facility management in china: an emerging market - · pdf filefacility management in china: an...

Forum Facilitator: Prof. John D. Gilleard, PolyU
Forum Panelists: Ms. Natina Wong, Jones Lang LaSalleMr. C. H. Fan, SynergisMr. David Rees, Standard Chartered Bank
Facility Management in China: An Emerging MarketFacility Management in China: An Emerging Market

China: An Emerging Market
Geographically worlds 3rd largest country
Population ~1.296.5 billion (2004); ~1.37 billion (2010)
20% worlds population; 7% worlds land
~92% ethnic Chinese, or Han~40% urban; 60% ruralLife expectancy 71Literacy 91%
Source: World Bank

GDP average 9.5% growth 1978 -2004; [US 3rd Quarter 2005 3.3%]
GDP (US$ billions) 1,653.8 [US 10,881; Japan 4,326; Germany 2,401]
Gross capital formation/GDP 45.2%Inflation 3.9% CPIExport of goods & services US$656
billion - [USA US$1,147]Import of goods & services US$607
billion [USA US$1,764]Per capita income $1,100; $5,000 PPP
rates.
GDP average 9.5% growth 1978 -2004; [US 3rd Quarter 2005 3.3%]
GDP (US$ billions) 1,653.8 [US 10,881; Japan 4,326; Germany 2,401]
Gross capital formation/GDP 45.2%Inflation 3.9% CPIExport of goods & services US$656
billion - [USA US$1,147]Import of goods & services US$607
billion [USA US$1,764]Per capita income $1,100; $5,000 PPP
rates.
Key economic trends 2004
Source: World Bank China at a glanceSource: World Bank China at a glance
By GDP China ranks number seven of the worlds largest economies
By GDP China ranks number seven of the worlds largest economies

Foreign direct investment picks up in December - China Daily
Large foreign direct investment (FDI) contracts flowed back to China in December to enable the nation's 2004 FDI record US$62 billion in paid-in terms, or ~8% of Global FDI. Manufacturing industry continued to be the star performer, with 70%of total investment.
Foreign direct investment picks up in December - China Daily
Large foreign direct investment (FDI) contracts flowed back to China in December to enable the nation's 2004 FDI record US$62 billion in paid-in terms, or ~8% of Global FDI. Manufacturing industry continued to be the star performer, with 70%of total investment.
USA inward FDI US$ 121 billionUSA inward FDI US$ 121 billion

China: The worlds factory
By 2005 China produced 66% of the worlds photocopiers, microwaves and DVD players; 50% digital cameras and 40% of all personal computers.
By 2005 China produced 66% of the worlds photocopiers, microwaves and DVD players; 50% digital cameras and 40% of all personal computers.
China Factory: MediaTech Industrial Inc: ShiJie Town, DongGuan, GuangDong, China
Lenovo Thinkpad production
http://www.mediatech.com.tw/pics/factory1.jpg

Following a massive wave of rural-urban migration it is estimated that by 2010 Chinas urban population will exceed 50%; and by 2050 up to 800 million people will live in urban areas. Huge urban agglomerates will emerge along the coastal areas of China.
130 cities > 1 million130 cities > 1 million
China builds cities

Property Management Trends in ChinaProperty Management Trends in China
1981 to 1994 - Government Housing Management Companies1994 to 1999 Startup of PM industry; introduction of PM laws; 2 million personnel working for 12,000 PM companies1999 to now Introduction of PM regulations; involvement of non-mainland PM & real estate companies; professional development focusing on operations & maintenance; establishment of residential owners committees
1981 to 1994 - Government Housing Management Companies1994 to 1999 Startup of PM industry; introduction of PM laws; 2 million personnel working for 12,000 PM companies1999 to now Introduction of PM regulations; involvement of non-mainland PM & real estate companies; professional development focusing on operations & maintenance; establishment of residential owners committees
The Chinese Ministry of Construction has mandated that the post of PROPERTY MANAGER should be formally established. 1st of January 1999 deadline for training and in possession of a certificate of competency. The Ministry has also established a unified fee structure.
The Chinese Ministry of Construction has mandated that the post of PROPERTY MANAGER should be formally established. 1st of January 1999 deadline for training and in possession of a certificate of competency. The Ministry has also established a unified fee structure.
In China the terms Facility Management and Property Managementare frequently treated as synonyms.In China the terms Facility Management and Property Managementare frequently treated as synonyms.

