PROJECT DETAILS

LOCATION and AMENITIES

New and upcoming mixed development in Central Boulevard, Marina Bay is between Asia Square and Marina Bay Suites

MARINA BAY DEVELOPMENTS

Marina Bay is a successful example of Singapore’s long term planning. The 360ha area was reclaimed during the 1970s and 1908s in anticipation of the need to grow the city centre in the future. Marina Bay allows for the seamless extension of Singapore's Central Business District and further supports the city-state's continuing growth as a global business and financial hub.

It is planned as a vibrant, mixed-use district with round-the-clock activities based on sustainable development strategies. It is well served by public transport with 4 RTS lines and 9 MRT stations and is the first district in Singapore to be planned upfront with a network of dedicated cycling lanes. Transit-oriented development optimises access for residents, workers and visitors to public transport. Marina Bay is Singapore’s first city to play host to water activities and is the focal point for major events. Together with the waterfront promenade and its loop of attractions and vibrant public spaces, Marina Bay aims to be a People’s Bay and will play a role in defining the character of Marina Bay in its leafy streetscape, lush park and sky-rise gardrens.

The next phase of development includes a new lively and mixed-use residential district at Marina South that is planned to be green, walkable and cycle-friendly.

SINGAPORE DOWNTOWN MARINA BAY LAND GETS RECORD BID OF S$2.6 BILLION FROM IOI PROPERTIES GROUP

Singapore - Malaysian plantation and real-estate tycoon Lee Shin Cheng has surprised the market with a bullish top bid of nearly S$2.57 billion or S$1,689 per square foot per plot ratio (psf ppr) for a white site in Central Boulevard.

The bid from IOI Properties Group is the highest in absolute dollar quantum as well as by psf ppr for a Government Land Sale (GLS) site in Singapore. The tender drew seven bids. IOI's bid was 16.4 per cent higher than that of its closest competitor, at S$2,568.69m (S$1,689 psf ppr).

At this price, CIMB reckons the cost to completion would be S$3,100-3,200psf of leaseable area. Based on an expected rental yield of 4%, the development, it said, would likely have to command a rent of S$12psf/mth or back to the 2009 level. This represents a CAGR of 6% p.a. for the next five years.

Temasek-owned Mapletree Investments, which offered S$1,451 psf ppr.

Nanshan Group, which The Business Times had earlier identified as the party that triggered the 99-year leasehold site's release from the government reserve list, bid S$1,438 psf ppr for the 1.1-ha site.

The top three bids were higher than the S$1,409 psf ppr record fetched for the adjacent site, on which now stands Asia Square Tower 1, at a URA tender September 2007. That bid amounted to S$2.02 billion.

The Malaysian tycoon's younger son and IOI Properties chief executive Lee Yeow Seng told BT the group is looking at an all-office development on the Central Boulevard site.

Noting that the total development cost would be "over S$3 billion", he indicated that IOI expects to begin construction around late 2017 or early 2018, with a construction period of four to five years. The group is open to developing just a single office tower or two towers, he added.

For now, IOI is going in solo for the development, although it is not ruling out the possibility of taking joint-venture partners later.

Acknowledging that the Singapore office market is currently not in its best shape, Mr Lee said : "There is a bit of a glut at the moment, but we're taking a longer-term view. The government has managed to transform the economy; Singapore is no longer just a regional financial centre. It has done very well in terms of attracting IT companies, for instance. Just look at South Beach Tower, where Facebook is (an anchor tenant) and is looking for even more space."

IOI Properties partnered City Developments for the South Beach mixed-development project and Ho Bee for two condo projects in Sentosa Cove - Seascape and Cape Royale. IOI is developing The Trilinq condo in Clementi as well.

The group also developed the former IOI Plaza, a 12-storey granite office block at the corner of Middle Road and Prinsep Street, a white site the group clinched in a URA tender in 1996. In 2010, the group sold the building to Singapore Pools.

Colliers International managing director of Asia capital markets and investment services Terence Tang estimates IOI Properties' breakeven cost for a full-office project on the Central Boulevard site at S$2,600 psf, "given that the group is an experienced developer in Singapore and assuming it builds a single office tower which will maximise efficiency, or the ratio of net lettable area (NLA) to gross floor area (GFA)".

Assuming an 85 per cent efficiency ratio, the site can yield 1.29 million sq ft NLA of offices.

However, an insider suggested IOI could push down the breakeven cost to around S$2,500 psf, considering the senior Mr Lee's modus operandi - which includes minimising borrowing.

At the other end of forecasts, JLL's Singapore research head Tay Huey Ying estimates the breakeven cost at S$3,000 to S$3,100 psf. "The aggressive bid is likely to have stemmed from the expectation of keen competition and the desire to clinch a new downtown site to build a trophy commercial building carrying the bidder's name."

IOI's pricing for the site also reflects its confidence that prime office rents in the Marina Bay area will recover to the recent (Q1 2015) peak of S$12.90 psf a month or higher by the time this project is completed - from the Q3 2016 level of S$9.54 psf, said Ms Tay.

Mr Tang of Colliers said: "Today's tender result is set to boost commercial property values in Singapore's CBD and stir further interest from foreign investors in the office market."

BlackRock is seen to be one of the most immediate beneficiaries from any euphoria generated by Tuesday's tender close. The world's largest money manager is currently sussing out interest in Asia Square Tower 2, which has about 780,000 sq ft NLA. Earlier this year, it sold Tower 1 for S$3.4 billion or around S$2,700 psf on NLA to Qatar Investment Authority.

Also bidding at Tuesday's tender for the Central Boulevard site was a tie-up between Hongkong Land and Cheung Kong Holdings, which offered S$1,398 psf ppr.

CapitaLand Group of companies, in partnership with Hongkong-based Great Eagle Group founded by hotel and real estate tycoon Y S Lo, made a S$1,318 psf ppr bid. Yanlord offered S$1,305 psf ppr.

The lowest bid of S$1.91 billion or S$1,256 psf ppr came from a consortium comprising OUE Limited, Guangzhou R&F Properties Co and Tang City Properties.

Located next to Downtown MRT station, the Central Boulevard site may be built up to 50 storeys, with a maximum GFA of 141,294 sq m (1.52 million sq ft), of which at least 100,000 sq m or 70.77 per cent must be put to office use. In addition, up to 5,000 sq m GFA can be set aside for retail use. The development is to include a childcare facility of at least 500 sq m. The balance may be utilised for additional office, commercial school, hotel, serviced apartment or residential uses.

The entire development, excluding the GFA for hotel, serviced apartment and residential use, can have no more than three strata lots. This means that strata subdivision of office units for sale as multiple individual units is not allowed.

Nanshan successfully applied for the site's release with an undertaking to bid at least S$1.536 billion (S$1,010 psf ppr), but will not be walking away with this coveted land parcel.

Source: Business AsiaOne 09th November 2016

WON TOP BID FOR MIXED DEVELOPMENT IN MARINA VIEW

Marina View

Mixed Development

This site is developing

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