Redbrick Mortgage Advisory is honoured to interview Mr. Clemence Lee, the current Executive Director of the Singapore Capital Market division, CBRE. He focuses and assists clients in terms of divestments and the acquisition of investment properties. This includes commercial buildings, retail malls, residential land, boutique hotels, conservation shophouses and strata commercial offices.
Over the last 2 years, Clemence has been involved in over $3 billion worth of deals, some of which include major transactions such as One George Street ($1.28 billion), Westgate ($680 million) and 20 Anson ($600 million).
Clemence has been dabbling in the conservation shophouse arena ever since he started investment sales 8 years ago. This was during a period when the market for shophouses was not as active and there were lesser interest from institutional funds and foreign investors to acquire them. Over the last 5 years, the market has shifted and interest to invest in this sector has grown substantially.
Being an expert in this area, he has been instrumental in the sale of some of the largest shophouse transactions in Singapore. In 2022 alone, he has transacted the sale of a portfolio of CBD shophouses (circa. $115 million), boutique hotel housed in a row of 12 shophouses at Mosque Street ($90 million), boutique hotel housed in a row of 17 shophouses at Jalan Sultan ($75 million), row of 11 shophouses at Lavender Street ($71.3 million) and a boutique hotel housed in 3 shophouses at Teck Lim Road ($53.4 million).
Q. Where do you stay and what do you like about your estate?
Clemence: My partner and I live in a duplex apartment in Tanjong Pagar. Personally, I really like the convenience of the area as there are plenty of food options right below our apartment. The nearby 100AM mall and Guoco Tower also houses many amenities such as gyms, supermarkets, restaurants, bakeries and clinics. Additionally, our place is located very close to the MRT station. As I work in the CBD, it is very convenient for me to head to work.
Q. What are your favourite restaurants you always frequent in your area?
Clemence: There are quite a few given the good mix of local and international cuisine at Tanjong Pagar, but it all boils down to my mood. When I am craving local food, such as chicken rice, hokkien mee or carrot cake, I often go to Maxwell Food Centre, Tanjong Pagar Plaza or Chinatown Complex. There is also Kok Sen Restaurant at Keong Saik Road which is highly acclaimed. If I want something different, there is Binomio along Craig Road and Fotia on Duxton Hill , the latter of which does good Greek food. I also enjoy going to cafes such as Five Oars Coffee Roasters and Bearded Bella as I can bring my dog along and the food they serve is incredibly tasty.
Q. How was your property search like when you bought your current home?
Clemence: We were living in a smaller apartment in the east previously and were looking to move to a bigger space. As we were searching for our new place during the peak of COVID in 2020 and we didn’t really set our mind on Tanjong Pagar initially.
However, upon doing my own research, I realised that there was a small price differential between living in the city and suburban areas. I saw value in purchasing a property in the Tanjong Pagar area and thought that it had quite a good per-square-foot value compared to other suburban launches. As I work on a lot of the shophouses in the area, I am quite familiar with the Tanjong Pagar locale and decided to settle there and managed to get quite a fair price for my unit.
Q. How was your experience with your agent?
Clemence: I have an interesting anecdote regarding this. One thing that not many people bring up is that it is difficult for real estate agents to purchase property for their own stay. Agents usually do a prior background check on their clients and when they find out that their client is also an agent, they may be suspicious and think that you’re fishing for information, and they aren’t inclined to help you.
Because of this, I had to pester my agent multiple times before I could view the unit. When I arrived, the agent was also surprised at my age and had the impression that I was just looking at the apartment. I also had to reiterate that I wouldn’t get a commission from this as it was for my personal stay. She was quite surprised when I gave her the cheque for the place! However, the overall experience was not too bad as this is something we are used to as agents.
Q. How was your experience when financing your home loan? Which camp did you belong to: Fixed / Floating?
Clemence: It was the fourth quarter of 2020 when I bought my place, and the interest rates were still low. Although floating rates were lower than fixed rates then, I preferred the stability of fixed rates and went ahead with that.
Looking back, this was quite a good decision as rates are now climbing. However, as my lock-in period of 3 years is going to be over in one years’ time, I may need to start shopping around with the different banks in the next 6 to 9 months.
Q. Where is your favourite estate in Singapore?
Clemence: I like the East Coast area despite moving away and still frequent the area as I have a dog who enjoys going to East Coast Park. We were previously living in the Jalan Eunos area, which is located close to the park. There are also a lot of cafés and dining options in the Joo Chiat, Paya Lebar, Upper Changi and East Coast area.
