Many new office buildings pre-leased

A sense of strength is coming back into the property market this year, with the bottom of the cycle possibly closing in. And consumer interest, in both the residential and commercial fronts, are on the rise too.

FraserTOwersWith news of Facebook pre-leasing space at Marina One, the upcoming Frasers Tower in the heart of the Central Business District (CBD) has also received leasing proposals for 30 per cent of its 38-storey office building from various interest tenants. Most were from multi-national conglomerates, legal services, technology firms and a serviced-office provider, The Executive Centre who expressed interest in taking up an entire 20,000 sq ft floor space.

New office buildings are gradually filling up even before they are completed or ready for occupancy. There is however some movement from other existing buildings as tenants take the opportunity to relocate or upgrade, as seen in the mix of tenancy in Marina One and Guoco Tower. Frasers Tower has a 663,000 sq ft of total net leasable area. More new office spaces are currently being developed in the CBD, including UIC Building and the new property which will sit on the site of the previous CPF building. Though office rents have been falling, it may be a good sign after all as the market would have picked up by the time these new buildings are

Prime Marina Bay site expected to lure aggressive bids

The Urban Redevelopment Authority (URA) has recently released a 1.1 ha prime site at Marina Bay in Central Boulevard. Coupled with news that Asian banks are expected to strengthen their presence in Singapore, this could be an office development site developers hanker after.

Asia Square

Photo credit: www.thehumanbuilding.com

The last time a site at Marina Bay was put up for tender was in 2007 – Asia Square now stands on this site. With the Central Business District location and size of the site taken into consideration, it will no doubt yield a number of plum Grade A offices. Bids are expected to come from mid- to large-sized developers as well as real estate investment funds, at aggressively too, as the site holds the potential for an impressive building with a huge number of units.

Despite the softening commercial sales and rental market, the successful bidder will be likely to have the project completed by 2020, which allows sufficient time for a market upturn. The bid closes on 8 November and investment entities from China and the Middle East may show particular interest. In fact, China’s Nanshan Group is said to be the ones triggering the release of the site as it was originally on the Government’s reserve list and was said to have been released after a developer committed to bidding at least $1.536 billion. But as more buildings are seeing increased levels of commitment from companies looking to stake a presence in Southeast-Asia, developers may have more confidence taking on commercial projects.