US bank could be tweaking portfolio, sources say; DBS may move to new location.
Goldman Sachs is said to be discreetly looking around for a buyer for DBS Building along Shenton Way. The US bank, which bought the two office towers two years ago, could reap a tidy gain of almost $1 billion should a deal go through.
Market watchers say that it makes sense for Goldman Sachs to reshuffle its office portfolio to more prime locations in Singapore.
Goldman is believed to be seeking a price of at least $2,000 per square foot of net lettable area (NLA), which would work out to about $1.75 billion, compared with the $789 psf or $690 million that it paid for the property in late 2005.
Meanwhile, DBS which sold the property to Goldman and leased back the space it occupied, is expected to relocate to Marina Bay Financial Centre (Phase 2), as reported by BT.
DBS occupied the entire 49-storey Tower 1 - which is more than 30 years old - when it sold the property to Goldman in 2005. It also occupied almost 40 per cent of the 34-storey Tower 2, which is just 13 years old. It leased the premises for eight years, with an option for renewal.
The Singapore bank is now said to be eyeing a move to its prestigious new location, expected to be completed in late 2011. This suggests a period of overlap with its existing lease on DBS Building, that runs till late 2013.
Goldman, on the other hand, has been snapping up new office assets of late.
In August this year, it inked a deal to buy Chevron House at Raffles Place from CapitaLand and other parties for $730 million or $2,780 psf of NLA.
The building stands on a site with a remaining lease of about 81 years. Goldman Sachs is also expected to purchase the 37-storey Hitachi Tower next door, in which CapitaLand also has a stake. The price is understood to be around $3,000 psf, or about $840 million in total. Hitachi House has a 999-year leasehold tenure and faces Collyer Quay.
‘It’s good business sense for Goldman to move its Singapore office holdings from the old Shenton Way area to Raffles Place/Collyer Quay, where rental and capital values are likely to appreciate faster.
‘The new financial district at Marina Bay will be connected to the Raffles Place/Collyer Quay vicinity, which will also be rejuvenated with the Ocean Financial Centre development,’ a seasoned industry market watcher said.
Some office market watchers estimate that in the current market, Goldman Sachs may fetch around $1,750 psf to $1,800 psf of NLA for DBS Building - instead of the $2,000 psf minimum price it is seeking - given the property’s age and short balance land tenure.
‘A lot will also depend on what sort of rentals the building can fetch after DBS moves out,’ a property consultant said.
And while the Singapore office market has sizzled this year because of an acute shortage of offices, investors have become a little cautious lately on fears that the US sub-prime contagion could clip the space requirements of big financial institutions here.
‘Perhaps Goldman Sachs stands a higher chance of achieving its target price range it if waits a little longer and hopefully by then, the current sub-prime woes may ease,’ an observer suggests.
Investment in Singapore’s office sector, including land for development into offices, has seen a staggering $14.9 billion worth of deals sealed so far this year. This is about three times the figure for the whole of last year.
The supply crunch has also seen prime office capital values rise from about $2,000 psf at the start of this year to nearly $3,000 psf, as seen in the price that Goldman Sachs is believed to have negotiated for Hitachi Tower.
Source : Business Times - 12 Dec 2007
Showing posts with label office space. Show all posts
Showing posts with label office space. Show all posts
Wednesday, December 12, 2007
78 Shenton Way for $650 million
FOREIGN institutional investors continue to be drawn to the Singapore office market.
The latest investor to come in is Germany’s Commerz Grundbesitz Investmentgesellschaft (CGI) group, which has bought 78 Shenton Way for $650 million, BT understands. The price works out to $1,857 per square foot based on a total net lettable area of about 350,000 sq ft. This comprises about 275,000 sq ft in the existing 34-storey office tower and a further 75,000 sq ft that is being built in an extension that will be spread across six levels of offices above the carpark podium.
The extension is expected to be completed in the second half of 2009.
78 Shenton Way is on a site with a remaining lease of about 75 years. The property was sold by a joint-venture between Credit Suisse and CLSA funds which bought the 34-storey tower this January for $348.5 million.
Sources say that the vendors are expected to pump in about $80 million to build the extension and spruce up the existing property.
Jones Lang LaSalle is said to have advised 78 Shenton Way’s sellers, while buyer CGI - which is making its maiden entry into the Singapore real estate market - is understood to have been advised by CB Richard Ellis. CGI is the capital investment company for the open-ended fund Haus-Invest.
The $1,857 psf of net lettable area achieved for the deal is in line with current office values in the area, industry observers say. In April this year, TSO Investment, a unit of a CLSA Capital Partners-managed property fund, sold SIA Building at Robinson Road to European pension fund manager SEB for about $1,780 psf of net lettable area.
In September, SEB also bought 12 floors at Springleaf Tower in the Anson Road area at $2,088 psf of net lettable area.
In October, Allco Commercial Real Estate Investment Trust picked up KeyPoint in the Jalan Sultan/Beach Road area for $370 million or $1,186 psf of net lettable area. The deal includes income support of up to $10.5 million for two years to be provided by the seller.
In August, a Goldman Sachs-linked fund bought Chevron House (formerly Caltex House) along Raffles Place for $2,780 psf, a record for an office block here. Chevron House stands on a site with a remaining lease of about 81 years.
The Goldman Sachs group is also expected to stitch a deal early next year to buy the nextdoor Hitachi Tower, which faces Collyer Quay, for about $3,000 psf, industry observers say. A higher price can be justified for Hitachi Tower due partly to its superior tenure (999-year leasehold) and orientation. As well, Hitachi Tower is not weighed down by rental caps for a major tenant, as in the case of Chevron’s lease at Chevron House, which limits the near-term rental upside of the property, according to an earlier media report.
Source : Business Times - 11 Dec 2007
The latest investor to come in is Germany’s Commerz Grundbesitz Investmentgesellschaft (CGI) group, which has bought 78 Shenton Way for $650 million, BT understands. The price works out to $1,857 per square foot based on a total net lettable area of about 350,000 sq ft. This comprises about 275,000 sq ft in the existing 34-storey office tower and a further 75,000 sq ft that is being built in an extension that will be spread across six levels of offices above the carpark podium.
The extension is expected to be completed in the second half of 2009.
78 Shenton Way is on a site with a remaining lease of about 75 years. The property was sold by a joint-venture between Credit Suisse and CLSA funds which bought the 34-storey tower this January for $348.5 million.
Sources say that the vendors are expected to pump in about $80 million to build the extension and spruce up the existing property.
Jones Lang LaSalle is said to have advised 78 Shenton Way’s sellers, while buyer CGI - which is making its maiden entry into the Singapore real estate market - is understood to have been advised by CB Richard Ellis. CGI is the capital investment company for the open-ended fund Haus-Invest.
The $1,857 psf of net lettable area achieved for the deal is in line with current office values in the area, industry observers say. In April this year, TSO Investment, a unit of a CLSA Capital Partners-managed property fund, sold SIA Building at Robinson Road to European pension fund manager SEB for about $1,780 psf of net lettable area.
In September, SEB also bought 12 floors at Springleaf Tower in the Anson Road area at $2,088 psf of net lettable area.
In October, Allco Commercial Real Estate Investment Trust picked up KeyPoint in the Jalan Sultan/Beach Road area for $370 million or $1,186 psf of net lettable area. The deal includes income support of up to $10.5 million for two years to be provided by the seller.
In August, a Goldman Sachs-linked fund bought Chevron House (formerly Caltex House) along Raffles Place for $2,780 psf, a record for an office block here. Chevron House stands on a site with a remaining lease of about 81 years.
The Goldman Sachs group is also expected to stitch a deal early next year to buy the nextdoor Hitachi Tower, which faces Collyer Quay, for about $3,000 psf, industry observers say. A higher price can be justified for Hitachi Tower due partly to its superior tenure (999-year leasehold) and orientation. As well, Hitachi Tower is not weighed down by rental caps for a major tenant, as in the case of Chevron’s lease at Chevron House, which limits the near-term rental upside of the property, according to an earlier media report.
Source : Business Times - 11 Dec 2007
Sunday, December 9, 2007
The 101 building faces the prospect of forking out about $6,000 to $35,000, depending on their properties
PAST building management financial woes have come back to haunt the owners of homes, shops and offices at a Beach Road building.
Each owner at The 101 building faces the prospect of forking out about $6,000 to $35,000, depending on their properties, to cover an outstanding debt of $300,000.
The debt, accumulated in recent years, is a hotchpotch of unpaid cleaning and security bills, as well as legal costs run up in a failed bid to recover unpaid carparking fees, among other things.
One of the home owners, Madam Tan Lee Sung, 77, told The Straits Times: ‘The money was not used by me. Why should I pay?’
The current management council is looking to see if its predecessors are liable for the debt. Things, however, could escalate if the debts remain unpaid, and creditors seek court orders.
The six-storey, roughly 20-year-old mixed development has 20 apartments and seven shops and office units.
A seafood restaurant and a steamboat outlet occupy the ground floor, while most of the apartments above are leased out by their owners.
Like all strata-titled buildings, it is run by a management council whose members are picked from the owners.
According to The 101’s council chairman, Mr Thomas Tan, 60, who took office about a month ago, the $300,000 debt arose partly because the former councils sued some owners for alleged non-payment of carparking fees and unauthorised alteration and use of common areas, among other things.
The council lost the lawsuits and found itself saddled with legal fees.
In October 2005, the management had $168,500 in its kitty, but this was whittled down to $12,150 by April this year. Its creditors have taken out court orders to freeze its bank account.
A former council chairman, businessman Tan Fung Chuan, 50, offered a different explanation for the debts. He pointed the finger at low maintenance contributions that the owners voted to pay in 2005.
At a meeting then, an owner had tabled a resolution to cut the total management fee collected every month from $7,000 to $3,000. Mr Tan said that was barely enough to pay for the building’s operating costs.
He said: ‘A reasonable operating fee should be $8,000 to $12,000.’
He added that the lawsuits against individual owners were taken out on legitimate grounds, as the owners had violated Singapore’s building regulations.
‘We wanted to comply with the authorities’ guidelines.’
At a heated meeting at The 101 on Thursday, unit owners voted to give their current council the power to take various steps to scrutinise its books for possible financial irregularities.
They have also voted to let the council claim money back from former council members and anyone else, if any wrongdoing is proven.
The owners refused, however, to raise their monthly contributions.
The council intends to try again to get the owners to agree to higher fees at another meeting soon.
Meanwhile, Mr Thomas Tan said his team would just focus on setting things right if it turned out to be a simple case of bad judgment on the part of the previous councils.
