For us oldies, I found this edition had sufficient articles to interest me, the presentation is quite lively and the content varied, so no real complaints from me. Roger Nissim FRICS, Hong Kong FLIPPING OUT Sir, Regarding your article on whether to implement a property speculation tax (page 7, Modus, Asia, Q4 2014). I won’t argue the macroeconomic issues here. But I must point out that some properties are not purchased for the quick flip without first adding value. Some smaller investors purchase to refurbish, renovate and add value first. These people provide a genuine benefit to the market and deserve all the gains for their efforts. As long as there is a provision for those that purchase and then spend some recognisable amount to improve before they flip, then I don’t see the issue. If you take that away, there will be fewer quality places to live and fewer opportunities for those willing to sweat their assets. Daniel Kuhlman, Brussels, Belgium

@RICSAsia // #RICSmodus @maddinaish Six months worth of ‘stuff’ filed away, now to chill with farm shop apple juice and #RICSModus @bridgetwhipsin Has anyone else noticed that Modus is now water resistant, making it even easier to read it in the bath? @StanHornagold SOS Message from #RICSModus Magazine. Help – I have been hijacked by crazy graphic designers. Over the top-graphics and awful fonts. Hellpp! @RICShonsec Great article @modusmag

How corrupt is your country? Ethical standards core to #RICS

WORDS OF A FEATHER Sir, Your article on the use of glass focused on new techniques to improve energy performance of buildings and so reduce their environmental impact (Modus, Asia, Q4 2014). But it completely omitted to refer to the risk that ever larger areas of glass pose to bird life. The RICS rightly places great importance on green issues, but our profession needs to be aware of how hazardous glass structures are to birds and we should be pioneering the use of bird-safe design elements in buildings. Tim Knowlman FRICS, Amboise, France

POSITIVE INFLUENCE Sir, The President rightly confirms the RICS’ role as a professional body to influence public policy, which separates it from a trade association (page 13, Modus global edition, September 2014 and Asia edition, Q4 2014). Yet, on page 8 (global edition), Mat Lown takes a defeatist attitude in accepting that his children are likely to grow up in cities that are much more crowded, even more expensive and less equal economically. His solution is green infrastructure to make cities more liveable. Surely the RICS must follow the President’s lead and lift its ambitions much higher than this negative approach? It should seek to use its well-deserved influence to transform cities to be sustainable communities, with attractive and energyefficient housing to provide a good quality of life for all sections of our society. John Sharpe FRICS, chairman and consultant, Environmental Solutions through Partnership

MODUS ONLINE

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FOR SUNDAY Editor Oliver Parsons / Art Directors Christie Ferdinando, Ben Martin / Contributing Editor Brendon Hooper / Production Editor Andy Plowman / Senior Designer Isabella Fernandes / Creative Director Matt Beaven / Account Director Karen Jenner / Senior Account Manager Amy Smith / Advertising Sales Director Charlotte Turner / Advertising Manager Victoria Underwood / Asia Advertising ROF Media, Bryan Chan, +852 3150 8912, byan@rofmedia.com / Production Manager Michael Wood / Managing Director Toby Smeeton / Repro F1 Colour / Printers ROF Media / Cover Illustration HelloVon / Published by Sunday, 207 Union Street, London SE1 0LN sundaypublishing.com / For RICS James Murphy and Kate Symons [UK] / Roy Ying and Jeanie Chan [Asia]

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Intelligence

News / Reviews / Opinions / Reactions

DIFFERENCE OF OPINION

Should residential developers venture into commercial property development? Discuss.

A WHOLE DIFFERENT LEAGUE Developing a successful commercial venture poses a whole different set of management and financing issues to those usually encountered by housebuilders. Should you even dare to take the risk?

B ECAUSE RESIDENTIAL DEVELOPERS IN C HINA ARE OFTEN COMPARATIVELY less experienced than commercial real estate developers, they are likely to underperform in assessing and predicting the real business value, prospects and risks for commercial prosperity. And even if the initial state of operation turns out fine, an inadequate capability to manage the property could potentially result in a project failure. Before a project is launched, the lynchpin of its success is in having a seasoned team with a practical background to submit a reliable feasibility report, which residential developers may not have. Consequently, inexperienced real estate developers may encounter a higher risk of project failure from RONALD YAU MRICS DEPUTY REGIONAL CHIEF EXECUTIVE, congenital deficiency in human resources and project set-up. NEW WORLD CHINA LAND The other important issue is that developing commercial real estate, such as shopping malls and offices is, in essence, I N RECENT YEARS , SEVERAL WELL - KNOWN DOMESTIC REAL about doing business instead of developing property. estate enterprises have entered into commercial property Commercial properties are distinct from residential in their development, seeking a share in a burgeoning business market that is long-term profitability, while housebuilders gain financially growing from continuous urbanisation. However, residential developers in the early stage after the buildings are completed. moving into the development and operation of commercial property face These different profit models require different strategies many upcoming challenges, including a slowing domestic economy, a and intelligence. For consistent profits from commercial possible market bubble, and market snatch by ecommerce retailers. properties, pre-investment research should be carried out, But this doesn’t mean residential companies cannot be successful in the and even more important is a well-equipped operation team commercial market. To do so, developers must have a high level of ability, that will ensure it is run in an orderly and sustainable way. integrate resources and actively explore “trans-boundary transformation”, Just as residences need property managers, shopping malls such as combining commerce with culture, art, tourism and other areas. and offices need people who can mobilise the immobile. Such For example, New World Group’s K11 project in Hong Kong is the world’s a team plays a key role in harmonising the relationship first “art mall”, combining arts, humanities and nature to give visitors an between tenants and investors which, if done badly, can bring all-round sensory experience that they would never get with online commerce down earning expectations and eventually cause it to fail. alone. Following its success in Hong Kong, 19 more K11 centres are expected to be built around China in the next three years. In such a fiercely competitive Do residential developers in China have what environment, residential developers who have ventured into commercial have it takes to succeed in commercial property? to do more to ensure their projects are outstanding, with development, Join the discussion on LinkedIn at rics.org/ operation and financing ability all being huge challenges. linkedin, or email editor@ricsmodus.com But a strong company with a diversified portfolio is sure to gain more opportunities. Newcomers to commercial property development must create a new business world built on their own developmental strength, and by having a rich experience in commercial operation and creativity in business. 06

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ILLUSTRATION DALE EDWIN MURRAY INTERVIEW BRENDON HOOPER

ANDY TO MRICS EXECUTIVE DIRECTOR, ASSET SERVICES CHINA, CBRE

Intelligence WHERE ARE THE WORLD’S TALLEST OFFICES? China has outgrown the US as the country with the most buildings over 150m tall Source: CBRE Research

CHINA 34%

US 28%

China 34%

NEWS IN BRIEF

JAPAN 7% SINGAPORE 3% UAE 4% AUSTRALIA 3%

US 28%

Japan 7% Singapore 3% UAE 4% Australia 3%

OTHERS 21% Others 4%

OFFICES ®

GOOD DESIGN IMPROVES STAFF WELLBEING 1.93m

ricsasia.org/ modusasia

Do you see yourself sitting on Governing Council?

1.66m

1.34m

0.3m

The report also presents a simple toolkit with which businesses can measure the health, wellbeing and productivity of their staff – data such as absenteeism, staff turnover, medical complaints and revenue – which2017 can be related back to the physical features of buildings. Overall, the study emphasises the view that a building’s impact on its occupants must be included within financial considerations. “This report goes to the very heart of what drives property markets – the value that organisations derive from their occupation of property,” commented Miles Keeping MRICS, partner in sustainability at Deloitte Real Estate. “It is so important that landlords and developers pay attention to its findings, addressing physical factors within buildings that affect productivity.” Romania

27.8%

Hungary

25% Mozambque

20.3% Poland

24.2%

20% Zambia

Brazil

19.9%

Global Average

18.5% New Zealand

16.5% Australia

13.4%

9.5% Ireland

8.3%

12.6%

7.6% Germany

Canada

6.7% France

37.8%

Members have an opportunity to shape the future of the profession by applying for a 2015 2016 role on Governing Council, the 2014 RICS decision-making body that sets the long-term direction of the organisation. Elections for Governing Council take place in April 2015 and there There is “overwhelming evidence” BANK STATEMENT that an office’s design has a are 22 positions available from Commonwealth a total of 60 Council members: significant effect on the health, Bank’s Sydney five will be elected from the entire headquarters is wellbeing and productivity of its global membership; two will be an exemplar in staff, a report from the World Green modern office Building Council has concluded. for RICS matrics members only; design, and has four will be for the UK – London, Sponsored by JLL, Lend Lease won developer East Midlands, South East Lend Lease five and Skanska, the research is the England and West Midlands; international first global study to consider what awards impact features such as interior plus one for each of Americas, Mainland Europe, Oceania, South layout, air quality, daylight levels Asia, Australia, China (excluding and views of nature have on Hong Kong), China (Hong Kong), office staff. It is hoped that better Germany, India, UAE and USA. DOWNLOAD THE REPORT from understanding the link between Successful candidates will worldgbc.org. How can we make workers and their workplace will join Governing Council on 30 our offices healthier places to help to drive the business case June 2015. work? Email your thoughts to for higher-quality, healthier and Governing Council meets editor@ricsmodus.com greener buildings. three times a year in strategically important markets worldwide. The annual time commitment LARGEST INCREASES IN PRIME OFFICE is approximately 10 days, SPACE OCCUPANCY COSTS, 2013-2014 including travelling. Details of how to express your Source: CBRE interest, the role requirements for Council members, and how being 60% 19% 17% 121 16% 14% a Council member can help your 13% professional development, can 150 be found at rics.org/gcelections. Members will be emailed voting 144 81 instructions early in 2015. If you 83 Dublin London Seoul Yeouido, Seattle Kuala Lumpur are concerned that RICS does Ireland West End, UK South Korea Suburban, US Malaysia 78 not have your correct address, 49 35 31 14 16 please email contactrics@rics. 13% 11% €558m org and provide your name and €1,648m €417m €137m €235m 10% 10% €3,628m €186m €1,924m 10% €2,891m €1,736m €855m membership number. For a hard copy of the ballot form, write to: Corporate Management Houston Department, RICS, Parliament San Francisco San Francisco Jakarta Houston New York Downtown, US Peninsula, US Suburban, US Downtown, US Downtown, Indonesia Square, London SW1P 3AD, UK. Source: Xxxxxxxxx

INFOGRAPHIC IAN DUTNALL IMAGE JOHN GOLLINGS

THE DATA

Manhattan US

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2014* Q1 2015_MODUS A SI A

“As the Chinese domestic market continues to underperform, we expect a significant amount of overseas expansion by Chinese investors”

here has been a tremendous surge of Chinese outward investment in overseas real estate markets in recent years, fuelled by several, key, push-and-pull factors. From 2009 to 2014, the total value of Chinese overseas investment skyrocketed from $600m to an estimated $15bn. Domestically, one of the most powerful drivers has been the continued consolidation of China’s residential real estate market. Fierce domestic competition, combined with government curbs on home purchases and rising borrowing costs over the past two years, has led developers to look elsewhere for new opportunities. At the same time, Chinese government incentives, such as the relaxation of real estate investment regulations for insurance companies, have also resulted in billions of dollars in extra funding for overseas investment. Meanwhile, mature gateway markets in the UK, US and Australia – with their relatively stable economies, quality products and higher yield returns – continue to attract Chinese investors. Typical grade A office yields for Beijing and Shanghai now range from 5% to 6%. However, a tight credit environment means that funding costs in these cities are also very high, often at more than 8%. By contrast, although yield returns for New York, London and Sydney offices are 4%-6%, interest rates have been low. In the US for example, funding costs can be as low as 3%. This yield spread is much more attractive for Chinese investors. Last year, Australia recorded the strongest-ever growth in inbound real estate investment from China, at more than a 60% increase year on year. In London, investments

RICS A SI A .ORG

by Chinese institutional investors in income-generating commercial properties are on the rise. And in the US, Chinese capital has been increasingly targeting assets in gateway markets such as New York and Los Angeles. However, yield return in these cities is significantly compressed, and many provincial capitals and key cities in these countries now present a better yield spread. Therefore, Chinese investors are expected to start looking in other markets – in particular, in relatively underpriced secondary locations such as Frankfurt, Manchester and Brisbane. Over the past few years, we have witnessed several waves of outward investors. The first saw sovereign wealth funds investing in trophy assets and banks acquiring property for owner occupation. Large developers then followed, looking to diversify with an overseas presence. In this current third wave, equity investors and insurance firms are seeking core and yield-driven opportunities. Right now we are also seeing the formation of a fourth wave: insurance companies, ultra-high-net-worth individuals, small- to mid-cap state-owned enterprises and private developers. They are harder to predict and track, given their relative lack of international exposure, therefore efforts to evaluate their overseas growth targets will follow a steep learning curve. The influx of Chinese capital has pushed up property prices in the target markets, especially in cities with a relatively small stock of property, resulting in local resistance. In Hong Kong, for example, capital from the Chinese mainland has pushed up property prices, leading the government to impose higher stamp duty rates on non-local and corporate buyers, effectively killing off foreign investment. The Australian Central Bank also recently stressed the importance of rigorous standards on loans to property investors. Investors should take policy factors into account when making overseas investment decisions. As the Chinese domestic market continues to underperform, we expect a significant amount of overseas expansion by Chinese investors in the coming years. The aforementioned fourth wave will emerge as new buyers in outward real estate, and provincial capital cities are likely to become new targets, given their higher yield returns.

