Respected property experts, at the recent (PropertyGuru) GuruTalk seminar 2015 at the City Gate Show Suite, informed listeners that mixed use developments were extremely valuable to those looking either for an investment or for a home. Guru Talk is a series of property education seminars and 80 people came to hear the wisdom and insights of Chief Investment Officer, SLP Scotia, Francis Tan and ERA Realty Network’s Key Executive Officer, Eugene Lim.
Investment Talks for Westwood Residences
Mr. Tan’s opening remarks explained the concepts of mixed use developments and went on to speculate as to how they might evolve in the future for Westwood Residences. He said that the combination of residential, commercial, cultural, institutional, and industrial use was common elsewhere in the world, but not in Singapore, because of the clarity of the Singaporean URA Zoning system, which separates industrial zones from residential zones.
He added that there was a possibility that this would not remain so forever and that during the next 20 years, as the mega ports at Jurong and Tuas come nearer to completion, industrial/residential mixed use developments could come to Singapore in Westwood Residences.
Mr. Tan also gave some hints on how to wisely calculate the profit performance of an investment.
Westwood Residences EC Showflat Design
Using the example of investing in some retail space in a mixed use development, he said that whereas most people look at the return on investment or ROI they should really calculate their profit on a return on their equity or ROE, because return on investment ROI is an unrefined formula and its use hides a great many costs. The difference is that return on equity ROE calculates profitability on what you have actually spent or the equity rather than on the total value of the property and gives a far greater yield, a process called ‘gearing’, when investing investors must always think about ‘gearing’ but must not become over greedy in Westwood Residences.
Showflat Design by Westwood Avenue EC
Mr. Lim of ERA revealed that where a mixed use development was sited could greatly affect its value. He specifically labelled the Rest of Central Region or RCR as a “quiet achiever”. Mr. Lim said that URA statistics illustrated clearly that the 20,000 homes sold in the city fringe as opposed to the nine thousand in city area in the past five years, city fringe prices have increased by 51% whereas the increase was merely 38% for city centre developments such as Westwood Residences which has a bicycle theme available for the residents.
Those who attended gained much knowledge and insights on mixed use developments as a viable property investment option.