SLP to more than double agent strength in Singapore

SINGAPORE - Homegrown property agency SLP International, part of the ZACD Group, is bucking industry outlook with an ambitious goal to more than double its agent strength in Singapore to at least 2,500 through mergers and acquisitions (M&As). It is also looking to have 10,000 agents regionally through organic and inorganic means.

Such expansion plans would seem to defy current market conditions, which have prompted many property agents to leave the industry. SLP's agent strength - including agents under SLP International, SLP Realty and Scotia Real Estate Group - wobbled close to 1,000 after the latest licence renewal exercise.

ZACD group chairman Kain Sim conceded that the agency business is going through a rough patch since property cooling measures came in place and technology has threatened to displace intermediaries in property transactions. Savvy buyers are also increasingly open to buying international properties directly from overseas developers.

"We foresee that with the influx of technology, very soon, if agents remain just agents, their services can be quite redundant," said Ms Sim. But for SLP, expansion is made viable with the backing of a strong project pipeline from the ZACD platform."

"A lot of the agents will be able to see the value of coming to our platform not just for property transactions but also that they are able to be more like relationship managers to offer a suite of investment products to their clients," she added.

"This gives agents a suite of products, raises their skills and gives them a career path and an option for those who eventually say they want to be in financial services. So, the platform is very versatile and dynamic compared to the traditional agency business."

She shared that SLP's plan to build a regional platform was propelled by the realisation five years ago that developers can no longer be contained within their home country. They need to market their products regionally.

"Let's say a developer launch a project in Singapore, we can take it in a roadshow and concurrently launch the same project in different key cities," Ms Sim said.

SLP is looking to expand into Australia and Malaysia, and will be setting up an office in Johor Baru next month. It had set up an office in Jakarta in 2006 and in Shanghai in 2009.

Ms Sim said she is also confident of moving into the investment sales arena, whereby clients can pool together in bulk purchases through the SLP platform.

Beyond project marketing, SLP has also undertaken asset management and property management. It will be expanding its property management team from 20 staff members to 100 - this team generally undertakes the MCST (Management Corporation Strata Title) business or the management bodies of private housing.

Since the inception of ZACD in 2005, four years after SLP's founding, the group has shed its image as a pure agency business. Ms Sim noted that developers have also started to see the advantage of partnering ZACD in joint-venture opportunities to tap its financial strength.

A case in point was Qingjian Realty's Natura Loft, an HDB Design, Build and Sell Scheme (DBSS) project in Bishan, which was launched one month after the Lehman Brothers crisis in 2008 but still achieved an internal rate of return of 11 per cent.

"With our agency arm, we are committed in the midst of a crisis and we are able to weather the storm," Ms Sim said. "Our clients saw the merit of having an agency business in a real estate fund (management firm)."

This article was first published on Jan 28, 2016.
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