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Business Times
4 days ago
- Business Times
Apac biotech sector could draw capital as investors seek diversification amid US-China tensions
[SINGAPORE] Asia-Pacific could be the new frontier for biotechnology investment, a report by consulting firm Bain & Company indicated on Thursday (Jul 31). Markets in the region are gaining ground as credible innovation hubs as global biotech strategies shift amid geopolitical tensions and deep US research funding cuts, according to the report. The report was developed jointly with the Economic Development Board, the Agency for Science, Technology and Research, JPMorgan and SG Growth Capital. 'The potential for US-based scientific talent to migrate to more favorable regions could also create an opportunity for Asia-Pacific governments and institutions to strengthen their innovation bases,' the report indicated. Favorable intellectual property regimes, regulatory agility and tax incentives – particularly in Singapore – position Apac as an attractive destination for global biotech investment, it added. Moreover, the region is winning recognition for next-generation modalities, from mRNA and cell and gene therapies to artificial intelligence-enabled drug discovery. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Fabio La Mola, partner at Bain & Company, said: 'We are looking at an exciting era for Apac's biotech sector, with the opportunity for true innovation to emerge from a geography that historically has been primarily a commercialization hub.' China leads, but geopolitical conflict pull capital away China dominates Apac's biotech investment scene, but geopolitical developments could divert capital elsewhere, said Bain & Company. The country accounted for more than 75 per cent of regional biotech venture capital and private equity flows since 2019, and industry giants like Pfizer and AstraZeneca are committing billions to research and development facilities in China, according to the report. With stunning strides over recent years, China's biotech sector is poised to challenge Western dominance on innovation. Notably, the number of Chinese novel drugs entering into development surpassed that of the European Union in 2024. However, the report noted that geopolitical tensions are reshaping biotech strategies, with biotech funding activity in China having slowed over the past few months. Amid fraught US-China relations, US pharmaceutical firms are rethinking their reliance on China and are seeking diversification to hedge against risk, Bain & Company said. 'While China continues to offer significant advantages in cost efficiency and scale, persistent geopolitical tensions and mounting policy uncertainty are diversifying capital flows into emerging hubs like Singapore and South Korea,' the company said. 'China has long been Asia-Pacific's biotech leader in terms of scale, but Singapore is emerging due to its commitment to innovation, political neutrality, intellectual property protection, and regulatory alignment,' it added. Slowing US-led innovation in early-stage R&D funding presents opportunity for Apac As tightening research budgets threaten to slow US-led innovation, particularly in early-stage academic research, Apac markets could step in to fill the gap, the report said. This comes as proposed funding cuts at the US National Institutes of Health are expected to reduce grant availability. 'As a result, Apac markets are increasingly positioned to lead in early-stage research, with big pharma likely to turn more actively to the region for sourcing innovation,' Bain & Company said. The report indicated that public funding plays an increasingly important role in supporting early-stage research, given that capital tends to flow toward later-stage, clinically-validated biotech deals, as higher investor risk aversion has led to a preference for more mature projects with clearer commercialisation pathways. This is seen in how early stage funding in Apac declined at an 11 per cent compound annual growth rate from 2019 to 2024, while late-stage biotech deal volumes grew 1.5 times. In response to the early-stage R&D funding gap, Apac governments are stepping up to seizing on the opportunity. They are launching targeted programmes providing capital and infrastructure that supports early-stage R&D projects to attract private capital investment flows to their markets. For instance, the Korea Drug Development Fund has committed US$1.6 billion to over 1,200 projects by 2030, while Japan's Bioventure Support Program is deploying US$366 million to nurture biotech startups. In Singapore, the government has allocated S$28 billion to support science and technology development, including biomedical R&D under the ongoing Research, Innovation, and Enterprise plan.
