Ascendas has started to construct a $118 million factory building for use by food production businesses. A total of 72,000 sq m of space spread out over 284 units will be for sale at the new FoodXchange @ Admiralty site.
Speaking at the groundbreaking ceremony for the seven-storey ramp-up facility on Admiralty Road West yesterday, Ascendas president and CEO Chong Siak Ching said that, based on feedback, food industrialists - most of them with small or medium-sized companies - generally preferred to own their own premises.
Ms Chong said that at the end of Q2 2006, occupancy in high-rise food facilities exceeded the 84 per cent level for non-food multi-tenanted facilities.
She said current market rates for comparable sale units are $260 to $310 per square foot.
The FoodXchange @ Admiralty site has a balance of 53 years on its lease.
On whether the new facility could see its way into Ascendas’ real estate investment trust, Ascendas Reit, Ms Chong said: ‘The development is still in early stages and discussions of its future plans, such as whether it would be part of a trust, would be premature.’
Spring Singapore chairman Philip Yeo, also present at the ceremony, said that the output of SMEs in the food manufacturing industry increased 11.4 per cent in 2005 over the previous year to hit $2.4 billion. He said that 95 per cent of the 680 enterprises in the food manufacturing industry are SMEs.
He said: ‘Growing local SMEs develop higher value added exportable food products. Direct exports increased by 6 per cent to $714 million in 2005.’
Mr Yeo said that global sales of processed foods are worth more than $4.5 trillion and are expected to grow at 4.4 per cent each year.
FoodXchange @ Admiralty will have specialised features including a dedicated kitchen exhaust shaft, cold room operations and design which helps prevent cross-contamination.
In March, Soilbuild Group launched its Senoko Food Connection terrace food factories. The net saleable area is 20,271 sq m and industry watchers estimated that prices would be $140-$150 per square foot.
Source: The Business Times
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