Jonathan has been in the real estate and urban development industry since 2008 and has since worked in different capacities in the public, private and institutional sectors. Before relocating to Singapore in early 2017, Jonathan was a downtown planner at the City of Vancouver, Canada.
1. How long have you been in the real estate industry and how did you come to join Colliers International?
I have been in the real estate and urban development industry since 2008 and have since worked in different capacities in the public, private and institutional sectors. Before relocating to Singapore in early 2017, I was a downtown planner at the City of Vancouver, Canada.
I joined Colliers International Singapore in May 2018, after a stint at a Singapore-based R&D centre specialised in urban solutions. Working in a research environment was very stimulating and I have learned a lot about how new technologies can contribute to urban planning projects and policies. However, after a while, I felt that I belonged more in the business – rather than the technical - aspects of urban development. Also, I realized over the years that my passion lies in the complex economic interplay shaping cities through different real estate asset classes. When the opportunity to join the Advisory and Consulting team of Colliers International Singapore came about, it felt like the perfect fit as I could apply my urban development experience and expertise to serve clients across different assets classes and throughout the entire project cycle.
2. What have been some of the major changes in your segment of the real estate industry, and how should stakeholders (e.g. Government agencies, corporates and real estate firms) deal with them?
I am noticing two main shifts in the real estate consulting industry.
First, the need to bridge the gap between the physical and the digital realms in real estate. With the rise of the digital economy, the role of “brick and mortar”, particularly retail and tourism-related real estate, is becoming less about providing physical space to occupiers and more about delivering experiences that cater to the lifestyle of end-users. This shift toward “experiential” real estate is changing the type of consulting inputs clients are interested in. While traditional real estate investment analysis inputs remain important to clients, they are also increasingly interested in obtaining constant feedback from end-users to respond quickly to market trends. As a result, property developers, mall operators and government agencies are increasingly using big data analytics, artificial intelligence and machine learning to obtain reliable and timely market and consumer intelligence inputs and integrate these inputs to their KPIs. For instance, mobile phone data is being used to monitor pedestrian footfall in shopping malls and social media data provide qualitative appreciation of retail, hotel and attraction experiences.
Secondly, with rapid urbanization across Asia, there is increasing interest in the role of real estate in infrastructure financing. Currently, governments finance about 90% of total infrastructure investments across Asia. What’s more, most infrastructure projects in the region face significant financing gaps that undermine their long-term viability. With real estate accounting for up to 30% of the financing structure of infrastructure projects, real estate developers, infrastructure investment funds and government agencies have interest in establishing win-win partnerships. Developing viable infrastructure-related financing mechanisms and real estate strategies is complex but if done properly, can yield significant benefits for both investors and governments.
3. Which part of your work excites you and to what extent do you think it can offer higher business growth, and why?
The most exciting part of my work is to bring an urban planning and economics perspective to Colliers’ comprehensive real estate services. Every real estate project plays a key role in shaping the development of the neighbourhood and city where it is located, both in terms of cityscape and economic development. For instance, when carefully planned, real estate projects can have a catalyst effect on the regeneration of a neighbourhood.
Successful real estate projects are those that integrate harmoniously with and add value to their surrounding urban environment. Incorporating urban planning inputs as part of a project’s planning process helps obtain development approvals from authorities faster and facilitates the relationship with local stakeholders. For clients, this approach helps reduce the cost associated with the approvals process, provides greater opportunities for long-term capital appreciation and increases the marketability of their projects. As such, developers and investors have interest to consider both market viability and urban planning considerations when defining a project’s concept, programme, positioning and form of development.
4. In your opinion, which markets in Asia hold most potential for growth in infrastructure projects and urban planning solutions?
Rapidly urbanising markets hold the brightest growth prospects moving forward. A substantial number of transportation infrastructures, airports, public facilities, housing and commercial real estate projects will be needed to accommodate new urban dwellers and support economic growth across Asia.
In my opinion, India will exhibit by far the strongest demand for infrastructure and urban planning solutions considering the staggering growth of its urban population. From now to 2050, India’s urban population is expected to grow by an estimated 400 million people, an average of 13 million people per year moving to cities. The number of Indian cities with a population of over 1 million people will increase from 114 today to 161 by 2035. The 100 Smart Cities programme will further support the country’s demand for infrastructure and urban planning expertise.
China will continue to be a significant source of demand for new infrastructure and urban planning projects despite its rapid urbanisation of the past two decades. With an urban population expected to grow by about 220 million people from now to 2030, approximately 7 million per year, with the number of millionaire cities growing from about 300 today to 365 by 2035.
Indonesia’s future urban growth is estimated at 80 million people from now to 2050. Apart from urbanisation, the country will undertake significant road and public transportation infrastructures in coming years to tackle traffic issues in existing cities. In addition, given the country’s archipelago geography and its tourism development potential, major investments are to come in new airports and other tourism facilities.
Elsewhere in South-East Asia, Cambodia, Lao, Vietnam, the Philippines and Myanmar are key markets where significant infrastructure and urban planning related investments and business opportunities are emerging as a result of both sustained urbanisation and economic development.
5. What challenges could curtail the implementation of infrastructure and urban planning projects and what are potential solutions?
A key challenge encountered in the implementation of infrastructure and urban planning projects is financial viability. In particular, infrastructure projects driven by the delivery of public benefits are rarely self-sustaining from just their operating revenues. As for urban planning interventions, such as public realm enhancement, public housing development and urban regeneration schemes, they generate limited revenue on their own and usually rely heavily on government subsidies.
A solution to successful infrastructure and urban planning project implementation is to develop mutually-beneficial partnerships between government, private sector and institutional stakeholders to plan, finance and deliver projects. In these tri-partite partnerships, governments agencies play the key role of developing the vision, providing the legal framework and securing lower interest loans required for project implementation. Private sector investors and experts provide the technical assistance, equity participation, risk-exposure, capital and project management skills to successfully deliver the project. Institutions, such as the multi-lateral development banks, can provide the financing, policy and expertise framework. A comprehensive real estate and land-use strategy around a new infrastructure, for instance, when developed collaboratively, can play a significant role in the financial bottom-line of a project.
A key principle for successful partnerships is that there should be reasonable win-win conditions for each party. This means that sufficient public benefits should be delivered while private investors stand a chance to achieve a reasonable return on investment.