Mr Lim Hng Kiang at the Real Estate Developers’ Association of Singapore’s (REDAS) 48th Anniversary Dinner

SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE AND INDUSTRY, AT THE REAL ESTATE DEVELOPERS’ ASSOCIATION OF SINGAPORE’S (REDAS) 48THANNIVERSARY DINNER ON TUESDAY, 4 DECEMBER 2007, AT THE GRAND BALLROOM, THE RITZ-CARLTON MILLENIA SINGAPORE

Good Evening

Mr Simon Cheong, President of REDAS

Distinguished Guests

Ladies and Gentlemen

Introduction

I am pleased to join all of you here this evening in your celebrations to mark the Real Estate Developers’ Association’s (REDAS) 48th Anniversary.

Just last month, my Ministry, the Ministry of Trade and Industry, announced that the Singapore economy is expected to grow by 7.5 to 8 per cent this year. Next year, GDP growth is forecast to be in the range of 4.5 to 6.5 per cent. STB also expects the strong growth momentum for the tourism sector to continue next year. This will have a positive impact on the hotel and retail sectors.

New Challenges

Our economy has performed well in the last few years. We have attracted many foreign companies from various economies, to expand or set up new operations in Singapore. This reflects the rising confidence in our economy as a whole and the increased attractiveness of Singapore as a global hub for doing business. In line with this, the momentum is also driving growth in all sectors of the property market.

However, growth brings with it some challenges as well. Feedback from the business community reflects concerns of rising business costs and increasing rents for residential and commercial space. On the rental market, the current upward pressure on office rent has resulted in increased demand for office-like industrial property as firms explore the benefit of moving into cheaper rent options.

The hotel sector is also experiencing rapid growth. With STB’s target of 17 million visitors by 2015, the number of hotel rooms in Singapore will need to increase in tandem to cater to the market demand.

As many of you are aware, the Government is already ensuring that there will be a sufficient supply of office, private residential, and hotel space to meet the challenges ahead through careful planning of the Government Land Sales Programme. In the case of office space supply, we are also looking into releasing more business park space, mainly from Changi Business Park, Alexandra Distri park, International Business Park and One-North, between now and 2010.JTC is in the process of allocating sites that can yield business park space to meet the need of companies’ backroom operations and data centers of financial institutions and SMEs.

The strong partnership between REDAS and the Government allows us to meet these challenges together. We appreciate REDAS’ willingness over the years to work with industry partners and the Government towards a sustainable property market. Just to name a few instances of this partnership, REDAS’ support was seen in its role in working with the industry to formulate the Practice Note on co-sharing of cost increase for sand and granite in the aftermath of the Indonesian ban on sand and disruption to granite imports; and support for the Government’s green building initiatives such as the Green Mark Scheme.

I believe that REDAS members have an important role to play in contributing to a stable and progressive property market. REDAS can help map out strategies for the real estate industry to meet the challenges of this century by addressing such issues such as planning for an ageing population, the continued development of Singapore’s building landscape and the challenges of new global competition.

Global competition

I’ll touch a little on how globalization affects the real estate industry. The new global competition depends not only on traditional factors of production, like land, labor and capital; but increasingly on ideas, creativity and innovation. The value generated in the modern economy will undoubtedly be human talent. The development of physical landscape and infrastructure are factors which determine if Singapore can rank ahead of other global cities as the choice destination for talent to work, live and play. Here, developers and REDAS can play a major role that will underpin the future competitiveness of Singapore.

We are also encouraging our companies to venture abroad. The limits of our local market mean that Singapore businesses hoping to expand have to look beyond our shores, for new markets for further expansion. One way is to have a collaborative approach towards overseas projects. REDAS may wish to facilitate this co-operation among real estate firms together with International Enterprise Singapore, one of the statutory boards under my Ministry, who is responsible for helping Singapore companies to grow and internationalize successfully.

Conclusion

As you celebrate another year of growth, I am sure that you will also be reflecting on what the future holds. Many opportunities beckon, not only in Singapore, but also beyond our shores.

I would like now to congratulate REDAS on its 48th Anniversary and wish you all many successful years ahead. Thank you.