Tag Archives: Singapore Office

Prudential to save S$1.2m a year in rent with transitional site

Life insurance firm Prudential is expected to save S$1.2 million a year in rent for the next 15 years when it moves into a transitional office site at Scotts Road.

The site, which is slated to be ready in September, will house 2,500 staff.

The target to construct the S$35 million, four-storey building by September is a challenging one given the resource crunch in the construction sector.

Developer Scotts Spazio said it has been designed in a modular format to speed things up.

Ong Chih Ching, managing director, KOP Capital, said: “Our project managers are putting together a package where instead of having one main contractor, they have split the packages up and they, themselves, become the main contractor supervising the work.”

As its leases at Bugis Junction and Fuji Xerox building at Tanjong Pagar expire this year, sole tenant Prudential will take up all 150,000 square feet of the space at S$6.50 per square foot.

Philip Seah, CEO of Prudential Assurance Company Singapore, said: “At this point in time, we occupy about 200,000 square feet. By the time the rentals are due for the properties in town, we could be looking at rental of approximately S$10 to S$11, which is being cited to us, as opposed to S$6.50. In terms of the location and proximity to town, this will be a better location.”

Located right above Newton MRT station, the one-hectare site is considered one of the best transitional office sites to be released so far and both the developer and main tenant are already hoping that the URA will extend its lease beyond 15 years.

Source : Channel NewsAsia – 31 Jan 2008

Germany’s SEB Group buys 12 floors of Anson 79 for S$215m

Germany’s SEB Group has bought 12 strata-title floors of the office building Anson 79.

It is paying S$215 million to Farrell Asset Management for some 10,300 square metres of Grade A office space.

SEB already owns another nearby Grade A office building Springleaf Tower.

Anson 79 is a 23-storey building in Shenton Way and is within walking distance of Tanjong Pagar MRT station.

It has an occupancy of around 98 percent with Kellogg Brown & Root and Mitsubishi Chemicals among its tenants.

SEB Asset Management is the specialist real estate and securities investment house of the SEB Group in Germany. – CNA /ls

Source : Channel NewsAsia – 24 Jan 2008

Straits Trading pumps in S$60m for construction of new building

Singapore-listed Straits Trading Company is pumping in some S$60 million to build a new building.

It will be developed on the site of the old Straits Trading Building and is expected to be completed in 2009.

Agents for the New Straits Trading Building said they see strong demand for premium mid-sized office space.

A new 28-storey Straits Trading Building will rise in the heart of Singapore’s financial district.

There will only be two tenants per floor, with about 8,400 square feet for a typical column free office.

This may be small compared to an average of 18,000 square feet for offices at the Marina Bay Financial Centre.

However, the marketing agents said that there will be demand from multinational companies and financial institutions that want to locate near Raffles Place.

Calvin Yeo, Director, Commercial Leasing, Colliers International, said, “Unlike the new supply that is coming up in the new downtown, Straits Trading Building will meet the demand for tenants requiring a prime office address…there are no new developments coming up in Battery Road and this would be an opportunity for tenants requiring that premium address.”

Rentals would likely be at S$18 per square foot.

That is comparable to other buildings nearby such as 6 Battery Road.

The new building will also have unique design features such as two open air sky gardens and concierge services for tenants.

Norman Ip, CEO, Straits Trading, said, “I won’t say it’s really super luxurious, it’s more practical in raising the standards, because I think people’s expectations all have gone up…so definitely we aim for better quality.”

Construction is expected to be completed by the third quarter of 2009. – CNA/ms

Source : Channel NewsAsia – 23 Jan 2008

URA commercial site at Jalan Sultan draws 20 bids

Chiu Teng Estates has put in the top bid of S$14.8 million for a 99-year leasehold commercial site at Jalan Sultan.

This works out to S$10,480 per square metre per site area.

It is also just S$1.2 million more than the second highest bid.

The tender attracted 20 bids in all.

Meanwhile, the Urban Redevelopment Authority has decided to reject the only bid submitted for the transitional office site at Aljunied Road and Geylang East Avenue 1.