ILLUSTRATIONS ANDREA MANZATI

THOMAS LAM FRICS SENIOR DIRECTOR, HEAD OF VALUATION AND CONSULTANCY, KNIGHT FRANK, HONG KONG

“Internet of things”

28bn

THE INTERNET OF THINGS

Intelligence

Smartphones

6bn

Growth of devices connected to the internet has ballooned as more and more everyday items become “smart” Source: Goldman Sachs

PCs

1bn 1996-2015 1996-2015

NEWS IN BRIEF

WE LIKE

ricsasia.org/ modusasia

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INFOGRAPHIC IAN DUTNALL

International guide to BIM implementation published

CROSS PURPOSE Infrastructure projects such London’s Chinaas 34% Crossrail already use BIM. BIM4SME.org aims to spread that knowledge to SMEs

1.34m

Japan 7% Singapore 3% UAE 4% Australia 3%

Others 4%

1.93m 1.66m 0.3m

Adam Lansdown FRICS, principal consultant, GVA Hotels and Leisure You would think that with all this digital help – digital cameras, smartphones etc – the speed of transactions would have been greatly

83 35

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€417m

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€186m

49 €558m

27.8%

Romania

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improved over the past five or 10 years, but for some reason, it hasn’t. We invest a great deal in kit, and find ourselves wrestling with mice and keyboards in an attempt to keep up. Perhaps it’s just human nature keeping the pace so steady. People need time to digest what they are 144 seeing and to work

Hungary

25%

20.3% Poland

Mozambque

20% Zambia

24.2%

19.9%

Global Average

18.5% New Zealand

16.5%

13.4% UK

Australia

12.6%

Canada

9.5%

ONE THING I KNOW Ireland

8.3%

7.6% Germany

6.7%

37.8%

What’s that? The growing use of building information modelling (BIM) is bringing about huge changes to the industry, but it can be tough to understand how the technology might affect the everyday work of small and medium-sized enterprises (SMEs). For example, because SMEs form the bulk of the industry’s supply chain, many will need to adopt BIM 2015 2016 2017 processes at some point to be able to provide services, products and information in a structured and consistent manner – particularly when working in the public sector. Launched as part of the UK government’s BIM Task Group, BIM4SME.org is a not-for-profit organisation whose website helps explain and articulate the business benefits of BIM to SMEs. How can it help me? The site offers free resources, such as presentations and case studies, to show why and how others are using BIM, as well as a list of key BIM events to attend. The creators of the site have also formed training partnerships to provide e-learning packages for those who want to learn about BIM at their own speed. “We’re welcoming content from SME BIM users, such as case studies and blogs to include on the website, so we can help all property and construction SMEs against a backdrop of increasing BIM demand,” says Andrew Turner MRICS, vice-chair of BIM4SME. bim4sme.org; bimtaskgroup.org

“Technology is only as good as the person using it”

€855m

US 28%

BIM 4 SME

2014

France

RICS has launched the International BIM implementation guide (1st edition) to facilitate better understanding of building information modelling (BIM), which will have a significant impact on property professionals and firms globally. Providing advice on how to implement and use BIM in the design, construction and operation of building projects, the guidance focuses on facets of procurement and asset management in small, mediumto-large and complex projects. It also highlights national BIM initiatives in the UK, US, China, Finland and Australia. Alan Muse, RICS Director of Built Environment Professional Groups, commented: “Chartered surveyors and construction professionals worldwide are looking for practical guidance on how BIM will affect them. This guide has been written by an international working group that has first-hand knowledge of global BIM in practice. It is extensively illustrated to form a bespoke, but clear, overview of how to implement BIM across land, property and construction.” The guidance note presents a series of conclusions and recommendations that examine the implications of BIM adoption for the sector more broadly. David Philp, head of BIM at Mace and head of BIM implementation on the government’s UK BIM Task Group, points out that BIM is a wide subject with many perspectives from across the globe, both in 121 terms of what it means and how it should be applied. rics.org/bim

out how they can turn it to their advantage. Every property is unique and there is always something new to consider. It is the law of unintended consequence that bedevils us. But it does, at least, keep us on our toes. 150It is a pity we do not get more thanks for the effort in finding these elusive results. Q1 2015_MODUS A SI A

€1,924m €2,891m

SECRET SURVEYOR

ricsasia.org/ modusasia

“When I was studying, if I was awarded a bad mark, I accepted that the lecturers knew best”

International measurement standard for offices launched

eaching was never my original plan, but, by chance, that is where I have ended up. One of my old college friends asked me how things had changed since we studied together 25 years ago. Apart from it obviously being much easier now than it was in our day, the other main change is how consumer-focused the surveying education system has become. When I was studying, if I was awarded a bad mark, I accepted that the lecturers knew best, that was after all why they were doing that job, and tried harder next time. Nowadays, perhaps partly due to the high fees they are required to pay, students are much more demanding consumers. A while ago I received a threepage, 54 bullet-point, critical analysis of why a mark I had awarded was incorrect. I requested “blind second marking” to check, and the second marker came in below my mark. I therefore had to go back to the student suggesting that had they put as much effort into their original assignment as

A new global standard that sets out how offices are measured has been published, in an effort to bring greater transparency to global property markets. The International Property Measurement Standards for Office Buildings will benefit all stakeholders with an interest in property. The standard, which was developed over several months by a coalition of global organisations, will create a common language for property measurement and enable benchmarking across property portfolios. RICS will issue guidance about how the standard will be implemented this year. For more information, visit ipmsc.org. Global bodies unite to launch ethical standards RICS and 16 other global professional bodies gathered in October at the UN in New York to launch the International Ethics Standards Coalition (IESC). Its aim is to develop and implement the first global ethical standard for the built environment. The coalition will work to introduce a clear framework that allows professionals to undertake their work in a way that is ethically consistent, and to improve services and promote stable property markets globally. Key principles such as trust, integrity and respect that are outlined in existing codes will be aligned through the new standard, which is due to be launched early in 2016. The coalition will then implement the standard through its own training and guidance. Peter Bolton King, Global Director of Residential for RICS Professional Groups, commented that: “Establishing a common, internationally applied ethical standard will enhance trust in the services offered by professionals, wherever they operate.”

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they had into their analysis of my marking, they would have achieved a much higher mark. This year, I received a request from a student for exam feedback, which is commonly provided to students who have failed. This student had however achieved 64% in a valuation exam, which I would have been delighted to achieve – however they obviously felt it was worth more than that. In addition to complaints, students are also very comfortable offering praise and recognition of what they perceive as good service. So, are the high standards that students are demanding from their educational providers a good thing? It certainly keeps us educators on our toes, but I think it may be going a step too far. One institution I work for refers to students as “customers” which, on the basis that “the customer is always right”, should make my future assessments very easy! Are you interested in writing a future Secret Surveyor column? Email editor@ricsmodus.com

INFRASTRUCTURE

CHINA HAS $159BN FOR UK PROJECTS IN THE DOCK Chinese developer Asian Business Port is to plough $1.5bn into London’s Royal Docks

China is ready to plough £105bn ($159bn) into UK infrastructure by 2025, a recent report from law firm Pinsent Masons, China Invests West, has revealed.

The leading recipients are likely to be the energy, real estate and transport sectors. As the need to modernise the UK’s infrastructure becomes a greater priority, joint UK-China partnerships are going to become increasingly important over the next decade, the report claims. “Chinese businesses are now becoming cofunders, co-developers and co-contractors in large UK infrastructure projects,” said Richard Laudy, Pinsent Masons’ head of infrastructure.

Furthermore, the report notes, China is also expected to use its vast domestic manufacturing capability to export equipment and materials for UK projects on which it is providing funds. “Entry by China into the UK market will create opportunities to provide expertise on how to operate in the UK market effectively,” added Laudy. DOWNLOAD the report at pminfrainvestment report.com

IMAGE HAYS DAVIDSON

NEWS IN BRIEF

Intelligence

BENGALURU BUILD IS TOO COOL FOR SCHOOL The universal challenges of schools construction: low budgets and short build times. And in hotter climates such as India, there is the additional challenge of cooling hundreds of pupils without excessive airconditioning. One solution from Khosla Associates in Bengaluru has met all three needs. Lattice panels harness the cityâ&#x20AC;&#x2122;s cooling south-westerly wind, while simple use of concrete structural elements and corrugated metal walls allowed the building to complete quickly and at a low overall cost. The project forms a prototype for a new approach to schools, which it is hoped can be repeated across India.

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29.8%

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Intelligence

POVERTY LEVELS IN INDIA Number of people on the poverty line has more than halved over the past 18 years Source: World Bank

45.3%

INVESTMENT

CHINESE INVESTORS UP DOWN UNDER Wealthy Chinese investors are increasingly turning to Australia’s property market as a 19% safe haven for their money, as a sweeping 60% 17% 16% 14% 13% corruption crackdown by the government in China threatens their assets back home. Australian property has long been a popular destination for Chinese investment – both legitimate and illegitimate – but the flow appears to have accelerated since Seattle Kuala Lumpar Dublin London Seoul Yeouido, Suburban, US Malaysia Ireland West End, UK South Korea China began a corruption crackdown in late 2012. China was the top source of foreign capital investment into Australia’s real 13% 11% 10% 10% 10% estate in 2013, reports the Australian foreign investment review board, which received approvals to invest nearly A$6bn ($4.67bn) LOUISE BROOKE-SMITH FRICS RICS PRESIDENT in the sector, up 41% on the previous year. TAKING D IVERSITY MAKES A POSITIVE DIFFERENCE . Evidence shows that companies Although many investors have legitimateJakarta San Francisco San Francisco Houston Houston New York LEAD funds to invest, firms such as JLL report Indonesia THEDowntown, US Peninsula, US nurture Suburban, talent US Downtown, Downtown that attract and from aUS wider pool are likely to be more Opening up the Manhattan, US that many are concerned about being successful. Poor performance in the diversity league tables is not just pathways to caught up in an investigation, which can the industry disappointing from the perspective of equality and corporate and social is crucial to look into the affairs of dozens of associates responsibility – it is also bad for business. Globalisation has transformed avert a skills of the main target, and losing wealth. the culture of consumer habits and the companies best able to engage with shortage “What we see at the moment is that anticipated by different groups will thrive as a result. The most successful organisations there are more Chinese who would likely 65% of CEOs will be those that draw people from a wider range of backgrounds. send more money out of the country so Diversity is not about political correctness or the slavish pursuit of they don’t get caught up in this crackdown,” management theory. At its core, diversity is about talent. RICS offers access said David Green-Morgan, global capital to the most sought-after professional status, and I believe this goes hand in markets research director at JLL. Ordinary Chinese citizens can legally hand with attracting and retaining the most sought-after talent. The better transfer $50,000 overseas each year, talent we can attract, the greater value will our status have. but vast amounts of money leak out of research has suggested2011 that 65% of CEOs in the real estate sector 2004 2005 2006 2007 2008 PwC2009 2010 2012 2013 China through a variety of loopholes. identified talent management, retention and leadership skills as the main State employees in particular, whose challenges for the next 10-15 years, and almost the same proportion are spouses or children live in foreign 128K 136K 136K worried about finding the skills they need. 145K 146K 141K Overnight countries, are often accused by154K Overnight Overnight Overnight Overnight Overnight visits The RICS Futures programme offers some insights into what this may 181K Overnight visits visits China’s ruling using overseas visits party of visits visits Overnight seven core themes to help us prepare visits mean in practice. We have identified 215K connections to illegally move assets. visits Overnight for possible future scenarios: leadership, sustainability, ethics, forward 269K visits Overnight thinking, technology, “multidisciplinarity”, and networks. visits While these headings are a necessary shorthand for a multitude of overlapping and complex issues, they suggest the areas across which the most talented professionals of the future will need to work effectively. It is clear to me that we need powerful role models to inspire young talent to join us, and senior professionals who are committed to coaching and mentoring talented individuals. We also need an innovative approach to education – the School of the Built Environment is a stand-out example – an increased commitment from industry to open up apprenticeship schemes, and significant encouragement to teenagers considering their career options. RICS is taking diversity very seriously and we welcome efforts by members BARANGAROO POUCHED to encourage the talent of the future to pursue a career in the industry. Lend Lease has presold all 159 flats at Barangaroo South scheme in Sydney, many to Chinese investors Follow Louise Brooke-Smith on Twitter @LbsLouise

INFOGRAPHIC IAN DUTNALL ILLUSTRATION BERND SCHIFFERDECKER

“We need powerful role models to inspire young talent to join us”

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rlb advert -3mm bleed.pdf 1 19/01/2015 15:03:17

CMY

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JAPAN

TOKYO TOPS TABLE OF WORLD’S MOST COMMERCIALLY ATTRACTIVE CITIES

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Android version of global CPD app launched RICS’ global CPD app is now available for Android and features a simplified log-on and welcome screen, as well as some new, additional features to those available on RICS’ iPhone app. Available in a range of languages, including simplified Chinese, in-app messages encourage users to complete planned activities when the due date arrives. The app will also issue reminders when the CPD year deadline approaches. Users can view planned, completed or all recorded activities for the present, previous and next CPD year. Members elected at inaugural RICS Japan Council meeting RICS Japan Council held its inaugural meeting in December, at which six members were elected to play a leading role in advising the development of RICS in the country. The members are Miho Asano (Daiwa Real Estate Appraisal), Nakao Iijima (Mitsui Fudosan Investment Advisors), Yuichiro Kawaguchi (Waseda University), Yoshio Nakayama (Xymax Real Estate Institute Corporation), and Tsunenari Kano (The Building Surveyor’s Institute of Japan). Heading up the Council, Paul Watkinson was appointed Chairman of RICS Japan 2014-15. RICS scholarships awarded to three Thai students Three outstanding undergraduate students in Thailand have received RICS scholarships. Bill Jones, RICS ASEAN Managing Director, visited Thailand’s Thamassat University in November to give a presentation on RICS’ work in Asia, and gave out RICS’ annual Scholarship Award to the highest-scoring real estate students: Punnawich Pornsukanan (Gold); Kanasanan Theerathumsathein (Silver); and Yadanut Tansai (Bronze).