‘If it is proven that this current state of finances is due to ignorance or a bad judgement call, personally, I may try to convince owners to let it go and move on.’
Source : Straits Times - 8 Dec 2007
Each owner at The 101 building faces the prospect of forking out about $6,000 to $35,000, depending on their properties, to cover an outstanding debt of $300,000.
The debt, accumulated in recent years, is a hotchpotch of unpaid cleaning and security bills, as well as legal costs run up in a failed bid to recover unpaid carparking fees, among other things.
One of the home owners, Madam Tan Lee Sung, 77, told The Straits Times: ‘The money was not used by me. Why should I pay?’
The current management council is looking to see if its predecessors are liable for the debt. Things, however, could escalate if the debts remain unpaid, and creditors seek court orders.
The six-storey, roughly 20-year-old mixed development has 20 apartments and seven shops and office units.
A seafood restaurant and a steamboat outlet occupy the ground floor, while most of the apartments above are leased out by their owners.
Like all strata-titled buildings, it is run by a management council whose members are picked from the owners.
According to The 101’s council chairman, Mr Thomas Tan, 60, who took office about a month ago, the $300,000 debt arose partly because the former councils sued some owners for alleged non-payment of carparking fees and unauthorised alteration and use of common areas, among other things.
The council lost the lawsuits and found itself saddled with legal fees.
In October 2005, the management had $168,500 in its kitty, but this was whittled down to $12,150 by April this year. Its creditors have taken out court orders to freeze its bank account.
A former council chairman, businessman Tan Fung Chuan, 50, offered a different explanation for the debts. He pointed the finger at low maintenance contributions that the owners voted to pay in 2005.
At a meeting then, an owner had tabled a resolution to cut the total management fee collected every month from $7,000 to $3,000. Mr Tan said that was barely enough to pay for the building’s operating costs.
He said: ‘A reasonable operating fee should be $8,000 to $12,000.’
He added that the lawsuits against individual owners were taken out on legitimate grounds, as the owners had violated Singapore’s building regulations.
‘We wanted to comply with the authorities’ guidelines.’
At a heated meeting at The 101 on Thursday, unit owners voted to give their current council the power to take various steps to scrutinise its books for possible financial irregularities.
They have also voted to let the council claim money back from former council members and anyone else, if any wrongdoing is proven.
The owners refused, however, to raise their monthly contributions.
The council intends to try again to get the owners to agree to higher fees at another meeting soon.
Meanwhile, Mr Thomas Tan said his team would just focus on setting things right if it turned out to be a simple case of bad judgment on the part of the previous councils.
‘If it is proven that this current state of finances is due to ignorance or a bad judgement call, personally, I may try to convince owners to let it go and move on.’
Source : Straits Times - 8 Dec 2007
Saturday, December 1, 2007
OFFICE space in severe short supply now
OFFICE space may be in severe short supply now, but Citigroup predicts the tables will be turned by 2010 with even a glut possible.
‘The market is underestimating the potential supply of new office space in 2010 and beyond, in our view,’ said the banking group in a report on Monday.
While rents and prices of offices are skyrocketing due to the supply crunch, Citigroup said the situation is set to change in a few years, because of the slew of commercial sites sold by the Government in recent months.
It noted that since May, six new sites have been awarded that could yield three million sq ft of offices in 2010 and 2011. This is in addition to projects already under way.
It means that in those years, potential new supply could be 3.2 million to 3.5 million sq ft a year, according to Citigroup’s estimates.
Demand over the last few years has averaged only 1.5 million sq ft per year, the report added.
All eyes are now on the Government Land Sales programme for next year, which is due to be announced next month. If more office sites are released, even more supply can be expected.
Recent bids for office sites have already come in below market expectations, reflecting a more cautious long-term outlook among developers.
A Marina View site earlier this month attracted bids 35 per cent lower than those drawn by an adjacent plot just two months before. The site has yet to be awarded to a bidder even though the tender closed two weeks ago.
The Citigroup report also predicted that landlords of the new offices - most will be in the Central Business District - will face keen competition for tenants. Occupancy rates will peak next year or in 2009 and decline after that, it said.
This has led Citigroup to downgrade the shares of two major office owners: Keppel Land to ’sell’ and City Developments to ‘hold’.
But other analysts are sceptical of Citigroup’s forecasts of an oversupply. They say that for now and next year at least, demand for office space will still far outstrip supply.
When the new offices are opened from 2010 onwards, enough pent-up demand will have been built to soak up all the space, said Mr Wilson Liew, an investment analyst at Kim Eng Research.
‘Judging from the current demand, if this trend continues, there shouldn’t be much of an oversupply,’ he said. ‘These two, three years or so, the supply that is coming on stream is way below the average rate, so there will be a lot of pent-up demand.’
Mr Soong Tuck Yin of Macquarie Securities said the average supply of offices between next year and 2012 comes to only 1.7 million sq ft a year.
This drops to 1.4 million sq ft if space that has already been pre-committed - leased by companies even before being built - is excluded.
Another analyst added that in three to five years’ time, Singapore’s two casinos will have been built. And with the Government promoting Singapore as a financial hub, banks will still expand and be in need of prime space.
There may also be a delay in some of the new office space coming on stream, given the current shortage of contractors, he added.’It’s a bit soon to be making these sorts of predictions,’ the analyst said of the Citigroup report.
In the end, it boils down to whether the economy keeps growing, said Mr Winston Liew, senior investment analyst at OCBC Investment Research. ‘The office market is mainly driven by GDP growth. If our GDP continues to grow, demand should not be an issue.’
Source : Straits Times - 28 Nov 2007
‘The market is underestimating the potential supply of new office space in 2010 and beyond, in our view,’ said the banking group in a report on Monday.
While rents and prices of offices are skyrocketing due to the supply crunch, Citigroup said the situation is set to change in a few years, because of the slew of commercial sites sold by the Government in recent months.
It noted that since May, six new sites have been awarded that could yield three million sq ft of offices in 2010 and 2011. This is in addition to projects already under way.
It means that in those years, potential new supply could be 3.2 million to 3.5 million sq ft a year, according to Citigroup’s estimates.
Demand over the last few years has averaged only 1.5 million sq ft per year, the report added.
All eyes are now on the Government Land Sales programme for next year, which is due to be announced next month. If more office sites are released, even more supply can be expected.
Recent bids for office sites have already come in below market expectations, reflecting a more cautious long-term outlook among developers.
A Marina View site earlier this month attracted bids 35 per cent lower than those drawn by an adjacent plot just two months before. The site has yet to be awarded to a bidder even though the tender closed two weeks ago.
The Citigroup report also predicted that landlords of the new offices - most will be in the Central Business District - will face keen competition for tenants. Occupancy rates will peak next year or in 2009 and decline after that, it said.
This has led Citigroup to downgrade the shares of two major office owners: Keppel Land to ’sell’ and City Developments to ‘hold’.
But other analysts are sceptical of Citigroup’s forecasts of an oversupply. They say that for now and next year at least, demand for office space will still far outstrip supply.
When the new offices are opened from 2010 onwards, enough pent-up demand will have been built to soak up all the space, said Mr Wilson Liew, an investment analyst at Kim Eng Research.
‘Judging from the current demand, if this trend continues, there shouldn’t be much of an oversupply,’ he said. ‘These two, three years or so, the supply that is coming on stream is way below the average rate, so there will be a lot of pent-up demand.’
Mr Soong Tuck Yin of Macquarie Securities said the average supply of offices between next year and 2012 comes to only 1.7 million sq ft a year.
This drops to 1.4 million sq ft if space that has already been pre-committed - leased by companies even before being built - is excluded.
Another analyst added that in three to five years’ time, Singapore’s two casinos will have been built. And with the Government promoting Singapore as a financial hub, banks will still expand and be in need of prime space.
There may also be a delay in some of the new office space coming on stream, given the current shortage of contractors, he added.’It’s a bit soon to be making these sorts of predictions,’ the analyst said of the Citigroup report.
In the end, it boils down to whether the economy keeps growing, said Mr Winston Liew, senior investment analyst at OCBC Investment Research. ‘The office market is mainly driven by GDP growth. If our GDP continues to grow, demand should not be an issue.’
Source : Straits Times - 28 Nov 2007
Monday, November 26, 2007
PRIME office rents have grown faster in Singapore than anywhere else in the world over the past year, a new report has found.
PRIME office rents have grown faster in Singapore than anywhere else in the world over the past year, a new report has found.
The rate of increase beat even that in Mumbai, now the world’s second most expensive office market, after London’s West End, according to CB Richard Ellis (CBRE).
But overall, Singapore ranks 11th on the list of worldwide office rentals, which are generally rising quickly.
Rental levels plus other associated costs for Singapore prime office space shot up 82.6 per cent in the 12 months ended Sept 30 to $12.60 per sq ft (psf) a month, said the CBRE’s Global Market Rents report. Apart from lease rates, occupancy costs include expenses for management and basic building maintenance.
In terms of occupancy costs, Moscow posted the second-fastest growth, of 65.4 per cent. Third in line was Mumbai, where occupancy costs grew 55 per cent.
The booming economics of the Asia-Pacific region continue to support strong demand for office space and to drive occupancy costs at a faster rate than in any other region, said CBRE in the report.
In comparing the costs, it looked at the typical achievable rent for a 10,000 sq ft unit in a top-quality building in a prime location.
Of the 171 markets it monitored, 85 per cent recorded growth in occupancy costs.
London’s West End - which registered 41.9 per cent growth - still has the most expensive office space, at $328US.91 ($476S.76) psf a year.
Mumbai came in a distant second, at $189US.51 psf a year. But it is already 5 per cent more expensive than London City, where occupancy costs came to $180US.80 psf a year.
Moscow is ranked fourth most expensive, at $180US.78 psf a year.
To facilitate comparisons across markets, the report based the most expensive rents on US dollars while rental growth was measured in local currency terms.
Singapore is ranked 11th on the world’s most expensive list, at $102US.37 ($148S.39) psf a year.
It came just after Hong Kong, where costs were at $106US.31 psf a year.
At $100.79 psf a year, rents for prime office space in New York’s Midtown have come down. Costs in Tokyo ranged from $154US.56 to $178US.61 psf a year.
As was the case with other key Asian financial centres such as Tokyo and Hong Kong, office vacancy rates remained low in Singapore at 5 per cent or less, said CBRE.
It noted that the uncertainty in global financial markets has had no discernible impact on demand for office space in Singapore.
