Real-Estate Developer Keeps Up With Changing Landscape
Being Proactive, Knowing Returns
Are Key for Ceo of CapitaLand Retail
Pua Seck Guan, chief executive of CapitaLand Retail Ltd., is responsible for CapitaLand's expansion into China, where it is building malls with the international division of Wal-Mart Stores Inc. as anchor tenant, and into India, where it will manage retail properties and property funds with Pantaloon Retail (India) Ltd. He also heads CapitaMall Trust, Singapore's oldest and largest real-estate investment trust with US$2 billion in assets.
CapitaLand Retail, with more than 45 malls in Singapore, China, Japan and Malaysia, is one of Asia's largest owner/managers of shopping centers. It reported in February that profit after tax and minority interests more than doubled in 2005 to S$750.5 million (US$469 million), from S$305.7 million in 2004.
Mr. Pua, who holds a masters degree in civil engineering from Massachusetts Institute of Technology in the U.S., is best known in Singapore for installing long escalators at CapitaLand mall entrances that bring customers directly to the top floor to boost rental values, and for converting the upper floors at other malls into gardens and using the freed retail space on lower levels to stay within guidelines for maximum permissible gross floor area. He was interviewed in Singapore by Kevin Lim.
WSJ: What was your first job and what were the lessons you learned?
Mr. Pua: My first job was with Hotel Properties Ltd. [of Singapore] as a project manager. I was a young engineer, just graduated, and there were a lot of technical things I didn't know. But you can learn, and you can command the respect and hold the whole team.
The other thing I learned is that you need to know the next step in the value chain. I figured out (that property development) required more than project management, so I learned the next thing of importance, which was investment.
THIS WEEK'S QUESTION
Mr. Pua warned new business owners to have a realistic business model when starting out. What do you think someone starting his or her first business should know?
Please visit:
www.wsj.com/question. Or email:
Leadership@wsj.com. Please include your name and country.WSJ: What do you consider to be the most important attributes of a good manager?
Mr. Pua: No. 1 is that you must never accept no for an answer. In the real-estate business, we create wealth by undoing constraints. You must also be very proactive. Because things keep changing, what is right today might not be relevant in a few months. You must keep thinking of how to stay on top of things.
You must continually build core skill sets that are relevant to the business. [For CapitaLand, which was once a traditional developer] it's now retail, property-management, leasing, fund-management and asset-management. So you must continually build competence, and you must continually raise your bar, find a new platform.
WSJ: What are the three most important things on your checklist when deciding whether to build or invest in a mall?
Mr. Pua: First, you must know the investment returns. You start with the macroeconomics. In Singapore, the driving factor is low retail space per capita, high spending power. So you really can't go wrong if you have the business properly planned. In China, consumerism is on the rise with 8%-10% GDP growth a year. In India, organized retail is just a few percent of overall sales; there is potential for huge growth in organized retail. Then you go down to the asset level, and see what trade mix you need to get the target returns you want.
No. 2 is your exit strategy -- very, very critical [and] you must have it up front. Because a mall is such a big investment and requires intensive management expertise, very few organizations can buy malls. Even though a mall can be a good investment, you could have your money stuck for a long, long time. [Space in] the mall has to be sold to somebody who is an expert who requires a certain return. The third thing is that you must have good management in place, because returns might be good the first year, the second year. But every year the retail trend changes, the competition becomes more intense.
WSJ: What advice would you give a budding retailer or restaurant operator?
Mr. Pua: First, you must have a product to offer.
No. 2 is have a business model, and do a real feasibility study. Let's say you are in the restaurant business, and you spend a lot of money to retrofit the shop, to buy equipment. You dream people will queue up to eat there. On the day it opens, that dream disappears. Or you might do well, but when you work out the numbers, you realize that the return, for all the risk and money you put in, isn't enough.
Many times I tell people, you are just making an accounting profit, because you never depreciated your equipment. Your lease is three years, you depreciate your equipment in five years. At the end of three years, you may not get a lease renewal, and you have two more years of depreciation that haven't been written down.
WSJ: How do you choose a tenant?
Mr. Pua: The key thing is to look at what kind of sales he can generate, not just the rent that he can pay us. The business must be sustainable or, in no time, he will go bankrupt. We must look at the concept he has, and whether he can help to draw in customer traffic.
We actively seek out tenants who can provide the kind of merchandise the customers want. In the case of Tampines Mall (in suburban eastern Singapore), we realized that there was lots of demand for [mobile] telephones, so although we already had M1 (Mobile One Ltd.) and StarHub (Ltd.), we decided to get SingTel Mobile (a unit of Singapore Telecommunications Ltd.). By drawing more customers to our place, the value of neighboring shops goes up.
WSJ: What is your advice to new employees?
Mr. Pua: For every new hire, the advice I give is this: Do a good job, and make sure you add value to the job. And be sure the job adds value to you.