SINGAPORE BLING Singaporean sovereign wealth fund GIC bought Pacific Century Place, by Tokyo railway station, for $1.7bn in October last year

Tokyo has taken the top spot in JLL’s 2014 Global Commercial Attraction Index, which measures a city’s economic and real estate power, among other key variables. The index found that Tokyo’s global competitive position is tied to its unique economic scale as the world’s most populous city. Greater Tokyo’s economy exceeds $1.4tn, and with nearly 38 million consumers, its domestic market far exceeds that of New York, London and Paris. Defined by JLL as a “Super City”, Tokyo also has the world’s largest stock of commercial offices – more than $50bn of commercial property was transacted in the metropolis

PAGETURNER Our urban spaces are more digitally connected than ever before. From security cameras to sensors in the sewers, the contemporary city is permeated with networked information technology. The grand vision of the smart city is one in which such technologies can be

over the past three years. The untapped potential of Tokyo’s real estate is well recognised by investors across the globe, many of whom are targeting the city, attracted by its newfound energy and momentum. Furthermore, JLL expects Tokyo to top the global league table for prime office rental growth in 2015. “The evolution of Tokyo and its real estate market over the next decade holds an intriguing mixture of vast promise and perplexing challenges,” said Rosemary Feenan, director, global research at JLL and author of the report. “Not only are the 2020 Olympics set to give a huge boost to the city and its international reputation, but to meet its own aspirations of improving its world position, Tokyo may also have to absorb a number of significant changes to its fabric and lifestyle, and even to its personality.” Among these changes will be how Tokyo refreshes its global reputation and alleviates some of the ongoing constraints on international business activity. The firm says the real estate industry will play an essential role in this, for example by improving transparency, and by increasing the focus on green buildings as key selling points for investors and corporate occupiers. Find out more about Tokyo 2020 on page 24

AGAINST THE SMART CITY Adam Greenfield

harnessed to achieve unprecedented levels of efficiency, security, convenience and sustainability. However, Greenfield explores the ways in which this discourse treats the city as an abstraction, and also looks at why the urban planners of tomorrow’s cities may

be making the same mistakes of the past. Nominated by Steven Ramage FRICS, Against the Smart City is a must-read if you are interested in how smart cities may develop. WHAT ARE YOU READING? Tweet to let us know, using #RICSmodus Q1 2015_MODUS A SI A

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Urbanisation in emerging nations is occurring at an explosive rate and planners, engineers and developers are losing the battle to keep up. George Bull reports

CITY

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PLANNING INFORMAL ECONOMY FUELS SPREAD OF INFORMAL SETTLEMENTS

f there is a common theme running through Latin America’s fastest growing markets, it is that largescale urban planning is stuck playing catch-up. From Mexico City to Santiago, opportunistic development is dictating the direction of growth, resulting in congested and dislocated cities. Rather than nurturing a denser urban core, the main characteristic of these cities is a hollowing out of the original central business districts and downtown areas. “Many properties in the old colonial centres are under multiple ownership, which makes it very difficult to obtain assets to redevelop,”explains Tim Gifford FRICS, Miami-based senior vice-president at CBRE Global Capital Markets. “But more importantly, there just isn’t the infrastructure or planning to enable that redevelopment on a cost-efficient basis.” As a result, developers seek out available land near ring roads or highways. Many are converting old estates in suburban neighbourhoods or tracts of industrial land into commercial urban centres. What tends to be left downtown are government buildings and ageing residential properties. As private development creates new city districts, the government is left chasing after it to build the infrastructure. The latest city to experience this shift is Lima. In the past eight years, economic growth has averaged 7% a year in the Peruvian capital, faster than anywhere else in Latin America, and today about 9 million people make their home in the city – almost a third of Peru’s total population. Gifford suggests the governance structure of the city is not conducive to longterm urban planning. Although Lima has a defined greater metropolitan area, it also has municipalities governed by mayors who have their own agendas. So in the absence of a shared vision for the city, development generally follows the path of least resistance. The other critical factor is traffic. As economic growth drives the expansion of the middle class, more cars than 18

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GROWING PAINS Almost one-third of Peruvians live in Lima (left) and the city is expanding upwards as well as out; Jakarta’s crippled roads (centre) cause slums to sprout up on the city’s edge, which in Lagos means building your house on water (right)

highways can cope with hit the road, turning even short commutes into agonisingly slow grinds (see box). This drives developers out. A similar dynamic is exerting itself in the Indonesian capital of Jakarta. “If you came here, you’d be quite surprised by the quality of the buildings,” says James Austen MRICS, head of retail at JLL in Indonesia.“What lets it down is the infrastructure – the traffic is so bad.” As a result, Austen says townships are starting to mushroom up around the edges of the city’s peripheral markets. “Jakarta bases a lot of its entertainment around malls, which survive because they’ve got their own catchment area. Because it takes so long to travel anywhere else, malls can be supported by their local population. A lot of big-box retailers are now looking to expand into these markets.” But to focus exclusively on how the market is shaping these cities is to ignore the communities that enable its growth – most of which are informal. In Lima, more than half of the population make their living from the informal economy, and its asentaminentos humanos (human settlements) sprawl out from the city centre into the surrounding hills. Informal settlements will always exist to some degree, suggests Gifford. Many of the slums in Lima and Rio de Janeiro, for example, are multi-generational. The bigger question is how you enable their successful transition from informal to formal. In 2012, violent clashes broke out in the Pinheirinho shanty town near São Paulo, as slum-dwellers fought relocation efforts that would leave them with longdistance commutes to their jobs. “The new urban poor are often working in the informal sector and that means they need to be close to it,” says Gifford.“Even if you could provide the housing, it’s very hard to dislocate individuals because they have a great urban location. The place where you will most likely be able to provide housing will be a one- or two-hour bus ride away. So while it might be better housing, a better neighbourhood with better infrastructure, where is their employment base?” From the favelas of Rio to the floating villages of Makoko in Lagos Lagoon, informal settlements are often the first landing point for a population streaming in from the

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Urbanisation

CASE STUDY

Brazilians live life in the bus lane

countryside. In the built-up areas of the Nigerian capital, for example, there are 20,000 people per square kilometre, about 70% of whom are believed to live in slums. “Many governments don’t want to encourage people to come, so they’re not planning for it,” says Tony Mulhall MRICS, Associate Director of RICS’ Land Professional Group. “But that flow from rural to city is almost guaranteed. So the aim should really be how to organise the initial arrival in a way that can be retrofitted subsequently, because the market is not going to deliver the basics.” Poor governance structures in these cities mean that even if there is a plan, the state will often fail you as well.“We did some work on affordable housing in Nigeria and it’s just a shocking record of non-delivery,”says Mulhall. The challenge that the rapidly urbanising city poses for planning, then, is that many of the existing mechanisms for delivery are predicated on things turning up in a perfect, or at least predictable, way. A more incremental approach is needed so that you can build towards an ideal standard for housing and development, he adds. But what is an“ideal”standard for an imperfect situation? Mulhall’s view, and it is one he has shared with UN-Habitat (the United Nations Human Settlements Programme) and the UN Economic Commission for Europe, is that for affordable housing, planning needs to underwrite a quality that is both low enough for the building to be delivered locally, but high enough that a mortgage could be taken out against it in the future. This, Mulhall explains, “begins to define the building as an asset, and as an asset it’s useful as security for a loan”. People need access to jobs to fund those mortgages, of course, which is often where the planning system falls down. Vast unoccupied residential blocks in some of China’s lowertier cities are useful reminders that building houses is only part of the picture – there is a basic community infrastructure that needs to come with it. “People might think that it’s quite a luxury to go from having nothing to what I’m describing,” says Mulhall. “But that’s what longterm resilience is – it’s not just about putting a roof over someone’s head.” »

The new urban poor often work in the informal sector and need to be close to it. The place you are most likely to be able to provide housing will be a one- or two-hour bus ride away TIM GIFFORD FRICS CBRE Global Capital Markets

Could one of Brazil’s fastestgrowing cities demonstrate how to deliver reliable and sustainable transport services on a tight budget? Curitiba, a city of 1.6 million people in the south of Brazil, is best known as an exemplar for urban planning. Unable to afford a rail system, and struggling to deal with rapid population growth, in 1974 Curitiba developed a network of local bus routes on which buses – each carrying 270 passengers – move in their own lanes. They are reported to travel just as fast as an underground system but for less than 2% of the capital construction cost. It is estimated that the introduction of the bus rapid transit (BRT) system has resulted in 27 million fewer car trips per year. Although the city has one of Brazil’s highest rates of car ownership, the BRT accounts for more than 70% of daily journeys in the city and it is cheap – Curitibanos spend well below the national average on travel. The system shows how integrated transportation and land-use planning can improve a city’s liveability. Curitiba’s masterplan promotes a linear model of urban expansion, in which commercial growth is encouraged along transport arteries, reducing the importance of a single downtown area and thereby easing peak congestion. Q1 2015_MODUS A SI A

Urbanisation

INFRASTRUCTURE MANILA BATTLES FLOOD OF DEMAND FOR WATER

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was compounded, says Marsden, by the fact that development has robbed the city of adequate run-off areas. A lack of green infrastructure can be a real problem when the power of economic growth forces people to live in unsafe places. Tom Venables, a director in Aecom’s planning department, is working on a large-scale project in the Saudi Arabian city of Jeddah, which he says has a problem with mass migration and unplanned settlements, many of which get built in the wadi systems – essentially dry riverbeds – around the city. “Jeddah has been very receptive to green infrastructure. When the wadis flooded recently, people’s homes were swept away and a lot of conversations after that were about how we could improve the situation. Aecom’s original task was to build storm drains, but we’re now looking at how we can take a more naturalistic approach.” The combination of rapid development, inadequate infrastructure provision and climate change poses a real risk for these fast-growing cities. Tiwari suggests that some of India’s largest river basins, for example, will see a 5%-20% increase in drought by 2050, with adverse effects for the cities they supply. And despite Manila’s progress, water security remains one of its biggest challenges. Per capita water use is already increasing as the economy grows and the government is seeking to extend its already stretched supply source at Angat Dam to the northern province of Bulacan. “As the city has grown, the number of water sources hasn’t increased,” explains Marsden. “Drought and demand have meant that the level at Angat has dropped well below its minimum level this year, so the government has had to stop irrigation, which then has an impact on rice production.”

Installing sewerage networks is a real challenge. The roads are busy and narrow and the logistics of digging them up are complex ADRIAN MARSDEN Arup

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anila, Philippines, 1995. Three-quarters of homes in the east of the city lack a 24-hour water service and only 8% have a sewerage connection. Almost two-thirds of the water produced is being lost to leaks, poor metering and illegal connections. The poorest residents are forced to buy water from street vendors, often paying up to seven times more per litre than customers connected to the state utility company. Faced with mounting evidence that the city would soon be facing serious water shortages, the government passes the Water Crisis Act with a mandate to privatise the state provider and improve the quality and coverage of water and sanitation services. Fast-forward to 2006, and in the east of Manila the number of households with 24-hour access to water is up from 26% to 99%. The Manila Water Company has also launched a “Water for the Poor” programme, which allows residents in the poorest neighbourhoods to pay just $1.50 a month for clean water. By 2010, lost or “non-revenue water” has been cut from 63% in 1997 to 11% through a 13-year programme combining engineering support and strengthening community partnerships. Today, Manila is the world’s most densely populated city, with more than 46,000 people per square mile, and its wider metropolitan area, home to more than 20 million residents, is the fifth largest globally. To put the success of its approach to water services in perspective, consider that not a single city in India claims to provide adequate water to all its citizens. Some cities, such as Nagpur, Hubli and Dharwad, have recently piloted 24/7 piped-water supply, but they are yet to reach the necessary scale to serve the entire population. Piyush Tiwari MRICS, Associate Dean and Director of the School of Real Estate at the RICS School of Built Environment at Amity University in India, says that an important lesson from Manila’s experience is that private sector involvement can help improve the operating ratio. “With private sector financing, the water systems have to be structured in a way that makes them bankable. This pushes utilities to undertake measures, such as reduction in non-revenue water, improved collection efficiency and metering. Although these are straightforward principles, most utilities companies in the developing world face problems in implementing them.” But getting water in is often easier than getting it out. Adrian Marsden, water team leader for Arup, has been kept busy constructing wastewater treatment facilities in Manila for the past four years. One reason for that is the ambitious sewerage and sanitation targets set for the city’s water companies. “Coverage is only at 13% of the population,” he says. “But installing sewerage networks here is a real challenge because of the geography. The roads are so busy and narrow, that the logistics of digging them up to install the pipes are complex and expensive.” Most of the city’s waste is held in septic tanks before finding its way into Manila Bay or Laguna Lake, which are forced to act as giant settlement tanks. So achieving these targets is essential to avoid contamination, especially given Manila’s vulnerability to flooding. When tropical storm Ondoy hit in 2009, nearly 80% of the city was flooded. This

Current practices of designing water management systems that do not account for the implications of climate change will come under severe pressure, argues Tiwari. “These considerations need to be integrated in policies and due diligence mechanisms for infrastructure right from planning through design, construction and implementation. While cost may pose a constraint, an alternative that fails to address climate change is not an option.”