The companies in Singapore that require larger spaces are largely from the fast-growing financial and insurance sectors. And before year-end, several sizeable bookings by companies in these two sectors are expected, CBRE said.
The report also echoed comments by property consultants about rising tenant resistance to rental hikes as rents are at record-high levels.
Companies are now more prepared to move to cheaper space further out of town to avoid paying high rents.
Source : Straits Times - 22 Nov 2007
The rate of increase beat even that in Mumbai, now the world’s second most expensive office market, after London’s West End, according to CB Richard Ellis (CBRE).
But overall, Singapore ranks 11th on the list of worldwide office rentals, which are generally rising quickly.
Rental levels plus other associated costs for Singapore prime office space shot up 82.6 per cent in the 12 months ended Sept 30 to $12.60 per sq ft (psf) a month, said the CBRE’s Global Market Rents report. Apart from lease rates, occupancy costs include expenses for management and basic building maintenance.
In terms of occupancy costs, Moscow posted the second-fastest growth, of 65.4 per cent. Third in line was Mumbai, where occupancy costs grew 55 per cent.
The booming economics of the Asia-Pacific region continue to support strong demand for office space and to drive occupancy costs at a faster rate than in any other region, said CBRE in the report.
In comparing the costs, it looked at the typical achievable rent for a 10,000 sq ft unit in a top-quality building in a prime location.
Of the 171 markets it monitored, 85 per cent recorded growth in occupancy costs.
London’s West End - which registered 41.9 per cent growth - still has the most expensive office space, at $328US.91 ($476S.76) psf a year.
Mumbai came in a distant second, at $189US.51 psf a year. But it is already 5 per cent more expensive than London City, where occupancy costs came to $180US.80 psf a year.
Moscow is ranked fourth most expensive, at $180US.78 psf a year.
To facilitate comparisons across markets, the report based the most expensive rents on US dollars while rental growth was measured in local currency terms.
Singapore is ranked 11th on the world’s most expensive list, at $102US.37 ($148S.39) psf a year.
It came just after Hong Kong, where costs were at $106US.31 psf a year.
At $100.79 psf a year, rents for prime office space in New York’s Midtown have come down. Costs in Tokyo ranged from $154US.56 to $178US.61 psf a year.
As was the case with other key Asian financial centres such as Tokyo and Hong Kong, office vacancy rates remained low in Singapore at 5 per cent or less, said CBRE.
It noted that the uncertainty in global financial markets has had no discernible impact on demand for office space in Singapore.
The companies in Singapore that require larger spaces are largely from the fast-growing financial and insurance sectors. And before year-end, several sizeable bookings by companies in these two sectors are expected, CBRE said.
The report also echoed comments by property consultants about rising tenant resistance to rental hikes as rents are at record-high levels.
Companies are now more prepared to move to cheaper space further out of town to avoid paying high rents.
Source : Straits Times - 22 Nov 2007
Savills reveals that in the CBDs of Hong Kong and Singapore, Grade A rents are now the equivalent of $9.80 and $9.70 psf respectively.
AVERAGE island-wide Grade A rents are currently just a shade under those of Hong Kong, but the highest rents achieved by Hong Kong Grade ‘AAA’ office buildings are still about 1.8 times higher than the top rents achieved in comparable buildings here.
A report by Savills reveals that in the CBDs of Hong Kong and Singapore, Grade A rents are now the equivalent of $9.80 and $9.70 psf respectively.
However, top rents in Hong Kong’s Grade ‘AAA’ buildings like the International Financial Centre, Chater House and AIG Tower are closer to $32 psf while those in Singapore’s Republic Plaza, One Raffles Quay and 6 Battery Road are at about $17.50 psf.
Rising business costs have come under scrutiny recently and Savills Hong Kong senior director (research and consultancy) Simon Smith does say that there is the perception that Hong Kong and Singapore are in direct competition to attract businesses for this segment of the property market. However, he added: ‘I have not come across any financial institutions that have chosen to relocate from Singapore to Hong Kong yet.’
Indeed, Mr Smith believes that the financial institutions that are so important to the economies of both cities are more likely to set up offices in both cities to service different markets.
In terms of new supply of office space, Mr Smith does point out that Hong Kong will see some ‘AAA’ space become available next year in areas like West Kowloon where the 2.5 million sq ft International Commerce Centre (ICC) is set to open. The ICC is said to have attracted some major financial institutions already.
In contrast, Savills notes that the recently awarded commercial development sites including those at Marina View and Beach Road are expected to generate a combined 3 million sq ft of office space, scheduled for completion between 2010 and 2012.
But competition actually could come from more unlikely quarters.
Savills’ survey of regional office rents includes the emerging Vietnamese cities of Hanoi and Ho Chi Minh City and already average Grade A office rents in both cities have outpaced those in Shanghai and Beijing (but are still less than Tokyo, Hong Kong and Singapore).
Mr Smith believes that rising rents and 100 per cent occupancies in Hanoi and Ho Chi Minh City are largely due to the shortage of quality buildings in these cities, and hence adds: ‘There is a huge potential there for developers.’
Giving an insight into the pace of development there, he said: ‘Vietnam is much like China was in the 1990s, where companies were running their businesses out of hotel rooms. But when the market matures, rents will settle down.’
Savills believes the outlook for Singapore office sector remains positive, with rents continuing to rise, although at a slower pace for Grade A space due to ‘resistance from tenants’.
‘Demand from multinational companies for offices in suburban areas and high-tech space is expected to increase, especially by those who are more conscious of their bottom-line,’ it said.
Source : Business Times - 22 Nov 2007
A report by Savills reveals that in the CBDs of Hong Kong and Singapore, Grade A rents are now the equivalent of $9.80 and $9.70 psf respectively.
However, top rents in Hong Kong’s Grade ‘AAA’ buildings like the International Financial Centre, Chater House and AIG Tower are closer to $32 psf while those in Singapore’s Republic Plaza, One Raffles Quay and 6 Battery Road are at about $17.50 psf.
Rising business costs have come under scrutiny recently and Savills Hong Kong senior director (research and consultancy) Simon Smith does say that there is the perception that Hong Kong and Singapore are in direct competition to attract businesses for this segment of the property market. However, he added: ‘I have not come across any financial institutions that have chosen to relocate from Singapore to Hong Kong yet.’
Indeed, Mr Smith believes that the financial institutions that are so important to the economies of both cities are more likely to set up offices in both cities to service different markets.
In terms of new supply of office space, Mr Smith does point out that Hong Kong will see some ‘AAA’ space become available next year in areas like West Kowloon where the 2.5 million sq ft International Commerce Centre (ICC) is set to open. The ICC is said to have attracted some major financial institutions already.
In contrast, Savills notes that the recently awarded commercial development sites including those at Marina View and Beach Road are expected to generate a combined 3 million sq ft of office space, scheduled for completion between 2010 and 2012.
But competition actually could come from more unlikely quarters.
Savills’ survey of regional office rents includes the emerging Vietnamese cities of Hanoi and Ho Chi Minh City and already average Grade A office rents in both cities have outpaced those in Shanghai and Beijing (but are still less than Tokyo, Hong Kong and Singapore).
Mr Smith believes that rising rents and 100 per cent occupancies in Hanoi and Ho Chi Minh City are largely due to the shortage of quality buildings in these cities, and hence adds: ‘There is a huge potential there for developers.’
Giving an insight into the pace of development there, he said: ‘Vietnam is much like China was in the 1990s, where companies were running their businesses out of hotel rooms. But when the market matures, rents will settle down.’
Savills believes the outlook for Singapore office sector remains positive, with rents continuing to rise, although at a slower pace for Grade A space due to ‘resistance from tenants’.
‘Demand from multinational companies for offices in suburban areas and high-tech space is expected to increase, especially by those who are more conscious of their bottom-line,’ it said.
Source : Business Times - 22 Nov 2007
CapitaCommercial Trust (CCT), one of Singapore’s biggest office landlords
CapitaCommercial Trust (CCT), one of Singapore’s biggest office landlords, announced yesterday the establishment of a $1 billion multi-currency medium-term note (MTN) programme.
The programme was established by CCT MTN Pte Ltd - a wholly owned unit of CCT trustee HSBC Institutional Trust Services Singapore.
The MTN programme will allow CCT MTN to issue notes in series or tranches in any currency as may be agreed between the company and DBS Bank, the arranger and the dealer of the MTN programme.
CCT MTN may issue each series or tranche of notes in various amounts and tenors, which may bear fixed, floating or variable rates of interest.
It can also issue hybrid or zero coupon notes.
All sums payable in respect of the notes will be unconditionally and irrevocably guaranteed by the CCT trustee.
The programme has been given a ‘Baa1′ rating by Moody’s Investors Service.
The net proceeds from each notes issue will be onlent by CCT MTN to HSBC. The CCT trustee can use the funds to: refinance existing borrowings; finance or refinance its investments; lend to any trust, fund or entity in which it has an interest; finance or refinance any asset enhancement works initiated by itself or such trust, fund or entity in which it has an interest; and for its general working capital.
CCT said yesterday that it has applied to the Singapore Exchange for permission to deal in, and quotation for, any notes which are agreed at the time of issue to be listed.
CCT last month posted distributable income of $29.6 million for the third quarter ended Sept 30, 2007 - 13.5 per cent higher than its forecast based on a circular dated August last year, and a 52.4 per cent improvement from the same period last year.
CCT’s Singapore properties include 6 Battery Road, Capital Tower, Robinson Point, HSBC Building, StarHub Centre and the Golden Shoe and Market Street car parks, and a 60 per cent stake in the Raffles City complex.
CapitaMall Trust is the joint owner of Raffles City complex.
Source : Business Times - 21 Nov 2007
The programme was established by CCT MTN Pte Ltd - a wholly owned unit of CCT trustee HSBC Institutional Trust Services Singapore.
The MTN programme will allow CCT MTN to issue notes in series or tranches in any currency as may be agreed between the company and DBS Bank, the arranger and the dealer of the MTN programme.
CCT MTN may issue each series or tranche of notes in various amounts and tenors, which may bear fixed, floating or variable rates of interest.
It can also issue hybrid or zero coupon notes.
All sums payable in respect of the notes will be unconditionally and irrevocably guaranteed by the CCT trustee.
The programme has been given a ‘Baa1′ rating by Moody’s Investors Service.
The net proceeds from each notes issue will be onlent by CCT MTN to HSBC. The CCT trustee can use the funds to: refinance existing borrowings; finance or refinance its investments; lend to any trust, fund or entity in which it has an interest; finance or refinance any asset enhancement works initiated by itself or such trust, fund or entity in which it has an interest; and for its general working capital.
