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Singapore Undergoes a Glitzy Makeover

For years, this affluent trade entrepot was known as one of the sleepier cities in Asia—a nice place to live and work, but nothing compared with the flashy financial capitals of Hong Kong, London and New York. Opulentus SingaporeBut that is changing, as Singapore's central business district undergoes its biggest makeover in a generation. Rising across 360 hectares (889 acres) of reclaimed land downtown are a number of new mega developments with an unusual mix of entertainment and business, especially for the traditionally conservative city-state. Marina Bay includes a more than $5 billion Sands casino-resort, with a 150-meter-long (492-foot) swimming pool on its 57th floor. It also has a $1 billion tropical sanctuary designed to be the Central Park of Singapore and gleaming office buildings that are attracting some of the biggest names in global business. When the ambitious project was announced, many questioned whether Singapore could create something on the scale of Paris's La Defense, London's Canary Wharf or China's Pudong that would attract billions of dollars of investment. But today, less than two decades after the reclamation work was completed, Marina Bay is well on its way toward accomplishing that goal. The district's first condominium developments sold in weeks, and completed office towers are more than 70% occupied. Marina Bay also has enough celebrity-branded restaurants and luxury boutiques to put other major cities to shame. Google Inc. GOOG -0.63% established its new Southeast Asia headquarters in Marina Bay's Asia Square earlier this year, and Citigroup Inc. C +1.56% is investing 85 million Singapore dollars (US$69 million) to make the same complex home to its new Singapore office and its largest trading floor by head count in the Asian-Pacific region. In 2011, London-based Standard Chartered STAN.LN -1.74% PLC opened its largest office in the world in the district. "As part of Singapore's new skyline, we believe that we are sending the right message to our customers," said Rohinton Mehta, a senior real-estate executive at Standard Chartered. To be sure, most of Marina Bay's success has come during Asia's remarkable growth spurt and has yet to be tested by a sustained downturn. That is becoming more of a concern as Singapore cools along with the rest of the Asian economy. In August, Singapore's Ministry of Trade and Industry said it expects the economy to expand a mere 1.5% to 2.5% in 2012, compared with 14.5% in 2010. That has put a damper on office leasing and might cause problems for the 1.11 million square meters (11.9 million square feet) of space in the Marina Bay development pipeline. Still, the Singapore government, which already has paid for S$9 billion of infrastructure, is continuing to invest heavily in the area. Unperturbed by the city-state's slowing growth, it has committed to invest S$3.3 billion in Marina Bay over the next 10 to 15 years. Developers are continuing to search for available plots of land that may soon be ready for development around Marina Bay, particularly as the government pushes forward with plans to move the historic port about five minutes from Marina Bay over to the West side of the island. "Given the right space, we would be keen to bid for land parcels close to our existing developments," said Warren Bishop, chief executive of Raffles Quay Asset Management, which co-developed the Marina Bay Financial Center, one of the district's flashiest projects. Marina Bay was the brainchild of government planners in the 1970s who wanted to ensure that Singapore, with limited space for expansion, kept competing with Hong Kong and other hubs. Authorities set about reclaiming hundreds of kilometers of land, creating an artificial bay at the city's southern end where developers could build the next downtown out of swamp and sea. The skywalk in Singapore's Marina Bay winds through a 'Supertrees Grove.' The once-sleepy city-state is attracting some big companies. The plans attracted some critics. Some believed the glitzy developments would bring in more rich foreigners and drive prices out of reach for locals. Many also questioned making a casino the centerpiece in straight-laced Singapore, worried it might bring in crime. But in 2005, the city-state approved casinos partly in a move to protect its tourism industry against gambling centers opening throughout Asia. The Sands, along with flashy events in Marina Bay like an annual Formula One race, also are adding what some believe is much-needed glamour to Singapore. "It is ironic that something primarily of entertainment value, the casino resort, can make a city more attractive to financial firms," said Patrick Phillips, chief executive of the Urban Land Institute in Washington. "But that has really been Singapore's way of spicing things up—it was always seen as boring in comparison to other Asian cities." Designed by celebrity architect Moshe Safdie, the Las Vegas Sands complex spans 100 hectares and includes Pangaea, a nightclub with an $80 cover charge, as well as a floating Louis Vuitton store. The casino-resort generated US$694.8 million in revenue in the first half of the year. Marina Bay also has benefited from Singapore's tightly controlled political system, which has helped leaders avoid the kind of infighting that delayed other master-planned developments, like the new World Trade Center complex in New York. The government support helped lure investments from big-name developers, including Hong Kong's Cheung Kong (Holdings) Ltd., Hongkong Land Ltd., Singapore's Keppel Land Ltd. K17.SG -1.13% and MGPA, a private-equity real-estate company. These developers built towers with some of the largest trading floors in Singapore. Tenants like American Express AXP -0.95% Co.; Barclays BARC.LN -0.72% Capital, a unit of Barclays PLC; Société Générale SA; Bank of America Merrill Lynch, a unit of Bank of America Corp.; and Bain & Co. have moved there, even though prices per-square-foot are among the most expensive in Singapore. Some middle-class Singapore residents say Marina Bay is a reminder of Singapore's wealth gap, one of the widest in the world. The new developments have been accompanied by "crass displays of wealth," said Manu Bhaskaran, a research fellow at the Institute of Policy Studies in Singapore and a partner at the Washington-based Centennial Group. Singaporeans have seen more "expensive fast cars, gourmet restaurants and other high-end conspicuous consumption flaunted publicly," he said. Responding to these concerns, Singapore's government has made it harder for expatriates to get permanent residency. New amenities are being added that planners hope will make the district more enjoyable for locals, like the Gardens by the Bay park, whose first phase opened in June. Meanwhile, Marina Bay is attracting many fans. John Witter, a 35-year-old relationship manager for a French bank who moved into the Marina Bay Residences two years ago, said he was happy to pay over S$6,000 a month for the two-bedroom flat because it is "hard to put a value on something like quality of life." "I see fireworks several times a year, can watch the F1 races and have a light show outside my window every night," said Mr. Witter, a French expatriate who moved to Singapore in 2010. "It makes me feel proud to live in Singapore." Source: Wall Street Journal

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