HOUSING BOOMING CITIES STRUGGLE TO ACCOMMODATE MIGRANT WORKERS

owhere has the might of economic growth resulted in such a rapid urbanisation of a country’s people than in China. Cities such as Shenzhen, which was home to just 30,000 people in 1979 and now has a population of 12 million, have seen more than 50% of that growth in the past decade. The government has ambitious plans to move a further 100 million residents out of the countryside and into urban areas by 2020, so how do Chinese cities intend to succeed where so many other countries have failed? In 2007, recognising that rising prices were putting the housing market out of reach for the urban poor, China started to rebuild its public-sector housing system on an incredible scale. An RICS-commissioned report: More doesn’t mean better: inefficiencies in China’s affordable and social housing sector, found that, between 2011 and 2015, city governments will have constructed 36 million affordable and social housing units. There were more than 24 million starts by the end of 2013, and targets for around six million units a year to be delivered this year and next look likely to be met. But until recently, access to affordable housing has excluded migrant workers who, as registered rural residents, were not entitled to any of the social benefits offered by the city. China’s Hukou, or housing registration system, in which the population is classified either as rural or urban citizens, was initially created to prevent a mass influx to cities and the

KILLER IN MANILA Only 13% of Manila’s population is connected to sewerage facilities and when the city floods (left) the run-off flows into Laguna Lake, washing away slums on its shore (right)

emergence of slums as the economy grew, explains James Macdonald, head of research at Savills China. “But as manufacturing and exports have slowed, the government is looking to stimulate domestic consumption. Its attitude to city-building is changing to encourage more people to buy into the city and put down roots.” On 16 March 2014, China’s State Council released the National New-type Urbanisation Plan to utilise, in premier Li Keqiang’s words, “human-centred urbanisation” as an engine to foster economic growth. As part of the plan, which will speed up urbanisation across the country, city governments will be required to extend affordable social housing to migrant workers. Dr Albert Cao, senior lecturer in the department of real estate and construction at Oxford Brookes University in the UK, explored this shift as part of the RICS report. He says local governments have, on the whole, been reluctant to open the floodgates to migrant workers, but there are others that see it as an opportunity to compete for workers. He compared two cities: Guangzhou, southern China’s largest city; and Wuhan, a city of more than 10 million people in central China. Average house prices in the cities have rocketed by 134% and 80% respectively since November 2007. “Guangzhou refused – it already has huge numbers of migrants and providing access to social housing would also mean granting access to schools and healthcare,” Cao explains. “But Wuhan, which needs more workers, started last year to allow those migrant workers with permanent jobs to join the social housing scheme.” Reform is needed in China, Cao says, both to ensure that local governments are not financially penalised if they allow migrant workers access to social housing, but also to accommodate those who want to become urban citizens and would be indifferent if they lost countryside rights, and those that would rather head home and start their own businesses. “Reforming the Hukou system would enable people to become part of a local community, without having to make a choice between the city or their homeland.” The advantages of the Hukou system, which has essentially allowed local governments to periodically » Q1 2015_MODUS A SI A

Urbanisation

BUILDING STANDARDS

move on shanty towns of rural migrants because they have no rights in the city, are becoming less obvious to a nation looking to urbanise. As it becomes harder for workers to find even the most basic accommodation as values rise, they have to return home. “That’s why the central government is pushing for integration into the city,” Cao explains. But speeding up urbanisation will bring its own challenges for liveability. It is likely to have sweeping environmental consequences and, as Barry Piper MRICS, chief operating officer, Asia, for Faithful+Gould, points out, “hatred of China’s deteriorating environment, particularly the noxious haze over cities, is growing fast.”While the new urbanisation plan sets out measures to tackle these issues, Piper says China’s hopes for a “green leap forward” rest on the success of experiments such as eco-cities, and it is hard to tell if these will take off. “Eco-cities were intended to be models of green urban design, but many have become a laboratory for planners seeking to realise their futuristic visions,” he explains. “Not a single project has been fully completed.” The ability to build houses – or even cities – is one thing, building good-quality, viable communities is another. Unlike many of their peers, Chinese cities have a history of building and investing before there is demand. This has resulted in white elephant schemes, particularly in lowertier cities, and the pace of growth has pulled in plenty of companies outside the real estate sector, which has impacted on build quality. “We are now looking at a slowdown in real estate markets where demand hasn’t emerged as quickly as anticipated. We hope this period of consolidation will weed out weaker competitors,” says Macdonald. Cao’s report found that many large social housing projects were “far away and poor in terms of accessibility at least in the early years of development”. But he adds that reform could be the catalyst for a rise in standards.“More and more cities will follow the example of Wuhan and start to admit migrant workers. All Chinese cities are good at one thing – creating jobs – and the first condition is that a city has to be able to financially provide for that population. If they realise that more people are better for the city, they will try to innovate and improve their offer.” 22

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All Chinese cities are good at one thing: creating jobs. If they realise that more people are better for the city, they will try to improve DR ALBERT CAO Oxford Brookes University

ON THE RISE Tianjin Eco-city – a collaboration between the governments of China and Singapore – is expected to be home to 350,000 residents by 2020

Following Cambodia’s induction into the Association of Southeast Asian Nations (ASEAN) in 1999, the country was required to introduce building standards. RICS was asked to advise on how to introduce an appropriate system from scratch. Martin Russell-Croucher MRICS, Director of Special Projects and Sustainability at RICS, led the project. “There is a lot of inward investment in Cambodia and that demands a level of construction that up until now they’ve had no way of delivering,” he explains. Not only can building standards save lives and reputations, the cost of being out of business can be catastrophic. “Between 10%–20% of businesses never get going again,” says Russell-Croucher. Producing a set of recommendations is just the start, enforcing the new standards is the most important thing, he adds. Following the work in Cambodia, RICS has been building a coalition to support a set of high-level international standards. Several organisations, among them the World Bank and the International Code Council, have already signed up. Russell–Croucher says: “The intention is to make these accessible enough so they can be adapted to individual countries.”

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RICS helps Cambodia tailor new guidelines

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Tokyo 2020

RETURN OF THE RINGS 五环回归五輪の再来 In 2020, Tokyo will host its second Olympics. Maggie Hohle sees how it is getting into shape

CRITICAL MASS Zaha Hadid’s stadium will form the centrepiece of the Heritage Zone but its design and scale has been criticised 众矢之的萨哈哈帝设计的竞技馆将成为遗产区的焦点，但其设计及规模备受批评決定的なボザハ・ハディド氏設計の競技場はヘリテッジゾーンの目玉となるが、そのデザインと規模は非難の的になった

Fifty years on from Tokyo’s last Olympics in 1964, the success of the city’s 2020 Games will hinge on the enormous challenge of planning, funding, building and managing the infrastructure required to host an Olympics in such a crowded metropolis. Tokyo now has a daytime population of 35 million – 50% more than Seoul, New York City or Mumbai. So what can visitors and athletes expect to experience in terms of new transportation and infrastructure, and what will it cost the city? Hirokazu Anai, an analyst with JP Morgan Japan, predicts that total Olympics-related construction costs will be in the region of ¥3-4 trillion. In the original bid for the games, the Tokyo team announced commitments such as a “dedicated $4.5bn reserve fund” and an ambition to successfully hold “one of the most compact Games ever … in the heart of a big city.” One example of this compact efficiency will be how Olympians and Paralympians won’t need to travel more than 8km from the Olympic Village to reach 28 of the 33 Olympic venues. This means most athletes will be able to reach their competition venues in less than 30 minutes, and 72% within 10 minutes. The two main Olympic sites will be the Tokyo Bay Zone, “a model for future urban development”, and the Heritage Zone »

东京将于2020年東京が2020年に二度第二次主办奥运会, 目のオリンピックを開催 Maggie Hohle为各个する。その全容をマギ准备功夫作出介紹ー・ホールが解説する东京上次主办奥林匹克运动距今五十年，即1964年。 2020年奥运能否成功，取决于是否能应付在人口稠密的大都会举办奥运所面对的艰巨挑战，包括基建规划、拨款、建造和管理等等。东京目前的日间人口高达 3 , 5 0 0万，比首尔、纽约或孟买多 50%。新的交通和基建设施将会为亲临参与奥运的游客和运动员带来什么样的体验﹖东京又要为此投放多少资源呢? 根据日本摩根大通分析员穴井宏和估计，跟奥运相关的总建造成本大约为3-4万亿日圆。在申办奥运会时，东京代表团公布将承担“45亿美元专用准备金”，并筹躇满志地表示要“在大城市心脏地带成功举办有史以来最密集的奥运会。” 其中一个体现这种高密度效率的例子，是奥运会和残奥会选手从奥运村前往33个奥运场馆之中28个时，路程均少于8公里。换言之，大部分选手可以在30分钟之内到达比赛场馆，其中72%场馆更可在10分钟内到达。东京奥运会的两个主要场地将位于号称“未来城市发展模范”的东京湾区，以及1964年奥运会场地的“遗产区”。这两个区有如两个互扣的椭圆，构成一个高效和便利的文氏图。东京都政府预期，在为期18天的奥运盛事间，每天将有多达92万游客。因此，虽然距离不远，但东京仍要展开基建和物流建设，令运动员和观众能畅快地参与这项盛事。若有城市能达到这个任务，那一定是东京。东京大部分公共运输系统本来 Q1 2015_MODUS A SI A

LEND A HAND Iconic Yoyogi National Gymnasium, part of the Heritage Zone, will host the handball competition in 2020 助一臂之力具标志性的代代木竞技场位于遗产区，是2020年奥运会手球比赛的场地

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– a legacy from the 1964 Games. The zones appear as interlocking ovals, a Venn diagram of efficiency and ease. During the 18-day extravaganza, the Tokyo Metropolitan Government (TMG) expects 920,000 visitors a day. So while distances will be short, Tokyo will have to pull off infrastructural and logistical feats to keep athletes and spectators moving and happy. If any city can do it, Tokyo can – most of its public transportation system is already incredibly efficient and heavily used, as Paul Watkinson MRICS, Chair of RICS Japan Council and GE Capital Real Estate’s managing director of risk management for AsiaPacific, points out:“Shinjuku station is the busiest in the world, with 3.5 million people passing through each day.”Furthermore, Tokyo International Airport, just beyond the 8km circle and

已有非常高的效率，而且使用率也相当高。正如皇家特许测量师学会 (RICS)日本分会主席兼GE Capital Real Estate亚太区风险管理董事总经理Paul Watkinson所说： “新宿站是全球最繁忙的地铁站，每天有高达 350万人次经过该站。”此外，东京国际机场位于8公里圈以外不远，而且有单轨铁路连接东京市中心，该机场现正扩充航班班次。东京国际机场被ForbesTraveller.com 评选为全球最准时的机场。及至2020年，该机场将设有新泊车区、延伸跑道、改善交通，还可能兴建第五条跑道。 2020年奥运的筹备工作将有助加快改善东京的道路网络，以配合奥运会的举行。东京中央的交通挤塞相当惊人，平均行车时速只有16公里，是全国平均速度的一半，这显然需要改善。仲量联行工业与基建总监二瓶博和表示： “环形道路例如环状2号线，东京外环自动车道和首都高自动车

With new projects and rising order values, Olympic-related construction demand could increase

新たなプロジェクトと発注金額の上昇は、オ新的工程项目及定单リンピック関連の建設值上升，会推动跟奥需要の増加につながる可能性がある运相关的建造需求

HIROKAZU ANAI JP Morgan Japan

穴井宏和日本摩根大通

穴井宏和 JPモルガン証券

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助っ人としてヘリテッジゾーンにある国立代々木競技場はハンドボール会場となる

Tokyo 2020

with a monorail connection to the city centre, is expanding its flights schedule. Already named the world’s most punctual airport by ForbesTraveller. com, by 2020 it will have new parking areas, extended runways, improved access and possibly a fifth runway. Preparations for the 2020 Games will help speed up improvements in Tokyo’s road network in time for the event. Congestion in central Tokyo is horrendous: the average commuting speed is 16km/h – half the national average. Clearly, something has to give. Hirokazu Nihei, director of industrial and infrastructure insights at JLL, says: “opening sections of ring roads like the C2, the Tokyo Gaikan Expressway and the Metropolitan Intercity Expressway will significantly help ease” that congestion. When the final 8km, ¥357bn section of C2 is finished later this year, moving extraneous traffic away from the city centre and improving airport access, it will close the circle and give the Tokyo Bay Zone a new metropolitan entrance. Winning the Olympics has helped push forward the timetable for some of TMG’s city-wide greening projects to create connected green corridors with development and redevelopment projects. One such project is Loop Road 2, which opens an east-west axis that connects the national stadium in Shinjuku Ward to Chuo Ward’s Olympic Village via a cluster of hotels that will be used by the International Olympic Committee. The redeveloped Toranomon neighbourhood on a 1.4km section of the road boasts three new buildings – among them the 52-storey Toranomon Hills – in a designated “Asian Headquarters Strategic Special Zone”, which provides tax breaks for foreign businesses that locate there. The forward-thinking project relies on a multi-level road system: a tunnel houses the expressway, leaving aboveground lanes for city traffic. The new section, Shin-Tora Dori, is 40m wide with 13m-wide, tree-lined sidewalks and has been dubbed the ChampsElysees of Tokyo. Watkinson expects the work on Loop Road 2 “to provide a catalyst for further development.” »

道等落成后，将大大舒缓交通挤塞状况”。而耗资3,570亿日圆的环状2号线最后8公里路段于年中落成后，则可将与奥运无关的交通转移到市中心以外，改善来往机场的交通。届时，交通圈将会完成，并为东京湾区开辟新的首都圏入口。取得奥运主办权有助东京都政府提前展开部分全市绿化计划，利用绿色通道串连各个发展和重建工程。其中一个这类工程是环状2号线。该环形线开辟一条东西轴线，借着多间由国际奥委会的人员使用的酒店将新宿区的国家体育馆与中央区的奥运村连在一起。重建的东京都港区虎之门1.4公里范围的道路会兴建三座新的建筑物，包括52层高的虎之门之丘。这些建筑物位于指定的“亚洲总部战略特区”，位于该区的外国企业可享有税务优惠。这些高瞻远瞩的工程项目有赖一套采用地底高速公路的多层道路系统，腾出地面车道供城市交通使用。新建的新虎路宽 4 0 米，旁边的13米宽行人道树木林立，被誉为东京的香榭丽舍大道。 Watkinson预期，环状2号线工程将为“进一步发展提供催化剂” 。重用旧的奥运场馆有助东京贯彻其

ROAD WORKS Construction of multi-level Loop Road 2 has created development potential in crowded city and will ease congestion 道路工程兴建多层环状 2号线为人口稠密的城市创造了发展潜能，有助舒缓塞车问题道路建設複層式の環状 2号線の建設は過密都市における開発機会を創り、交通渋滞の緩和を促す

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Tokyo 2020

HOME ADVANTAGE Athletes’ Village (below) will intersect the two Olympic zones, reducing journey times to venues 主场之利选手村（下）位處两个奥运區之间，可缩短往返两区的时间便利な宿舎選手村（写真下）は2つのオリンピックゾーンの間に位置し、会場への移動時間を削減