CCT said yesterday that it has applied to the Singapore Exchange for permission to deal in, and quotation for, any notes which are agreed at the time of issue to be listed.
CCT last month posted distributable income of $29.6 million for the third quarter ended Sept 30, 2007 - 13.5 per cent higher than its forecast based on a circular dated August last year, and a 52.4 per cent improvement from the same period last year.
CCT’s Singapore properties include 6 Battery Road, Capital Tower, Robinson Point, HSBC Building, StarHub Centre and the Golden Shoe and Market Street car parks, and a 60 per cent stake in the Raffles City complex.
CapitaMall Trust is the joint owner of Raffles City complex.
Source : Business Times - 21 Nov 2007
Thursday, November 22, 2007
Singapore’s office rents leapt 83 per cent in the past 12 months
Singapore’s office rents leapt 83 per cent in the past 12 months - the fastest rate in the world - as it shrugged off turmoil in global financial markets, commercial property consultancy CB Richard Ellis Research said.
The survey of office occupation costs in 171 cities worldwide showed that Singapore was followed by Russian capital Moscow, India’s financial capital Mumbai, the Philippines’ capital Manila and Norway’s capital Oslo.
‘The recent uncertainty in global financial markets has had no discernible impact on Singapore demand for office space,’ CB Richard Ellis Research (CBRE) said in its semi-annual Global Market Rents survey.
Office rents in Singapore rose to US$102.37 per square foot, making it the 11th most expensive business centre in the world, up from the 24th position in the August survey, CBRE said.
The survey showed London’s West End, Mumbai, the City of London and Moscow as the top four most expensive office markets in the world.
‘With (Singapore) rents at record levels, there is increasing tenant resistance to rental hikes, and occupiers are more prepared to explore lower cost locations and consider relocating to business parks or high-tech space,’ the survey said. — REUTERS
Source : Business Times - 22 Nov 2007
The survey of office occupation costs in 171 cities worldwide showed that Singapore was followed by Russian capital Moscow, India’s financial capital Mumbai, the Philippines’ capital Manila and Norway’s capital Oslo.
‘The recent uncertainty in global financial markets has had no discernible impact on Singapore demand for office space,’ CB Richard Ellis Research (CBRE) said in its semi-annual Global Market Rents survey.
Office rents in Singapore rose to US$102.37 per square foot, making it the 11th most expensive business centre in the world, up from the 24th position in the August survey, CBRE said.
The survey showed London’s West End, Mumbai, the City of London and Moscow as the top four most expensive office markets in the world.
‘With (Singapore) rents at record levels, there is increasing tenant resistance to rental hikes, and occupiers are more prepared to explore lower cost locations and consider relocating to business parks or high-tech space,’ the survey said. — REUTERS
Source : Business Times - 22 Nov 2007
London and Mumbai tenants paid the most for high-quality offices this year
London and Mumbai tenants paid the most for high-quality offices this year, while Singapore rents grew the fastest as economic growth lured international banks to Asia, said CB Richard Ellis Group Inc, the world’s largest commercial real estate broker.
London’s West End led with average annual rents of US$328.91 per square foot (psf) this month, compared with US$180.80 for the UK capital’s main financial district.
Mumbai had the second-most expensive leases at US$189.51, CB Richard Ellis said in its semi-annual Global Market Rents survey.
Asia’s booming economies drove up demand for financial and computing services in the region, catapulting Mumbai to second spot and fuelling Singapore’s 83 per cent growth in rents.
The US currency’s decline also drove up costs in dollar terms, while a dearth of new space bolstered London rents, CB Richard Ellis said.
‘Markets that moved up that quickly had the highest growth rates based on the economy’ as well as a scarcity of space, said Ray Wong, director of research operations for the Americas for Los Angeles-based CB Richard Ellis.
‘In the most expensive markets, if they’re close to their peak, the expectation for increase is marginal, but other markets, especially resource sectors, are enjoying an increase in demand so they’re going to move up a lot quicker.’
Mumbai’s rents rose 55 per cent, driven by computer related tenants, according to CB Richard Ellis.
Midtown Manhattan was the most expensive North American market, with rents averaging US$100.79 psf, 12th- highest worldwide. Downtown New York ranked 46th globally at US$53.47.
Moscow rents jumped 65 per cent after crude oil prices tripled in the past five years, bolstering the economy of the world’s second-biggest exporter of the fuel.
Rents in the oil hub of Edmonton, Canada, rose 43 per cent, the ninth- fastest worldwide, as energy companies leased more space to house expanding workforces, the survey showed. Edmonton did not rank in the top 50 markets by rental prices.
Eighty-five per cent of the 171 cities included in the survey saw rental increases in the year ended Sept 30, according to CB Richard Ellis. This bodes well for investment returns, Mr Wong said.
The survey measures the most expensive rents based on US dollars. Rental growth rates were measured in local currency terms. — Bloomberg
Source : Business Times - 22 Nov 2007
London’s West End led with average annual rents of US$328.91 per square foot (psf) this month, compared with US$180.80 for the UK capital’s main financial district.
Mumbai had the second-most expensive leases at US$189.51, CB Richard Ellis said in its semi-annual Global Market Rents survey.
Asia’s booming economies drove up demand for financial and computing services in the region, catapulting Mumbai to second spot and fuelling Singapore’s 83 per cent growth in rents.
The US currency’s decline also drove up costs in dollar terms, while a dearth of new space bolstered London rents, CB Richard Ellis said.
‘Markets that moved up that quickly had the highest growth rates based on the economy’ as well as a scarcity of space, said Ray Wong, director of research operations for the Americas for Los Angeles-based CB Richard Ellis.
‘In the most expensive markets, if they’re close to their peak, the expectation for increase is marginal, but other markets, especially resource sectors, are enjoying an increase in demand so they’re going to move up a lot quicker.’
Mumbai’s rents rose 55 per cent, driven by computer related tenants, according to CB Richard Ellis.
Midtown Manhattan was the most expensive North American market, with rents averaging US$100.79 psf, 12th- highest worldwide. Downtown New York ranked 46th globally at US$53.47.
Moscow rents jumped 65 per cent after crude oil prices tripled in the past five years, bolstering the economy of the world’s second-biggest exporter of the fuel.
Rents in the oil hub of Edmonton, Canada, rose 43 per cent, the ninth- fastest worldwide, as energy companies leased more space to house expanding workforces, the survey showed. Edmonton did not rank in the top 50 markets by rental prices.
Eighty-five per cent of the 171 cities included in the survey saw rental increases in the year ended Sept 30, according to CB Richard Ellis. This bodes well for investment returns, Mr Wong said.
The survey measures the most expensive rents based on US dollars. Rental growth rates were measured in local currency terms. — Bloomberg
Source : Business Times - 22 Nov 2007
Wednesday, November 14, 2007
Singapore office market
The new-found caution surrounding the Singapore office market is now spilling over to the Central Business District.
Reflecting this, a site at Marina View diagonally behind One Shenton yesterday attracted a top bid from Macquarie Global Property Advisors (MGPA) of $779.42 psf per plot ratio - only about half of the group’s winning bid in September for the site next door.
Knight Frank managing director Tan Tiong Cheng acknowledged that office investors have turned cautious. ‘The outcome of the sub-prime episode may have an impact on demand for office space in Singapore, while the government has expressly stated recently it will boost supply of office land in the next few years to alleviate the current shortage,’ he said.
Another reason for the lower bid for the latest site - Marina View Land Parcel B - is that it has a minimum hotel component of at least 25 per cent of the site’s maximum gross floor area, property consultants said. ‘Hotel land values are a lot lower than office values,’ said Mr Tan.
‘The latest tender outcome is also a knee jerk-reaction to what has been happening lately in the US - the sub-prime crisis being worse than initially thought and big banks being affected. Banks are prime users of office space.’
The only other bid at yesterday’s tender came from units of CapitaLand, at $898 million or $734.52 psf ppr.
BT understands that CapitaLand was to team up with Thai tycoon Charoen Sirivadhanabhakdi’s privately held vehicle Pacific Coast Assets, had its bid been successful.
By most counts, the top bid at yesterday’s tender by MGPA unit MGP Kimi of $952.89 million or $779 psf ppr was lower than had been predicted.
CB Richard Ellis executive director Li Hiaw Ho had expected Marina View Land Parcel B to fetch about $1,200 to $1,300 psf ppr, lower than the $1,409 psf ppr that an MGPA unit paid in September for the next door Marina View Land Parcel A, considering the minimum hotel component for the latest plot. ‘There is a chance that the state’s reserve price may not have been met and that the latest site may not be awarded,’ Mr Li suggests.
However, other property consultants argued that the plot will be awarded.
Mr Tan said his firm, Knight Frank, predicted in late July projected that the site would attract bids of $1.1 billion to $1.3 billion, or $900-1,060 psf ppr. ‘Taking the mid point of $1.2 billion, the top bid was about 20 per cent lower than our projection. To me that is within range, and I would expect the site to be awarded,’ Mr Tan said.
‘The price is still substantially higher than other sites sold in the Marina Bay area in recent years.’
Jones Lang LaSalle’s Asia Capital Markets head Stuart Crow said: ‘The price seems fair going by recent land bids and taking into account the hotel component for this site.’
MGPA’s top bid at yesterday’s tender also ‘reinforces the foreign investor interest in the Singapore property market fundamentals’, he added. ‘In my view, the site will be awarded.’
Mr Crow estimates that MGPA’s bid price for Parcel B yesterday reflects a break-even cost of about $2,200 to $2,300 psf for the office component of a potential development on the site. As for the hotel component, market watchers estimate the break-even cost could be about $700,000 to $800,000 per room.
Marina View Land Parcel B has a site area of about 0.9 hectare and can be developed into a maximum gross floor area (GFA) of about 1.22 million sq ft, of which at least 60 per cent must be for offices and at least another 25 per cent for hotel use.
Source : Business Times - 14 Nov 2007
Reflecting this, a site at Marina View diagonally behind One Shenton yesterday attracted a top bid from Macquarie Global Property Advisors (MGPA) of $779.42 psf per plot ratio - only about half of the group’s winning bid in September for the site next door.
Knight Frank managing director Tan Tiong Cheng acknowledged that office investors have turned cautious. ‘The outcome of the sub-prime episode may have an impact on demand for office space in Singapore, while the government has expressly stated recently it will boost supply of office land in the next few years to alleviate the current shortage,’ he said.
