A great many metropolises in Asia are defined by their skyscrapers — one only has to think of the Petronas Towers in Kuala Lumpur and Lord Norman Foster’s HSBC headquarters in Hong Kong. But while high-rise building lace the skylines of major Asian cities like Singapore, Jakarta and Bangkok, Yangon stands as an exception.
Last month, Singapore-listed Yoma Strategic announced it will collaborate with BTJV Myanmar, a joint venture between Dragages Singapore and Japan-based Taisei Corporation, to build Yoma Central, which will feature Peninsula-branded luxury residences, two Grade A office towers, a business hotel and serviced apartments when complete.
A second flagship project, Peninsula Yangon, will be constructed by BYMA, a separate joint venture with Dragages Singapore and Yoma. It will conserve, restore and revitalise the former headquarters of the Burma Railway Company into a luxury hotel. This project is a joint venture between the Hongkong and Shanghai Hotels, Yoma Strategic and FMIC.
Both projects together sit on an approximately 10-acre prime site near Bogyoke Aung San Road and are expected to be complete in 2021. The combined contract value is over $400 million.
Importantly, Yoma and its partners will be among the first few real estate developers to gain a foothold into the nascent Yangon office space and at a time when the sector is expected to take off in tandem with the Myanmar economy in the years ahead.
“We look at the long-term trajectory of Myanmar and Yangon, as a whole. Given today’s market, there aren’t enough offices in Yangon of what we perceive to be the market in 5-10 years’ time,” Cyrus Pun, executive director of Yoma, tells The Myanmar Times in an exclusive interview.
“The stock of Yangon’s office supply is merely a fraction of other regional cities, including Ho Chi Min, Bangkok, Jakarta and Kuala Lumpur.
“We’re still very short of the mark. As the country develops and the economy grows, office demand will grow rapidly as well – we’re still undersupplied if you look at the long-term demand of Yangon,” he said.
Poised for take off
Currently, the office market in Yangon hasn’t yet taken off. But Mr Pun said that local businesses, most of which work out of their own properties, will sooner or later move to office buildings.
“Houses and apartments are not well-designed for a working environment; however, it is convenient for existing local companies to use because they may already own some properties. As businesses begin to grow, they need better work spaces,” he said.
Mr Pun reckons one of the reasons local businesses are not yet switching from apartments to office buildings is that businesses lack stability and confidence. “If you know that your business is stable, then you can allocate some budget for ongoing expenses like renting out an office. Unless you get to that stage of stability, you want to always minimise your outliers of cost using existing space.
“Concerning confidence, I think that the business culture will change over time, where people will appreciate the need of an office building with easier security, closer businesses, more conducive business, and, above all, enhanced teamwork and communication,” he remarked.
Satellite towns Mr Pun sees a future central business district (CBD) situated in the current downtown area – where Yoma Central is located. That will be what rivals Marina Bay Financial Centre in Singapore or Alexandra House in Hong Kong. Beyond this CND, though, the city will see the emergence (or in one or two cases, growth) of several commercial centres with clusters of office buildings and malls. For all these to work, road and rail connectivity is the key.
In fact, Yoma has already developed two such satellite towns – Star City in Thanlyin township and Pun Hlaing Estate in Hlaing Thayar township. StarCity, which will boast 10,000 condominium units upon completion, seeks to strategically tap into the urbanisation and prosperity in Thanlyin, which is catalysed by Thilawa Special Economic Zone (SEZ).
Star City is a community estate – it has a school, a swimming pool, shops, supermarkets and it will eventually have a hospital. Hence in a few years, it will become a mini-town in its own right, enriched by its greenery and community space. Additionally, the company is building a jetty to connect the area with downtown. The jetty coincided with the introduction of the Yangon Water Bus system.
“We will also be providing our own dedicated shuttle ferry service for residents too, which will allow connection to downtown Yangon in roughly 10-12 minutes – much quicker than by road. It will not only serve Star City residents, but also the whole Thanlyin township – Star City will become a transport hub,” Mr Pun said.
Even though the existing connection between Thanlyin and Yangon’s city centre is currently abysmal, the presence of Thilawa SEZ means that there is “a certainty that a new bridge will definitely be built”, or else the SEZ cannot succeed.
We have already seen the planning of the [new] bridge both the financial and technical planning,” he said.
Meanwhile, Pun Hlaing Estate, a more remote satellite town which targets very high-end buyers, has already sold 400 properties as of March.“Pun Hlaing has always had its own place in the market where it is a more comfortable and secure estate and something that people look for that is not found in the rest of the city: security of mind – a comfortable environment where kids can run down the streets feeling very safe,” said.
Source: The Myanmar Times
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