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Reusing the old venues helps Tokyo adhere to its own criteria: to minimise travel time and maximise the Olympic experience. The three refurbished facilities are in the Heritage Zone, a main site of the 1964 Games. Bid documents claim that refurbishing will “extend their legacy for at least 50 years”– an eternity for modern Tokyo. These iconic structures are in continuous use and hold a special place in the Japanese psyche, representing Japan’s commitment to sport and spectacular postwar growth. Among them are Yoyogi National Gymnasium, Tokyo Metropolitan Gymnasium, and Nippon Budokan – or Martial Arts Hall – which was inspired by the ancient temple complex at Ho ¯ryu ¯-ji in Nara. Budokan will host Judo in 2020, just as in 1964. Twelve other existing venues will be used and 22 will be built, only half of which will be permanent. The biggest new facility will be Zaha Hadid’s controversial 80,000-seat Kasumigaoka National Stadium, set to replace Kenzo Tange’s 1964 original. In 2013 the government slashed its funding from ¥300bn to ¥169bn – forcing Hadid to reduce the building’s visual weight – following attacks by renowned Japanese architects Toyo Ito, Kengo Kuma, Sou Fujimonto and Riken Yamamoto, who opposed its size relative to the surroundings. The downsizing has done little to placate them – Isozaki wrote last November that “the sight left me in despair”. Hadid hit back a few weeks later, branding the architects “hypocrites” and the row is still rumbling on. Energy efficiency was also an integral part of the Olympic bid: the national stadium will be partially powered by geothermal energy and solar power, by 2020 almost all railway cars will use Variable Voltage, Variable Frequency control and regeneration brakes, and 90% of buses will meet stringent carbon emission standards. The 44ha Olympic Village – the nexus of the two zones – will cost ¥105.7bn. There will be 21 competition and celebration sites and a new cruise vessel terminal. Designed to become the International Exchange Plaza after the games, the village may eventually

准则：尽可能缩短交通时间及优化奥运体验。三项翻新设施均位于遗产区，该区是 1964年奥运的主场地。申办奥运的文件指翻新工程会“ 将传承延续至少50年”，为现代东京缔造永恒。这些标志性建筑物一直备受重用，对日本人有特别意义，代表日本对体育的热忱和战后的辉煌发展，其中包括国立代代木竞技场、东京体育馆和日本武道馆。日本武道馆的设计灵感来自奈良法隆寺的古代寺庙建筑群。跟1964年奥运一样，2020年奥运也会在日本武道馆举行柔道比赛。另外，2020年奥运将利用12个现有场馆，并兴建22个新场馆，当中只有一半是永久性场馆。最大型的新设施是由萨哈哈帝设计、备受争议的国立霞丘陆上竞技场。竞技场设有80,000个座位，落成后将取代丹下健三为1964年奥运设计的原馆。政府在 2013年将拨款从 3,000亿日圆削减至1,690亿日圆，再加上日本著名建筑师伊东丰雄、隈研吾、藤本壮介和山本理显提出反对，指竞技场的规模跟四周环境格格不入，使哈帝不得不缩减竞技场的外观设计。然而缩小规模并未能安抚他们。矶崎新去年11月发表文章直指该设计“不堪入目”。数周后，哈帝反斥该批建筑师是“伪君子”，这些争

GOING SWIMMINGLY A permanent Aquatics Centre will be built at Yumenoshima Park in the Tokyo Bay Zone 游刃有餘位于东京湾区的梦之岛公园内将会兴建永久的游泳中心

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スイスイと国際水泳場は東京ベイゾーンの夢の島に建設

house another legacy – the Event and Sport Technology and Science Institute, which will be built with a mix of private and public funding. “We expect these projects to create new landmarks through the conversion of the Tokyo Waterfront City area into an entertainment district,” says Anai. In 1964, Tokyo residents were enlisted to house visitors to the Olympics. This request is not likely to be repeated for 2020, as there are already enough hotel rooms. However, the government’s Japan Revitalization Strategy, published in 2013, has an aim of trebling overseas visitor numbers to 30 million by 2030, and infrastructure improvements catalysed by the Olympics will help realise this goal. For example, the Tokyo Big Sight convention facility will be expanded by 44,000 m2 to serve as the International Broadcast Centre during the Olympics, and Anai predicts this “will result in a continued rise in the number of overseas tourists even after the games.” Furthermore, with“the announcement of new projects and rising order values owing to the inflation of construction prices, Olympic-related construction demand could increase.” Watkinson admits that “30 million visitors is a big number from where we stand today. But the Olympics will be a fantastic opportunity to demonstrate what the country has to offer.” tokyo2020.jp

议相信仍会持续。节能也是成功申办奥运的重要一环：国家竞技馆会局部利用地热能和太阳能发电。及至2020年，几乎所有的铁路车辆都会采用变压变频控制和再生制动器，90%巴士将符合严格的二氧化碳排放标准。耗资1,057亿日圆、占地44公顷的奥运村与两个区相连，共设21个比赛和庆祝场馆及一个新的邮轮码头。奥运会结束后，奥运村将会成为国际交流馆，并设立“活动及体育与科学研究所”。研究所由私营机构和政府拨款兴建。穴井表示：“我们预期这些项目会令东京临海副都心转型成娱乐区，为该区带来新地标。” 1964年，政府征用东京民居为奥运访客提供住宿。但对于2020年奥运而言，由于酒店客房供应充裕，因此这项措施将无须再用。不过，政府在 2013年公布了日本振兴战略，其中一个目标是在2030年之前将海外游客人数增加三倍到3,000万人次，由奥运会带动的基建改善会有助达成此目标。例如，东京Big Sight会展设施会扩充44,000平方米，并在奥运期间充当国际广播中心。穴井预测， “ 即使奥运会结束，海外游客数目依然会持续增长”。此外， “公布展开新的工程项目，及定单值由于建筑费用增加而不断上升，令与奥运相关的建造需求随之增加。” Watkinson承认， “从现时看，3,000 万人次游客是一个庞大的数字，但奥运会是让日本展示实力的绝佳机会。” tokyo2020.jp Q1 2015_MODUS A SI A

Astronautics

PROF. SIR MARTIN SWEETING OBE HonRICS EXECUTIVE CHAIRMAN, SURREY SATELLITE TECHNOLOGY AND CHAIR, SURREY SPACE CENTRE, UK In 1985, I was part of a small team who built and launched the UK’s first two micro-research satellites at the University of Surrey, from which we then formed a spin-off company, Surrey Satellite Technology. Now, 30 years later, we have a turnover of £127m ($192.2m) and employ 550 staff. We have designed, built and launched 43 nano- (1-10 kg), micro(10-100 kg) and mini-satellites (100-500 kg) into orbit. Our big idea has been to use off-the-shelf, commercial, electronic components. These have been tested for thousands of hours and are far more robust than more expensive, bespoke parts. How often does a mobile phone fail? Incredibly rarely. We have recently launched into orbit a beach-ball-sized experimental satellite based around a »

e, b o l he g . t f o ers iplines n r r co d disc orld u o f all myria this w n o of d ss t n o u r u c o re fo and a truly a s ber ntries job is m e m 0 cou their S ylor C Sha rew RI rly 15 n say d n yA aph ea ew ca togr n Pho y b n gh i illou ry f e ael W h v c i ds M But Wor 30

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Astronautics

Our big idea has been to use off-theshelf components. How often does a mobile phone fail? Incredibly rarely MARTIN SWEETING HonRICS Surrey Satellite Technology

STAR TECH Surrey Satellite Technology is constructing three highresolution observation satellites that will work in constellation for a Chinese mapping company

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PORTRAIT ANDREW J LOITERTON

mobile phone. A smartphone has everything a satellite needs – audio and visual sensors, a computer and GPS. We also use specially tested hard disk drives from commercially available laptops to store data on our satellites. We put these techniques to use in the most important projects. At present we are building 22 satellite payloads for Galileo, the European version of the US’ GPS system. It is vital that Europe has its own system because we cannot rely on just one – no matter how friendly the provider. Everything we do these days is linked to very precise timing, from financial transactions at ATMs to, of course, navigation. The Galileo will contain some of the most accurate clocks in the world. Each satellite is the size of a small van and they will travel around the world in groups of three to five, providing timing and navigation services to Europe and beyond. Our satellites also provide Earth observation data, such as real-time imagery to help rescue and support missions during disasters, as well as monitoring agriculture and tracking illegal logging. The technology was used in the aftermath of the 2004 Asian tsunami and Hurricane Katrina. Obviously, it is not much use having to wait for a satellite to reach the area in which you want to survey, or using week-old images if you are engaged in highly time-sensitive clean-up operations. This is where constellations of satellites taking daily images are particularly useful. We also have a more academic enterprise, the Surrey Space Centre, which operates out of the University of Surrey and employs 90 academics. The centre’s aim is to look between five and 25 years ahead to try to examine the space technologies we might build in the future. A current area of experimentation and exploration is dealing with space junk. If left too long in orbit, hardware can disintegrate. The small particles can take out satellites – as happened in 1996 [when a French reconnaissance satellite was hit by debris from an Ariane rocket – the first verified case of a collision between two objects in orbit]. There is more pressure these days to make sure your satellite doesn’t explode, and the space centre is looking at designing spacecraft to see how this problem might be tackled. One has the equivalent of a solar parachute that captures enough of the very thin air in space to help it fall out of orbit when its useful life is over. Another, more active solution, is a device that can grab pieces of debris and take them out of orbit. www.sstl.co.uk; surrey.ac.uk/ssc

BO WU MRICS PROGRAMME LEADER OF MSC IN GEOMATICS, DEPARTMENT OF LAND SURVEYING AND GEO-INFORMATICS, HONG KONG POLYTECHNIC UNIVERSITY

I guess you could say we have created the most accurate map of the moon BO WU MRICS Hong Kong Polytechnic University

In 2012, I was contacted by the China National Space Administration (CNSA) and asked to help them plan the safe arrival of the Chang’e 3 lander on the moon – which occurred on 14 December 2013. When you go to a new place you need an accurate map to help you get familiar with the environment. The moon is no different, except there isn’t GPS! CNSA has mapped the moon’s surface before, from lasers and cameras on orbiting satellites. However, each method is flawed: photogrammerty – by which we make 3D models from photographs – shows errors of up to several kilometres on the horizontal direction; laser measurement can be out by up to one kilometre on the vertical axis. By combining data from two different sources, we were able to remove errors from the data. This was important because if the area on which you are trying to land is higher than you think, there could be a disaster. We analysed the slopes of the moon because the module would not be stable at angles of greater than 15 degrees. We also mapped its surface to ascertain the distribution of craters. If the lander touches down in a crater, the rover would not be able to get out. Finally, we mapped all the large rocks that could have caused the landing module problems. I guess you could say we have created the most accurate map of the moon. When I saw the successful landing of the module from the real-time video, I breathed a sigh of relief – as, I’m sure, did all the other thousands of people who worked on the programme. As a surveyor, I feel honoured to be part of this mission [Chang’e 3 is China’s first lunar landing mission and is the first spacecraft to land successfully on the moon since 1976] and am proud of how we helped solve this critical issue. U n f o r tu n a te ly, t h e rove r h a s malfunctioned and cannot move around the surface of the moon – although the landing module is taking measurements. Nevertheless, our information might help further explorations of the moon’s surface in the future and lead to scientific and geographic discoveries. » www.lsgi.polyu.edu.hk

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Astronautics

HANS RUDOLF HAURI FRICS CEO, RUAG REAL ESTATE, BERN, SWITZERLAND Ruag Real Estate is a specialist industrial developer and one of the largest landlords in Switzerland. As a subsidiary of a technology company, two-thirds of our property is let to the various divisions within the group, while the remaining third is let on the open market. One of those divisions is Ruag Space, for whom we are creating a factory that will manufacture components for the European space programme. The 5,500 m2 (60,000 ft2) facility is in the Swiss town of Emmen, and will make payload fairings for space rockets. The site will be handed over to Ruag Space at the end of July this year. Ruag Space has made the payload fairings (nose cones) for every rocket the European Space Agency has launched since Ariane 1 in 1979. These fairings protect the satellites – or payloads – that are being put into orbit, harmlessly falling away from the rocket after it leaves Earth’s atmosphere. The fairing must keep equipment safe from the extreme forces unleashed during the first three minutes of a launch, during which the rocket reaches speeds of up to 8,000 km/h (4,971 mph) – namely vibration, ear-splitting noise, and temperatures of around 700°C (1,300°F). The nose cone must be as light as possible to save on expensive rocket fuel and is a composite of aluminium honeycomb core,

We always create sector-specific parks to facilitate the exchange of ideas between our divisions and our private tenants HANS RUDOLF HAURI FRICS Ruag Real Estate

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covered with layers of carbon fibre, cork, and up to 14 pieces of painted, reinforced plastic. The nose cone Ruag created for the Ariane 5, first launched 1998, is 17m long with a diameter of 5.4m, but weighs just 2.4 tonnes. The new factory will be centred around a large oven that can bond the nose cones in one piece. At present, they are created in an autoclave (high-pressure chamber) in two halves. The cones will also be inspected by a new robot, rather than by hand. The facility is an important development if we are to bring about price reductions in this increasingly competitive market. Although Ruag Space is a market leader in payload fairings, China, Russia and Brazil are creating new entrants into the commercial satellite launch market. We are already planning a second facility on the production site, which will include a paint shop that can also be used by Ruag Aviation, which is already based in Emmen. The wider Ruag Group thrives on exploiting these synergies – as an established airforce base, Emmen is already home to a host of supporting industries and a highly skilled workforce. As a developer, we always create sector-specific parks to facilitate the exchange of ideas between our various divisions and our private tenants. ruag.com/group/real-estate

ON THE NOSE Ruag’s real estate arm develops facilities that manufacture components for the European Space Agency, such as these nose cones under construction in Emmen, Switzerland

Asia BIM Conference 2015 The Mandarin Oriental, Kuala Lumpur 4 June 2015 Practice and Collaboration: Making BIM happen As a continuation of the successful BIM conferences run in the UK, this conference will, through a mixture of case studies and a panel session, allow you to assess how BIM is successfully implemented in practice around the world. For more information or to register, please contact Salim Aslam t +65 6635 4248 e msalim@rics.org

Find out more at ricsasia.org/events

Retail

THE FALL

hen Vashi’s Palm Beach Galleria Mall was completed in the mid2000s, it appeared to have a bright future ahead. Sited in one of Mumbai’s affluent business districts, the location made perfect commercial sense and it quickly attracted a strong line-up of tenants. But then, as India’s economic activity slowed during 2011-13, the tenants started to leave the mall one by one. Earlier last year, with just a handful left, the landlord announced that if he could get a good price for the scheme he would consider selling. The Palm Beach is by no means an isolated example. Several other malls in Mumbai are also on the market, and some landlords are even resorting to residential or office conversions, due to their unviability as retail outlets. Plans to construct new shopping centres in the area have also been shelved. It is a trend that is being played out in towns and cities throughout the country. JLL reports average vacancy rates in malls across India running as high as 19%. The situation is so severe that one local property expert claims of the 300 or so malls in India, “only a handful may be described as successful retail projects that have gained maturity”. Have Indian consumers, who rushed to the new generation of air-conditioned, Westernised temples to Mammon in their droves a decade ago, fallen out of love with shopping malls? And if so, what are landlords doing to woo them back? Many of the problems the nation’s mall owners face today were caused by the herd mentality that ensued between 2000 and 2008, Indian property professionals claim, as developers rushed to capitalise on the country’s rapidly growing middle classes. Much of the construction that took place in this period happened in a haphazard fashion with little consideration given to urban planning.“This is evident in cities like Pune and Ahmedabad, where the malls are suffering and a high vacancy rate is prevalent due to erratic urban planning,” says Pushpa Bector MRICS, senior vice-president and head of leasing and mall management at DLF. “These regions have a cluster of oversupply and so developers are facing a tough time.” The situation was further exacerbated by poor mall management, which resulted in many centres having a similar tenant mix and offering little differentiation to attract the more discerning Indian consumers, adds Shubhranshu Pani MRICS, managing director – retail, at JLL. »

AND RISE OF?