Another reason for the lower bid for the latest site - Marina View Land Parcel B - is that it has a minimum hotel component of at least 25 per cent of the site’s maximum gross floor area, property consultants said. ‘Hotel land values are a lot lower than office values,’ said Mr Tan.
‘The latest tender outcome is also a knee jerk-reaction to what has been happening lately in the US - the sub-prime crisis being worse than initially thought and big banks being affected. Banks are prime users of office space.’
The only other bid at yesterday’s tender came from units of CapitaLand, at $898 million or $734.52 psf ppr.
BT understands that CapitaLand was to team up with Thai tycoon Charoen Sirivadhanabhakdi’s privately held vehicle Pacific Coast Assets, had its bid been successful.
By most counts, the top bid at yesterday’s tender by MGPA unit MGP Kimi of $952.89 million or $779 psf ppr was lower than had been predicted.
CB Richard Ellis executive director Li Hiaw Ho had expected Marina View Land Parcel B to fetch about $1,200 to $1,300 psf ppr, lower than the $1,409 psf ppr that an MGPA unit paid in September for the next door Marina View Land Parcel A, considering the minimum hotel component for the latest plot. ‘There is a chance that the state’s reserve price may not have been met and that the latest site may not be awarded,’ Mr Li suggests.
However, other property consultants argued that the plot will be awarded.
Mr Tan said his firm, Knight Frank, predicted in late July projected that the site would attract bids of $1.1 billion to $1.3 billion, or $900-1,060 psf ppr. ‘Taking the mid point of $1.2 billion, the top bid was about 20 per cent lower than our projection. To me that is within range, and I would expect the site to be awarded,’ Mr Tan said.
‘The price is still substantially higher than other sites sold in the Marina Bay area in recent years.’
Jones Lang LaSalle’s Asia Capital Markets head Stuart Crow said: ‘The price seems fair going by recent land bids and taking into account the hotel component for this site.’
MGPA’s top bid at yesterday’s tender also ‘reinforces the foreign investor interest in the Singapore property market fundamentals’, he added. ‘In my view, the site will be awarded.’
Mr Crow estimates that MGPA’s bid price for Parcel B yesterday reflects a break-even cost of about $2,200 to $2,300 psf for the office component of a potential development on the site. As for the hotel component, market watchers estimate the break-even cost could be about $700,000 to $800,000 per room.
Marina View Land Parcel B has a site area of about 0.9 hectare and can be developed into a maximum gross floor area (GFA) of about 1.22 million sq ft, of which at least 60 per cent must be for offices and at least another 25 per cent for hotel use.
Source : Business Times - 14 Nov 2007
Saturday, November 10, 2007
Cushman & Wakefield found rent rises of up to 24 per cent over the past two years in the area
SOARING rents for retail office space at Raffles Place have stunned Ms Yeap Cheng Guat, the executive director of Cedele By Bakery Depot, which has two outlets in the major office hub.
‘Rents have gone up by 100 per cent. It’s that crazy,’ she said.
The bakery cafe chain has operated at Republic Plaza for about eight years now and has a newer outlet at One Raffles Quay.
Singapore’s office space crunch is spilling over to tenants like Cedele in office districts such as Raffles Place.
‘When they told me about the increase, I nearly fell off my chair,’ Ms Yeap said.
‘If my rentals rise by 100 per cent, can my food price increase by the same?
‘Then the tenant can sell only bird’s nest and abalone,’ she said, referring to expensive delicacies.
Occupancy levels for retail space such as cafes and fashion outlets in Raffles Place are close to 100 per cent.
A recent study by property consultant Cushman & Wakefield found rent rises of up to 24 per cent over the past two years in the area.
Supply of shop space is tight with no major new retail space expected for the financial district in the short term.
That means retail rents there will keep rising by another 10 to 15 per cent in the year ahead, the firm’s managing director here, Mr Donald Han, told The Straits Times. This is up from about 14 per cent in the last 12 months, he said.
The rise is relatively high, considering that rentals in the traditional shopping belt of Orchard Road have experienced single- digit rises in recent years.
Overall, rentals for prime retail space are expected to climb by 15 to 20 per cent year on year, with capital values up by 10 to 15 per cent, according to Knight Frank.
Ms Maye Kwok, 32, who sells bags and shoes from a ground-level shop at The Arcade, is convinced she will soon be paying higher rent.
‘Across the board, rents have gone up. My neighbours here have paid higher rents. I am 100 per cent sure they will raise the rent when my lease is up for revision.’
Mr Han said the office space crunch was affecting nearby retail space.
‘Most developers within the financial district prefer to maximise office use rather than retail,’ he said.
‘The irony is that when more offices are built, retail demand from the office population will grow in tandem.’
Most retail centres in Raffles Place such as OUB Centre, Raffles Xchange, One Fullerton and Republic Plaza are enjoying full occupancy.
Average gross rent for Raffles Place ground-level shops is between $18 and $35 per sq ft (psf) a month - well up from $13 to $25 psf two years ago.
Basement level space is between $12 and $25 psf a month, again well up from $9 to $18 psf two years back.
On the upper floors, which have less pedestrian traffic, rents hover between $8 and $14 psf a month, up from $6 to $9 psf a month two years ago.
As Raffles Place’s retail rents rise, several landlords have already started to either reposition their retail developments or add new retail supply, said Cushman & Wakefield.
Sino Land, the Hong Kong-based sister firm of property developer Far East Organization, recently announced plans to revamp a 26,000 sq ft retail and entertainment complex at Clifford Pier, a site that it had obtained late last year.
At OUB Centre, an additional 32,000 sq ft of retail space will be added, said Cushman & Wakefield.
It noted that newly retrofitted projects like the Market Street carpark have done well, with space nearly fully leased out at $10 to $25 psf a month.
‘The retail market situation in Raffles Place is coming to a level where nothing is available. This sub-market is being ignored when there is demand,’ said Mr Han.
Source : Straits Times - 8 Nov 2007
‘Rents have gone up by 100 per cent. It’s that crazy,’ she said.
The bakery cafe chain has operated at Republic Plaza for about eight years now and has a newer outlet at One Raffles Quay.
Singapore’s office space crunch is spilling over to tenants like Cedele in office districts such as Raffles Place.
‘When they told me about the increase, I nearly fell off my chair,’ Ms Yeap said.
‘If my rentals rise by 100 per cent, can my food price increase by the same?
‘Then the tenant can sell only bird’s nest and abalone,’ she said, referring to expensive delicacies.
Occupancy levels for retail space such as cafes and fashion outlets in Raffles Place are close to 100 per cent.
A recent study by property consultant Cushman & Wakefield found rent rises of up to 24 per cent over the past two years in the area.
Supply of shop space is tight with no major new retail space expected for the financial district in the short term.
That means retail rents there will keep rising by another 10 to 15 per cent in the year ahead, the firm’s managing director here, Mr Donald Han, told The Straits Times. This is up from about 14 per cent in the last 12 months, he said.
The rise is relatively high, considering that rentals in the traditional shopping belt of Orchard Road have experienced single- digit rises in recent years.
Overall, rentals for prime retail space are expected to climb by 15 to 20 per cent year on year, with capital values up by 10 to 15 per cent, according to Knight Frank.
Ms Maye Kwok, 32, who sells bags and shoes from a ground-level shop at The Arcade, is convinced she will soon be paying higher rent.
‘Across the board, rents have gone up. My neighbours here have paid higher rents. I am 100 per cent sure they will raise the rent when my lease is up for revision.’
Mr Han said the office space crunch was affecting nearby retail space.
‘Most developers within the financial district prefer to maximise office use rather than retail,’ he said.
‘The irony is that when more offices are built, retail demand from the office population will grow in tandem.’
Most retail centres in Raffles Place such as OUB Centre, Raffles Xchange, One Fullerton and Republic Plaza are enjoying full occupancy.
Average gross rent for Raffles Place ground-level shops is between $18 and $35 per sq ft (psf) a month - well up from $13 to $25 psf two years ago.
Basement level space is between $12 and $25 psf a month, again well up from $9 to $18 psf two years back.
On the upper floors, which have less pedestrian traffic, rents hover between $8 and $14 psf a month, up from $6 to $9 psf a month two years ago.
As Raffles Place’s retail rents rise, several landlords have already started to either reposition their retail developments or add new retail supply, said Cushman & Wakefield.
Sino Land, the Hong Kong-based sister firm of property developer Far East Organization, recently announced plans to revamp a 26,000 sq ft retail and entertainment complex at Clifford Pier, a site that it had obtained late last year.
At OUB Centre, an additional 32,000 sq ft of retail space will be added, said Cushman & Wakefield.
It noted that newly retrofitted projects like the Market Street carpark have done well, with space nearly fully leased out at $10 to $25 psf a month.
‘The retail market situation in Raffles Place is coming to a level where nothing is available. This sub-market is being ignored when there is demand,’ said Mr Han.
Source : Straits Times - 8 Nov 2007
Tender for a transitional office site in Tampines yesterday drew just one bid - from City Developments Ltd’s (CDL) unit Glades Properties.
In a possible reflection that caution among developers may be extending to the office sector, a tender for a transitional office site in Tampines yesterday drew just one bid - from City Developments Ltd’s (CDL) unit Glades Properties.
And its bid of $10 million, which worked out to $80.65 psf per plot ratio (ppr), was lower than the $100 psf ppr region that most property consultants had expected the 15-year leasehold site to fetch.
The government has indicated recently that it will inject more office space into the market soon - a step that could cool prices. Some felt that yesterday’s bidding reflected caution on part of the developers while others suggested Tampines may not be a popular location among office investors.
They pointed out that the next-door 99-year leasehold office site offered through a tender that closed in May this year had also drawn just one bid, again from CityDev, although at a more substantial price of $622 psf ppr.
The maiden 15-year leasehold transitional office plot next to Newton MRT station attracted a whopping 11 bids with a top price of $219 psf ppr in August.
Whether the weaker sentiment among office investors is confined to Tampines or is spreading to the Central Business District (CBD) as well will be seen in a tender closing on Nov 13 for Marina View Land Parcel B, a 99-year leasehold site with stipulated minimum office and hotel components.
Property consultants polled by BT unanimously expect URA to award the 124,000 sq ft transitional office site at Tampines Ave 5 to CDL, despite its bid being the sole offer and that too at a price lower than expected.
‘Government should make the award since as a transitional office site, it is part of the interim solution to the acute office shortage here. Otherwise, the government objective would not be met,’ Knight Frank managing director Tan Tiong Cheng reasoned.
The Urban Redevelopment Authority said yesterday in response to a query by BT that ‘the government will continue to release more transitional office sites to meet business needs; details on these sites will be released shortly’.
