Category Archives: Uncategorized

Raffles Medical Group to open new medical centre in Orchard Road

Private healthcare provider Raffles Medical Group will open a new medical centre at Shaw Centre in June to bring a full range of medical and specialist services to patients in the Orchard Road area.

The announcement came as the healthcare provider booked a net profit of S$15.1 million for the first quarter of 2015. This marks a 3 per cent growth from the same period a year ago.

Raffles Medical Group said revenues in its Healthcare Services division rose by 13.7 per cent, while revenues in its Hospital services climbed by 6.2 per cent.

The Group also said its development of Raffles Hotel V is on track to be completed in the first quarter of 2016.

Raffles Hospital’s Emergency Department will also be collaborating with the Ministry of Health to receive patients from the Singapore Civil Defence Force emergency ambulances. The collaboration is expected to commence in mid-2015.

Source : Channel NewsAsia – 27 Apr 2015

Demand for shophouses grows as office rents continue to rise

With their colourful facade and distinctive five-foot way, shophouses are reminiscent of Singapore’s past. But even in today’s modern business environment, there is still a demand for them.

At Amoy Street, such shophouses have been taken up by creative outfits, restaurants and even small businesses who are looking for cheaper office space. With office rents already going up by 9.8 per cent in the last year, property observers have said that they expect demand for shophouses to pick up going ahead.

As of the last quarter of 2014, median office rents in the downtown core area stood at about S$10.50 per square foot per month. Shophouses, however, have significantly lower rents.

Ms Christine Li, director of research at Cushman & Wakefield, said: “If you compare the rents for shophouses and office buildings in the Central Business District (CBD), it is really at about half-price.

“It appeals to people and tenants, particularly those from the creative industries, who do not need the Grade A specifications but still want to be in the CBD, close to their clients. So without paying S$10 per square foot per month for a Grade A office building, they can just pay S$5 to S$6 for a shophouse next to it.”

According to a recent report by property consultancy Colliers International, before 2012, quarterly median rents remained generally below S$4 per square foot a month. That is compared to S$5.42 per square foot per month in the fourth quarter of last year.

However, while rents have gone up, shophouses are not necessarily the best asset class to invest in. Their rents have seen lower growth as compared to the rise in capital value, according to consulting firm Chestertons Singapore.

Mr Donald Han, managing director of Chestertons Singapore, said: “Your yield for conservation shophouses these days is at about 1.5 to 2 per cent, definitely less than 3 per cent.

“For investors looking at shophouses as an investment class, despite it being limited in number, they would have to hold on to an asset with lower returns, compared to other asset classes like residential that might give in excess of 3 to 4 per cent. Commercial strata offices might give you yield of about 3 to 5 per cent, industrial maybe about 7 per cent.”

Since the start of 2015, 25 shophouses have been sold, according to the Urban Redevelopment Authority.

Source : Channel NewsAsia – 20 Apr 2015

VivoCity expands retail space, including 2 retailers new to Singapore

Local mall VivoCity on Wednesday (Apr 15) announced that nine retailers, including two new to Singapore, will occupy the expanded space at Basement 1.

The introduction of the two retailers – US apparel brand American Eagle Outfitters and Weekends, a multi-brand lifestyle retailer – and the expansion of Basement 1 by 15,000 square feet are part of the mall’s efforts to keep it relevant to shoppers, its management said in a press release.

Weekends is currently open, while American Eagle Outfitters is scheduled to open on Jun 19. The expanded space is located at the main thoroughfare that connects HarbourFront MRT Station to the main shopping areas at the mall, as well as the Sentosa Express Station, said a VivoCity spokesperson.

The other seven retailers that will occupy the expanded space are: Steve Madden; Thomas Sabo; Rabeanco; Aeropostale; Lab Series; Etude House; and Innisfree. These retailers will open progressively from Wednesday, VivoCity said.

The expansion of VivoCity cost about S$5.5 million, added the spokesperson.

“This new retail space will take advantage of a constant stream of shopper traffic due to its location at the main thoroughfare that connects HarbourFront MRT Station (at Basement 2) to the main shopping areas in the mall as well as the Sentosa Express Station (at Level 3),” said Ms Joanna Lee, Head of Retail Management at Mapletree Commercial Property Management.

Source : Channel NewsAsia – 15 Apr 2015

Singapore retail rents seen falling further after declining in Q1: Cushman

Shopping mall rents in Singapore fell during the first quarter and will likely decline further over the next 12 months, hurt by falling visitor arrivals and weak retail sales, property services firm Cushman & Wakefield said on Wednesday (Apr 8).