地产开发商要立足潮流把握先机
嘉德商用产业有限公司(CapitaLand Retail Ltd.)总裁潘锡源(Pua Seck Guan)正在推进嘉德置地(CapitaLand)在中国和印度的扩张。在中国，嘉德建造的大型购物中心吸引到了沃尔玛连锁公司(Wal-Mart Stores Inc.)这样的大客户；在印度，公司将联手Pantaloon Retail (India) Ltd.共同管理零售地产和地产基金。与此同时，他还掌管著拥有20亿美元资产的新加坡最古老、规模最大的房地产投资信托基金嘉茂信托(CapitaMall Trust)。
嘉德商用产业在新加坡、中国、日本和马来西亚有超过45家购物中心，是亚洲最大的购物中心所有人或管理人。该公司2月份公布，2005年税后利润增长一倍以上，由2004年的3.057亿新元增至7.505亿新元（4.69亿美元）。
潘锡源毕业于美国麻省理工学院(Massachusetts Institute of Technology)，获得民用工程硕士学位。他的得力之作包括在嘉德购物中心入口增设直达电梯、使租赁价值得到了大幅提升，将其他一些购物中心的顶层改造成花园，以及充分利用底层零售空间等。日前，他在新加坡接受了《亚洲华尔街日报》记者KEVIN LIM的采访。
WSJ问：你的第一份工作是什么？有什么收获？
潘锡源答：我的第一份工作是在新加坡Hotel Properties Ltd.担任项目经理，我当时刚刚毕业，还是个年轻的工程师，有很多技术问题都不懂。不过你可以学，而且你完全可以赢得尊重，甚至管理整个团队。
另外，我逐渐领悟到，你必须知道下一步应该做什么。我发现搞房地产开发不仅仅需要项目管理，还需要投资，这就是关键的“下一步”。
问：你认为一个卓越的经理人最重要的品质是什么？
答：首先，你的工作中不能有“不”，要做到没有你解决不了的问题。在房地产业务中，你必须摆脱桎梏才能创造财富。你还要有先见之明，因为形势总是在变化，今天看来正确的事情或许几个月后就未必如此了。你必须不停地思考如何做到对事情的前景有足够的把握。
你还要不断积累与房地产项目有关的核心知识。对于嘉德这样一个从传统的地产开发商脱胎而来的企业，眼下零售业、房地产管理、租赁、基金管理和资产管理都是他们要掌握的内容。因此你必须不断树立竞争意识，提高目标，探索新的业务平台。
问：当你决定是否要建设或投资一家购物中心时，你认为需要考察的3个最重要的因素是什么？
答：首先，你必须对投资回报胸有成竹。你要从宏观经济入手。在新加坡，一个很有推动力的因素是，人均零售空间很低而居民的购买力相当强。所以如果你计划得当，基本上不会失败。在中国，随著国内生产总值(GDP)以8%-10%的速度增长，消费主义风潮正在盛行。而在印度，有一定规模的组织化零售行为只占整体零售额的几个百分点，因此可能有巨大的增长空间。然后，衡量一下自己的资产水平，根据自己的回报目标设计一个投资组合。
其次是退出战略－－这一点非常关键，而且你必须事先制定。由于对购物中心的投资往往规模庞大，需要精湛的管理经验，很少有哪家机构会购买购物中心。尽管这可能是一项不错的投资，但你必须把资金压上很久。只有这方面的专家才愿意出手购买购物中心的空间，而且他们往往也期待相当的回报。
第三，你必须有良好的管理经验。第一年和第二年的回报可能很好。但是一旦零售业出现滑坡，竞争就会异常激烈。
问：对初出茅庐的零售商或餐馆经营者你能给些建议吗？
答：首先，你必须有受欢迎的产品。
其次，业务模式也很重要，要作一些真正的可行性研究。举例来说，假设你经营餐馆业务，花了很多钱装饰店面，购买设备。你梦想著来这里吃饭的人络绎不绝。但是当餐馆真的开业了，情况可能并不如你所愿。或者表面上你的生意很好，但最后算算总帐，回报率可能并不高。
我经常告诫一些人，不要只看帐面利润，因为你可能还没有摊销设备成本。或者你的租赁期是3年，但你却要摊销5年。3年后，你不一定续租，这时候你将有两年的成本未摊销。
问：你对租户的选择有什么技巧吗？
答：最重要的是看他能产生多少销售额，而不仅仅是付给你多少租金。他的业务必须是可持续的，不会很快破产。我们要了解他的理念，看他是否愿意为吸引客流作出努力。
我们会积极寻找那些受消费者欢迎的商户。以新加坡东部偏远地区的Tampines Mall为例，我们发现手机的需求很旺，所以尽管我们已经接纳了M1(Mobile One Ltd.)和StarHub (Ltd.)，我们仍然决定接受SingTel Mobile（新加坡电信(Singapore Telecommunications Ltd.)的一家子公司）。
购物中心的顾客多了，店铺的价值自然水涨船高。
问：给新雇员提点建议吧？
答：对于每一名新雇员，我会对他们说：希望他们做好本职工作，为这份工作贡献自己的价值，反过来也要确保这份工作能够提升他们的个人价值。