Colliers International director (research and consultancy) Tay Huey Ying said: ‘If the government releases more transitional office sites in or near the CBD, I believe demand will be healthy.’
She reckons the thin bidding for the Tampines plot yesterday may be due to concern among developers that strong office demand currently outside the CBD is the result of an overflow of demand from the CBD.
‘There may be concern that post-2010, when there will be a large influx of new office space being completed within the CBD, the spillover demand for suburban offices may recede,’ she added.
‘Next week’s tender for Marina View Land Parcel B will be interesting to watch, to see whether developers are also concerned about office supply in the CBD itself,’ she added.
CB Richard Ellis executive director Li Hiaw Ho said: ‘That is a much better site (than today’s Tampines plot), although I do not expect a lot of bidders because it is a huge site with a substantial outlay.’
Source : Business Times - 7 Nov 2007
And its bid of $10 million, which worked out to $80.65 psf per plot ratio (ppr), was lower than the $100 psf ppr region that most property consultants had expected the 15-year leasehold site to fetch.
The government has indicated recently that it will inject more office space into the market soon - a step that could cool prices. Some felt that yesterday’s bidding reflected caution on part of the developers while others suggested Tampines may not be a popular location among office investors.
They pointed out that the next-door 99-year leasehold office site offered through a tender that closed in May this year had also drawn just one bid, again from CityDev, although at a more substantial price of $622 psf ppr.
The maiden 15-year leasehold transitional office plot next to Newton MRT station attracted a whopping 11 bids with a top price of $219 psf ppr in August.
Whether the weaker sentiment among office investors is confined to Tampines or is spreading to the Central Business District (CBD) as well will be seen in a tender closing on Nov 13 for Marina View Land Parcel B, a 99-year leasehold site with stipulated minimum office and hotel components.
Property consultants polled by BT unanimously expect URA to award the 124,000 sq ft transitional office site at Tampines Ave 5 to CDL, despite its bid being the sole offer and that too at a price lower than expected.
‘Government should make the award since as a transitional office site, it is part of the interim solution to the acute office shortage here. Otherwise, the government objective would not be met,’ Knight Frank managing director Tan Tiong Cheng reasoned.
The Urban Redevelopment Authority said yesterday in response to a query by BT that ‘the government will continue to release more transitional office sites to meet business needs; details on these sites will be released shortly’.
Colliers International director (research and consultancy) Tay Huey Ying said: ‘If the government releases more transitional office sites in or near the CBD, I believe demand will be healthy.’
She reckons the thin bidding for the Tampines plot yesterday may be due to concern among developers that strong office demand currently outside the CBD is the result of an overflow of demand from the CBD.
‘There may be concern that post-2010, when there will be a large influx of new office space being completed within the CBD, the spillover demand for suburban offices may recede,’ she added.
‘Next week’s tender for Marina View Land Parcel B will be interesting to watch, to see whether developers are also concerned about office supply in the CBD itself,’ she added.
CB Richard Ellis executive director Li Hiaw Ho said: ‘That is a much better site (than today’s Tampines plot), although I do not expect a lot of bidders because it is a huge site with a substantial outlay.’
Source : Business Times - 7 Nov 2007
A PROPERTY fund that won the tender for a leasehold office plot on Anson Road has roped in construction group Lum Chang Holdings to jointly develop
A PROPERTY fund that won the tender for a leasehold office plot on Anson Road has roped in construction group Lum Chang Holdings to jointly develop the site.
Lum Chang will take a 5 per cent stake in Firstoffice, a vehicle set up to develop the land.
The remaining 95 per cent is held by Homerun 28, a wholly-owned subsidiary of LaSalle Asia Opportunity Fund III.
The total development cost, including the land, is estimated at $379.2 million.
Lum Chang has been appointed the main contractor for the $82.5 million contract to build a 20-storey office tower on the land next to International Plaza.
When completed by end-2009, the 99-year leasehold property is expected to yield 200,208 sq ft of net lettable office space and 1,668 sq ft of carpark space.
Given the rising demand and shortage of prime office space, the project is expected to draw keen interest from multinational tenants looking for Grade A offices near the Tanjong Pagar MRT station, said Lum Chang in a statement.
LaSalle won the tender with a top offer of $237.2 million in a government tender in August.
The Anson Road site is the maiden Singapore investment for LaSalle Asia Opportunity Fund III, which is planning to make about $12US billion ($17S.4 billion) worth of acquisitions over the next three to four years. The fund is part of the Jones Lang LaSalle group.
Source : Straits Times - 7 Nov 2007
Lum Chang will take a 5 per cent stake in Firstoffice, a vehicle set up to develop the land.
The remaining 95 per cent is held by Homerun 28, a wholly-owned subsidiary of LaSalle Asia Opportunity Fund III.
The total development cost, including the land, is estimated at $379.2 million.
Lum Chang has been appointed the main contractor for the $82.5 million contract to build a 20-storey office tower on the land next to International Plaza.
When completed by end-2009, the 99-year leasehold property is expected to yield 200,208 sq ft of net lettable office space and 1,668 sq ft of carpark space.
Given the rising demand and shortage of prime office space, the project is expected to draw keen interest from multinational tenants looking for Grade A offices near the Tanjong Pagar MRT station, said Lum Chang in a statement.
LaSalle won the tender with a top offer of $237.2 million in a government tender in August.
The Anson Road site is the maiden Singapore investment for LaSalle Asia Opportunity Fund III, which is planning to make about $12US billion ($17S.4 billion) worth of acquisitions over the next three to four years. The fund is part of the Jones Lang LaSalle group.
Source : Straits Times - 7 Nov 2007
Monday, November 5, 2007
Gross allocation of ready- built space in JTC’s business parks almost doubled to 5,300 sq m in the third quarter.
THE take-up among businesses for JTC Corp’s ready-built facilities is at a two-year high.
Net allocation of such industrial space stood at 75,100 sq m in the July to September quarter - 29 per cent more than in the previous quarter and the highest since the third quarter of 2005.
This increase in take-up from the industrial landlord was due mainly to good demand for factory space and business park space.
Gross allocation of ready- built space in JTC’s business parks almost doubled to 5,300 sq m in the third quarter.
If the amount of space given up is taken into account, the net amount of business park space taken up stood at 1,800 sq m for the third quarter, more than double the figure achieved from April to June.
Occupancy of JTC’s business parks was 94 per cent as at the end of September.
The net take-up of JTC’s prepared industrial land stood at 55.9ha in the quarter.
This is 13 per cent down from the previous quarter but still more than twice the figure achieved in the third quarter of last year.
Such land - which has road access, drains, water and sewer mains so companies can develop their own facilities - is provided both inside and outside specialised parks such as Changi Business Park, International Business Park in Jurong East and Biopolis at one-north in Buona Vista.
JTC said demand came mostly from companies dealing in logistics, precision engineering and services.
Meanwhile, consultants expect more companies to consider moving operations from the Central Business District (CBD) as office rentals soar.
Rents grew 14.8 per cent in the third quarter and have shot up more than 40 per cent since the end of last year.
The director of research and consultancy at Colliers International, Ms Tay Huey Ying, said: ‘We are seeing firms that are more prepared to consider alternative business premises other than office space within the CBD.’
Companies providing management services or those in the insurance, design or aviation sectors, for example, have already made the move out or are preparing to do so, she said.
Ms Tay expects the trend to continue until more prime office space is added from 2010, mainly at Marina Bay.
Meanwhile, JTC said that the first phase of its research and development complex, Fusionopolis in one-north, is expected to be completed by the end of this year. It will offer about 120,730 sq m of business park space.
Source : Straits Times - 3 Nov 2007
Net allocation of such industrial space stood at 75,100 sq m in the July to September quarter - 29 per cent more than in the previous quarter and the highest since the third quarter of 2005.
This increase in take-up from the industrial landlord was due mainly to good demand for factory space and business park space.
Gross allocation of ready- built space in JTC’s business parks almost doubled to 5,300 sq m in the third quarter.
If the amount of space given up is taken into account, the net amount of business park space taken up stood at 1,800 sq m for the third quarter, more than double the figure achieved from April to June.
Occupancy of JTC’s business parks was 94 per cent as at the end of September.
The net take-up of JTC’s prepared industrial land stood at 55.9ha in the quarter.
This is 13 per cent down from the previous quarter but still more than twice the figure achieved in the third quarter of last year.
Such land - which has road access, drains, water and sewer mains so companies can develop their own facilities - is provided both inside and outside specialised parks such as Changi Business Park, International Business Park in Jurong East and Biopolis at one-north in Buona Vista.
JTC said demand came mostly from companies dealing in logistics, precision engineering and services.
Meanwhile, consultants expect more companies to consider moving operations from the Central Business District (CBD) as office rentals soar.
Rents grew 14.8 per cent in the third quarter and have shot up more than 40 per cent since the end of last year.
The director of research and consultancy at Colliers International, Ms Tay Huey Ying, said: ‘We are seeing firms that are more prepared to consider alternative business premises other than office space within the CBD.’
Companies providing management services or those in the insurance, design or aviation sectors, for example, have already made the move out or are preparing to do so, she said.
Ms Tay expects the trend to continue until more prime office space is added from 2010, mainly at Marina Bay.
Meanwhile, JTC said that the first phase of its research and development complex, Fusionopolis in one-north, is expected to be completed by the end of this year. It will offer about 120,730 sq m of business park space.
Source : Straits Times - 3 Nov 2007
Friday, October 26, 2007
RISING office rentals is the biggest concern among Norwegian-owned businesses operating in Singapore.
RISING office rentals is the biggest concern among Norwegian-owned businesses operating in Singapore.
While 88 per cent of these firms expect to expand in the next 12 months, many are increasingly concerned about spiralling business and manpower costs.
The findings came from a recent survey conducted by the Norwegian Business Association in Singapore over the past six weeks.
The respondents were from 60 Norwegian companies, with more than half having an annual turnover of over $50 million.
A total of 24.4 per cent of the respondents said office rentals were their main concern, while 22.6 per cent cited rising wage bills.
A further 20.2 per cent said they were worried about the recent steep rises in living costs.
The survey findings - which were presented at the Norway Asia Business Conference held in Singapore yesterday - echoed those of a poll released by the American Chamber of Commerce in June.
This showed that rising rents and housing costs are becoming more of a worry for senior executives at American firms in the Republic.
Economic Development Board (EDB) managing director Ko Kheng Hwa addressed the rents issue at the conference, saying the EDB and the Government are ‘very concerned’ about business competitiveness and are working to increase the supply of commercial and residential space.
