Keeping and growing the family fortune

Keeping and growing the family fortune

By Francis Chan

THE first generation makes the money, the second enjoys it and the third squanders it all.
Believe it or not, that adage is actually backed by academic research.

Dr Sanjay Goel, an associate professor at Minnesota University’s school of business, said that typically a family business starts to lose its entrepreneurial edge by the third generation.

But if the founder passes on good family values to his successors, the empire may retain its essence and grow over succeeding generations, said Dr Goel, who was in Singapore recently at the invitation of the Singapore Management University.

The expert on strategic management and entrepreneurship said his conclusion was based on studies of family-run firms in the US and Europe, and was also the ‘consensus of experts in the field’.

Dr Goel said successors of family firms, especially those that have achieved a certain size, often become too pre-occupied with daily operations to the point where they neglect to keep the business relevant through re-invention.

And ensuring relevance to customers is especially vital for family-run firms because they are typically in more traditional fields of businesses.

‘The idea is to sustain the entrepreneurial drive across generations, because the world is changing even faster now,’ added Dr Goel.

He cautioned that unless successors of family- run firms possess the same values and drive as their founders, the operation is likely to end up ’stuck in time’ due to entrepreneurial malaise.

Dr Goel’s advice for first-generation entrepreneurs who want their businesses to succeed over the ages is: ‘Spend as much time with your family as with your business.’

‘The kids will learn from watching the entrepreneurs go through pressure, see the sacrifices they have to make and appreciate the business more.’

Mr Adrin Loi, executive chairman of Ya Kun International, a family firm that owns a popular kaya toast and coffee chain, agrees with Dr Goel.

‘The descendants of these entrepreneurs…will witness the founders’ hard work and determination to succeed in the business, and have a strong familial obligation to continue and perpetuate its growth,’ said Mr Loi, whose father, Loi Ah Koon, founded Ya Kun in the 1920s.

‘I can vouch that they will also fuse tradition with modernity…without compromising the true essence of the business’, said Mr Loi, who has successfully taken Ya Kun’s business to Indonesia, Korea, Japan, Taiwan, Vietnam and the Philippines.

Dr Goel also said that in such cases, the successor would have a greater awareness of his own family’s values and align them with his business aims.

And when the time comes, they will be able to better leverage on the strengths of the family to re-invent and expand the business, while still retaining its individual quality and heritage.

Source : Straits Times - 20 Aug 2008

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International schools get more room to grow in Singapore

International schools get more room to grow in Singapore

Govt offers buildings and land, allowing 8,000 places by 2015 to ease space crunch

By Jane Ng

TO EASE the shortage of places in schools for expatriate children here, the Government is making available public buildings and vacant land for up to four more foreign schools.
International schools can occupy a former school in Upper Serangoon as a permanent new campus or one of three other former schools temporarily until new buildings are built on vacant plots in Bukit Batok, Hougang or Yishun.

At full capacity, the four permanent sites will be able to take in more than 8,000 students by 2015.

This is about three times the current enrolment of one of the biggest international schools here, the United World College of South East Asia (UWC).

The Government’s announcement yesterday comes at a time when many international schools here are full, and popular ones have long waiting lists.

The number of expatriates here has been growing over the years and the school space crunch was starting to cause problems for companies looking to move their expatriate employees here, the American Chamber of Commerce in Singapore had recently reported.

The problem, which Prime Minister Lee Hsien Loong raised as a possible ‘constraint’ on Singapore’s growth, is being tackled by a government committee chaired by the Economic Development Board (EDB).

Agencies like the Singapore Land Authority (SLA) are also involved in the drive to attract more foreign schools to add to the 38 operating here already.

These schools offer an international curriculum from preschool, right up to the Singapore-equivalent of a junior college.

Because of the pressing need for more schools, successful tenderers for the four sites must start classes by next year.

Their proposals will also be assessed on their curriculum, proposed enrolment and investment commitments.

EDB’s director of education and professional services, Mr Toh Wee Khiang, expects a good response, as there have been many enquiries from both new players and existing schools.

On the use of former schools, Mr Teo Cher Hian, a SLA director handling the project, said that adapting these vacant buildings optimises Singapore’s scarce land resources.

He added: ‘It also provides immediate solutions to cater to the growing demand since they are purpose-built with playfields and other ancillary facilities.’

To date, 19 international schools are using state properties as campuses, including the Avondale Grammar School in Toa Payoh Rise.

Among the established international schools interested in the new sites is the Singapore American School.

Its superintendent, Mr Brent Mutsch, said the sites would be considered for the expansion of its Woodlands campus.

It has about 3,800 students from preschool to the 12th grade, and has had a waiting list for several years.

