Tag Archives: real-estate

RQAM confident of filling up office space at MBFC Tower 3

Raffles Quay Asset Management said it is confident of filling up the rest of the office space at Marina Bay Financial Centre Tower 3, as well as sell the remaining units of luxury apartments at Marina Bay Suites — despite uncertainties in the global economy and the property cooling measures announced in January 2013.

About 88 per cent of the 221 units at Marina Bay Suites have been sold so far. While sales have slowed, the manager of MBFC said it is confident that buyers will return.

The high-end residential development, with an average selling price of S$2,700 per square foot, will be ready for occupation soon.

The luxury property segment has been hit by various rounds of property cooling measures in the past years, the most recent being the additional buyers’ stamp duty on foreign buyers.

As for MBFC Tower 3, about 12 per cent of the space is still available, after filling up 100,000 square feet of the premises in the first quarter of this year.

Warren Bishop, CEO of Raffles Quay Asset Management, said: “In terms of where rentals are going at the moment, there is more demand than supply at the moment. A lot of the agents are talking about prices possibly going up, which is always an issue when you refer to the cost of doing business.

“But actually Singapore as a regional business centre is still very affordable compared to other regional centres. Property rates here are comparable and reasonable — compared to places like Tokyo, London, New york and even Hong Kong.”

Source : Channel NewsAsia – 15 May 2013

San Centre sold to CEL Property Investment

San Centre, a 12-storey office building located along Chin Swee Road, has been sold to CEL Property Investment for S$113 million.

It is the first commercial collective sale site sold this year.

The buyer is a subsidiary of mainboard-listed Chip Eng Seng Corporation.

San Centre comprises 107 strata-titled office units and 80 carpark lots.

It has a land area of about 28,700 square feet and was built in the 1970s.

Source : Channel NewsAsia – 26 Mar 2013

Orchard Gateway: Orchard Rd set to welcome new mall

Singapore’s prime shopping belt Orchard Road is set to welcome a new mall, Orchard Gateway, around November this year.

Its marketing agent Savills said 80 per cent of the retail space has already been pre-committed.

And there will be a few new-to-market brands that will appeal to fashion-forward shoppers.

The mixed-development straddles both sides of Orchard Road and has 172,000 square feet of net lettable retail space.

Savills said the mall has managed to snag some big international names.

They include American chain Crate & Barrel, which will open its five-storey flagship store there, spanning over 20,000 square feet.

There is also multi-label fashion company I.T Hong Kong and Swatch – which will open its third mega store in Asia at Orchard Gateway.

Sulian Claire Tan-Wijaya, senior director at Savills, added: “Some of the other brand names will include J.Lindeberg, which is a fashion brand from Sweden. They will be introducing their ladies range for the first time in Singapore. There is also the US shoe brand Red Wings shoes – they will be opening their first concept store in Singapore.

“Also coming in to Orchard Gateway is Nike – they are introducing a new concept called Amplify women. We have also dedicated the entire fourth floor just for men, so it’s…very much skewed towards men’s fashion. There is also UK brand Religion, which has never been to Singapore.”

To cater to younger shoppers, Savills said the mall also has up-and-coming fashion blogshops.

Aside from the retail offerings, Orchard Gateway also has 37,000 square feet of office space and a 500-room hotel.

Some analysts said nearly 2 million square feet of retail space will come on stream in Singapore this year. About 18 per cent of the space will be located along Orchard Road, with the rest to be built in the suburban areas.

In recent years, retail rents between malls in the regional centres and Orchard Road have narrowed.

CBRE said prime Orchard Road rents were around S$31.60 per square foot per month compared to S$29.75 in suburban malls in the fourth quarter of last year.

Desmond Sim, associate director at CBRE Research, said: “The past two years, the rental premiums for Orchard Road and suburban malls, they have probably compressed from 20 over per cent to close to 10 per cent.

“Although the rents have been compressed quite a fair bit, at the end of the day, Orchard Road with the tourists influx still commands a premium.”

Barring any unforeseen events, analysts expect retail sales to remain healthy this year, supported by tourism and domestic demand.

Ku Swee Yong, CEO of International Property Advisor, said: “Retailers should not have problems with getting the revenue part of the business in place, the issue in the past two years has been the curb on employment of foreigners, the foreign worker levy has gone up, foreign worker ratio has gone down, and so for the retail players, it is more of an issue of manpower and manpower cost.”

Market watchers added that the labour shortage and increasing resistance against further rental increase from tenants will also affect retail rents going forward.

Source : Channel NewsAsia – 19 Mar 2013

Shaw Centre to undergo major revamp

Shaw Centre, a landmark building at Orchard Road, is up for a major facelift — its first in almost three decades.

