More Hong Kong Businesses Moving To Singapore

SINGAPORE – Property buyers from Hong Kong and expatriates have been relocating to Singapore since the end of the latter’s lockdown in June, reported the Financial Times on Saturday (21 November, SGT).

While the Hong Kong exodus has mainly benefitted the city-state’s housing market, it may also end up helping the office property sector.

For instance, a commercial tenant representative for a major property company who requested anonymity revealed that businesses from Hong Kong are making low-key movements to set up subsidiary offices in Singapore. In time, these are expected to become head offices, replacing those in the Chinese territory.

However, the relocations to Singapore are being done covertly, as many firms with offices in Hong Kong are unwilling to transfer executives en masse or draw much attention, so as not to antagonise China’s central government. This is because moving indicates that the Chinese territory has become less appealing as a financial hub.

“(Home) sales have picked up as more Hong Kong businesses move to Singapore,” said Knight Frank’s Associate Executive Sales Director Ella Sherman. She revealed that many of her clients work in private equity. She was also recently hired by a British expat couple, who were born and raised in Hong Kong, but had just recently emigrated to Singapore.

If the residential property sales to foreigners will be used as an indication of how many people have already moved from Hong Kong, then it’s no small amount.

During the first 3 quarters and despite the COVID-19 pandemic, 260 residential units were acquired by foreigners. Of this figure, 75 percent consists of international buyers from Hong Kong or mainland China, said Ismail Gafoor, CEO of Singapore’s biggest real estate agency, PropNex Realty.

“Singapore is in a very strong position despite the pandemic as far as real estate is concerned,” he noted, pointing out that the country’s government has done a good job of handling the virus outbreak.

Notably, Hong Kong has become less attractive after it legislated the new national security law in June. It has also recently suffered a 4th wave of COVID-19 infections that led to the suspension of the planned Hong Kong-Singapore travel bubble.

The political turmoil in the Chinese territory has also made Singapore’s stability even more valued. In addition, the city-state is on the radar of international property buyers and high-flying financiers thanks to its low taxes and the strong rule of law.

Furthermore, many Chinese tech behemoths, like Alibaba, Tencent, and ByteDance are expanding into Singapore. And this trend is expected to help Singapore’s property market, both residential and the office segments.

“Tech giants are coming to Singapore and these companies’ middle management has been heavily rewarded due to market demand and performance of stock prices,” added Christine Li, Research Head for Singapore and Southeast Asia at Cushman & Wakefield (C&W).