theSun February January 2017

“I think the first thing I would say

to an investor is in every

investment, invest inwhat you

know. If you don’t know, find out

and learn. Just getting advice from

others and acting on it often ends

badly. Be passionate about what you

are investing in and take your time

to learn it thoroughly,” he said.

PROMPTS AND CUES

Panellist and B.I.G Industries

Berhad chairman BT Lau shared

Email your feedback and

queries to: propertyqs@

thesundaily.com

> Exploring further on lifestyle proclivities that are

altering the global real estate outlook

HILE

last week’s article

highlighted the rise of

global cities along with

the shift in lifestyle

habits andmindsets due to the way

modern day companies function

and themasses engage, this week

we look at threemega trends

expected to drive the real estate

market and howMalaysia is faring

in its goal as a developed nation.

To further understand these

changes that are slowly and subtly

changing the global urban

landscape, let us first look at trends

andmarket opportunities that are

causing this evolution.

SHAPING THE SHIFT

According to a study conducted by

Oxford Economics onGlobal Cities

2030, the urban economic power

will shift into the court on the

east side. By the year 2030, it is

forecast that:

410millionmore people will be

living in the top 750 global cities;

240millionmore jobs will be

created (with 60million extra

jobs in industries);

the number of elderly aged 65

and above will rise by an

additional 150million people;

consumer spending will increase

by $18 trillion; and

260millionmore newhomes

will be needed.

China will be the powerhouse to

watch, with cities like Chengdu,

Hangzhou andWuhan

economically at the top. Cities

expected towitness the biggest

increases in population andGDP

growth in Asia andOceania include

Dhaka, Karachi, Jakarta, Delhi,

Mumbai, Tokyo, Istanbul,

Singapore and Bangkok.

While emergingmarkets of

India, Brazil and China will make it

as the stories of the century, the

world’s major 750 cities (by 2030) as

surveyed in the report, are set to

contribute to the world’s economy

with staggering amounts.

URBAN ECONOMIC POWERS

According to the report, by 2030,

Chinese cities will be at the heart of

the radical shift in the urban centre

of economic gravity. These cities,

driven by burgeoning urban

populations and rapid labour

productivity growth, are expected

to overtake Europe’s 139 largest

cities and America’s 58 cities by

2020. Chinese urban incomes will

also grow six times faster than that

in the Europe sector.

By 2030, US and Asian cities are

expected to dominate the top 10

spots with the biggest increases in

urban income and consumer

spending. While cities across Asia

will continue to urbanise rapidly

until 2030, their urban populations

will also age.

Across the globe, aging

populations will bring both

challenges and opportunities.

REAL ESTATE CATALYSTS

The threemega trends to drive the

real estatemarket according to

investment and business website

Visual Capitalist founder Jeff

Desjardins are globalisation,

demographics and technology. Here

are examples of each and valuable

tips for the real estate investor.

Globalisation

– Global cities are

receivingmore foreign capital

across all real estate types eg. 60%

of commercial real estate in

London, which have been bought

up by international investors in

the past 10 years. He urges

investors to look for opportunities

to diversify real estate portfolios

across a broader mix of

geographics and asset types.

His advice – think globally and

develop strong knowledge about

the local market before investing.

Demographics

– Themiddle

class in Asia is expected to

“explode” in growthwhile in

Western countries, the agedwill

reach their ranks. Global and

mega cities have already started

mushrooming andwill attract and

account for the vast majority of

economic activity. Desjardins

recommends investors look at

emergingmarkets with rapidly

expandingmiddle class

(emergingmarkets), as well as

capitalise on areas with large

retiree populations.

Technology

–With its

omnipresence, technologywill

also impact real estatemarkets.

The growing demographic of

“highly-prized commodity of

skilled and talented techies”

drawn to urban centres will re-

shape and re-map communities.

Suggests Desjardins, explore

emerging technology hubs for

real estate opportunities and look

for favourable circumstances

in urban-adjacent industrial

properties as businesses establish

distribution centres near cities to

reduce costs.

MALAYSIA INTO THE FUTURE

With all the development, evolution

and progress that Asia is forecast

for, it sounds as though the real

estate industry in this part of the

world is in for an exciting time. As

it is back here on home ground, one

cannot help but notice the amount

of construction that has been on-

going. Driving this growth and

development is the Economic

Transformation Programme,

otherwise known as the ETP, which

was launched in 2010 and has set

sights for our country to achieve

“developed-nation” status by 2020.

Parallel to our topic on global

cities, we examine Greater Kuala

Lumpur (Greater KL), which

encompasses the capital city of KL

and its surroundingmetropolitan

areas. Sprawling some 2,793 sq km

to accommodate approximately 7.9

million people – Greater KL is said

to be well positioned as a regional

hub for diverse economic activities

and business dealings. In its

development as amegalopolis and

with our currencywhere it is, public

and private stakeholders are

reported to be attracting

multinational global firms to set up

regional hubs right here. Agencies

established to help the country

achieve the ETP and its developed-

nation come world-class status

include InvestKL and

InvestSelangor.

As it is, investors and

stakeholders fromChina and

Indonesia, as well as other countries

are already behind a couple of major

mega property development

projects. The real estate landscape

is already on its course of change as

lifestyles and habits transform.

Followour column next week for