The renovations are expected to be completed in the first quarter of 2014.

After the redevelopment, the Shaw Centre retail mall will be integrated seamlessly with the adjoining Shaw House.

Shaw House’s anchor tenants include Isetan and Shaw Theatres Lido.

The new Shaw Centre will also feature a two-storey high glass retail frontage with verandahs for merchandising.

Other key changes include a new basement food court that links Shaw Centre and Shaw House, and a new 1,000-square-metre Urban Plaza built over the public concourse formerly located at Shaw House.

Shaw Brothers said the space will be used for red carpet events and product launches.

Rental rates are expected to be comparable to nearby retail spaces at the Orchard Road and Scotts Road junction, said Shaw Organisation.

Mark Shaw, Shaw Organisation’s executive vice president of operations, said: “What we’re looking to do is to attract international flagship brands to come to Shaw Centre because we’re one of the last few remaining buildings with good Orchard Road and Scotts Road frontage.

“We’re looking at a few restaurants and obviously a lot of retail clients. We hope that the new food court will also bring in a lot more traffic — so what’re we doing is to complement that with retail tenants that attract the same sort of shopper profiles that we have in our cinemas.”

Shaw Organisation’s executive vice president of film distribution, Christopher Shaw, said the proposed renovations will align Shaw Centre’s positioning and target audience with that of Shaw Theatres Lido.

“This revamp and the new tenant mix will reflect our aspiration to bring a quality experience to our patrons and allow them to have plenty to do prior to and after their movie,” he added.

Source : Channel NewsAsia – 21 Feb 2013

Marina One set to raise bar for future integrated developments

The Marina One mixed-use development in the heart of Singapore’s Central Business District (CBD) will be a coveted business and lifestyle destination that will raise the bar for integrated developments and act as a catalyst to attract and grow new businesses.

That is the vision of M+S, a joint venture company owned by Malaysia’s Khazanah Holdings Bhd and Singapore’s Temasek Holdings, that is working on the landmark project.

M+S also said Marina One, designed by world renowned architect Christoph Ingenhoven, marks a brand new chapter in the Marina Bay Masterplan.

Its design was unveiled on Tuesday by Singapore’s Prime Minister Lee Hsien Loong and his Malaysian counterpart, Mr Najib Razak, who are holding their Leaders’ Retreat.

M+S said Marina One will be completed in 2017, with a gross floor area of 3.67 million square feet and is valued at S$7 billion.

It consists of Marina One Residences, Marina One Offices as well as a retail podium.

Marina One Residences comprises two towers of 1,042 luxury city residences, ranging from one- to four- bedroom units, including penthouses. These will be launched in the second half of the year.

Marina One Offices — with east and west towers — offer 1.88 million square feet of prime office space.

Its crown jewels will be two 100,000 square feet office floor plates, one of the largest in Asia.

Marina One will also have a retail podium called The Heart, which will also serve as a sanctuary and green space.

The development will also incorporate a unique garden ecosystem by landscape architect Gustafson Porter, best known for their world-class design of Singapore’s Bay East, Gardens by the Bay.

PM Lee said he is happy to see the bricks and mortar starting to come up on site.

He added: “It’s going to be an iconic project in the middle of our new business district for many, many more years to come. This is a project that both countries will be proud of and which will thrive and prosper in our city and friendship.”

Mr Najib said he is excited to see the design for himself.

“I think it’s a wonderful design. I think we have a real winner in this Marina One and it will certainly fulfil our expectations… A landmark, an iconic building and what we see today is the beginning of that iconic building,” he added.

The two leaders were also briefed on the progress of the other joint project located near Kampong Glam.

The project, called DUO, includes office, residential and hotel components.

It sits on 160,000 square metres of gross floor area and is valued at S$4 billion.

The DUO and Marina One are part of six land parcels jointly developed by Singapore and Malaysia under a land swop deal agreed on in 2010.

Source : Channel NewsAsia – 19 Feb 2013

Office rents set to rise as new supply shrinks

The Republic’s office rents are set to rebound from their first annual decline in three years as new supply shrinks and more businesses expand, said CapitaCommercial Trust.

Rents in the city are reaching a trough and demand may rise as the country positions itself as a regional business hub, said Ms Lynette Leong, Chief Executive Officer of CapitaCommercial Trust.

Supply for the next three years will be about 0.8 million square feet a year, down from 1.3 million square feet over the past two decades, she said.

“Rents are poised for a recovery,” Ms Leong said. It is “a no-brainer that rents are not going to go down very much further so it’s more when the rents will turn and to what extent”, she added.