Business Times
27-07-2025
- Business Times
Balancing premium growth with market inclusivity in Singapore's office sector
[SINGAPORE] The Republic's 60-year economic journey is visible in its evolving skyline. What was once a manufacturing hub has transformed into a high-value economy, creating a gleaming testament to growth and Asia's premier business hub. Amid this skyline remain the older commercial buildings which are increasingly dealing with the winds of change. This duality of new and old presents Singapore with its next great challenge: balancing high-value economic ambition with market inclusivity. The strategic ascent Singapore's economic strategy has been deliberate and effective. Recognising limited land and labour resources, authorities have encouraged companies to locate sophisticated operations within Singapore. Over the years, more labour-intensive functions have moved elsewhere in the region. Recent tightening of immigration policies and higher minimum salary thresholds for work visas have increased hiring costs. This has prompted companies to base regional back-end staff in lower-cost South-east Asian countries while maintaining high-value functions in Singapore. This approach supports Singapore Economy 2030, aiming to increase the Modern Services cluster's value-add by 50 per cent by 2030. Focusing on finance, professional services and IT creates roles requiring advanced digital skills, strategic thinking and innovation capacity. These high-value activities maximise economic output per square foot of precious Singapore real estate. According to the Singapore Economic Development Board (EDB), the average value-added per worker in Singapore has increased by approximately 35 per cent over the past decade. Corporate evolution in action The corporate landscape in Singapore's Central Business District (CBD) tells this story clearly. Standard Chartered Bank maintains its regional headquarters (HQ) in Marina Bay Financial Centre Tower 1, having relocated processing and call centres to Malaysia and India. Its Singapore office now focuses on complex financial products, wealth management and fintech innovation, generating higher revenue per employee. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up Pharmaceutical giant GSK maintains sophisticated biomedical manufacturing operations in Singapore, having moved basic production offshore. Its Singapore operation now serves as HQ for its global general medicines business and regional HQ for Greater China and emerging markets. It focuses on complex biologics production and research and development, rather than basic tablet manufacturing which has shifted to Thailand and India. Even manufacturing companies have adapted. Tetra Pak recently closed its packaging production facility in Jurong. The company consolidated manufacturing across the region. It retained core functions such as business management, IT, finance and marketing in Singapore. Its move from Jurong to Labrador Tower shows a shift from industrial operations to knowledge-based work. Office market patterns and the 21-year itch This economic evolution has created a growing split in Singapore's office market. JLL's review of 87 tenant moves to four recently completed premium buildings – IOI Central Boulevard Towers, Guoco Midtown, CapitaSpring and Keppel South Central – shows a pattern of an emerging market transformation. Growth trumping uncertainty is perhaps the most revealing trend with 49 per cent of these relocations being expansion-driven despite global economic headwinds. Financial powerhouses are among companies that have relocated. With Morgan Stanley having secured spaces exceeding 107,000 square feet, it signals strong business confidence in Singapore's future. The '21-year itch' phenomenon is evident as companies exit ageing buildings. Those relocating to the four Grade A developments are leaving facilities averaging more than 21 years old. This flight to quality was the primary motivation across all four buildings – from 24 per cent of tenants at IOI Central Boulevard Towers to 100 per cent at Keppel South Central. JLL's data also shows a shift from flex spaces to permanent ones. Some 15 per cent of new premium tenants are graduating from flexible workspaces to permanent offices. Fintech firms such as Coinup and AppLovin lead this trend, suggesting Singapore's high-growth startup ecosystem is maturing. Cluster power is evident as clear industry specialisations emerge in specific buildings. IOI Central Boulevard Towers has become a magnet for legal firms, Guoco Midtown attracts luxury retailers and pharmaceuticals, while CapitaSpring has become the destination for financial services. These movements have created two distinct market segments: premium buildings commanding ever-higher rents and ageing buildings facing increasing vacancy and pressure to redevelop. The balancing act ahead These market trends create opportunities and challenges for Singapore's commercial real estate landscape. The flight to quality concentrates demand in newer buildings, allowing landlords to maintain pricing power despite JLL Research reporting five consecutive quarters of modest growth for Singapore office rents. A widening rent gap between older Grade B or B+ buildings and premium Grade A developments is emerging, presenting a significant market challenge. While high-value companies willingly pay premium rents for sophisticated spaces, mid-tier firms that contribute significantly to Singapore's diverse business ecosystem often lack the resources to compete for top-tier space. Older buildings now face what we call the addition and alteration imperative. JLL's data shows that tenants demonstrate a clear willingness to pay substantially more for modern amenities and sustainability features. Building owners must either undergo significant upgrades or risk obsolescence in an increasingly bifurcated market. This market division shows remarkable resilience against economic uncertainty. In previous cycles, uncertainty depressed the entire office