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Scores of shopping centres across India, built in anticipation of a demand that failed to materialise, now sit empty, for sale, or converted. But as a new, aspirational middle class finally emerges, could their fortunes be about to change? Words Simon Creasey

THE MALL Q1 2015_MODUS A SI A

STORE WARS (clockwise from right) Once the first mall in Navi Mumbai, Center One now has several local rivals; cricket fans watch a match in a mall in Kolkata; keep-fit enthusiasts put an empty car park to good use in congested Mumbai

“[Consumers] prefer the superior-grade malls that provide international standard facilities, retail offer and services,” Pani explains. “The retailers, too, prefer space in schemes that offer a good location, optimal design and business potential.” The global economic downturn, which badly affected shopping malls in the West as retailers went bust or downsized their portfolio, appeared to have limited direct impact on Indian malls as the country’s restrictive foreign direct investment (FDI) rules precluded many international brands from setting up in the region. However, it badly affected consumer confidence. “Consumption in India stagnated because consumer sentiment took a big beating and sales remained stagnant for a few years with marginal growth,” says Pani. “This resulted in brands being conservative on their expansion and rental returns reducing. Most brands realigned their formats and models and we saw many of them reducing store sizes to be more efficient and profitable.” This combination of factors led to many mall developments that were scheduled to open between 2009 and 2013 stalling, as the downturn caused funding sources to dry up. “One might even venture to add that this [development] gap came as a blessing in disguise for the segment, which underwent introspection and came out more mature from the crisis,” posits Vivek Kaul MRICS, head of retail services at CBRE South Asia. Indeed, Kaul is not unduly worried about the high vacancy rates at some malls, as it comes at a time when the Indian retail sector 38

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is experiencing rapid change. “The segment has developed very fast in comparison to mature markets and continues to evolve,” he suggests.“High vacancy rates are a fallout of just such a development phase, which will decrease over time.” He adds that average vacancy rates have started to improve over the last couple of quarters, but at stratatitled malls, where the fragmented ownership structure makes management difficult, rates remain high and this situation is unlikely to improve any time soon. The other glimmer of hope is the considerable shortage of available, goodquality retail space. Vacancy rates in the country’s higher-grade malls are running at less than 10%, reports JLL. Bector claims vacancy rates at DLF’s malls are less than 5%. As a result, she’s bullish about the outlook for the company’s portfolio: “Our DLF Mall of India [in the Noida suburb of New Delhi], which is set to be fully operational by the first quarter of 2015, is already 90% leased. This further reinforces the fact that good-quality projects by credible developers are going to stay and vacancy rates will be lower in such schemes.”

The sector underwent introspection and came out more mature from the global financial crisis VIVEK KAUL MRICS CBRE South Asia

She adds that rental values are also starting to show signs of recovery, increasing by as much as 15%-20% in some locations. This rise has been largely down to the efforts of mall landlords who are adopting a number of different tactics to boost vacancy rates. Some are using unorthodox methods to encourage footfall (box, opposite), whereas others are converting malls to alternative uses – Gold City Mall in Vashi is now an office complex, and Delhi’s Star City Mall has been converted to office and banqueting space. The remaining landlords are focusing on better mall management and working with retailers on “co-marketing initiatives and customer engagement programmes to ensure constant footfall”, adds Bector. As for future projects, it is clear that many developers have learnt from past mistakes. “Landlords are now adopting a structured approach for shopping mall developments

Retail

by undertaking proper feasibility studies, concept and positioning strategies, ratification of design by experts and allowing some flexibility of entry of international retailers,” Pani explains. They are also eschewing some of the more traditional approaches to mall management, adds Kaul. “The new generation of malls, in the leading cities at least, are moving away from the older strata-titled model towards a fully leased model, coupled with innovations such as revenue sharing and minimum guarantee rentals,”he says.“The segment has witnessed a new breed of home-grown mall management firms coming to the aid of retail developers. Newer malls also offer a better tenant mix and better design, primarily because of better planning, better advice and more opportunities in the market.”

mendments to the nation’s FDI regulations, which came into force in 2013, are also expected to improve the tenant mix. An influx of international retailers are now poised to enter the market, such as Marks & Spencer, which has a joint-venture agreement with Reliance Retail. Uniqlo and H&M are also looking for opportunities. “With the increasing presence of international retailers, there will be an improvement in demand,” predicts Inderjit Narula MRICS, president – business development, at developer Wave Infratech. India’s new REIT regime should also prove of significant benefit to the cash-starved retail real estate sector, which has been suffering from restrictive investment

guidelines during the recent downturn, Kaul suggests.“A key challenge for retail REITs to succeed in India would be the availability of investible, en-bloc assets in our leading cities, which are limited at the moment,” he explains. “Having said that, there are a few large players in the field who do own such assets and who have set the ball rolling.” The combination of falling vacancy rates – particularly in the higher-grade malls – rising rents, improved mall management and better planned developments that are due out of the blocks over the next 12 months or so, mean that property professionals such as Ashutosh Limaye, head of research and real estate intelligence service at JLL India, are cautiously optimistic about the future. Indeed, Limaye sees parallels between the current state of Indian retail and the situation in China a few years ago. “The Chinese market had experienced an evolutionary process very similar to the one being witnessed in India,” says Limaye. “However, a changing consumer profile and retail market dynamics ensured that demand for retail spaces in China eventually met with the right quality of supply. The time when the Indian retail market will match China on the evolutionary ladder and become more attractive to international retailers is still at some point in the future.” But if the market continues to evolve at its current rate of knots, it may not be long before India’s shopping malls are on a par with those in China. KEEP TRACK of the latest developments in your market at rics.org/commercialmonitor

ASSET MANAGEMENT

IMAGES GETTY IMAGES, CORBIS

Special offer: landlords pull out stops for shoppers Desperate times call for desperate measures and with many of India’s malls suffering from cripplingly low footfall, landlords are resorting to a range of unconventional tactics to attract customers through their doors. One of the most innovative landlords in this regard is Inorbit, which has introduced a range of events at its Malad mall in Mumbai, from hosting a World Series of Boxing bout – which it claims was a world first for a shopping mall – through to installing large screens in the mall’s food court to show

live sporting events such as Indian Premier League matches. It also hosts regular cooking classes, music concerts and self-defence workshops, and in 2010 it introduced a “Mall Walk” scheme, inviting people to use the mall for their morning stroll. Inorbit is not alone. The Alpha One Mall in Ahmedabad has organised a European film festival and last year played host to the Har Shehar Ka Junior MasterChef contest. Some landlords are allocating space for flea markets and allowing vacant units to be used as pop-up shops. They

are also organising mall-wide sales days, on which all retailers offer a set price reduction on goods sold in store. Discounts are also being offered on low footfall days in whole areas of malls – for instance, the food court at Growel’s 101 in Mumbai sells cheaper food on Tuesdays. Susil Dungarwal FRICS, chief mall mechanic at boutique mall advisory company Beyond Squarefeet, has trialled similar ideas, such as dedicated parking bays for women, community events, festival celebrations, competitions and even “lucky customer” draws.

“All customers who walk into the mall are given a coupon, irrespective of whether or not they make a purchase,” says Dungarwal. “This coupon entitles the customer to be entered into a “lucky” draw that is held the next day where prizes include discount coupons, gift vouchers or cash.” As for whether or not such tactics actually work, Dungarwal is unequivocal. “These events help to drive footfall in the malls – in fact, some events that we’ve undertaken have helped footfall grow by as much as 35%-40%,” he adds. Q1 2015_MODUS A SI A

STAYING POWER

The UK hotels market is booming, fuelled by record numbers of overseas visitors. Brendon Hooper reports

LATEST ATTRACTION Hong Kong-based Dorsett Hospitality International opened its first London hotel, the 317-room Dorsett Shepherds Bush in the former Pavilion cinema (1), in mid-2014 SHARD DRIVE Shangri-La Hotels and Resorts was the debut prelet at the Shard, signing for a 202-bed hotel back in 2005 and kick-starting Asian operators’ rush to open in London (2)

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D ESPITE THE LASTING EFFECTS OF RECESSION AN D WHAT SEEMS LIKE MORE REGULARLY occurring bouts of extreme weather, the UK hotels sector is enjoying hospitable conditions for growth right now. Tourist visitor numbers to the UK are reaching all-time highs, hotel transactions are heading for a record year, and hotel investment in both London and the regions is growing at a serious pace. “It’s a very interesting time,” says Will Duffey MRICS, senior vice-president in the hotels and hospitality group at JLL.“Over the past six months, we’ve seen hotel investment really pick up, and not just in London, where you’d expect, but also in gateway cities across the UK, such as Manchester, Newcastle, Leeds and Birmingham.” Figures from Deloitte show that in the first six months of 2014, UK-wide hotel transaction activity totalled around £1.5bn ($2.27bn) – the second strongest start to a year since the peak in 2007. As this was a 65% rise on the previous six months, the accountant believes there is a good chance 2014 will be a record year. What is more, as of mid-August, Savills reports regional transaction volumes were up 135% on the same period in 2013. Meanwhile, the London hotel investment market grew by 155% in the first quarter of 2014 compared with 2013, notes JLL, with a massive jump in investment coming from Asian buyers, rising from zero to 33% between two quarters. Driving all this activity are people coming from around the world to take in the sights – international visitors to the UK reached a record high of 32.8 million in 2013, surpassing 2007’s peak. The Office for National Statistics also found the first half of 2014 was the most popular period ever for tourism into the UK. London, for instance, reported an 8.6% growth in numbers, making it the most visited city in the world by overseas tourists. Tourists from Asia in particular want to holiday in the UK – visits by Chinese

LIGHT SLEEP In June 2013 Legal & General Property bought the Light in Leeds, northern England, which contains a Vue cinema and Radisson Blu hotel, for £91.8m

BY NUMBERS

INFOGRAPHIC IAN DUTNALL

EASTERN PROMISE Chinese visits to the UK have increased by at least 19% a year over the last three years. It is anticipated that this will continue to grow once simpler visa procedures are introduced Source: Savills

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For Chinese visitors coming to the UK, a hotel’s reputation is all-important. As a result, Savills predicts the number of Hong Kong and China-based hotel brands in the UK could double over the next three years, with London being the primary focus. For example, Hong Kong-based Shangri-La Hotels & Resorts opened a 202-bed hotel in the Shard in May, and Dorsett Hospitality International, also from Hong Kong, plans to launch two hotels in London by 2016. Their first is an eight-storey, 317-room hotel, which opened in the former Pavilion cinema in Shepherd’s Bush over the summer. Originally a protected building, the hotel group took care to retain the property’s historic facade. But it is not all about London – the rise in tourist numbers has helped boost the operational performance of hotels in regional cities. And as the general economy improves, it also means more business travellers are staying in hotels up and down the country for meetings or conferences. “It’ll be interesting to see how many overseas investors start to move out of London and buy in the regions over the next year,” says Duffey. “An investor can get a much better yield in the regional hotel market – around 7%, compared with the central London market of around 4% or 5%.”

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128K 141K 136K 136K Overnight 145K 146K 154K Overnight Overnight Overnight Overnight Overnight 181K visits visits visits visits visits

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nationals have risen exponentially over the past three years (graph, above). Marie Hickey, director of research at Savills, says: “The number of Chinese visitors to the UK is growing rapidly, driving hotel acquisitions by Asia-Pacific investors. This will be a key area for investment growth and could reach up to £500m ($756.6m) a year by 2015.” At the same time, following a relaxation of Chinese government restrictions on companies investing overseas, developers from China are funnelling increasing amounts of money into UK property. Research from JLL reports a 33% rise in Asian investment into London’s hotel market in the first quarter of 2014, compared with zero in the same period the previous year, with private equity firms making up over a quarter of the investment total. Interestingly, the firm reports investment from sovereign wealth funds is on the rise, making up 28.4% of first-quarter investment this year, compared with zero in the fourth quarter of 2013. “Capital from China is not only going into purchasing investments,” adds Duffey, “but also into brands building hotels, especially in central London, in anticipation of capturing an increasing market of travellers from China. I’ve heard Southwark Borough Council, for example, is encouraging Chinese hotel brands to set up in the area.” With the government considering making UK visa procedures for Chinese nationals simpler, this would make sense. VisitBritain’s “China Welcome” programme aims to attract 650,000 Chinese visits a year by 2020.

