JTC factories in Kadut, Yew Tee, Kranji face relocation

Businesses located in JTC-owned factories in the Sungei Kadut, Yew Tee and Kranji areas may have to relocate as part of changes Singapore will undergo according to a new Master Plan that is still in a draft stage.

The industrial property landlord and developer said yesterday that it will assist firms through the process of relocation.

"We will definitely come in to facilitate. In terms of the timing, that's where we need to be practical and realistic and we need to accord sufficient time for the phasing out to happen," said JTC assistant chief executive officer of Cluster Development Group 2, Eunice Koh.

She added that there will be clarity only in the year 2015 on what the Master Plan would entail for the three industrial estates, as the review of the plan is still ongoing.

On whether it is certain that all firms currently located in the three areas will have to relocate, Ms Koh said: "We don't know the extent until 2015."

The industrial estates at Sungei Kadut, Yew Tee and Kranji together house the operations of many firms from the furniture, timber, construction and engineering industries. JTC said that it currently does not have details on the number of firms with operations in these industrial estates.

Ms Koh's comments were made yesterday after JTC held a closed-door meeting with some industrialists who have their firms in the affected areas, at the Singapore Chinese Chamber of Commerce and Industry (SCCCI). The chamber helped to facilitate discussions between JTC, the industrialists and their respective trade associations.

JTC is now working to help 116 firms whose leases expire between next year and 2019. The affected industrialists are worried about their future because of the uncertainty over the renewal of their leases. The Master Plan, which decides how land will be used in the future, is still in the works, although a draft is being made public today.

At yesterday's meeting, JTC said the affected firms can apply to extend their leases until 2020.

To do so, companies will have to fill in a one-page form. A JTC officer will then engage the individual firms and assess their application.

Criteria that they will be assessed on include their value added and productivity projections over a three-year period, which starts from the time the lease extension is granted.

Said JTC's Ms Koh: "There must be a productivity increment, so they have to declare it and at the end of three years we have to look at it again."

"We are looking at whatever the members are achieving (currently), plus a certain growth. That is a reasonably achievable level . . . It is the spirit of improvement that we are trying to encourage."

Ms Koh added that JTC hopes to process all applications by June next year.

SCCCI president Thomas Chua said that industries such as the furniture and timber sectors are very happy with JTC's gesture.

At the very least, it gives industrialists a timeline so that they can continue to make plans for the business, said Mr Chua in Mandarin. "We have come to a happy conclusion."

Freddie Ng, president of the Singapore Timber Association, said: "Most of our members' leases expire in 2015 and 2016, so actually this is quite urgent . . . In view of (how) the Master Plan is still on review, JTC has come up with this solution to extend (our lease) to 2020, of course with certain criteria . . . so my members are definitely aware that they have to pay attention to productivity and value add."

He added that JTC's offer is "very welcome" news because from now to 2020, my members have seven years to plan to bring in what is necessary to do value adding".

Of the 116 firms whose leases are up in the next six years, 76 are from the timber trade.

Tony Pang, assistant honorary secretary at the Singapore Furniture Industries Council, said that the five affected furniture firms - which include his company V-Mark Woodcraft - will now be able to continue with their business plans knowing that they have seven years, up till 2020, to work with.

The offer to extend their leases means that the firms can "still continue with their business knowing that there is seven years to play with", said Mr Pang.

"They can manage cost, they can rethink their business strategy for management in line with the new labour situation we are facing in Singapore right now, and then plan ahead for the future growth of the company. So this news we are getting today is very beneficial and we are very thankful for it."

Source: Business Times 20th November 2013

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JTC factories in Kadut, Yew Tee, Kranji face relocation

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