market. Today, the concentration of strategic functions in Singapore creates a stable demand base for premium spaces. The Amazon Effect illustrates this shift, with the tech giant's consolidation from four scattered locations to a massive 369,000 sq ft space signalling a broader corporate strategy where maximum efficiency in landmark buildings trumps distributed footprints. European financial institutions further reinforce this trend, establishing strategic footholds in Singapore. Credit Agricole, VP Bank and Unicredit have all moved into premium office spaces, positioning Singapore as the bridge between Western capital and Asian opportunity. A sustainable path forward How the market responds to this bifurcation will determine Singapore's commercial real estate's future. For building owners, differentiation strategies become crucial. While government schemes may offer incentives, market-driven solutions will likely prove most effective. Innovative asset repositioning strategies, going beyond cosmetic upgrades to deliver genuine value enhancement, will separate winners from losers. For tenants, especially mid-tier companies, alternative location strategies and flexible space solutions offer viable pathways. The Flex-to-Perm Revolution seen among fintech firms suggests that a new tenant journey emerging. This creates opportunities for landlords to develop growth pathways within their portfolios. The pull factor shown by the four buildings analysed by JLL is fuelling the cluster power where specific buildings become magnets for particular sectors. This organic shift creates value opportunities for both landlords and tenants. IOI Central Boulevard Towers' emergence as a legal sector hub and CapitaSpring's appeal to technology-forward financial services demonstrates how strategic positioning can create premium value even within the Grade A segment. Long term, Singapore's commercial real estate market appears positioned for resilience. Despite potential short-term fluctuations, the structural shift towards higher-value activities creates a foundation for sustained rental growth in the prime Grade A segment. This rental dynamic reinforces Singapore's market positioning as a regional command centre, attracting premium rents for high-value business functions while more cost-sensitive operations relocate regionally. As Singapore celebrates its remarkable six-decade journey, its economic transformation stands as perhaps its greatest achievement. By recognising its constraints early and deliberately moving up the global value chain, Singapore has created a template for sustainable economic development. The next challenge will be ensuring that this model remains inclusive and adaptable. Singapore must create space for businesses at all stages of growth while continuing to attract high-value functions. If Singapore can successfully navigate this balancing act, it will secure its continued prosperity and offer valuable lessons to cities worldwide facing similar constraints. Tahlil Khan is executive director, leasing advisory, and James Short is senior director, leasing advisory, at JLL Singapore
Independent Singapore
25-07-2025
- Independent Singapore
Microsoft launches first Southeast Asia AI research lab in Singapore
Photo: Facebook/Tan See Leng SINGAPORE: Microsoft has launched its first artificial intelligence (AI) research lab in Southeast Asia, Microsoft Research Asia (MSRA)–Singapore, backed by the Singapore Economic Development Board (EDB), to drive the region's AI research and innovative solutions for key industries while nurturing its next generation of AI talent. 'Microsoft Research Asia – Singapore will drive innovation on intertwined goals: deploying industry-transforming AI, pursuing frontier breakthroughs in AI foundations, and advancing responsible, socially beneficial applications,' it stated in a press release on Thursday (July 24). Manpower Minister Tan See Leng, who is also the Minister-in-charge of Energy and Science & Technology in the Ministry of Trade and Industry (MTI), attended the launch ceremony alongside Microsoft Research President Dr Peter Lee. In his Facebook post, Minister Tan said, 'MSRA Singapore will anchor cutting-edge research in AI, focusing on areas like healthcare, where AI can help clinicians deliver better outcomes for patients.' He also noted, 'I am especially heartened by MSRA's collaborations with SingHealth and A*STAR to develop AI solutions for preventive healthcare.' 'I am excited to see how MSRA Singapore will contribute to building a more resilient, inclusive, and innovative society,' he added. In EDB's press release, it stated that the lab is already working with local partners, including SingHealth, to develop AI capabilities aimed at delivering personalised analysis and enhanced diagnostic accuracy for better patient outcomes. It's also collaborating with the National University of Singapore (NUS) and Nanyang Technological University Singapore (NTU Singapore) to develop embodied AI, enabling AI to interact with the physical world, for complex tasks in smart environments. Earlier this year, Microsoft announced a five-year research collaboration with NUS to nurture PhD students through the Industrial Postgraduate Programme supported by EDB and the NUS School of Computing. It's also working with NUS, NTU, and the Singapore Management University (SMU) on joint workshops and summer schools to support academic exchange. EDB managing director Jermaine Loy said that the new lab will create new opportunities for researchers and companies in areas such as healthcare and finance. /TISG Read also: Microsoft cuts jobs again as AI costs climb, to let go of about 9,000 employees () => { const trigger = if ('IntersectionObserver' in window && trigger) { const observer = new IntersectionObserver((entries, observer) => { => { if ( { lazyLoader(); // You should define lazyLoader() elsewhere or inline here // Run once } }); }, { rootMargin: '800px', threshold: 0.1 }); } else { // Fallback setTimeout(lazyLoader, 3000); } });