News that classes in new schools could open up as early as next year was welcomed by Mr Niraj Parekh, 31, an investment banker, whose daughter Isha has been on the waitlist at UWC since she was two months old last November.

‘When more information becomes available about the schools, we’ll reassess the situation. But we know the quality of education that UWC offers so we’ll definitely keep her on the waitlist there,’ said Mr Parekh.

Source : Straits Times - 20 Aug 2008

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New One World International School to open in Singapore

New One World International School to open in Singapore

By Christie Loh,

SINGAPORE : There’s good news for parents frustrated by the long waiting lists at international schools in Singapore - a new foreign school called One World International School will be starting classes in September.

Located along Upper Changi Road East, the school is the latest offering for the expatriate community here. It is open to all nationalities and can take up to 450 students.

While classes will initially be for kids aged three to 11, principal Noel Hurley said a secondary school will be added next year.

This should be a boon for expatriate families faced with school placement problems, said Hurley, who was the primary principal at the Australian International School in Singapore for about seven years.

He said: “At the moment, many families are faced with a dilemma of having to send their children to separate schools. They may be able to get one child into one particular school, but not the other child.

“So you find that parents enroll their children in two, or sometimes three schools. Our school allows parents to make sure their children stay in one school.”

The school’s programmes are accredited by the University of Cambridge. Its physical facilities include tennis courts, a gymnasium and a multi-purpose auditorium - all built on the former site of the Siglap-Changi Community Centre.

Hurley said One World was set up by Mumbai-based businessman Nishant Garodia, who also plans to take the brand beyond Singapore, into the rest of the region.

Like other parts of Asia, Singapore’s 40-odd international schools are struggling to cope with rising demand. So acute is the shortage that some foreign companies have held off deploying their top executives in Singapore.

Popular international schools have even started asking parents for six-digit fees to guarantee a spot for their kids.

Hurley said his school has no plans to ask for such placement-guarantee fees. - 938LIVE /ls

Source : Channel NewsAsia - 20 Aug 2008

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Singapore URA launches transitional office site at Mohamed Sultan Road

Singapore URA launches transitional office site at Mohamed Sultan Road

By Nicholas Fang,

SINGAPORE : The Urban Redevelopment Authority (URA) has launched a transitional office site at Mohamed Sultan Road for sale by public tender.

The site is one of three commercial parcels to be sold through the confirmed list under the Government Land Sales Programme for the second half of this year.

It has a land area of nearly 0.62 hectare and a maximum permissible gross floor area of about 9,200 square metres.

A low-rise development of about four storeys can be built on the site, which has a lease of 15 years.

Tender for the site will close at noon on October 14.

Consultant Knight Frank expects the bids to range between S$10 million and S$13 million. This translates to S$100-S$130 per square foot per plot ratio.

Rents in the Mohamed Sultan Road area are currently hovering between S$5 and S$7 per square foot.

Separately, two other parcels on the reserve list are expected to be put up for tender.

The URA said a developer has committed to bidding at least S$10.8 million for a land site at Kallang Pudding Road.

A developer has also agreed to offer at least S$21.6 million for another site at Ubi Avenue 4. - CNA /ls

Source : Channel NewsAsia - 20 Aug 2008

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Local bankers in demand at foreign banks

Local bankers in demand at foreign banks

By NOOR AISHA

TWO local bankers have clinched top-notch managerial positions at the local arms of foreign players Barclays Wealth and Swiss private bank Lombard Odier Darier Hentsch & Cie (Singapore).

Richard Wee and Pheabe Chau clinch top posts at Lombard Odier Darier Hentsch & Cie and Barclays Wealth respectively.

Richard CH Wee is the newly appointed chief executive officer of Lombard Odier Darier Hentsch & Cie (Singapore). He was formerly managing director, deputy CEO and head of marketing.

Previously with Citi Private Bank as managing director and team head, Mr Wee has chalked up 29 years of experience in private banking.

In an interview with BT, Mr Wee said the appointment of Singaporeans to top management positions at the local arms of foreign banks presents a potential competitive advantage, owing to the better familiarity with local regulations and customs. ‘I hope to give the bank some exposure,’ said Mr Wee.

Headquartered in Geneva, the bank adopts a long- term, personalised view of client-bank relationships. The bank was founded in 1796.

Over at Barclays Wealth, Pheabe Chau was appointed as Singapore head of investment specialists.

In this role, she will oversee a team of investment specialists based in Singapore and report to Thomas Fekete, the global head of investment specialists. Ms Chau was previously senior vice- president, investment advisory at RBS Coutts Bank Ltd.

Ms Chau has held senior positions in several financial institutions across Hong Kong and Singapore, including UOB, American Express Bank and Citibank over a 20-year span.