Although Tanjong Pagar has its advantages in terms of convenience, it still feels very commercial and reminds me of work. In contrast, the east is definitely a more peaceful residential area.
Q. Are there any new launch or projects that you are eyeing?
Clemence: Personally, I prefer not to look at new launches as I believe that there are more value in older projects compared to new launches. Singaporeans, by and large, prefer buying new launches but those are often priced at a premium compared to older developments in the same area. You can always get a better deal if you look hard enough in the resale market versus buying new.
Q. Which is your favourite corner of your home?
Clemence: My apartment is a duplex unit with two storeys. I particularly like my living room area. As my apartment is on a high floor and faces the sea, my family and friends enjoy the unblocked sea view.
Q. Would you consider renovating parts of your house?
Clemence: The design of the unit we bought was dated and tacky. Prior to moving in, we did some renovations to the unit to modernize it such as replacing the entire kitchen, removing the wallpaper, staining the floor to a darker colour, upgrading the toilets, added new carpentry and changed all the air-conditioner. We also bought new furniture, bedding and appliances. The theme we had leaned towards was minimalism with warm tones of beige, grey and black. In fact, our kitchen is completely matte black! We did some research regarding this, and matte black looks a lot sleeker than its shiny counterpart. Many male friends that came over to our place commented that a black kitchen was something they had in mind for their own renovations, but their wives preferred something lighter.
We chose black and beige as the main colours as the marble on the floor was white and we wanted some contrast to complement. To add life and a pop of colour to the house, we decorate our house with plenty of plants. We even have a small tree planted next to our TV console!
Q. Who has inspired you in your investment journey and what is your investment philosophy?
Clemence: When I was in the army, I was very inspired after reading Rich Dad Poor Dad by Robert Kiyosaki. This book opened my eyes as to why it was better to work for yourself and invest in properties or other instruments.
One thing that I remember to this day is what Robert defines as an investment. In Singapore, many people feel that owning a home is an investment. However, in the book, he mentioned that any house you live in isn’t an investment as no income is generated from there. Although your home can appreciate in value, you’ll not be able to realise the capital gains without selling it. This had changed my perspective on what an investment is.
Given the nature of my job as an agent, a big part of my income comes from commissions which defers month to month. As such, this has shaped my investment philosophy to invest in instruments which are more stable to counter the income fluctuations. For instance, in my own portfolio, I have a large portion weighted towards Singapore REITs which provides consistent dividend income.
Q. What/Which tool do you think is best to grow wealth or generate multiple streams of income?
Clemence: I have a long term stocks portfolio, but it is quite simple. I believe in the idea of dollar-cost averaging (DCA) in the market, especially in index funds that tracks the S&P 500 (for capital gains) and STI (for dividend income) to build wealth. DCAing into index funds is a simple strategy for me to diversify and consistently invest into the market without having to spend too much time managing the portfolio and studies have shown that DCA typically outperforms most active investment strategies for retail investors such as myself. It is also perfect for me as I’m busy with my job and do not have much time to track the market. I try to limit my stock exposure to other overseas market due to currency risk. A substantial portion of my investments go into Singapore REITs due to its stability, high dividend yield, potential for mid to long term capital appreciation and favourable tax structure, and I have money in government bonds such as T-bills and the Singapore Savings Bond. I also dabbled a little into cryptocurrency.
I would love to start investing into commercial properties such as a small strata office unit or small shophouse into my portfolio as these assets typically offers higher yields as compared to residential properties and there are lesser taxes and restrictions involved. However, I’ll need to save up more and this will be my next goal.
I also believe that setting up a side hustle is a good way to generate additional income although I’m too busy with my job and do not have time to focus on this.
Q. If you could relate the wealth creation journey to a ride in a theme park, which would it be?
Clemence: As cliché as it sounds, it would be a rollercoaster ride with many ups and downs. When I was younger, I have made some investments which have made money but have also made multiple investment mistakes that have lost money. While my wealth creation mainly comes from my job, I invest on the side for more stability. As long as my investments don’t drop in value and consistently grow, I am satisfied.
Q. If you could turn back time, what would you have done differently 5 years ago?
Clemence: On hindsight, I would have put all my savings into cryptocurrencies and I’ll be able to retire by now!
Joking aside, I would have chosen to rent my own home while using the money to invest into a small freehold shophouse instead. Over the past 5 years, freehold shophouses in prime locations have almost doubled in value due to its scarcity and heritage value and I believe that these tightly held assets will continue appreciating in value.