Cushman said the biggest drop was seen in city fringe areas such as the City Hall and Marina Centre area, where rents fell 1.3 per cent quarter-on-quarter to S$23.68 per square foot per month (psf/mo).

Average monthly gross rents of prime retail space in the Orchard Road submarket slipped marginally by 0.8 per cent on-quarter to S$38.20 psf/mo, while average monthly gross rents for prime retail space in suburban locations edged down 0.5 per cent from the preceding quarter to S$31.85 psf/mo.

“Unlike the city fringe submarket, Orchard Road is still highly sought after by international retailers looking to open their first or flagship stores. Thus, rents of major retail malls in Orchard Road have held relatively firm even though economic indicators are signalling a down market,” Cushman said in a report.

It added the suburban market experienced the smallest drop in rents due to the resilient nature of suburban malls.

2015 A CHALLENGING YEAR

Looking ahead, Cushman said 2015 will be a challenging year as retail spending is expected to take a hit due to the slowdown in visitor arrivals and weaker consumer confidence.

“Consolidation of space among various trades has been more evident since the start of 2015. Fashion apparel and accessories brand Lowrys Farm exited the market earlier this year, while other tenants such as Marks & Spencer and Cold Storage in Centrepoint, John Little stores at Marina Square and Tiong Bahru Plaza, and Japanese department store Isetan at Wisma Atria are expected to cease operations by the second quarter of 2015,” Cushman said.

It added that Lifebrandz is also expected to pull out five nightspots from The Cannery at Clarke Quay, surrendering 57,000 square feet of space.

Space consolidation is likely to continue, particularly for retailers which expanded aggressively during the boom time but have started to experience rising business costs, the property services firm added.

Source : Channel NewsAsia – 8 Apr 2015

‘Retail-tainment’ key to Orchard Road’s revival: Experts

The Centrepoint along Orchard Road will soon go through another facelift to make itself more attractive to shoppers and tourists. But in an increasingly competitive landscape, malls along Orchard Road must also offer other leisure activities and facilities to complement the retail experience, according to property experts.

Orchard Road receives more than seven million visitors each year, but it is facing competition from new attractions and hotels in Singapore outside the shopping belt.

Second Minister for Trade and Industry S Iswaran announced recently that the Government is gathering feedback on how to rejuvenate the 2.2-kilometre stretch in order for it to remain a competitive retail destination for tourists.

Property consultants said activities and services can help improve the shopping experience. Mr Desmond Sim, head of research for Southeast Asia and Singapore at CBRE, said: “The retail environment is definitely more competitive and … retail malls are no longer pure plays of transactions. You have to do other activities.

“Our guys have coined the term ‘retail-tainment’ – where you go into a retail place and you do a lot of things. You can go for a spa, kids’ lessons … as well as things like parks and museums so as to engage the whole age spectrum. Activity is important, and through such activity, hopefully they will start spending as well.”

Other property consultants also mentioned social media as another way for mall owners and retailers to engage shoppers amid rising competition from digital retailers.

“It is important not only for the shopper’s experience but it also helps mall owners and retailers understand shifting in profiles of shoppers,” said Ms Lee Siew Ling, director of retail at Jones Lang LaSalle Property Consultants.

“By making use of social media, it will help them to understand the changing demand and cater to that. This is especially for high-street brands, where a lot of brands are accessible via shops and online. There are less reasons now for shoppers to go to brick-and-mortar stores to purchase a product.”

Source : Channel NewsAsia – 2 Apr 2015

Centrepoint to undergo S$50m makeover

Following news that long-time tenants are moving out, Frasers Centrepoint Malls has announced a S$50 million makeover for the Centrepoint mall.

A news release from Frasers Centrepoint on Wednesday (Mar 18) said the 16-month makeover is scheduled to start in May, and will see “major renovation works” on the ground and basement levels. The Orchard Road entrance will be revamped to have wider street frontage and greater shop visibility.

It added that the plan to remake Centrepoint was conceived last year, with the introduction of Metro, a new anchor tenant.

Frasers Centrepoint said when works are done, the mall will have a more open-concept layout, with thematic zones focused on fashion, beauty, lifestyle, sports, dining, and the home. The mall will also have a new tenant mix.

Frasers Centrepoint confirmed on Wednesday that electronics retailer Harvey Norman will also exit the mall, on top of Marks and Spencer and supermarket Cold Storage. In place of Marks and Spencer on levels 2 and 3 and Harvey Norman on Level 3 will be a “gourmet precinct and an expanded fashion zone”.