CapitaCommercial estimates new demand accounted for 1.5 million square feet to 1.8 million square feet annually in the past three years, Ms Leong said, without giving a forecast for this year.

Singapore’s office rents fell 0.3 per cent in the fourth quarter, extending the decline last year to 1.3 per cent, the Government said on Jan 25.

The figures climbed 8.4 per cent in 2011 and 13 per cent in the previous year, government data showed.

Source : Today – 31 Jan 2013

Room for more commercial developments in northeast S’pore

The government has been ramping up housing supply in recent years, particularly in the north-eastern part of Singapore and some analysts said there is room for more commercial developments to meet the needs of the growing population.

According to the Urban Redevelopment Authority (URA) and the Housing and Development Board (HDB), a total of 44,868 residential units will be completed in Sengkang and Punggol by 2016.

The nearby Pasir Ris town will also see 10,243 units in the next three years.

As a result, analysts said some of these towns may have limited shopping options.

Chia Siew Chuin, director of research and advisory at Colliers International, said: “When we look at shop space, we need to bear in mind that this excludes space used for F&B as well as entertainment space. If we were to consider the total amount of shop space available in the main areas of Sengkang, Punggol, Pasir Ris as well as Tampines, we can actually see that Sengkang and Punggol have a lower space per capita of about two square feet, compared to Tampines which has about seven square feet.”

The completion of The Seletar Mall and Waterway Point in the next two to three years would add another 780,000 square feet of retail space in the Sengkang/Punggol area.

The URA has also launched a commercial site at Punggol Point for sale on December 4 last year.

Looking ahead, as these new towns continue to grow, analysts said there is room for more shopping malls.

Responding to MediaCorp’s query, CapitaMall Trust which owns Rivervale Mall in Sengkang said it continually looks at opportunities to refresh its malls through asset enhancement initiatives to meet shoppers’ needs.

Richard Ng, head of asset management at CapitaMall Trust said, “When assessing a mall, we observe the shopper and vehicular traffic, shopper flow through the mall, purchasing patterns and tenants’ sales.”

Meanwhile, Frasers Centrepoint said as Sengkang town continues to grow, it will review Compass Point mall’s tenant mix to optimise space usage. The mall, which is located near the Sengkang MRT station, currently house 120 shops.

Frasers Centrepoint added that its joint venture project at Watertown in Punggol will also comprise a retail component – Waterway Point. The mall is expected to be completed by 2015 and will house 220 shops.

Donald Han, HSR Property Group’s special advisor, said: “In three to five years, there could be more opportunities for commercial sale of sites. Generally, these malls maybe smaller in size of less than 300,000 square feet. In some cases, they could be about 100,000 square feet to 200,000 square feet, mainly catering for the local population.”

Some analysts said one way to address the issue is for the government to release more mixed development sites in these areas. On these sites, developers will be able to build a combination of residential units and commercial shops which will also serve residents in the vicinity.

Analysts expect the government to continue to improve the range of facilities in new towns.

Lee Sze Teck, senior manager of training, research and consultancy at DWG, said: “The Masterplan review is coming up this year and we will probably see some changes to land uses. From there on, we will see how the URA is going to implement some of these changes to cater for an increase in population.”

Responding to query, HDB said more commercial facilities will be provided to serve residents as a town gets more developed.

It added that 71 shops, eating houses and supermarkets will be built in Sengkang, Punggol and Pasir Ris by 2016.

The National Development Ministry is due to release its Land Use Plan paper this week.

It will outline the government’s land use plan to support possible population growth.

Source : Channel NewsAsia – 30 Jan 2013

Retail rents in S’pore up 2% in 2012

Prices of shop space rose 2.0 per cent in 2012, while rentals dropped marginally by 0.3 per cent according to the latest statistics from the Urban Redevelopment Authority (URA).

Yields of retail units have dropped last year, but most market experts Channel NewsAsia spoke to are optimistic about the demand for retail space in Singapore from both investors and retailers.

After just one week, some retail units at the newly-launched mixed commercial development Alexandra Central are reportedly put on the market again.

Such speculation raises the possibility of cooling measures being extended to the commercial property sector where prices of strata-titled retail units have jumped by some 56 per cent over the last two years while median rentals have gone up by up to 35 per cent, according to Savills Singapore.

Alan Cheong, research head at Savills Singapore, said: “Rentals are not keeping up with price increases, meaning there will be yield compression. We also noticed that strata title units sold was about 1,274 square feet (in 2010). Last year, it was only 430 square feet. There is shrinkage in the average size of retail units.”

A smaller strata-titled unit could reduce the capital outlay for investors despite prices on a per square foot basis getting more expensive.