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As well as rising tourist numbers, research from Savills puts regional hotel growth down to improved trading fundamentals, higher profit margins, and the scarcity of London deals. Martin Rogers MRICS, a director in hotels, leisure and trading at Savills, notes: “As investor demand improves and competition for prime assets increases, we are beginning to see an imbalance with stock levels in London, and investors are therefore looking to the regions.” The firm forecasts regional hotel transaction volumes could reach £2bn ($3.03bn) by the end of 2014, a 17% increase on 2013. Improving conditions are driving building activity, too. Around 14,000 extra rooms were expected to open in 2014, although Colliers International cautions that too much activity may be detrimental if overactive developer markets deliver too much new supply in the coming years, particularly in cities such as Glasgow, Manchester and Liverpool.

REFERENCE POINT REPORTS AND RESOURCES Market trends Royal Bank of Scotland’s report on new markets and trends in the UK hotel sector. bit.ly/rbs_hoteltrends London and Paris An insight into the growing London and Paris luxury hotels market from Knight Frank. bit.ly/kf _londonparishotels UK hotels PWC’s UK hotel forecast update. bit.ly/PWC_hotelsforecast2014

British Hospitality Association The members’ organisation for the hospitality and tourism industry. bha.org.uk Next generation Trendy hotel brand Ace has reached London. acehotel.com Hong Kong hotel group Dorsett Hospitality International opened its first property in Europe in Shepherd’s Bush, London, in June. dorsett.com

Q1 2015_MODUS A SI A

CLEARING ALL THE HURDLES A radical transformation has brought greater accountability and clarity to facilities management at the Hong Kong Jockey Club. Richard Byatt reports

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TURF ACCOUNTED Every building owned by the club, including those at Happy Valley, one of two racecourses in Hong Kong, will be evaluated as part of a property asset health review

T HE H ONG K ONG JOC K EY C LUB ’ S PROPER T Y assets comprise two racecourses, four riding schools, four clubhouses, retail branches and betting counters, along with corporate and residential buildings – 9m ft2 (836,120m2) in total, making it one of the largest property owners in the city, not to mention its largest taxpayer. With such a large property portfolio, facilities management (FM) is recognised as one of the club’s principal business areas, so the decision to transform the way FM is organised and delivered represented a huge challenge. The project has been driven by the club’s head of property facilities management, Graham Tier MRICS. “The starting point was about aligning accountability and responsibility within the organisation,” says Tier. The club’s previous structure was relatively passive with budget holders sitting above service providers controlling each transaction performed by the delivery departments. Tier changed the relationships so services

HIGH STAKES Surpluses from betting revenues go into a charitable trust, which donated HK$249m for the Zaha Hadid-designed Innovation Tower at Hong Kong Polytechnic University

ACCUMULATOR The club is one of the largest property owners in Hong Kong, holding assets that total 9m ft2 and include stables, riding schools, retail branches and betting shops

IMAGES DOUBLESPACE

WINNING OUTPOST The Jockey Club’s assets stretch beyond the boundaries of Hong Kong. In 2008 it opened a clubhouse for members on Beijing’s prestigious “Golden Avenue”

are now provided to business departments with a defined scope, at a set annual cost, and with service-level agreements in place. “The FM transformation project is about looking at the services required, developing the right approach or target-operating model and then defining the structure required to deliver that,” explains Tier. “The previous structure made it difficult to get things done or to know the true cost and, given the club’s divisional structure, it was challenging for our finance team to calculate it. We now have absolute clarity in service delivery and service cost, so we can make better decisions.” A longstanding complaint of facilities managers is that they are not involved at an early stage in new projects. This is certainly not the case at the Jockey Club, where FM is integrated in developments from acquisition right through to handover. FM is involved in pre-feasibility work – developing the operating cost model before going into capital cost and design detail.

There are facilities managers on the design team and their role is to ensure new facilities will be operationally efficient. “We use life-cycle costing data to support our decisions and we guide the project team on the systems and equipment we want in the building,” Tier explains. “We get better supply relationships, greater buying power and long-term maintainability.” In the project phase, FM drives testing and commissioning as the end custodian of the assets on behalf of the club. This is the result of a lot of hard work by Tier and his team. However, the benefits are significant. The team has been using the life-cycle costing approach for some time. In the early stages of plant replacement it demonstrated to the board the advantages of a different approach to procurement. Asset health is crucial to the club’s forward strategic planning. “We have conducted a comprehensive asset management audit using [British Standards Institute specification] PAS 55 and

developed a property asset health policy and condition assessment framework based on an international review,” says Tier. “Eventually every building in the club, including those at the racecourses, will be evaluated. This will give us a better understanding of asset performance and condition for future planning. “We’re a 130-year-old company,” Tier continues. “The FM transformation project was a huge change for the organisation and I had the board’s full support. We have always delivered what we have promised and reported back to the board, giving them confidence that when FM commits to something, it will be done on time and within budget. Leveraging on sustainability and utility costs we have demonstrated FM’s ability to integrate the people, process and technology with great results.” READ THE RICS CASE STUDY at rics.org/fmcs, and check rics.org/ facilitiesmanagement for the latest news Q1 2015_MODUS A SI A

Careers / Business / Legal / Training

Foundations CAREERS Consider a spell working overseas and you could boost both your future prospects and your pay packet

TRAVEL CHECKLIST

Talk to any recruitment expert at present and it seems there has never been a better time to be a surveyor overseas. “Remuneration packages are rising in line with the rest of the UK because of skills shortages,” says Eliot Wright, director at executive search business Carriera. “Demand is high in the Middle East, especially in Abu Dhabi, Qatar and Dubai. Hong Kong and Singapore are steady, and there are some vacancies in the US.” The most commonly required skills are quantity surveying and project management, followed by building surveying. James Wakefield, director at Cobalt Recruitment in Abu Dhabi, says: “More growth is projected in hospitality, development, residential, commercial and industrial. We are seeing a surge in demand in valuation, property management and commercial agency services.” In Singapore, fellow Cobalt director Marcus Davies Bateman adds: “With the skills shortage in Singapore and projected increase in population, there will be a demand for overseas surveyors.” Such is the demand, claims Marco Cassandro, regional director, Asia, at Command Recruitment in Singapore, that “your career overseas could grow four to five times faster than in the UK”. Most packages include an annual flight home, relocation, medical and dental cover, plus bonus. In the UAE, salaries are tax free and generally higher than in the UK. As Wakefield suggests, though, the benefits are more than financial: “Many businesses offer experience that would be hard to

01 If your existing employer offers work overseas, they may arrange a relocation package. 02 Research your partner’s visa situation and consider what they will do there. Unhappy partners are a big reason for relocation failure. 03 If you have a family, check on healthcare and education and whether packages cover housing and school fees. 04 Check the tax regime in the destination country – lower taxes may offset lower salaries. 05 Don’t neglect professional contacts at home while abroad, as you are likely to return some day. 44

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gain in the UK, particularly in real estate.” But he cautions that some expats struggle to adjust to the climate, social and cultural change and a less mature market. Apart from commercial agency and valuations, which require local experience, international candidates have a lot to offer the south-east Asian market, Davies Bateman suggests, and RICS membership offers greater credibility. “Several employers will only consider RICS members or, at junior level, those with an RICS-accredited degree from a well-known university,” Wakefield adds. “Many businesses are most interested in candidates between the graduate and fouryear PQE (post-qualified experience) level.” Consider travelling to your prospective destination country first. In Cassandro’s opinion, “candidates that are generally successful are those who come here at their own expense to meet employers”. Matt Milledge MRICS recently moved from the UK to Australia as project development manager at Keystone Group. Having previously visited the country, Milledge had a good idea of what to expect, but before leaving he looked up prospective employers. “Have a clear idea of the work you want and research relevant companies,” he suggests. “Visit your destination and wear out some shoe leather. Most of my contact with employers was in Sydney, as they prefer to speak to candidates in person.” He also contacted the local RICS office, and was invited to a networking evening where he met local members and discussed prospects. “Ask for contacts. Chat to chartered surveyors working there – I had several offers just by doing that.”

NEXT ISSUE: GOING BACK TO WORK For further careers advice, go to rics.org/careers, and for the latest jobs, see ricsrecruit.com

ILLUSTRATION DENIS CARRIER, MARCUS BUTT PORTRAIT JO HANLEY WORDS LINDA WHITNEY

PREPARE FOR TAKE-OFF

Foundations

HOW TO

BET TER INFLUENCE CLIENTS Each time you meet a client, you build your credibility in your area of expertise. This will increase your chances of influencing the significant issues that relate to the client’s perception of you and your organisation. Know your client’s business. Research their recent history, and get to grips with their products. Think about how would you feel if you were the client, knowing what you know about the situation your client is in. Know your business with the client. Keep a record of your dealings, including any relevant personnel. What relationship has your office had with the client in the past? Are there any unresolved issues? What are your client’s objectives and expectations? Know your business. Be clear on what you do and do not know. “Bluffing your way” might destroy any credibility and trust you have built up. Think also about possible areas of common ground. Make a thorough diagnosis. Without this, influencing a client becomes a matter of chance. Find out what is causing the client to behave in a particular way. What do they want and expect, and what will they accept? STEPHEN MAY is managing director of Activedge, activedge.co.uk

MY WAY

Dr Fiona Grant FRICS

CHAIR, RICS UK & IRELAND, ASSOCIATE PROFESSOR AND DIRECTOR OF QUALITY, SCHOOL OF ENERGY, GEOSCIENCE, INFRASTRUCTURE AND SOCIETY, HERIOT-WATT UNIVERSITY

Building is in my family’s blood. I knew I wanted to be part of the profession some day, but my father half-jokingly said that I was never going to work on a building site. After school, my local technical college in Fife gave me a taste of a variety of building professions. But it was quantity surveying that really ticked all the career boxes for me, so I went to university in Dundee to complete my degree. I was lucky enough to do some work placements while studying, which helped me to get work at a local surveying firm, becoming chartered in 1996. An opportunity arose for me to return to academia in the 1990s. I started as a lecturer at Edinburgh’s Heriot-Watt University in 1999, supervising built environment courses and modules, and later became director of

studies for quantity surveying and construction project management. My present role covers standards, processes and procedures in how we deliver our education – not just in Scotland, but in Dubai and Putrajaya in Malaysia. I was out there in 2013, meeting staff and students. The potential for professional growth is huge in these regions – nearly 70% of our students are overseas at postgraduate level. The international perspective also fits nicely with my role at RICS, as I’ve been very much involved in developing education standards and advising Governing Council. The profession has changed so much over the past 10 years, and what’s encouraging is that as RICS expands into new regions, it is maintaining high standards in training the next generation of surveyors. Being involved with RICS has given me the opportunity to meet people, network, speak publicly and present business ideas in a way that I might never have had in my academic career. I would encourage people to get involved as much as possible, because the skills you develop stay with you forever. rics.org/fionagrant

“Being involved with RICS has given me opportunities I might never have had in my academic career. I would encourage people to get involved, because the skills you develop stay with you forever” Q1 2015_MODUS A SI A

ALL REMOTELY POSSIBLE

W EB CONFERENCING CAN HELP CUT THE COST AND TIME of travelling to face-to-face meetings, but as well as allowing users to see and hear each other on screen, the right service can provide additional features that are particularly useful for surveyors. Sam Rogers MRICS is associate director at DeVono Property in London, which represents tenants looking for commercial property. He finds that, “as well as being useful for meetings, [the technology] reduces time spent waiting for communications.” Rogers, who works in the agency team finding property for clients, explains: “Now, instead of emailing property details or leases to clients and waiting for them to reply with queries and comments, web conferencing allows me to hold the document on our hard drive and invite the client to log in to my computer, so we can both look at it at the same time while we discuss details on the phone.” Large documents such as commercial leases no longer need to be sent by email, where they risk exceeding download limits and clogging up the recipient’s email system. The firm’s project management team also uses the WebEx conferencing service, which is provided by Cisco. “Clients can alter room layouts on screen while talking to us,” says Rogers. DeVono’s operations director, Kirsty McGregor, adds: “We use it for training sessions as well as meetings. It speeds up communication NEXT MONTH: VIRTUAL TEAMS and makes meetings easier.” Chartered quantity surveying firm HOW TO RUN a business when your Jackson Rowe uses web conferencing staff are in different locations. to conduct monthly team briefings and To take part in future business advice meetings between its four offices. But columns, email editor@ricsmodus.com 46

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TALK PLANS Prices are usually based on factors such as the number of hosts and the maximum number of users. WebEx, for instance, offers a range of meeting plans. The basic version allows access for three people and one host per meeting, uses VOIP (voice-over-internet protocol) audio connections, so connection is via the internet rather than by traditional telephone, and allows the sharing of a desktop, whiteboard and documents. It includes up to 250MB of storage, as well as user guides, FAQs and help articles. At the other end of the scale, however, is a £49-a-month ($74) plan that caters for up to nine hosts and 100 users, is accessible by telephone as well as VOIP,

ILLUSTRATION DAVID LEMM WORDS LINDA WHITNEY

BUSINESS Web conferencing has evolved into a valuable time and money saver

practice manager Anthony Youlton chose a service that also allows the user to record their sessions. Youlton says: “We use it for CPD [continuing professional development]. Recently we invited an English lecturer to talk to us about effective business English. People joined in live, but the presentation was recorded so no one need miss it. We are building up a library of recordings that anyone, including our APC [Assessment of Professional Competence] candidates, can access any time.” The firm also appreciates the fact that control of the screen can be handed over to clients who can, for instance, use it to display spreadsheets. Youlton chose the service with help from the firm’s IT advisers. “It costs £80 [$120] a month for two hosts and up to 50 users and we review it periodically to check it is still suitable for our needs.” Kevin Meager, solutions consultant for Olive Communications, which helps firms find, install and run communications technology, suggests: “If you’re running Microsoft Office 365, you may already have Lync online, which is capable of running basic online meetings, and won’t cost you an additional penny.” Otherwise, research the various providers and shop around, because the market is quite competitive. Meager advises: “Established players such as the Citrix GoToMeeting service and Cisco’s WebEx are now being challenged by new entrants, and established software firms such as Microsoft.”