The mall will remain open to shoppers during the renovation.

Mr Christopher Tang, CEO of Frasers Centrepoint Commercial said he is confident the makeover will inject greater vibrancy into the 32-year-old mall.

“The new Centrepoint will offer more exciting retail, dining and lifestyle options for its patrons. The mall’s improved connectivity, expansion of offerings and distinct frontage will certainly create an integrated identity for The Centrepoint,” said Mr Tang.

Source : Channel NewsAsia – 18 Mar 2015

Frasers Tower plans unveiled

Property group Frasers Centrepoint (FCL) on Tuesday (Feb 17) unveiled plans for Frasers Tower, its latest project in downtown Singapore.

Frasers Tower is a 38-storey premium Grade A office development located at Cecil Street in the Central Business District. It will have a total net lettable area of around 690,000 square feet (sq ft) with an open-space terrace on the fourth floor, and a roof garden.

Frasers Tower will be linked to a 3-storey cascading retail podium with various retail and food and beverage offerings. The development also includes a standalone restaurant in a park and a 3-storey basement car park.

Mr Lim Ee Seng, FCL’s Group CEO, said, “Frasers Tower will have both indoor and outdoor work areas. The indoor offices will have floor plates of between 19,000 sq ft to 21,000 sq ft which are regular shape and free of interior columns. The outdoor areas such as the open-space common terrace on the fourth floor of the office tower and roof gardens will enable tenants to work, discuss and hold events and meetings while being close to nature.”

FCL did not disclose the development costs of this building. It expects the project to be completed by 2018.

Source : Channel NewsAsia – 17 Feb 2015

Shopping mall rents set to fall in 2015: Savills

Rents for shops and restaurants in Singapore are expected to fall this year, with prime rents on Orchard Road forecast to recede by 3 to 5 per cent and rents in suburban malls by up to 3.0 per cent, real estate services firm Savills said in a report on Wednesday (Feb 11).

“It appears that landlords in the prime shopping districts are beginning to hold out olive branches to retailers, many of whom are confronted with the twin woes of higher fixed costs and lower sales,” said Mr Alan Cheong, Savills Research senior director for Singapore, in the report.

Much of the new retail space coming onto the market in 2015 will be in central areas, unlike in 2014 when most of the new supply was in suburban areas.

Developments with large retail areas that are slated to open this year include Capitol, the National Gallery Singapore and South Beach.

Singapore retailers have been hurt by rising labour costs and falling visitor arrivals. The latest available data showed retail sales excluding motor vehicles dipping 0.4 per cent year-on-year in Nov 2013, while the Singapore Tourism Board said that international visitor arrivals totalled 15.1 million last year, a 3.1 per cent drop from 2013′s record figure of 15.6 million.

Savills, however, expects vacancy rates at malls to remain low this year as any easing of rents would see revived interest from potential tenants.

For the fourth quarter of 2014, Savills estimates prime retail rents on Orchard Road will be moderated by 5.0 per cent from the third quarter to S$32.90 per square feet per month – the first decline after four consecutive lull quarters.

But prime suburban mall rents are expected to hold firm at S$31.10 per square feet per month, as businesses remain resilient in malls that serve a large population catchment.

Source : Channel NewsAsia – 11 Feb 2015

URA to decentralise business activities and commercial centres outside CBD

In an exclusive interview with Channel NewsAsia, the Urban Redevelopment Authority’s (URA) Chief Planner and Deputy Chief Executive Officer Lim Eng Hwee said URA intends to intensify efforts to decentralise business activities and commercial centres outside the city.

Decentralisation is a way to achieve a more sustainable growth by distributing commercial activities to various parts of the island, such as Tampines, Jurong and Paya Lebar – as well as an upcoming one stretching from Woodlands to Punggol, called the North Coast Innovation Corridor.

Q: What is URA’s key strategy for the next decade?

A: Broadly and conceptually, we have always talked about decentralising activities, but we think there is opportunity for us to really intensify, to work across all the agencies to make it happen – and in the process create something that is quite unique.

Take Jurong as an example. Before we launched the development, the masterplan in 2008, people’s impression of Jurong is: It is near an industrial area; it is not attractive; there is only one shopping mall. With Jurong East today, once you have coordinated effort across agencies, partnerships with the private sector to try to integrate things together, it can take a very refreshing look.

