Backed by rising demand, income growth and new jobs, and aided by a package of policy changes put in place by the government in July last year, the property market is entering a nascent stage of activity after years of anaemic behaviour. Property prices are showing a discernible increase with robust demand. In 2005, total primary market private home sales reached 8,955 units (a level not seen since 2002), which underscores the restoration of a healthier demand for property.

With better economic conditions, our business has also gotten better. But this, I must emphasise, has been chequered, patchy and not across the board. In truth, we have not been able to lift our sales and leasing performance sufficiently to the requisite levels for sustained growth. We have fallen short of our targets across the various segments of our business both in our sales of properties as well as our recurrent income portfolio of residential, retail, industrial and hospitality assets.

In 2005, we recorded sales of about 900 residential and commercial units. We launched La Casa, our latest executive condominium in Woodlands, to good market response. 195 out of the 225 units released have been sold. During the year, we introduced new concept developments like New Age Office at Central above the Clarke Quay MRT station and Novena Medical Center at Square 2 atop the Novena MRT station. These projects garnered a good rate of sales with about 70 per cent of the 120 New Age Offices at Central and 95 per cent of the 72 medical suites released for sale at Novena Medical Center taken up.

We completed close to 2,000 residential units and a purpose-built warehouse leased to SembCorp Logistics at Tradelink Place in Tuas South. We acquired Pacific Plaza, a commercial development of shops and offices located in the midst of bustling Orchard Road and Scotts Road, for $111 million. Plans are underway to improve this property with corresponding increase in yield.

Our hotels were the best performing asset category in the Organization in 2005. Business was boosted by record high tourism arrivals both in the business and leisure segments. Concerted efforts by the public and private sectors to raise the profile of Singapore as a global marketplace and tourism capital appear to be paying off. At the same time, we have also remodelled our operations, which entail grouping resources as a shared back-of-house infrastructure, outsourcing and stronger financial discipline.

Orchard Parade Hotel and The Elizabeth Hotel out performed their top-line targets with the latter further exceeding its bottom-line target. Their strong showing pulled up the hotel portfolio performance to a commendable 4.5 per cent yield in 2005.

The success of The Elizabeth Hotel has prompted us to kick off an extension programme by redeveloping the adjacent residential block, Elizabeth Regency, into a new wing, which will be positioned as an “independent” hip 100-room hotel.

In line with the uplift in the hospitality sector, our serviced residences portfolio registered improved occupancies of 86 per cent and increases in apartment rates of between 5 to 10 per cent in 2005. These levels were, however, still way below the peak performance seen through 1996/97.

In the last few years, we have had to contend with a market, which is fraught with episodic twists and turns and that has taken on a very different shape today. Property development, in particular, is much more challenging today compared to the last decade.

New age consumerism because of information and media explosion is changing the marketplace and the way people buy goods including property. Buyers today are exposed to a myriad of creative marketing hype promoting avant- garde ideas or foreign crazes resulting in even more rapid shifts in market demand. As a result, property today has become less of a durable goods business and more of a semi-perishable goods business. Lifestyles are as diverse today as sports shoes, which actually reflect the plethora of choices that customers want. Fads come and go as quickly as Swatch watch designs change.

To deal with this new reality of the market as well as future challenges, we must have the patience and perseverance to endure the uncertainty of a rapidly changing marketplace and be prepared to make personal sacrifices to meet customers' needs and preferences. From perseverance comes character and a strength to believe that we can soon taste some success. This is hope itself, which we must all have to see us to a better tomorrow and a better world.

In 2005, our people at Far East Organization which includes Orchard Parade Holdings and Yeo Hiap Seng have demonstrated a certain measure of perseverance, character and hope, in changing the way we do things, reinventing ourselves, and coming up with ideas on how we can improve our business and our products.

During the year, we advanced into the second phase of the revitalisation of Yeo Hiap Seng, both in its food and beverage business as well as in its organisation building. To meet the diversity of consumer tastes, we continue to introduce new products in various beverage categories while refreshing core products with new and improved formulation. New products and labels were also launched for Yeo's food and sauces in the Singapore and international markets.

In August last year, Yeo's teamed up with a new partner in America, Hain Celestial Group, to tap business opportunities in the high margin, high growth organic and natural food industry.

The year also saw the rollout of various leadership development programmes and communication forums that brought Yeo Hiap Seng's operations in Singapore and Malaysia closer together. Malaysia is the largest and most important market for Yeo's products. The sense of unity forged through greater sharing of experiences and better understanding of each other's markets will stand Yeo Hiap Seng in good stead in the expansion of our business in the region.

In our efforts to transform Far East Organization from being an entrepreneur-led organisation to an entrepreneurial organisation, we need to be more perceptive and responsive to the marketplace. An entrepreneurial organisation exists to satisfy the desires of the market - both old and new. We need much more participation from the Organization on how we can improve our processes in order to serve the marketplace better. We must now work more effectively, differently and in breakthrough ways. The more we can force ourselves to do things 30 per cent differently from what we've already done, again and again, the better we'll be positioned to deliver excellence.

In 2005, to give our people the impetus to look more seriously at process improvements, we launched a major organisation-wide initiative called the Business Process Improvement (BPI) Awards. The BPI Awards serve to recognise and reward departments that have made the most improvements to their work processes during the year, resulting in increased efficiency, revenue generation, productivity, and better cost management.

The BPI Awards are given independent of the performance of the Organization with respect to our financial targets. The BPI Awards will be an annual competition. We believe this programme will pave the way for the business and financial success of Far East Organization, by egging our people on to make special efforts to recast cumbersome processes, raise their productivity and creativity to newer heights and to be much closer to the customer.

For our inaugural BPI Awards in 2005, Central Engineering Property Unit distinguished itself among the 26 participating teams to clinch the Top Award and the Challenge Trophy. Central Housekeeping Hotels Unit and Corporate Affairs won the two Merit Awards.

Genius is one per cent inspiration, 99 per cent perspiration. Thomas Edison said it nearly a century ago. We all know about perspiration from the toils and labour of the past seven years. Indeed, we extol perspiration which is synonymous with diligence, one of our core values. Our winning BPI teams have demonstrated this amply for us today. They have shown a doggedness to implement and execute improved business processes after being inspired with a new idea because they believed that it would make a difference to our Organization.

But, we must realise that there can be no inspiration without LOVE. LOVE is at the heart of inspiration. Steve Jobs of Apple, one of the most admired business leaders in the world, made a speech at a US college graduation last year, which was given wide exposure and circulated via e-mail to various strata of business corporations all round the world. He advised the young graduates to “Do what you Love”.

However, I don't think many of us have the luxury or latitude to respond to his call. Instead, I would suggest, “Love what you do”. Love your job, love your work, love your colleagues, love your customers and you will experience the makings of a different world. Love your Organization and love the business we are in to become an integral part of it. Love is a commitment and a lifelong journey. Love is when you are open to new ideas brought up by other people. Love is when you commit to do unto others what you would have others do to and for you.

Looking ahead, we can be confident of a more successful year in 2006 while being mindful of the risk factors that our business remains exposed to. The property market has shown signs of improvement and is well positioned to continue its growth path. There are bold, ambitious plans to remake Singapore into a vibrant global city of opportunity. The future holds the promise of the next five years being “better than the last five”, as envisioned by our Prime Minister. A lot depends on our own organisational preparedness to play a part in bringing the anticipated market uplift to pass. Let us have hope in our hearts and set out in love to light the marketplace. We can do it!