News roundup: APAC has 5 of the world’s top 10 most innovative cities, and other headlines

For PropertyGuru’s real estate news roundup, Asia Pacific is home to half of the top 10 performing cities in the world for innovation and talent. In other headlines, Australia’s real estate agencies are under pressure from productivity, while Vietnam’s revised Land Law seeks to entice US-based overseas Vietnamese to invest in the homeland.

Asia Pacific home to half of the world’s top 10 most innovative cities: JLL

Asia Pacific is home to half of the top 10 performing cities in the world for innovation and talent, including Beijing (2nd), Tokyo (4th), Seoul (6th), Singapore (7th) and Shanghai (9th), according to a JLL analysis as reported in ReTalkAsia. Throughout the next decade, market specialisation, talent migration, sustainability goals, and new technologies such as AI will continue to shape the global knowledge economy and high-tech industry ecosystem, with JLL projecting Asia Pacific cities to be major beneficiaries.

The third edition of JLL’s Innovation Geographies examines how innovation continues to influence real estate location and portfolio strategies, based on the dynamics of 108 cities globally. Despite the increasing competition for talent and challenges relating to costs of housing and doing business, these innovation hubs remain distinguished by access to critical capital and funding as well as the breadth and depth of skilled workers.

“Innovation has reshaped the built environment and demand for commercial real estate as its importance to economic growth intensifies. Companies in Asia Pacific will need to balance talent, operating environment, risk, and cost requirements in their location strategy. For owners seeking to attract high-growth occupiers, location strategy will also be key,” said Roddy Allan, Chief Research Officer, Asia Pacific, JLL.

Tokyo, Seoul, Shanghai, Beijing, Singapore, and Shenzhen all outperform in innovation output, while Beijing, Tokyo, and Singapore are high in talent concentration. It will be critical for innovation-related firms to maintain – and in some cases expand – their footholds in these cities, to realise the benefits of such structural advantages that are unlikely to be replicated elsewhere.

Productivity is real estate agency’s greatest threat – REAP Dashboard

As real estate professionals gathered for the third Real Estate Agency Profitability (REAP) Dashboard Profit Symposium in Australia, there was one elephant in the room – productivity.

According to a report in The Real Estate Conversation, the whole sector is under pressure, with some of the lowest listing numbers in recent memory making the sales market highly competitive. The REAP data showed exactly where the pressure is coming from and those who ignore it, do so at their own risk. Everyone in the room left with a much clearer picture of where the market is heading and the changes they need to make in their businesses.

Chris Mercer, REAP Dashboard’s CEO & Co-Founder, presented an in-depth analysis of the REAP20 dataset, collected over four years and encompassing sales, property management, overheads, and profitability. The data detailed the real numbers on fluctuating sales revenue and profit margins, showed in black and white the decline in productive agents impacting deal volume, and challenges in maintaining profitability amidst variable revenue and overhead costs.

In this challenging time, principals have halved the number of listings they are making, and contracted lead sales agents’ share of sales commissions has crept higher and higher. In Property Management, increases in rents and turnover of leasing are carrying many businesses. But while the average salary for a PM has increased 26 percent in the last two years, the average number of properties a PM can handle has not improved in 20 years. Productivity is in decline.

Vietnam’s revised Land Law a boost for property market, entices US-based OVs to invest

The Land Law (revised), which expands land use rights for overseas Vietnamese (OVs) and Vietnamese citizens residing abroad, is expected to give a boost to the domestic real estate market.

Lieu Nguyen, global ambassador to Vietnam, Cambodia, and Indonesia from the US National Association of Realtors, said in VietnamPlus that the legal document will help OVs and foreign investors feel secure about investment in the market.

Many elderly Vietnamese in the US share the wish to live in their homeland after retirement and purchase property there, said Lieu, who works for Westgate Realty Group of the US.

She proposed Vietnam implement home resort projects to serve not only OVs but also retired US and Japanese people who want to reside in the Southeast Asian nation, adding the projects should include medical services and others for the elderly.

The Property Report editors wrote this article. For more information, email: [email protected].