Mr Ko, the conference’s keynote speaker, added: ‘When supply and demand are better matched in the next couple of years, the cost escalation should be moderated.’
Norway is the sixth-largest foreign investor in Singapore, with a total foreign direct investment of $7.9 billion in 2005 - the latest year for which figures are available.
It is the fourth-largest European investor in Singapore behind Britain, the Netherlands and Switzerland.
There are more than 150 Norwegian business entities in the Republic.
Source : Straits Times - 26 Oct 2007
While 88 per cent of these firms expect to expand in the next 12 months, many are increasingly concerned about spiralling business and manpower costs.
The findings came from a recent survey conducted by the Norwegian Business Association in Singapore over the past six weeks.
The respondents were from 60 Norwegian companies, with more than half having an annual turnover of over $50 million.
A total of 24.4 per cent of the respondents said office rentals were their main concern, while 22.6 per cent cited rising wage bills.
A further 20.2 per cent said they were worried about the recent steep rises in living costs.
The survey findings - which were presented at the Norway Asia Business Conference held in Singapore yesterday - echoed those of a poll released by the American Chamber of Commerce in June.
This showed that rising rents and housing costs are becoming more of a worry for senior executives at American firms in the Republic.
Economic Development Board (EDB) managing director Ko Kheng Hwa addressed the rents issue at the conference, saying the EDB and the Government are ‘very concerned’ about business competitiveness and are working to increase the supply of commercial and residential space.
Mr Ko, the conference’s keynote speaker, added: ‘When supply and demand are better matched in the next couple of years, the cost escalation should be moderated.’
Norway is the sixth-largest foreign investor in Singapore, with a total foreign direct investment of $7.9 billion in 2005 - the latest year for which figures are available.
It is the fourth-largest European investor in Singapore behind Britain, the Netherlands and Switzerland.
There are more than 150 Norwegian business entities in the Republic.
Source : Straits Times - 26 Oct 2007
Higher rents in the Central Business District (CBD) are forcing companies to re-configure their current space
Higher rents in the Central Business District (CBD) are forcing companies to re-configure their current space, or consider shifting part of their operations to other locations.
To meet demand, the government is releasing transitional office sites into the market.
But property watchers say demand remains strong and rents will continue to push upwards.
Property firm Savills can now fit another 10 staff into its Shaw House office at Orchard Road.
It did so simply by halving its reception area.
Like Savills, more companies are reconfiguring their offices to maximise use of space and keep costs down.
Ku Swee Yong, Director, International Marketing, Savills, says: “There is still a lot more scope to restructure office space usage in the CBD - Shenton Way, Robinsons Road, Raffles Place. Many of these so called lower value type of work that probably is not customer facing, for example backroom operations, IT, maybe even administrative, human resource, transaction processing work, could be moved out of the CBD office.”
The government is releasing transitional office sites to help meet demand.
Property watchers say there are sites near the CBD which could be opened up.
Last Friday, the government released a site the size of two football fields at Upper Aljunied.
Mr Ku says: “So if you drive around town, you will see a few more properties, you will see a few more land parcels, just vacant grass land which could be potentially very attractive - for example next to Central Mall, Havelock Road. These sites I think would be a lot more attractive to the MNCs and the financial services industries.”
Consultants say transitional office sites will have little impact on rents in the CBD as they merely absorb low rent-yielding tenants so they can make way for companies who are willing to pay the higher rents.
They might, however, slow down the rate of increase.
Office rents in the CBD have shot up by 60 to 70 percent in the last 12 months.
Donald Han, Managing Director, Cushman & Wakefield, says: “Singapore is being recognised as a hub to position your original business in Southeast Asia as well as the Asian region, so more and more companies are demanding more space and expanding their operations. We are generally looking at almost every company (seeking) a minimal of 20 to 30 percent expansion of space upon every lease expiry, so that adds on to the pressure in terms of demand. So we think that this year, we expect net demand to be 3 to 3.5 million square feet.”
Analysts say Singapore needs about 2 million square feet of office space a year for the next 4 years but supply is estimated at just about half of that.
Source : ChannelNewsAsia - 25 Oct 2007
To meet demand, the government is releasing transitional office sites into the market.
But property watchers say demand remains strong and rents will continue to push upwards.
Property firm Savills can now fit another 10 staff into its Shaw House office at Orchard Road.
It did so simply by halving its reception area.
Like Savills, more companies are reconfiguring their offices to maximise use of space and keep costs down.
Ku Swee Yong, Director, International Marketing, Savills, says: “There is still a lot more scope to restructure office space usage in the CBD - Shenton Way, Robinsons Road, Raffles Place. Many of these so called lower value type of work that probably is not customer facing, for example backroom operations, IT, maybe even administrative, human resource, transaction processing work, could be moved out of the CBD office.”
The government is releasing transitional office sites to help meet demand.
Property watchers say there are sites near the CBD which could be opened up.
Last Friday, the government released a site the size of two football fields at Upper Aljunied.
Mr Ku says: “So if you drive around town, you will see a few more properties, you will see a few more land parcels, just vacant grass land which could be potentially very attractive - for example next to Central Mall, Havelock Road. These sites I think would be a lot more attractive to the MNCs and the financial services industries.”
Consultants say transitional office sites will have little impact on rents in the CBD as they merely absorb low rent-yielding tenants so they can make way for companies who are willing to pay the higher rents.
They might, however, slow down the rate of increase.
Office rents in the CBD have shot up by 60 to 70 percent in the last 12 months.
Donald Han, Managing Director, Cushman & Wakefield, says: “Singapore is being recognised as a hub to position your original business in Southeast Asia as well as the Asian region, so more and more companies are demanding more space and expanding their operations. We are generally looking at almost every company (seeking) a minimal of 20 to 30 percent expansion of space upon every lease expiry, so that adds on to the pressure in terms of demand. So we think that this year, we expect net demand to be 3 to 3.5 million square feet.”
Analysts say Singapore needs about 2 million square feet of office space a year for the next 4 years but supply is estimated at just about half of that.
Source : ChannelNewsAsia - 25 Oct 2007
Monday, October 22, 2007
EQUATION Corp has clinched a state property at Bukit Ho Swee for the stately rent of $90,000 a month.
EQUATION Corp has clinched a state property at Bukit Ho Swee for the stately rent of $90,000 a month. The Singapore Land Authority (SLA), which manages the property, said that this is twice the guide rent when the former community centre was put up for tender in June.
The building is on 40,892 sq ft of land and has a gross floor area of 27,361 sq ft. At $90,000 a month, the rent works out to $3.30 per sq ft (psf) per month. Deloitte & Touche Management Services put in the second highest bid of $54,700 a month.
Equation Corp - formerly Heshe Holdings - could not be reached for comment. But another company that clinched two other state buildings - a former childcare centre in Balestier and a former school at Toa Payoh - said that it is likely to offer these as office space.
Vita Holdings chief financial officer Kwek Siew Hwee said that her company has leased about a dozen state buildings and rented out 80 per cent of the space to tenants. Vita, through its subsidiary Whitehouse Holdings, bid $101,788 a month for the former school at Toa Payoh. After refurbishing the building, it hopes to achieve rent of $5-6 psf per month. ‘We expect to recover our cost in about six years,’ Ms Kwek said.
Whether Equation Corp plans to rent out the former community centre at Bukit Ho Swee is not known, but Savills Singapore director (commercial) June Chua reckoned that the space could fetch $8-9 psf a month after it is refurbished. Proximity to Tiong Bahru MRT station is its main attribute, she said, adding: ‘This site could fetch a premium because it’s an established office location.’
The rent may seem high considering that average prime office rent is $12-13 psf a month. But the supply crunch is exerting increasing upward pressure on rents, Ms Chua said.
Rents for some prime buildings in Raffles Place have now hit a record $18 psf per month. ‘It would not be impossible for some of these prime properties in Raffles Place to cross the $20 psf a month barrier next year,’ she said.
Other bids received by SLA include $288,999 a month or $1.30 psf per month from RichZone Properties for a former school in Alexandra Road, and $200,000 a month or $1.25 psf per month from Hean Nerng Investments for the former Gan Eng Seng School at Raeburn Park.
Source : Business Times - 20 Oct 2007
The building is on 40,892 sq ft of land and has a gross floor area of 27,361 sq ft. At $90,000 a month, the rent works out to $3.30 per sq ft (psf) per month. Deloitte & Touche Management Services put in the second highest bid of $54,700 a month.
Equation Corp - formerly Heshe Holdings - could not be reached for comment. But another company that clinched two other state buildings - a former childcare centre in Balestier and a former school at Toa Payoh - said that it is likely to offer these as office space.
Vita Holdings chief financial officer Kwek Siew Hwee said that her company has leased about a dozen state buildings and rented out 80 per cent of the space to tenants. Vita, through its subsidiary Whitehouse Holdings, bid $101,788 a month for the former school at Toa Payoh. After refurbishing the building, it hopes to achieve rent of $5-6 psf per month. ‘We expect to recover our cost in about six years,’ Ms Kwek said.
Whether Equation Corp plans to rent out the former community centre at Bukit Ho Swee is not known, but Savills Singapore director (commercial) June Chua reckoned that the space could fetch $8-9 psf a month after it is refurbished. Proximity to Tiong Bahru MRT station is its main attribute, she said, adding: ‘This site could fetch a premium because it’s an established office location.’
The rent may seem high considering that average prime office rent is $12-13 psf a month. But the supply crunch is exerting increasing upward pressure on rents, Ms Chua said.
Rents for some prime buildings in Raffles Place have now hit a record $18 psf per month. ‘It would not be impossible for some of these prime properties in Raffles Place to cross the $20 psf a month barrier next year,’ she said.
Other bids received by SLA include $288,999 a month or $1.30 psf per month from RichZone Properties for a former school in Alexandra Road, and $200,000 a month or $1.25 psf per month from Hean Nerng Investments for the former Gan Eng Seng School at Raeburn Park.
Source : Business Times - 20 Oct 2007
THE Singapore Land Authority (SLA) has launched another site for short-term office use, a move aimed at relieving the supply crunch.
THE Singapore Land Authority (SLA) has launched another site for short-term office use, a move aimed at relieving the supply crunch.
The property is the former Upper Aljunied Technical School on Upper Aljunied Road. It has a land area of 19,704 sq m and a gross floor area of 7,722 sq m.
It comes with a guide rental of $74,100 a month or $9.60 per sq m, with the tenancy renewable up to 2012.
The SLA says property and leasing companies have already expressed interest.
