Oxley flexes its strength in township projects, new markets

OXLEY Holdings is already going places as a young vibrant company, flexing its muscles on the global stage with complex development projects and entering new markets where no Singaporean firm has trodden. It first made a splash internationally in 2013 when it took on the iconic waterfront mixed-use project in London, The Royal Wharf and developed it at a speed unprecedented in the UK. Oxley's appetite and development capabilities have since grown. Now, it is eyeing large township projects in Myanmar's Yangon and potentially Vietnam through asset-light schemes.

Recalling a "heartwarming moment" during a recent stroll along the River Thames, group executive chairman and CEO Ching Chiat Kwong says that when he saw the beautiful township taking shape along London's historic riverfront, it dawned upon him that "Oxley has reached the shore". "We are now on the path that we can be taken seriously as a major developer to do township projects," he adds.

Indeed, the group has been short-listed for a major mixed-use project at Myanmar's Yangon Central Railway Station - a project that Mr Ching believes will be "world famous" in the most untapped emerging market in the world.

"Oxley has an edge over its competitors given the reputable partners it has engaged," he says. In addition, its bid is backed by Chinese state-owned enterprises and funds from the US, Canada and Hong Kong.

Beyond mature markets, Oxley is also expanding its footprint into under-explored markets like Italy, where it sees pent-up demand for residential. On all these counts, the group's diversification strategy across markets and asset classes has clearly come of age, within just five years since its first overseas foray.

Founded in 2008 as a boutique developer, Oxley is known for spearheading the fad of affordable shoebox apartments in Singapore. It has since diversified into industrial, offices and hotels and mixed-use developments.

When it became clear that the Singapore government would not relent on taming the property market, Oxley took the cue and ventured abroad. Within a span of five years, it has built a presence across more than 10 geographical markets including Singapore, the UK, Ireland, Australia, Cambodia, Malaysia, Indonesia, China, Japan and Myanmar.

Oxley also snapped up a 20 per cent stake in The Galliard Group, a UK developer and builder, in 2015 and a 40 per cent stake in Pindan Group Pty Ltd, an integrated property group based in Western Australia this year.

Far from being a speculative developer, every decision by Oxley to enter a new market is a calculated one, Mr Ching says. "We always approach every market with a strategy." In fact, Mr Ching himself puts his money where his mouth is. Before Oxley establishes a beach-head into a new market, he would have made some personal property investments to understand the culture of buying and selling in that market, government policies, and market conditions.

To expedite its understanding of overseas markets, Oxley also seeks out good local partners, such as through its stake acquisition of Galliard and Pindan Group. "A lot of people who talk about Oxley as a speculative developer do not understand that we are very different from other developers. Our management like myself go around to identify opportunities. I don't depend on others to investigate opportunities and bring back reports."

A case in point was its recent venture into Cyprus, where Mr Ching is seeing a revival in the property market amid a pro-business environment with low corporate tax of 12.5 per cent, immigrant-friendly policies and positive retail trends. Oxley's executional prowess for big township projects is also demonstrated in The Royal Wharf in London, where it has sold 90 per cent of 3,400 residential units to-date and some 500 units are being handed over to buyers. The development took almost half the amount of time the UK developers would have taken for a project of this scale.

Launched in October 2016, Dublin Landings consists of 65,000 sq m of flexible Grade A office and retail space, and 274 luxury residential apartments. Some 90,000 sq ft of office space is already leased to National Treasury Management Agency (NTMA) as the anchor tenant, which will generate 4.5 per cent yield for the group.

Notwithstanding market concerns that Oxley is highly geared, Mr Ching points out that the past years of growth shows that Oxley can execute and deliver results. "We have generated money from projects and repaid the loans to all our banks and repaid some of our bonds. We have a strategy."

And that strategy is now evolving into an asset-light model, he adds. This model is already practised in Malaysia where Oxley partners with landowners and only pays for construction, showrooms and consultants. The land cost is paid to landowners only upon the sale of the project.

Mr Ching notes that this model also works in other countries like Indonesia, Cambodia, and Ireland. "I envisage that we will find more opportunities for asset-light endeavours because we have built a branding in these few areas concerned," he adds.

For Dublin Landings, for instance, Oxley partners with the landowner National Asset Management Agency of Ireland (NAMA). Dublin's lack of new commercial space supply in the past eight years, low corporate tax and the population's high level of education and earning power present a conducive environment for real estate, Mr Ching says.

Markets like Cambodia, Yangon and Indonesia are characterised by favourable factors such as a young population, rising middle class with spending power, increased tourism and pro-business government policies, Mr Ching adds.

The group's optimism for Indonesia's Batam also hinges on its new status as a special economic zone; so far, Indonesians already bought close to 400 of the 1,193 luxurious units launched in Oxley Convention City.

In China, its joint venture project Sino-Singapore Health City, where it owns a 27.5 per cent stake, has benefited from soaring land prices following the Chinese government's announcement to turn Xiongan New Area into a new special economic zone. Mr Ching notes that land in Gaobeidian has surged from 5,000 yuan per sqm when it was bought to 20,000 yuan now.

While overseas opportunities are aplenty, the homegrown developer continues to keep tabs on the Singapore market. Seizing the opportunity to replenish its land bank here amid a potential market inflection ahead, it made a swift comeback through an en bloc purchase of Rio Casa, a former HUDC estate in Hougang, with three other consortium partners for S$575 million in May.

Oxley also inked an option to purchase a freehold property at 231 Pasir Panjang Road for residential redevelopment this month and exercised an option to purchase the property at 494 Upper East Coast Road from its owner for S$10.5 million in May.

"While we have a strategy for overseas, we also have a strategy for local market," Mr Ching says. "We are always on the hunt. Never resting on our laurels and we are not greedy to take the whole thing ourselves but spread our risk."

CURRENT PROJECTS

Royal Wharf, London: Exciting waterfront development in London. Winner of the 'Development of the Year RESI Awards 2015' and 'The Wharf Award 2015'.

The Peak, Cambodia: The mixed-use development consists of hotel, offices, retail, residential units, and the first Shangri-La Hotel in Cambodia.

Oxley Towers, Kuala Lumpur City Centre: Located in close proximity to the iconic Petronas Twin Towers, this mixed-use development consists of Jumeirah Living Kuala Lumpur Residences tower, So Sofitel Kuala Lumpur Residences tower, office tower and retail podium.

Oxley Tower, Singapore: This freehold commercial development offers ultimate accessibility right in the heart of Singapore's Central Business District.

Add: 138 Robinson Road, Oxley Tower, #30-01, Singapore 068906 Tel: 6438 0202 URL: www.oxley.com.sg