News Releases

4 July 2007

URA Launches the First Transitional Office Site for Sale and Announces Other New Supply of Space to Meet Office Needs

URA announced today the launch of sale of the first transitional office site at Scotts Road. It also announced the launch of the sale of a commercial site at Anson Road. The launch of these sites, which will generate up to almost 40,000 sqm of office space, will help to meet the demand for office space in the short to medium term.

These launches come soon after the Ministry of National Development (MND) had announced two weeks ago, on 14 June, that the Government will make available sites for a total supply of 534,000 sqm of commercial space in the second half of 2007, comprising 354,000 sqm of space from the GLS Programme and 180,000 sqm from other Government sources.

MND had also announced at the same time that there was another 640,000 sqm of office space from projects in the pipeline, i.e. projects with planning approval, from Government and private land sources, which were expected to be completed and be ready for occupation between the second half of 2007 and 2010.

In all, the total amount of commercial space that can potentially be realised, most of which can be for office use, is 1,174,000 sqm1. In comparison, the island-wide demand for office space (i.e. the amount of occupied office space) increased by an average of 220,000 sqm per annum between 2004 and 2006.

In addition to the supply of commercial space above, MND had also announced then that there were 250,000 sqm of business park space in the pipeline, mainly from Changi Business Park, Alexandra Distripark and one north, which were expected to be completed between the second half of 2007 and 2010. In addition to this, 250,000 sqm of business park space, JTC will allocate a number of other business park sites in the next few months, which will provide another 120,000 sqm of business park space. The likely developers of these sites are tying up with a number of financial institutions to house their backroom operations in the developments.

Transitional office site at Scotts Road

This Land Parcel, located next to Newton MRT station, is being tendered out for the development of a transitional office building. It has a site area of about 1.04 ha and a maximum permissible gross floor area of about 15,666 sqm. The site is sold on a short-term lease of 10 years and the office building on the site is expected to be a low-rise development of about 3 to 4 storeys that can be built quickly in about a year.

The Land Parcel is located at the prominent junction of Scotts Road and Bukit Timah Road, which is one of the major gateways into the City. The site offers convenient access to the City Centre via the Rapid Transit System (RTS) network, major arterial roads and the Central Expressway (CTE). The details of the Land Parcel are at Annex A-1 and the location plan at Annex A-2.

The Government has also identified a number of other sites for such transitional office developments. If there is good response to the tender for the first site, the Government will release more of such sites for tender.

Commercial site at Anson Road

This Land Parcel was made available for sale through the reserve list system of the GLS Programme on 26 October 2006. On 18 June 2007, URA announced that it had received an application from a developer to put up the site for tender and would launch the site for public tender in about two weeks’ time. The developer has committed to bid at least S$116.2 million for the site in the public tender.

The Land Parcel, which has a site area of about 0.25 ha and a maximum permissible gross floor area of about 23,418 sqm, is zoned for commercial development.

The Land Parcel is located within Tanjong Pagar, a key gateway into the Central Business District (CBD). The area has a number of major office developments, including Capital Tower, Temasek Tower, Springleaf Tower, as well as offices of key public institutions such as the Monetary Authority of Singapore and the Central Provident Fund Board. The Land Parcel’s prime location in the CBD and its site configuration will provide an opportunity for investors to develop a prime office building in the Tanjong Pagar area with a good-size floor plate of about 1,800 sqm.

The details of the Land Parcel are in Annex B-1 and the location plan in Annex B-2.

Other sources of supply in the near future

URA will launch the tender for another white site, Land Parcel B, at Marina View in the Marina Bay area later this month which can yield up to 84,830 sqm of office space. This follows the release of the first white site, Land Parcel A, at Marina View in May 2007 which can yield up to 133,120 sqm of office space. The tender for Land Parcel A will close on 19 September 2007.

The Singapore Land Authority (SLA) has recently awarded a State property at River Valley Road with a GFA of 4,400 sqm for office use. SLA is also in the process of evaluating the tenders for several other properties for office use. SLA will announce in the coming months a list of additional properties that will be made available for leasing for office use.

The above-mentioned initiatives by various Government agencies to generate office and business park supply in the short and medium term will help to meet the strong demand for such space.

The Government will also continue to monitor the office market closely and take other actions to provide additional office supply, where necessary, to moderate office rental increases.

More information on office supply and rentals

The public should take into consideration information on future supply of office space when evaluating media reports which cite the projections of future rental increases by property consultants. One example was the recent projection by property consultant Savills that office rentals in Singapore could surpass those in Hong Kong by end-2008.

The public should interpret such projections with caution. Whether such projections would materialise or not depends on many factors, in particular, the availability of additional supply. The consultants may not have taken into consideration the additional supply of office and business park space that will be generated from the latest Government initiatives.

To allow the public to have a more balanced perspective of the office market, URA is currently working towards the release of more detailed rental and vacancy data on office space. URA will announce more details of the data on 27 July 2007.

1. This includes sites on the Reserve List of the 2H2007 GLS Programme, which will be tendered out and developed based on market demand. Potentially all commercial space within the commercial and white sites could be developed for office use although other complementary uses such as retail is allowed.