Marina View Site May Fetch Up To $1.6b

Source : The Business Times, August 1, 2007

At least 60% of GFA must be zoned for office space: URA

A 99-YEAR-LEASEHOLD 'white' site at Marina View, launched for sale yesterday by public tender, could fetch as much as $1.6 billion, analysts reckon.

The site, which can be developed for a range of uses, was released by the Urban Redevelopment Authority (URA) - and could sell for $900-$1,300 per square foot per plot ratio (psf ppr), adding up to $1.1-$1.6 billion.

'Right now, prime office space in the central business district, even that with a 99-year lease, is selling for a high price,' said Donald Han, managing director of Cushman & Wakefield. 'This site can sell for $1,300 psf ppr.'

The tender for the new site - which URA terms parcel B at Marina View - closes on Nov 13. Market watchers expect bidders to take a cue from an adjacent site offered by URA. The tender for that site - parcel A at Marina View - closes on Sept 19. It is expected to fetch about $1,100 psf ppr.

The latest site is expected to attract keen interest as office rents in Singapore look set to keep climbing amid a supply crunch.

'This site could attract four to eight bids from major developers, investment funds and joint ventures of developers and investment funds,' said Knight Frank's director for research & consultancy Nicholas Mak. 'It would also attract foreign property players.'

The site is about 0.9 of a hectare, has a gross plot ratio of 13 and can yield a maximum gross floor area (GFA) of 1.2 million sq ft.

Land that is zoned 'white' can be put to various uses including hotel, retail, office and residential space. But this site comes with a URA requirement that at least 60 per cent of the maximum GFA be office space. URA said this is to help meet demand for prime office space.

The successful developer will also need to set aside at least another 25 per cent of GFA for hotel use, yielding about 550 hotel rooms.

'This is to contribute to the supply of hotel rooms to meet the expected increase in demand arising from the Singapore Tourism Board's target of attracting 17 million visitors by 2015,' URA said.

The remaining 15 per cent of the GFA can be used for any other permitted purpose. If it is used for residential units, the space could yield 190 to 200 apartments and several large penthouses, said MrMak.

URA hopes the project that goes up on the site will help create a critical mass of office space and hotel rooms in the Marina Bay area, so the precinct becomes an international business and financial hub.

The site will be connected to surrounding developments One Raffles Quay, Marina Bay Financial Centre and the future development One Shenton, URA said.