In a press release, Mr Fekete said: ‘We are delighted to welcome Pheabe to our team. Under her leadership, we are confident that the team in Singapore will provide best-in-class investment advice and trade ideas across all asset classes to our private banking clients, and ensure that our offering continues to set the industry benchmark.’

Source : Straits Times - 20 Aug 2008

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Singapore SM Goh reappointed as MAS chairman

Singapore SM Goh reappointed as MAS chairman

By UMA SHANKARI

SENIOR Minister Goh Chok Tong has been reappointed chairman of the Monetary Authority of Singapore (MAS) for a further two years starting today, the central bank said yesterday. Mr Goh was first formally appointed MAS chairman in August 2004, after his stint as Singapore’s prime minister.

In May this year, MAS said Minister for Trade and Industry Lim Hng Kiang had been reappointed deputy chairman for a further two years.

Other members of the MAS board include Finance Minister Tharman Shanmugaratnam, Central Provident Fund Board chairman Koh Yong Guan, Keppel Corp executive chairman Lim Chee Onn and MAS managing director Heng Swee Keat.

Also on the board are Finance Ministry Permanent Secretary Teo Ming Kian, Attorney-General Walter Woon and Allen & Gledhill managing partner Lucien Wong.

Source : Straits Times - 20 Aug 2008

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Contribution rates for Mendaki fund to be revised

Contribution rates for Mendaki fund to be revised

By EMILYN YAP

REVISED contribution rates could help the Mosque Building and Mendaki Fund (MBMF) secure an additional $2.9 million a year to support more programmes in the Muslim-Malay community.

Prime Minister Lee Hsien Loong sketched out three major initiatives for MBMF in his Malay speech at the National Day Rally last Sunday.

The fund will support a new mosque upgrading programme, improve religious education and do more to strengthen Malay-Muslim families.

MBMF will need more contributions for the expanded roles, but Mr Lee assured Muslims that the rates will remain affordable, especially for those earning less.

Proposed revisions to contribution rates, which could kick in early next year, were unveiled yesterday by the Minister-in- Charge of Muslim Affairs, Yaacob Ibrahim.

Contribution increases will be tiered according to gross monthly income - Muslim employees earning $1,001-$2,000 will pay 50 cents more each month; those earning $2,001- $3,000 will pay $1 more; those earning $3,001- $4,000 will pay $4 more and those earning more than $4,000 will pay $5 more. Muslim employees earning $1,000 or less each month will not have to contribute more to MBMF.

About 200,000 Muslim employees contribute to MBMF.

The proposed contribution revisions will have little or no impact on 80 per cent of those who earn $3,000 or less each month.

MBMF now collects about $10 million a year.

The revised contribution rates could boost this to about $12.9 million. Mosque building and upgrading programmes will take up some 42 per cent or $5.4 million of annual MBMF contributions.

The Ansar mosque at Bedok has been identified as one beneficiary.

Another 34 per cent or $4.4 million will go towards expanding Mendaki programmes to strengthen Malay-Muslim families.

The remaining 23 per cent or $3 million will be used to upgrade full-time madrasah education, enhance part-time religious education and develop religious teachers and instructors.

Source : Straits Times - 20 Aug 2008

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More Singapore land, buildings for foreign schools

More Singapore land, buildings for foreign schools

4 state buildings, 3 land parcels tagged; government inviting FSS proposals

By LEE U-WEN

THE government wants more foreign schools in Singapore to provide places for children of the growing number of expatriates moving here to work.

‘FSS are important infrastructure to attract global talent to live and work in Singapore.’

- Mr Teo

Four more state buildings and three land parcels have been identified for use as Foreign System Schools (FSS).

The buildings are the former Upper Serangoon Secondary School in Upper Serangoon Road, Nan Chiau High School in Kim Yam Road, Fuchun Primary School in Woodlands Centre Road and Jurong Town Primary School in Hu Ching Road.

Except for the Upper Serangoon Road property, the buildings will be leased for an initial three years, with the option to renew for two further three-year terms. The land parcels - at Yishun Avenue 1, Hougang Avenue 1 and Bukit Batok Road - have lease periods of 30 years.

These seven sites will add to the 19 international schools that already use state property, such as the Canadian International School, United World College of South East Asia, and the Avondale Grammar School.

The seven additional sites were chosen based on locality, convenience, availability, space and ease of adaptability.

In a joint statement yesterday, the Economic Development Board and the Singapore Land Authority (SLA) said that they are inviting proposals via a request-for-interest exercise.

Proposals will be assessed on such factors as quality, ability to meet market demand, investment commitments and, crucially, a commitment to start classes by next year.

‘Singapore’s strong economic growth over the years has attracted an influx of foreign talent,’ the two agencies said.

