Singapore-based developer Ascendas has been active in China for 20 years, creating space to meet clients’ evolving real estate requirements. It does this in markets throughout Asia, from India and the Iskandar Deveopment region in Malaysia to Singapore, South Korea, Vietnam and the Philippines. Ascendas’ projects in Chennai and Banagalore, India, are the subject of a Site Selection Investment Profile that appears in the September 2013 issue; Singapore properties are covered in the Investment Profile in this issue.
Of Ascendas’ running projects in China, five are business parks: Ascendas Innovation Park in Xi’an, Ascendas iHub Suzhou, Dalian Ascendas IT Park, the Singapore-Hangzhou Science & Technology Park and A-REIT City@Jinqiao, Shanghai. High-tech manufacturing and logistics space includes the Beijing Economic & Technological Development Area and Ascendas Xinsu, in the China-Singapore Suzhou Industrial Park (CS-SIP).
Williams Controls, a manufacturer of electronic, hydraulic and pneumatic throttle controls for commercial vehicles, among other products, has operated out of a 40,000-sq.-ft. Ascendas facility in SIP since 2005. The company, a subsidiary of Curtiss-Wright Corp., employs 160 in Suzhou, which will increase to about 200. A relative newcomer to China, Williams Controls draws on Ascendas’ “professionalism and reliability,” says Brown Hua, general manager of the Suzhou facility. “They have good relationships with the local government authorities, which is a great benefit to new companies in the area.”
Ascendas iHub Suzhou, also in the CS-SIP, is being built to attract regional headquarters, R&D, outsourcing and shared services operations. Phase 1A, now under construction, will include three towers and 39,000 sq. m. of space designed — like Ascendas developments throughout Asia — to deliver integrated live-work-play space, not merely office space. Target tenants are those companies wanting to be in Suzhou for its many logistics advantages and quick proximity to Shanghai, and Shanghai-based companies seeking to lower their operating costs.
The 35-hectare Dalian Ascendas IT Park in coastal Dalian, China, when fully completed, will consist of several high-grade multi-tenanted and built-to-suit buildings, stand-alone office space, and a central community hub with convention facilities, retail and other lifestyle amenities. Customers who are occupying the completed 200,000 sq. m. of floor space include multinational corporations providing R&D, software development and IT services.
Ascendas OneHub GKC in Guangzhou Knowledge City, will be built in three phases that when completed will offer 448,000 sq. m. of space, including residential, entertainment and leisure amenities. Long a manufacturing center, Guangzhou is now adding more knowledge-intensive service activities to her economic structure — and Ascendas intends to accommodate those functions, as well. Dalian Ascendas IT Park, on China’s northeast coast — on the Bohai Sea, specifically — has three phases completed. Tenants include Konica Minolta, Johnson Controls, Infosys, Nomura Securities, Citi and Toyota Tsusho. Dalian’s multilingual population has long been a draw for financial services and IT companies.
Ticking All the Boxes
The Global Workplace Solutions unit of Johnson Controls, Inc. manages space in Asia and also occupies space, some of which is Ascendas space, including some at the Dalian Ascendas IT Park.
“Having been in the region since the early 1980s, I’ve watched Ascendas grow its presence in Asia over the years,” says David Lindsay, director of corporate real estate, Asia, at Johnson Controls. Lindsay and a colleague worked on securing about 40,000 sq. ft. of space for its financial accounting and shared services operations in China and East Asia.
“Ascendas did a lot to help us in terms of building flexibility into the space, which is very important for scalability. We didn’t want to have to pull up stakes and move when it was time to expand.”
— David Lindsay, director of corporate real estate, Asia, Johnson Controls
“The ultimate decision to go with the Dalian space was based on what we could see as being a very clean ownership position with no question marks that troubled us. Management was understood to be very sound — Ascendas has a very good reputation for onsite management. The facility itself is extremely well built,” Lindsay adds, “and was part of a growing campus. It ticked a lot of boxes.
“Ascendas did a lot to help us in terms of building flexibility into the space, which is very important for scalability,” says Lindsay. “We wanted to be in a location where we could expand in the area. We didn’t want to have to pull up stakes and move when it was time to expand.”
As Dalian Ascendas IT Park is 20 km. from the city center, it was important to Lindsay that it contains dining and retail amenities for tenants and visitors.
“It was a clear winner in terms of our target list,” he notes. Ascendas even let Johnson Controls occupy some space before it officially moved in, says Lindsay, for conducting job interviews and other functions. “They provided us this space free of charge, which was above and beyond.”
Singapore-based InnoCellence Systems Pte Ltd is another tenant at Dalian Ascendas IT Park. The software development company works with multinationals, such as Eli Lilly & Co., to apply digital innovation to business operations. The company created and now supports Lilly’s Global IT Innovations Lab, which opened March 18th in Dalian.
Bill Yan, InnoCellence senior solution architect, says his company needs high-end, secure space to support initiatives such as Lilly’s new lab, and that Ascendas was a safe bet in that regard from the outset.
“Ascendas made a good impression at all times and provided valuable support for us to understand the local policies and procedures,” says Yan.
The space is more expensive than alternative locations the company looked at, he adds, but it delivers the appropriate value for the investment, particularly with respect to the company’s ability to meet multinational clients’ service expectations, he adds.
Sharing the Burden
Global logistics giant UPS occupies Ascendas space in Suzhou and Singapore, where it has several facilities. In Suzhou, UPS has a package center in the Suzhou Industrial Park from which it transports freight to Shanghai Pudong International Airport for global delivery. In 2011, UPS opened a 43,000-sq.-ft. health care facility in Singapore, UPS’ regional headquarters.
The facility has cold chain capabilities for products that require temperature-sensitive storage and distribution. Terence Shum, UPS’ director, real estate and facilities for Asia-Pacific, recalls his experience of discovering that the specialized distribution facility’s floor had been compromised by the previous tenant.
“Ascendas was very willing to discuss the situation with us and to work out a solution that eventually meant their sharing the repair cost with UPS,” says Shum. “They were not contractually obliged to help us but they went the extra mile because of our regional and strategic relationship. These are long-term partnership qualities that UPS is looking for. Our relationship is much stronger today because of the way Ascendas handled that situation.”
Ascendas subsequently referred business to UPS, because of its specialized distribution center, says Shum, demonstrating that it values UPS as a business partner.
“We are now looking at some Ascendas space in Shanghai,” says Shum. “When we have new space needs, I will call Ascendas. They have provided very professional support for the day-to-day management of our needs, as well as for bigger issues, such as repairing the floor in Singapore or supporting our need to find additional space.”