It said the bid of S$7.8 million or S$413 per square metre of gross floor area was too low. -CNA/vm

Source : Channel NewsAsia – 22 Jan 2008

Q3 office occupancy rate soars to 97.6% in Singapore

The strong demand for office space in the central business district has spilled over to the rest of Singapore.

According to property consultants DTZ, the occupancy rate for office space islandwide climbed to 97.6 percent in the third quarter.

This is largely because of an acute shortage of office space in the Central Business District (CBD).

DTZ says the shortage is due to the demolition of Asia Chambers Building and the alteration works being done at two office blocks, OUB Building and Ocean Building.

The office market saw a net loss of 455,000 square feet of stock in the three months to September.

Occupancy rates in Raffles Place rose by 1.1 percent from the previous quarter.

With higher asking rents and lack of office space in the CBD, many companies have flocked to the CBD fringe and decentralised areas.

This has boosted occupancy in these regions with the Alexandra area, for example, rising 3.5 percent to full occupancy.

Average monthly rents for Alexandra have increased by 13 percent to S$6.80 per square foot per month from the second quarter.

Another area, Novena, achieved 98.5 percent occupancy. – CNA/ch

Source : Channel NewsAsia – 28 Sep 2007

Banks get flexible with property needs

The short supply of available office space in the central business district is driving financial institutions to be more flexible when planning their real estate needs.

“Currently, banking and finance tenants occupy 36 per cent of all Grade A stock in Singapore, or close to 500,000 sq m,” said Justin Kean, associate director of Asia Pacific occupier research at consultancy Jones Lang LaSalle (JLL).

“This figure has increased by approximately half since the beginning of 2006.”

Added Mr Kean: “This implies that much of the recent rental movements in this market can be attributed to the banking and finance sector.”

A JLL white paper on real estate trends in the banking and finance sector showed financial institutions are exploring ways to create a better work environment, besides just looking at physical locations for expansion.

Advancements in data storage and communication technology have enabled the separation of front and back-end operations. The latter are then moved to cheaper locations.

To optimise office space, some banks here are considering the possibility of hot-desking, or allowing staff to work off-site or from home.

Such arrangements, together with the adoption of flexible work hours, would give the banks the flexibility to absorb minor shocks in the market, which might result in the reduction of staff numbers, without downsizing their real-estate portfolio.

JLL said, in line with the rise in corporate social responsibility within the sector, more real estate managers are making it an important part of their portfolio management strategy, including selecting eco-friendly buildings.

Source : Weekend Today – 25 Aug 2007

Cheung Kong may sell stake in Marina Bay Financial Centre

Hong Kong billionaire Li Ka-shing’s Cheung Kong Holdings may sell its one third stake in Singapore’s Marina Bay Financial Centre to Suntec Real Estate Investment Trust (Reit) when the complex is completed in 2010.

The stake is likely to be worth “more than US$1 billion ($1.5 billion)”, Mr Justin Chiu, executive director of Cheung Kong said. The company is building the 24-hectare office and residential complex on a waterfront site in Singapore with Hongkong Land Holdings and Keppel Land.

“We haven’t made a decision yet,” Mr Chiu said. “But as a parent, of course you want to take care of your own children. If the price is not that far off from the next interested buyer, we will sell.”

Cheung Kong and its partners made a joint bid of US$1.8 billion in 2005 for the 3.55-hectare site, part of Singapore’s plans to create a new business district.

The new Marina Bay, which will include projects such as a botanical garden, a casino-and-convention centre and luxury apartments, is aimed at luring companies and tourists.

Suntec Reit owns offices and retail space in Singapore, including the Suntec City development. Recently, Cheung Kong said it will sell its one-third stake in One Raffles Quay, another downtown office block built with Hongkong Land and Keppel Land, to Suntec Reit, for US$941.5 million.

“The offer was good, so we sold it,” Mr Chiu said. “Suntec Reit is our long-term commitment to Singapore. We like the place.”

Cheung Kong is bidding for a site at Beach Road near Suntec City, Mr Chiu said. It is working with Keppel Land on the tender. — BLOOMBERG

Source : Today – 3 Aug 2007