‘In recognition of increasing demand for FSS in Singapore, there is keen interest among existing FSS and new players to expand and set up new operations.’

The woes of many expatriates trying to secure places for children in international schools here have been reported many times recently. Most FSS are full and have long waiting lists.

In 2006, there were 875,500 expatriates in Singapore, up sharply from 798,000 the year before.

Interested FSS are invited to submit proposals for specific sites and can do so for more than one site.

SLA’s director of land operations (private) Teo Cher Hian, said: ‘We recognise that FSS are important infrastructure to attract global talent to live and work in Singapore. Adapting former vacant schools for use as FSS not only optimises land resources but also provides immediate solutions to cater to growing demand, since they are purpose-built with playing fields and other facilities.’

EDB said that the exercise is not one-off and that more schools will be attracted to the island in line with market demand.

Source : Straits Times - 20 Aug 2008

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Transitional office sites seek niche as market cools- Singapore

Transitional office sites seek niche as market cools- Singapore

Analysts expect lukewarm response as fresh site is rolled out at Mohd Sultan

(SINGAPORE) Sentiment in the Singapore office investment market is worsening, but Urban Redevelopment Authority yesterday rolled out another 15-year leasehold transitional office site as scheduled, this time in the pubbing district of Mohamed Sultan Road.

This is the seventh transitional office site URA has launched since July last year.

CB Richard Ellis executive director Li Hiaw Ho expects few bidders for the site and predicts bids of about $80 to $100 per square foot per plot ratio (psf ppr). ‘The site’s location in a mixed neighbourhood may appeal to businesses that don’t require a CBD location, and to businesses in the creative line,’ he said.

Knight Frank director Nicholas Mak projects a slightly higher price range of $100-$130 psf per plot ratio for the site, which is one of two transitional office plots slated for release in second half 2008. The other, at Mountbatten Road, will be launched next month.

Mr Mak reckons the Mohamed Sultan Road plot ‘may receive cautious or a few opportunistic bids’, citing that the expected completion time of the project on the plot could be close to 2010, when a large supply of office space from other projects is also slated for completion.

The Mohamed Sultan Road plot may receive cautious or a few opportunistic bids.

CBRE’s Mr Li, like some other industry watchers, said it may be timely for the Government to review the necessity of launching yet more transitional office sites in the near future given that the economic situation and outlook for the office market have changed since last year, when transitional office sites were first released.

The concept of these short-leasehold office sites outside the financial district, capable of being developed into low-rise office developments within a year, was devised to help ease the immediate-term office shortage last year. Prime and Grade A office rents nearly doubled in 2007 but the pace of increase has since eased with gains of around 7 to 10 per cent in the first-half of this year from end-2007 levels.

Morgan Stanley said last week it expects Singapore office rents to peak earlier, by end-2008 instead of end-2009, due to lower expectations for office demand, which will be below upcoming office supply (including business parks).

CBRE data shows that some 645,000 sq ft net lettable area of offices would be coming on stream in 2008-2009 from the five transitional sites awarded so far. Market watchers say that any further projects on transitional office sites sold today will be completed closer and closer to 2010, from which point several major office developments are slated for completion, including Marina Bay Financial Centre (MBFC) and Mapletree Business City.

About 10.1 million square feet of new office space will be completed between Q3 2008 and 2012, inclusive of the 645,000 sq ft of transitional offices, CBRE’s numbers show.

When contacted, a URA spokeswoman said: ‘We’ve received market feedback that there’s demand for transitional office sites at suitable locations from businesses which don’t need a city centre location and need office space urgently. The two sites at Mountbatten Road and Mohamed Sultan Road under the H2 2008 Government Land Sales (GLS) Programme are at the fringe of the city centre and are suitable for such developments. The supply of office from major office developments such as MBFC (Phase 1) in 2010 will go towards alleviating the current tight office market. Together, these different sources of office supply in the pipeline will help meet the overall demand for office space.

‘The Government will evaluate the market response to the tenders for the Mohamed Sultan Road and Mountbatten Road sites and decide on the release of such sites as part of the planning of first-half 2009 GLS Programme.’

The tender for the Mohamed Sultan Road transitional office site closes on Oct 14.

Separately, URA yesterday said it has accepted applications from parties (which it did not name) for the release of two 60-year leasehold industrial sites at Kallang Pudding Road and Ubi Avenue 4 in the reserve list. In both instances, the minimum price that the successful applicant has committed to bid is almost the same - $69.88 psf ppr for the Kallang Pudding plot and $69.85 psf ppr for the Ubi site, leading market watchers to guess the same party probably made both successful applications.

Source : Straits Times - 20 Aug 2008

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