Daily Archives: 19 Nov 2009

Blueprint to boost interior design sector

Trade group lays out plans to raise standards in the industry

Interior design is not just about running after contractors or drawing layouts – and an association believes it is time to hammer out higher standards for the industry here.

‘I probably didn’t draw a living room for 20 years,’ says Nicholas Merrow-Smith, client manager at Davenport Campbell (Singapore) who became president of the Interior Design Confederation Singapore (IDCS) in April.

And he wants to show that interior designers can do more. IDCS hopes to raise the level of innovation in the industry and has several suggestions on how this can be done.

Among its initiatives are an accreditation scheme for interior designers, a professional development programme and more collaborations with foreign design firms or other design disciplines.

The proposals have won the support of some practitioners in the wider design industry. Singapore Institute of Architects president Ashvinkumar Kantilal is one who thinks that IDCS is heading in the right direction.

‘The (interior design) industry needs to self-regulate and widen the members’ knowledge base,’ he says, suggesting skills upgrading programmes in the form of courses and seminars.

Financially, the interior design industry is in fine shape, with plenty of work. But according to Mr Merrow-Smith, it lacks creativity and diversity, and this is especially clear when it is seen against its foreign counterparts.

He cites an example – interior design firms here tend to focus on traditional real estate, while those overseas can be multi-disciplinary, even taking on projects such as theatre design.

And interior designers abroad are going into research, he adds. For example, there are studies on how the design of office space can get employees to buy into their companies’ values.

‘What we’re trying to do is to show people that the design portfolio is much wider,’ says Mr Merrow-Smith. And if design firms raise their standards, there is also a chance for them to secure better work, he adds.

IDCS is kicking off its efforts with a conference this month, called Design Value: Beyond the Tangible, to highlight how design can be a strategic tool.

It will be attended by players from global firms such as Gensler and Hassell, who will share their experience of how workplace and leisure space designs can influence people’s performance and behaviour.

In the longer term, IDCS will try to facilitate partnerships between interior design outfits and other design industries such as architecture.

DP Architects director Tai Lee Siang trusts that greater collaboration among the various design sectors will help strengthen the Singapore brand of design.

IDCS also hopes to set up a professional development programme by the middle of next year. With the course, interior designers can undergo continual training and conduct industry-related research.

The next – and tougher – step would be to establish an accreditation programme for interior design firms. There is no such assessment system in place now. ‘Some firms do very good work, but it’s certainly not across the board,’ Mr Merrow-Smith says.

Some interior design firms see benefits from accreditation. The group managing director of Nota Group, Ong Sheng Keat, reckons: ‘In Singapore, a large proportion of the market is dominated by business-minded contractors or decorators who see the profession as another form of trade mainly due to the lack of enforced certification’.

Altered Interior director Thierryson Chua also supports accreditation for firms in the industry, but believes a scheme could be more effective if the government was involved. If IDCS oversees the scheme, it will have to be ’super active’ in organising events and attracting members, he says.

IDCS could not disclose its membership size because an auditing session is under way. But Nota Group’s Mr Ong says IDCS has been seen as exclusive and inclusive – ‘exclusive in the sense that it only admits genuine practising interior design professionals as members, yet inclusive because it will attempt to convert the non-professionals’.

IDCS is aware of the hurdles to implementing its plans and it is getting help from the government. For instance, it has secured funding capped at $435,000 over three years.

The association also spoke to representatives from about 50 interior design firms and related companies. According to Mr Merrow-Smith, they are supportive of its initiatives.

‘We don’t expect the whole industry to step up,’ he says. But ‘we’d like to see a core body of people who are serious about pushing the envelope, innovating, and doing things differently’.

Source : Business Times – 19 Nov 2009

Australia property market less attractive

High taxes, rapid asset price recovery to blame, says LaSalle CIO

High taxes and a rapid asset price recovery have made the Australia property market less compelling for funds seeking high returns, with more attractive options in Japan and Singapore, according to a top executive of LaSalle Investment Management.

Ian Mackie, LaSalle’s chief investment officer for Asia-Pacific, told Reuters in an interview that the Australian government’s plan to cut withholding tax for foreign investors is a much-needed step to bring it into line with other regional countries.

‘The tax situation puts, in my opinion, Australia at somewhat disadvantage when comparing with other countries in the region,’ Mr Mackie said, ‘because the after-tax result of the investment is penalised harder in Australia than it is in Japan, Korea, Hong Kong or Singapore.’

The Australian government plans to cut the tax next July to 7.5 per cent from 30 per cent. Elsewhere in Asia, the tax rates range from 5 to 10 per cent.

Mr Mackie said that the speed of the recovery in Australian property prices compared to those in other countries meant limited opportunities for high-return investors, while a strong Australian dollar is also an obstacle because it has boosted hedging costs.

‘We still see opportunities here but the pricings recovered so much faster. They didn’t go down as much as another countries did and recovered much faster,’ he said. ‘Maybe for us in Australia, the window is closing faster.’

Prices for Australian office buildings were less than 20 per cent lower than a year ago in the second quarter, while those in Singapore and Tokyo were still down more than 30 per cent. Office vacancies in Australia are also stabilising.

LaSalle Investment Management, the investment arm of real estate services firm Jones Lang LaSalle, has US$3 billion available to invest in Asia after raising an opportunity fund last year, and Mr Mackie said that most of the funds have not been deployed yet.

Jones Lang’s chief financial officer, Lauralee Martin, told Reuters in an interview last week that its Asian business will drive growth next year as the region powers a global economic recovery.

Mr Mackie said that he sees some opportunities in suburban retail assets in Singapore and in the logistic sector in Japan. In particular, Japan offers handsome spreads between low borrowing costs and yields on buildings. ‘You’ve got 300 basis points of difference, which substantially leverage up the returns.’

He said that Singapore, as well as Thailand and Hong Kong, has seen sharper declines in property values, creating better chances to outperform Australian properties.

Source : Business Times – 19 Nov 2009