But market experts note that vacancy rates at 5.2 per cent in the fourth quarter of 2012 is at a 15-year low.

Unlike residential private property where an oversupply may be expected in the next few years, analysts believe demand for retail space is still strong.

Ku Swee Yong, CEO of International Property Advisor, said: “The future supply coming on stream will be spaced out for the next four to five years. And a large number of is concentrated in Jurong East where there will be creation of several thousand new jobs in two hospitals.”

Prime rents like those on Orchard Road are expected to stay resilient. In the worst case scenario, analysts expect a mild correction of up to three per cent. This is because of the strengthening Sing dollar and a slower Singapore economy in 2013.

Analysts said URA data on shop space rentals are derived from a wide variety of commercial properties like strata-titled units, and those belonging to real estate investment trusts or REITS.

A decline in the rental index in shop space could be due to a higher number of leases from those in the heartlands, which are typically lower than those from the Orchard Road belt.

Source : Channel NewsAsia – 28 Jan 2013

Prime shopping space in CBD shrinks

Prime shopping space in the central business district (CBD) has shrunk.

As at end of September 2012, retail space – excluding that for drinking, eating and entertainment – has fallen by about 3 per cent, according to data by the Urban Redevelopment Authority (URA) which was analysed by real estate firm Colliers International.

Prints, an upmarket stationery retailer, has been looking to expand in the Orchard Road area. Its outlet at Chevron house has attracted a lot of corporate orders and bulk purchases from surrounding offices.

But its business is still lagging behind its other outlet at Ion Orchard. With space four times larger Chevron’s, Ion brings in 20 per cent more business.

The company said expanding into the Orchard Road shopping belt may also open up new opportunities. Its third outlet at CityLink Mall sees the least business.

Prints’ operation manager, Lim Fung Leng, said: “We’re still looking at areas like Orchard and VivoCity because we would like to expand into the international market and we would like to attract more tourists and those area has a lot people from different walks of life it will get more exposure for our products.”

More retail space in the CBD area has been converted for Food and Beverage purposes, according to a research by real estate agency Colliers International.

As a result, the available space for other retail use has become tighter.

Colliers International’s research head, Chia Siew Chuin, said: “Why you see more retail space or rather more F&B space is because a lot of developers and owners of retail malls know that F&B outlets are actually magnets for people. Magnets for human traffic to be locked inside their retail malls. So gone are the days when you only see 15 per cent to 20 per cent F&B space. You can see as high as 40 or 50 per cent of your total space is F&B or leisure space.”

Other analysts said prime space for F&B outlets may typically command lower rents.

Savills Singapore’s research head Alan Cheong said: “F&B commands lower rentals on a dollar-psf, gross lettable area because you have a lot of non-revenue generating activities like your kitchen and in some instances you have to provide washroom compared to retail where every single space is for revenue generating purpose.”

Except for the building housing the former DBS headquarters that will be redeveloped to include a sizeable retail space spanning 170,000 square feet, analysts don’t see much office space being converted to retail space in the CBD.

In the next five to 10 years, new condominiums will create the need for more retail space.

But analysts said these would be F&B outlets and retail stores providing basic necessities like pharmacies, mini-grocers and supermarkets for affluent residents.

Source : Channel NewsAsia – 7 Jan 2013

NTUC Income to fully own 16 Collyer Quay

NTUC Income will be acquiring a further 51 per cent stake in 16 Collyer Quay from Goldman Sachs to fully own the prime office building.

In a statement, the Singapore insurer said the acquisition values the 37-storey, 999-year leasehold building formerly known as Hitachi Tower, at around S$660 million. This works out to less than S$2,400 per square foot on a net lettable space of over 278,000 square feet.

NTUC Income had bought its initial 49 per cent stake in the prime office building in January 2011.

The insurer said its sales and purchase agreement with Goldman Sachs is scheduled for completion at the end of the month.

16 Collyer Quay is located in Singapore’s central business district and has an occupancy rate of 94 per cent, comprising a mix of office and retail tenants.

NTUC Income added that it has plans to renovate the building to increase its asset value and appeal to office tenants.

Peter Heng, senior vice president and chief investment officer of NTUC Income, said: “16 Collyer Quay is part of our long-term strategy to allocate more of our investments to alternative investments, including real estate with a track record of strong income yields. Over the last five years, we have successfully diversified our portfolio to ensure stable, resilient, and higher returns for our policyholders.”

NTUC Income also fully or partially owns a number of commercial properties, such as NTUC Income Centre, Capital Square, Prinsep House, Parkway Parade, Ang Mo Kio Hub, EastPoint Mall and Clementi Mall.

Source : Channel NewsAsia – 2 Jan 2013