Tampines Regional Centre has achieved a certain critical mass, it right now has a couple of hundred thousand square metres of office space; it has three significant malls. So in terms of serving the residents’ needs it is adequate for now, but Tampines is still being developed. We see the Tampines regional centre and Changi Business Park – which is right next to the new SUTD University – as a twin hub that anchors major business and commercial activities.

The location of these two twin centres, in particular the Business Park, is right next to Changi Airport. In time, the next 10 years or so, Changi Airport will be expanded and there will be a lot more activities happening in Changi. The whole of Singapore’s East will be a very significant hub.

Q: Long-term and forward-looking planning has been entrenched in the land use development process in Singapore. How has this enabled Singapore to be more nimble in seizing opportunities?

A: I would say it is a very strategic advantage to Singapore. We were talking to some of the financial institutions and even sharing, doing exchanges with other cities. You realise that for other cities, when it is time for them to seize opportunities and obtain investments to expand, they were hindered by the availability of land. It is not just land – many cities are much bigger than Singapore, so it is not difficult to find land – but having land in a right location, at a right time that allows you to expand your business investment. To us that gives us an opportunity.

Planning is neverending so these are the type of questions we ask ourselves. Among the agencies we sit down together and brainstorm – whether there are new ideas, whether we can leverage on some of these opportunities.

We know in the longer term, the port will be consolidated in Tuas for example, so there must be a lot of opportunities for us not only to take away the freight traffic now in Keppel, Pasir Panjang, where there’s haulage in that area. When you consolidate, you take away that traffic and when you have so many trucks moving around serving the port, surely the logistics industry can find some way to extract maximum efficiency. It can create a logistics hub; it can create things which companies can share the services.

Likewise, the same concept can apply to Changi, when we start to grow aviation not just for passengers, but also the cargo, the aviation industry. Whether it is maintenance, repair and operations or logistics companies, when they start to congregate around the airport, again there will be opportunities for us to do something.

In planning what we can do is discuss with agencies, including economic agencies, to look at what some of these opportunities are, and make sure there is land safeguarded for these new ideas to take place.

Q: Were there any “planning mistakes” and what has been done to rectify them?

A: I am not sure if this is a mistake. Often you make certain decisions in the context of the situation at that point in time. One particular area is perhaps in the area of conservation. For obvious reasons, in the 60s and 70s, we were faced with huge challenges – unemployment, the acute housing shortage, and the city centre was so crowded.

The focus was not on whether heritage buildings should be conserved. So you see a lot of massive, comprehensive redevelopment, where so many old buildings were removed. Looking back in hindsight of course, we say some of these unique buildings ought to be kept.

Starting from the 80s, the planners and the decision makers at that point in time started to think about whether we should start to retain these heritage buildings which are important anchors for future generations. The buildings will provide a link for them to identify with their past. So the conservation journey really started in the 80s.

Having kept these buildings is not enough. Having retained them, I think we should now think about how can we help people to understand more of the history behind these buildings. We have to encourage people to start talking about the buildings, and share their personal stories so that the younger generation, when they look at the building, they understand the history behind them. I would not think that the decision made then to demolish the buildings as mistakes – it is really contextual.

In part two of the interview the URA Chief Planner discusses prospects of building underground and what the URA is doing differentiate Singapore from other cities.

Source : Channel NewsAsia – 2 Feb 2015

Consortium led by Perennial Real Estate Holdings buys AXA Tower

A consortium led by Perennial Real Estate Holdings (PREH) has acquired AXA Tower in downtown Singapore for S$1.17 billion.

The 50-storey office tower with some retail space has a total net rental area of about 674,000sq-ft. This translates the acquisition price to about S$1,735sq-ft.

Located within the Central Business District near Tanjong Pagar MRT station, AXA Tower has a total Gross Floor Area (GFA) of about 1.03 million sq ft. The building currently has an unutilised plot ratio that translates to an additional GFA of over 212,000 sq ft.

In a statement on Friday (Jan 30), PREH said that it will invest about S$117.9 million for a 31.2 per cent equity stake in the building. Another investor, HPRY1 Holdings, a shareholder of PREH, will hold a 10.1 per cent interest in the tower.

PREH’s chief executive officer, Mr Pua Seck Guan, said the “significant investment in the iconic operating asset not only strengthens the Group’s foothold in Singapore, but also provides the Group with an additional stream of stable income.”

He added that “the prime asset presents a unique opportunity to maximise and create value for shareholders through the execution of asset enhancement initiative and potential strata-sale strategy”.

AXA Tower can also house medical suites occupying no more than 32,000sq-ft.

Source : Channel NewsAsia – 30 Jan 2015