FM in China!FM in China!
Staff are younger, more energetic but less well trainedStaff are younger, more energetic but less well trained
Staffing scalability difficultStaffing scalability difficult
Ordinances frequently open to multiple interpretationsOrdinances frequently open to multiple interpretations
http://www.chinaonline.com/topstories/cs-protected/020328/1/B02032511.asp

Quality Advice = Quality DecisionsQuality Advice = Quality Decisions
Corporate Property ServicesFacilities Management Capability

Overview

2005 Corporate Property Services Key Statistics Asia Pacific
No of Countries 13
No of Clients 69
No of Properties 3,824
No of Leases 3,885
Operating Revenue under Management (Rent)
US$118,103,578
Operating Expenses under Management US$670,556,751
Area under Management (in Sq. ft.)
Commercial 41,422,484
Industrial 2,106,239
Retail 4,125,400
Other 2,705,384
Total 50,359,507
Note: Malaysia serviced through Jones Lang Wootton

What we do for our Clients
AccountManagement
Budget & FinancialManagement
PortfolioPlanning
Procurement & Contract
Management
UnscheduledMaintenance
ScheduledMaintenance
Operational Risk
Management
LeaseAdministration
WorkplaceServices
CapitalWorks
Co-ordination
LeaseManagement
Managing Resources Delivering Profit from Account Delivering Services to Client Client Reporting
Financial Budgeting & Planning Financial & Management Reporting Cash Management / Payments Accounts Receivables
Space Management Portfolio Occupancy Plans Lease Management
Lease Data Maintenance Lease Reporting Lease Obligations
Capital Works Budgeting Capital Works Planning Project Control & Reporting
Rent Reviews Options Exercise Renewals New Leases Terminations
Sub-contracting Purchasing Utilities Management
Service Requests from Occupants
HVAC/Fire/Security Cleaning Planned Maintenance
Essential Services Fire Safety Security Occupant Safety Environmental
Churn Management Reception Services Mail Room Services Meeting Room Management
StrategicOccupancy
Planning
Project & Development
Services
TenantRepresentation
Real Estate Facilities
KEY CPS
Other Business Lines in CS
Links to other Business Lines

China

China Capabilities Property & Facilities Management
Over 50 million ft2 under management Servicing clients in major cities Beijing, Guangzhou, Chengdu, Nanjing, Shanghai, Shenzhen, Shenyang, Tianjin, Wuhan, Xian and UrumiqiOur Commitment to the China Market
3 Corporate Offices 12 Branch Offices Pan China Class 1 PM Qualification one of the two international management companies with this qualification.

China Capability Experience and Expertise
Central Hub Northern Hub Southern Hub
(Shanghai) (Beijing) (Guangzhou)
Professional Staff 186 94 34 314
Engineers 45 35 5 85
Technicians 370 235 10 615
Non-Technical Staff 1,299 630 36 1,965
Total 1,900 994 85 2,979
Site Staff
Total

Facilities Management Services Offering in China
Account Mgmt
Budget & Financial
Mgmt
Lease Admin
Portfolio Planning
Capital Works Co-ordination
Lease Mgmt
Procurement & Contract Mgmt
Scheduled Maintenance
Unscheduled Maintenance
Operational Risk Mgmt
Workplace Services
Strategic Occupancy
Planning
Project & Development
Services
Tenant RepRegional Accounts

Facility Management in China An Emerging Market

2
FM Opportunities in the Emerging Mainland market
MNC
Overseas real estate developers
Institutional fund investors

3
Synergis Mainland Development
City No. of Projects
No. of Staff
Managed Area (sq.m.)
BJ 6 149 399,193
SH 8 376 515,511
SZ 2 10 Consultancy Project
Total 16 535 914,704
Shanghai
Beijing
Shenzhen

4
Some Projects in ShanghaiGrade A Commercial Properties
Corporate Avenue
Grade A office towers, hotels, a commercial centreand other facilities built next to the Taipingqiao Lake
GFA : 96,000 sq. m.
Shui On Plaza A 26-stor

facility management in china: an emerging market - · pdf filefacility management in china: an...

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