Three CBD Office Projects Given URA Approval In Q2

Source : The Business Times,Tue, Jul 31, 2007

Provisional permission also granted for several hotel projects

A SLEW of projects were granted provisional permission in Q2, according to latest Urban Redevelopment Authority statistics.

Afro-Asia Building: It will be torn down and the site redeveloped into a new project with about 121,100 sq ft GFA offices and 1,399 sq ft of shop space

These include a business park development of 215,000 square foot gross floor area (GFA) for Eurochem Corporation at International Business Park (IBP) in Jurong East, and several new office projects in the CBD - including redevelopment of Afro-Asia Building on Robinson Road (which was once the headquarters of Nanyang Siang Pau), Asia Chambers at McCallum Street, and Marina House at Shenton Way.

Asia Chambers: Owner TM Asia Insurance Singapore Ltd will build a new 19-storey office project with about 161,000 sq ft GFA offices

Residential projects that received provisional permission in the April to June quarter of this year include a 316-unit condo by Tripartite Developers on Flora Road, off Old Tampines Road, and a 329-unit condo by Frasers Centrepoint unit FCL Land Pte Ltd on the freehold Far East Mansion site on Kim Yam Road. Another condo, with 300 units, on River Valley Road, by EC Investment Holding Pte Ltd, was also granted provisional permission in April.

And as reported in June, Hong Fok has obtained provisional permission to develop 369 apartments on Beach Road under a redevelopment of part of The Concourse.

Eurochem's business park project at IBP is expected to have about 180,000 sq ft net lettable area. Eurochem is expected to occupy part of the space, while the rest could be leased out. Allowed uses include data processing and backroom offices of banks.

The company will be developing this on a site that it bought from JTC Corp on an initial 30-year lease term with an option to renew for a further 22 years, BT understands.

The three CBD office projects granted provisional permission by URA in Q2 can generate about 480,000 sq ft GFA of offices. Hong Leong Group obtained provisional permission to redevelop Marina House at Shenton Way into a new office project with about 199,455 sq ft GFA of offices. Afro-Asia Shipping Co Pte Ltd received URA's nod to tear down its Afro-Asia Building on Robinson Road (with an MPH store at street level) and redevelop the site into a new project with about 121,100 sq ft GFA offices and 1,399 sq ft of shop space.

Assuming redevelopment work begins early next year, the redeveloped building could be ready around early 2010. The current owner bought it in the late 1960s. The site has a land area of about 16,000 sq ft and has a remaining lease of about 45 to 46 years.

Work on redeveloping Asia Chambers at McCallum Street is expected to begin in August. Owner TM Asia Insurance Singapore Ltd - part of the Tokio Marine & Nichido Fire Insurance Co group - will build a new 19-storey office project with about 161,000 sq ft GFA offices. The net lettable office space could be about 110,000 sq ft, of which around half or so is expected to be occupied by the group, which currently operates out of leased premises at Fuji Xerox Towers on Anson Road. Tokio Marine's project, which is slated for completion in late 2009, will see a chunk of the building's street level space devoted to public spaces with trees, other greenery and sitting areas to serve as a meeting point in the location.

URA also granted provisional permission for several hotel projects in Q2, such as a 355-room hotel on Clemenceau Avenue/Unity Street to be developed by Hong Kong's Park Hotel Group); and a 90-room facility at Fullerton Square granted to Sino Land subsidiary Precious Quay Pte Ltd. The latter project also includes about 26,700 sq ft GFA of retail space.

In May this year, URA temporarily banned conversion of office use in the Central Area to other uses until December 2009 to curb further depletion of the existing office stock on the island. Even prior to that announcement, though, the trend had changed, with some owners of ageing CBD office blocks considering redeveloping their premises into office blocks, instead of the earlier trend of going for apartments, on the back of rising CBD office values.

Nonetheless, the redevelopment of these properties into bigger new office projects will worsen the office crunch in the short term while they are being redeveloped, say market watchers.