It has put out various state properties as interim sites this year, including former childcare centres, and more are being identified in suburban areas or away from the Central Business District.
This was a response to the tight office market and soaring rents in prime areas, which are driving some tenants to seek cheaper locations further from town.
In the residential market, two more collective sale sites have been put on the market.
The bigger plot is Cavenagh Gardens on Cavenagh Road, near the Istana. Owners at the estate, a 130,000 sq ft freehold site, want $619 million, or $2,308 per sq ft of potential gross floor area.
PropNex, which is marketing the site, has applied for permission to amalgamate a piece of state land.
If this is allowed, the combined site will cost $770 million, excluding about $72.8 million for the state land. The cost will be higher in this case because whoever buys the combined site will be able to build a bigger project.
If the amalgamation is not allowed, developers will be restricted to a smaller project of up to seven storeys, said PropNex.
PropNex said the buyer could instead keep and revamp two existing blocks, which have 13 storeys each, but they would have to apply for permission to retain them. The tender closes on Nov 23.
The agent also put up the freehold Novena Hill in Novena for sale yesterday at a price of $56 million to $60 million, or up to $1,777 per sq ft of potential gross floor area. The tender closes on Nov 16.
Source : Straits Times - 20 Oct 2007
The property is the former Upper Aljunied Technical School on Upper Aljunied Road. It has a land area of 19,704 sq m and a gross floor area of 7,722 sq m.
It comes with a guide rental of $74,100 a month or $9.60 per sq m, with the tenancy renewable up to 2012.
The SLA says property and leasing companies have already expressed interest.
It has put out various state properties as interim sites this year, including former childcare centres, and more are being identified in suburban areas or away from the Central Business District.
This was a response to the tight office market and soaring rents in prime areas, which are driving some tenants to seek cheaper locations further from town.
In the residential market, two more collective sale sites have been put on the market.
The bigger plot is Cavenagh Gardens on Cavenagh Road, near the Istana. Owners at the estate, a 130,000 sq ft freehold site, want $619 million, or $2,308 per sq ft of potential gross floor area.
PropNex, which is marketing the site, has applied for permission to amalgamate a piece of state land.
If this is allowed, the combined site will cost $770 million, excluding about $72.8 million for the state land. The cost will be higher in this case because whoever buys the combined site will be able to build a bigger project.
If the amalgamation is not allowed, developers will be restricted to a smaller project of up to seven storeys, said PropNex.
PropNex said the buyer could instead keep and revamp two existing blocks, which have 13 storeys each, but they would have to apply for permission to retain them. The tender closes on Nov 23.
The agent also put up the freehold Novena Hill in Novena for sale yesterday at a price of $56 million to $60 million, or up to $1,777 per sq ft of potential gross floor area. The tender closes on Nov 16.
Source : Straits Times - 20 Oct 2007
Friday, October 19, 2007
When You Can't Change Your Office
When You Can't Change Your Office
Not everyone has the luxury of selecting his or her own office building or work room. Unless you own your own company, chances are, we take what we are given – in this case, sit where we are allocated. Placing your door in the right sector, using the right room, facing the right direction – ideal as it may be; what happens when your boss has not heard of Feng Shui or does not subscribe to it?
All is not lost. Here's what you, the good employee, can do for yourself using the knowledge of House Gua and Life Gua.
Find out what direction your office building faces. All you need is a compass. Having done that, plot out the Eight Mansions chart for your office space. You don't necessarily need the floor plan just observe carefully:
- The main door sector
- The sector you (and fellow colleagues) are in.
Now, let's say you find out that the main door opens at the ‘Wu Gui' sector. That might explain why the previous two accountants had their services terminated under suspicious circumstances.
Your work area lies mainly in the ‘Liu Sha' sector. Does that explain all the backbiting and animosity amongst your workmates? Well of course, if it were ‘Jue Ming' we are talking about, chances are, everyone would be too tired and disorganized to be gossiping in the first place.
Having discovered all this information, what next?
Next to the office, what's the next place we spend most of our time?
Can you guess it? Our house of course.
Let's say you work with hostile colleagues, how do you compensate? Sleeping in a ‘Yan Nian' room can give you the ease of character to deal with them, help you to laugh them off. Everyone is already so uptight; why would you want to add to those numbers?
Now let's say one vindictive co-worker is back-stabbing you to the boss, and you realise that being cheerful and friendly failed to mellow this difficult person. Change your strategy – sleep toward your ‘Tian Yi' direction (or in the ‘Tian Yi' room of your house). This not only lends you strength to deal with higher stress levels, ‘Tian Yi' is also the ‘Nobleman star' – you want your boss to stop listening to falsehoods and start noticing all your hard work and effort. You want the promotion (and it should rightfully go to you).
Or you find that your office is not conducive for your work – you are the sales person but your energy is dwindling (let's say your work area is the ‘Fu Wei' which makes you inappropriately introspective instead). Sleep toward your ‘Sheng Qi' direction at home. One word of caution though, some people find it difficult to sleep in a ‘Sheng Qi' room – they become more active instead of dozing off!
n Feng Shui, there are many ways to manage the Qi that is affecting you; be it in the home or the office. Of course, the ideal way would be to align ourselves in the path of good Qi, but that is a privilege not available to everyone. Adjusting ‘Human actions' then becomes the next feasible option. Remember that Destiny is subjected to not only ‘Heaven' and ‘Earth', but also ‘Man'. When you know that your environment is already hostile (due to certain Qi influences), a little patience may be all you need to ‘rise above the rest'.
Not everyone has the luxury of selecting his or her own office building or work room. Unless you own your own company, chances are, we take what we are given – in this case, sit where we are allocated. Placing your door in the right sector, using the right room, facing the right direction – ideal as it may be; what happens when your boss has not heard of Feng Shui or does not subscribe to it?
All is not lost. Here's what you, the good employee, can do for yourself using the knowledge of House Gua and Life Gua.
Find out what direction your office building faces. All you need is a compass. Having done that, plot out the Eight Mansions chart for your office space. You don't necessarily need the floor plan just observe carefully:
- The main door sector
- The sector you (and fellow colleagues) are in.
Now, let's say you find out that the main door opens at the ‘Wu Gui' sector. That might explain why the previous two accountants had their services terminated under suspicious circumstances.
Your work area lies mainly in the ‘Liu Sha' sector. Does that explain all the backbiting and animosity amongst your workmates? Well of course, if it were ‘Jue Ming' we are talking about, chances are, everyone would be too tired and disorganized to be gossiping in the first place.
Having discovered all this information, what next?
Next to the office, what's the next place we spend most of our time?
Can you guess it? Our house of course.
Let's say you work with hostile colleagues, how do you compensate? Sleeping in a ‘Yan Nian' room can give you the ease of character to deal with them, help you to laugh them off. Everyone is already so uptight; why would you want to add to those numbers?
Now let's say one vindictive co-worker is back-stabbing you to the boss, and you realise that being cheerful and friendly failed to mellow this difficult person. Change your strategy – sleep toward your ‘Tian Yi' direction (or in the ‘Tian Yi' room of your house). This not only lends you strength to deal with higher stress levels, ‘Tian Yi' is also the ‘Nobleman star' – you want your boss to stop listening to falsehoods and start noticing all your hard work and effort. You want the promotion (and it should rightfully go to you).
Or you find that your office is not conducive for your work – you are the sales person but your energy is dwindling (let's say your work area is the ‘Fu Wei' which makes you inappropriately introspective instead). Sleep toward your ‘Sheng Qi' direction at home. One word of caution though, some people find it difficult to sleep in a ‘Sheng Qi' room – they become more active instead of dozing off!
n Feng Shui, there are many ways to manage the Qi that is affecting you; be it in the home or the office. Of course, the ideal way would be to align ourselves in the path of good Qi, but that is a privilege not available to everyone. Adjusting ‘Human actions' then becomes the next feasible option. Remember that Destiny is subjected to not only ‘Heaven' and ‘Earth', but also ‘Man'. When you know that your environment is already hostile (due to certain Qi influences), a little patience may be all you need to ‘rise above the rest'.
THE office market can be expected to continue teeming with deals, with the latest offering said to be the Singapore Power Building behind Somerset MRT
THE office market can be expected to continue teeming with deals, with the latest offering said to be the Singapore Power Building behind Somerset MRT Station. The 30-year-old building, once known as PUB Building, is being marketed through an expression-of-interest exercise, BT understands.
Market watchers expect the leasehold property to fetch about $1,800 per sq ft of net lettable area (NLA), which works out to $990 million based on the 17-storey building’s NLA of around 550,000 sq ft.
SingPower Building, completed in 1977 and refurbished last year, is on a site with a remaining lease of 67 years.
The building is being put up for sale by owners SingPower and Public Utilities Board. The latter moved out earlier this year. SingPower occupies some 200,000 sq ft, while the rest of the space is leased to other tenants.
SingPower is expected to structure a deal to lease back the space it occupies from the new buyer
Industry sources say SingPower Building’s existing gross floor area reflects a 7.0 plot ratio - the ratio of maximum potential gross floor area to land area. This exceeds the 4.9 plot ratio indicated in Master Plan 2003. The site area is about 110,000 sq ft.
However, there may be a possibility of redeveloping the property in the medium term by building a more efficient modern structure, after existing leases expire.
SingPower Building has two basements with a total of 530 parking lots. There is also an auditorium for public use.
The building was originally developed for $32 million. It was clad in silvery metal when refurbished last year.
The building was described as a ‘ground-scraper’ - two parallel slab blocks facing north and south connected by a lift and stair core - in an article in The Straits Times in August this year. Between the two blocks is a landscaped court.
If SingPower Building changes hands for around $990 million, it will be one of the biggest office deals so far this year, along with the $1.04 billion sale of Temasek Tower to a fund managed by Macquarie Global Property Advisors in March, and the sales of separate one-third stakes in One Raffles Quay to K-Reit Asia and Suntec Reit for $941.5 million each.
In late August, CapitaLand, IP Property Fund Asia and NTUC Income Insurance Co-op sold the leasehold Chevron House, formerly Caltex House, at Raffles Place, for $730 million or a record $2,780 psf of NLA. The buyer is understood to be a Goldman Sachs-linked fund.
The Goldman Sachs group is also understood to be finalising a deal to buy the next-door Hitachi Tower, a 37-storey office tower on a 999-year leasehold site facing Collyer Quay.
The price is expected to be around $3,000 psf.
Hitachi Tower is 50:50 owned by CapitaLand and National University of Singapore.
Source : Business Times - 18 Oct 2007
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