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LEGAL 101...

streams in high-definition video and allows sharing of applications and remote control. It also provides live 24/7 support and 1GB of storage. Other systems highlight particular features. GoToMeeting, for instance, offers drawing tools, giving participants the capacity to draw on screen, while Adobe Connect makes much of its high levels of security and ability to work on mobile devices.

“Instead of emailing property details to clients and waiting for them to reply, web conferencing allows me to invite them on to my computer to look at it while we discuss details on the phone” SAM ROGERS MRICS DeVono Property Once you have selected a service, check regularly that it is still value for money and offering the facilities you need. If something better appears, changing provider is fairly easy. Meager says: “There’s little or no software that gets installed on your own system, so it is not difficult to switch providers if you find your current supplier isn’t keeping up with technology changes, or your business requirements.” Most web conferencing services are provided as a subscription-based managed service, so you are unlikely to be locked into an agreement for longer than 12 months.

HOW TO CHOOSE A WEB CONFERENCING SERVICE How many meeting participants will there be? Services typically offer between 10 and 50. How often will you use it? If you plan regular meetings, consider a monthly plan, but for occasional use pay-asyou-go may be better. If you have lots of attendees you could be billed per minute or per user, which can add up.

Do you need dial-in voice services? Some services use a headset plugged into the PC, others use a dial-in telephone number and some handle both. What is your budget? Costs range from free to $45 a month for a single host. Many require up-front payment. What operating system and devices are supported? Some have apps that run on smartphones or tablets, so attendees can join when outside the office. Based on your answers, draw up a shortlist and request trials to check ease of use and performance.

Using BIM with cloud cover ZOE CHAN SO YUEN Solicitor, director of monitoring and compliance, I-onAsia

Cloud computing and BIM provide a convenient, ondemand access to “green computing.” A cloud can be private, public or hybrid – a composition of two or more clouds: private, community or public. BIM works as a series of federated IT models – 3D visualisation and dimensional functions – prepared by different design teams with various purposes to be determined by the employer or client. It puts together instantly a common framework for a single project with licenses granted to other project team members to use the information contained in the models. Benefits include:  cost saving and easy access through web browsers, desktops or even mobile apps at your convenience  improving the overall design, construction and operation environment among stakeholders.  quickening the construction project delivery, management and performance analysis  facilitating in the communication methods, technology, and resource management and training support. Despite the costsaving and operational benefits of these services, there are compliance risks to using BIM and cloud computing: Cybercrimes Monitoring data privacy and security, the intrusion of business

data, insurance measures of your service providers and data sovereignty of BIM clouds is important. Service provider risks and their default What happens, for example, if your IT service providers go into liquidation or receivership in other jurisdictions? Will the corporate management be liable to the failure of service producers? Customers can be left without any remedy if the service providers default in continuing clouds. Jurisdictional risks Conflicts of laws can be complex when BIM projects that involve multiple jurisdictions, preservation requirements and privacy laws may have caused further enforcement issues. Data ownership and retention Problems become more complex when data is stored on a server owned by the service providers outside your own jurisdiction. “E-discovery” is time consuming and expensive abroad. Breach of privacy and confidentiality Compliance on international data transfers and sensitive business data must be observed. Intellectual property rights Collaborative partnering relationships raise the issue of joint ownership of copyrighted BIM clouds for a third party’s controlled service providers. Cloud computing and BIM can work as a shield and sword to guard or work against your business risks in application. Clearer contractual management should be used to facilitate their usage. Q1 2015_MODUS A SI A

BRAIN GAIN

MEDIATION, NOT AGITATION British judge Sir Anthony Evans, a former master of the rolls, once said that he had never come across a single case that could not have been mediated. Alternative dispute resolution (ADR) is any method used for resolving a dispute that helps parties avoid ending up in court. Mediation is a form of ADR. It is not adversarial and, instead, it encourages amicable settlement and helps to maintain relationships. With this in mind, we need to encourage the use of mediation across the profession. Many people, however, do not fully understand the scale it covers. It really is a cost-effective way of resolving a wide range of disputes, by helping conflicting parties achieve a negotiated settlement facilitated by an impartial, professional mediator. Surveyors should understand the law requires parties to explore ADR and use it if appropriate, in an attempt to avoid

Brings together a range of topics from planning to facilities management in an accessible and engaging way, complete with illustrations and photographs. £36.99 ($ 55.97)

The guidance note will be available at rics.org and was officially launched at the RICS Dispute Resolution Conference in London in January. There will also be a series of educational roadshows, targeted at members from all spheres of professional practice. MARTIN BURNS is Head of ADR Research & Development at RICS rics.org/martinburns

Soonr Workplace It is: An app to help you share and collaborate on business files. It does: The app is ideal for when you need your team to be literally working from the same page, and from anywhere in the world. Documents can only be accessed and worked on – either online or RICS A SI A .ORG

rics.org/shop

For the first time, RICS has joined with the Property Litigation Association (PLA) to develop a joint mediation guidance note. The note is not intended for experienced mediators, but instead aims to equip chartered surveyors and lawyers with the knowledge and confidence to use mediation. Its objectives are to educate surveyors and lawyers on their obligations to encourage clients who are in dispute to avoid court and use ADR and mediation, and to inform all members about the benefits of mediation, how it works and how to access it.

APP LAUDED

RICS books

taking disputes to court. For example, a recent case (Philip Garrett, 2014) showed that having an extreme confidence in winning a case, or a belief that there is no middle ground between parties, are not legitimate reasons for refusal to engage. Furthermore, dislike and mistrust are issues the judiciary consider can be effectively addressed by mediation, and are not reasons to refuse it. Also, courts can penalise parties who refuse to explore mediation or unreasonably decline to use it.

offline – by you and selected team members. It will also keep the whole team up to date with any changes or comments made by a team member via text or email. What else does it do? The app is compatible with more than 50 file formats, even those not supported by your device, so you can collaborate on almost any file. A search tool helps you quickly find the files you need, which you

Essential reading for construction practitioners, senior undergraduates and postgraduate students in all areas of construction management. £48.50 ($73.38)

A short, practical introduction to building information modelling (BIM) from the point of view of mainstream practice, offering a userfriendly yet thorough explanation of the subject. £19.99 ($30.24)

can mark as favourites and store locally to work on while offline. All data is encrypted during communication and while in storage in the cloud. Furthermore, the app has a “smart locking” system that ensures no one else can make changes to a file once it has been finalised. Price: Free Search: Soonr Workplace at your preferred app store.

Foundations

EVENTS

BOOK RICS EVENTS ONLINE ricsasia.org For enquiries, call +852 2537 7117

HONG KONG

››The roles of chartered surveyors in the adaptive re-use of historic buildings 18 March Delivered by an expert in building reuse and urban design, this event will review project types, with examples of economic appraisals, environmental performance, and optimising the public benefit of reused protected structures. Surveyors will be advised on how to be more involved in managing historic environments, such as developing policy and influencing, developing technical know-how, and applying existing skills such as cost control to the special demands of historic environment.

››RICS Hong Kong Annual Conference 2015 21 May As densely populated Hong Kong continues to grow, one of the key issues of concern shared by professionals and academics is the city’s lack of space. The conference will address the following issues: should cities be building capacity before the demand comes; how can Hong Kong continue to grow with limited developable space; what can Hong Kong do to remain attractive to businesses, tourism and investors by 2041; which segment of the real estate market does Hong Kong not have the capacity to deal with in the next five to 10 years? ricshk-conference.org

JAPAN

››MIPIM Japan 20-21 May, Tokyo The first real estate forum for Japanese and global leaders, joining together property and finance professionals from all asset classes. A great number of attendees are expected, not only because of MIPIM’s reputation in the industry, but also because of the support and commitment of Japan’s Ministry of Land, Infrastructure, Transport and Tourism. mipimjapan.jp

MALAYSIA

››RICS ASEAN BIM Conference 2015 4 June, Kuala Lumpur A conference gathering key industry leaders and practitioners of BIM, who will present case studies of key projects from around the world. Delegates will listen to practical examples and best practices that will provide invaluable and usable knowledge for their own organisations’ BIM projects and plans.

INTERNATIONAL

››RICS Summit of the Americas LA 2015 22-24 April Los Angeles The third annual Summit of the Americas is the premier networking opportunity of the year, bringing top brokers, investors, clients and industry experts together from around the world to share fresh perspectives on the global market. Register before 31 January, and receive a $200 discount. For more information, visit La2015.rics.org.

RICS HONG KONG PROPERTY AWARDS AND ANNUAL DINNER

13 March, Grand Hyatt Hong Kong

CHINA

››RICS International Conference 2015 26-27 March, Beijing Themed “Urbanisation to Globalisation: China’s Next Steps”, the conference will discuss pressing issues relating to urbanisation from different perspectives. Local and overseas representatives from government, academia, developers, investors and property consultants will discuss topics including sustainable development, infrastructure and real estate finance, and explore the future of China’s urbanisation. ››RICS Future Cities Summit 2015 17 June, Shanghai The wealth of nations are increasingly dependent on how their key urban centres perform, and especially on how their cities position, profile and operate as an integral part of the global community amid rapid urban expansion. Themed “The Making of Global Cities of the Future”, this summit will discuss the key qualities of a successful global city and how they affect the land, property and construction industries.

The Academy Awards of the industry, the RICS Hong Kong Property Awards honour outstanding achievements and reward excellence found in projects, property teams and developments in land, property and construction, and the community. A presentation ceremony will be held at the RICS Hong Kong Annual Dinner. ricsasia.org/hkdinner Q1 2015_MODUS A SI A

Mind map

CAN WE BUILD OUR WAY TO BETTER HEALTH? Lynn Thurber, chair, Urban Land Institute and chair, LaSalle Investment Management, Chicago

More than two-thirds of Generation Y-ers think proximity to a park is important when choosing where to live, and 76% think walkability is important.

Healthcare costs now consume 19% of US GDP and 9% in Europe. In China, a huge amount of money goes towards treating illnesses resulting from pollution. Although there are numerous causes for declining health trends, many can be linked to land-use decisions that limit people’s ability to include healthy lifestyle choices as part of their daily routines.

We need designs that minimise car dependence by mixing land uses and offering safe, convenient options for getting from A to B. Healthy living needs to be prioritised and integrated into planning.

Being branded “healthy” gives communities an edge, in terms of investment and economic development. But to build healthy communities, people need more choices in transportation, so they are not forced to drive everywhere.

ILLUSTRATION JENNIE EDWARDS

Building for better health makes good business sense. The market response to wellness attributes has been greater than expected and the costs to cover them lower than expected. It is this proof of the payback that will move healthy building practices into the mainstream.

RICS A SI A .ORG

Hong Kong Annual Conference 2015 Building Hong Kong’s Capacity for Sustainable Growth – What can be done to stay competitive?

Thursday 21 May 2015 0900-1700

Grand Ball Room, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai

Save the date!

Guest of Honour Mr John TSANG Chun Wah, GBM, JP Secretary, HKSAR Government

Diamond Sponsor:

Gold Sponsors:

HOURS

– Financial

Speakers Prof Alfred CHAN – Chair for the Elderly Commission & Chair Professor of Social Gerontology, Department of Sociology & Social Policy, Lingnan University Mr Richard HO – Deloitte China’s Real Estate Managing Partner Mr James von KLEMPERER – President, KPF Mr KK LING – Director of Planning, Planning Department, HKSAR Government Mr Marco WU – Chairman, Hong Kong Housing Society

Day Moderator Mr Vincent WONG – Founder and CEO, Solution-On-Wheels Silver Sponsors:

Bronze Sponsors:

ricshk-conference.org

THE PRINCE PARK TOWER HOTEL, TOKYO, JAPAN

INNOVATION | COLLABORATION | OPPORTUNITY Connect with all of Japan’s leading property companies. The door for investment and business opportunities is wide open. ■

1,000 m² SHOWCASE AREA

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2,000 PARTICIPANTS

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20+ EXPERT-LED CONFERENCES 4 topics: The Olympics, Inbound and outbound investments, Innovative cities and Tourism.

CONFIRMED SPONSORS LOCAL AUTHORITIES: MINISTRY OF LAND, INFRASTRUCTURE, TRANSPORT AND TOURISM CITY OF NAGOYA CITY OF OSAKA UMEDA FUKUOKA CITY

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TOKYO METROPOLITAN GOVERNMENT

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URBAN RENAISSANCE AGENCY CITY OF YOKOHAMA ■

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PLATINUM SPONSORS : DAIWA HOUSE INDUSTRY CO., LTD. GROSVENOR EAST JAPAN RAILWAY COMPANY KUME SEKKEI MITSUBISHI ESTATE CO., LTD. MITSUI FUDOSAN CO., LTD. MORI BUILDING CO., LTD. MORI TRUST CO., LTD. NIHON SEKKEI, INC. NIKKEN SEKKEI LTD. NIPPON STEEL KOWA NOMURA REAL ESTATE DEVELOPMENT CO., LTD. NTT FACILITIES, INC. NTT URBAN DEVELOPMENT CORPORATION ODAKYU ELECTRIC RAILWAY CO., LTD. ORIX REAL ESTATE CORPORATION THE SANKEI BUILDING CO., LTD. SEIBU PROPERTIES INC. SEKISUI HOUSE, LTD TOKYO TATEMONO CO., LTD. TOKYU GROUP YAMASHITA SEKKEI INC. ■

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ASSOCIATE SPONSORS : CRE FINANCE COUNCIL CUSHMAN & WAKEFIELD ■

WWW.MIPIMJAPAN.COM

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