Retail, event business open revenue streams for Singapore Press Holdings

By Mark Toner

Washington, D.C., USA


Singapore’s Orchard Road is a 2.2-kilometer iconic boulevard flanked by shopping malls, restaurants, and hotels. It is a shopper’s haven, much like Fifth Avenue in New York. And Singapore Press Holdings (SPH) is at the centre of the bustling prime retail belt, with its real estate holdings generating considerable — and consistent — income for the media organisation. 

With premium brands like Gucci, Ferragamo, and TODS in its Paragon Mall on Orchard Road and two other shopping centres, Singapore Press Holdings receives steady recurring income from its property business.

Investing in a local mall brought in S$230 million in revenue to SPH in 2015.
Investing in a local mall brought in S$230 million in revenue to SPH in 2015.

With the opening of the latest retail mall late last year, the property business contributed more than S$230 million in revenue to the group in the latest financial year, says Janice Wu, the company’s head of corporate development. 

SPH began investing in retail properties in the late 1990s. The organisation had previously invested in telecommunications and cable companies and exited upon public listing of those investments.

But it identified property as another area of growth, given its recurring revenue stream. To manage the properties, SPH deployed a combination of newly hired retail experts and existing staff. Today, it owns a separate property management company that oversees its three shopping centres.

With more than 480,000 square feet of retail space, SPH’s flagship Paragon Mall also includes an additional 223,000 square feet of medical office space. Its two other suburban retail properties are each roughly 190,000 square feet.

All three properties enjoy full occupancy, each with compelling retail concepts to meet the needs and wants of shoppers, according to Wu. 

In 2013, SPH spun off two of its shopping centres into SPH REIT, a property trust listed on Singapore’s stock exchange, although it remains the majority shareholder. Establishing the property trust introduced the opportunity for the media organisation to realise gains.

“SPH REIT enabled us to unlock value in the properties, releasing capital for our growth initiatives, and also strengthened our balance sheet. In addition, it provides SPH with an efficient platform to hold our properties,” Wu says. 

SPH owns a property management company that oversees its three shopping centres.
SPH owns a property management company that oversees its three shopping centres.

As SPH continues to look for other growth initiatives, it has also identified exhibitions as another promising avenue.

In 2008, it launched Sphere Exhibits, its events subsidiary focused on consumer events, trade exhibitions, and conferences. The emphasis is on verticals — IT and food in the consumer event space, building technology and manufacturing solutions for trade exhibitions, and healthcare, hospitality, and tourism in the conference sector. 

“We grew this business through a mix of organic and inorganic efforts,” Wu says. In many cases, she says, SPH purchases existing exhibitions and “continues to reinvent them so as to keep the audience engaged.” 

“The core focus is on owning the brand names and the events, as opposed to organising events for others,” Wu says.

As with the property business, a combination of SPH staff and experienced event personnel were used to staff Sphere.

“When we do a new business, we understand that getting subject-matter experts on the team is important and we also believe that our current loyal and dedicated colleagues would value the challenge of learning a new business,” Wu says. 

Sphere’s last consumer IT exhibition drew more than 500,000 people to downtown Singapore — impressive in a city whose population is 5 million. Among its innovations to draw traffic include mobile device trade-ins and gaming challenges.

SPH is now expanding throughout the region, hosting events and conferences in Malaysia, Myanmar, the Philippines, and Sri Lanka. To build the business, SPH acquired several exhibitions in Malaysia and has partnered with local companies to “geo-clone” its exhibitions in the region, according to Wu.

SPH now holds more than 40 events, working with almost 3,000 exhibitors and partners. Together, these events draw 1.8 million people annually and bring in between S$30 and S$40 million.

While SPH remains focused on its media business, it established a designated division many years ago to focus on growth investments. It also set up a S$100 million SGD media fund, to invest in emerging digital companies, and an accelerator, SPH Plug and Play, which focuses on early-stage start-ups. 

“We take a multi-pronged approach to our growth,” Wu says. “Media remains very much our core business, but we are also building other pillars of growth at the same time. For us, we would like to transition to a successful multi-platform media business of the future, as well as own other non-media assets.” 

This is one of 14 case studies featured in INMA’s strategic report “Revenue Diversification Beyond Traditional Print and Digital,” released in December 2015.

About Mark Toner

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