URA Launches First Hospital Site In 30 years

Source : The Business Times, October 30, 2007

THE Urban Redevelopment Authority (URA) yesterday launched a hospital site at Novena Terrace/Irrawaddy Road for sale by public tender. URA said that the last hospital site launched was at Mount Elizabeth in 1976.

URA said that it worked with the Ministry of Health to identify the new site. The news comes after Health Minister Khaw Boon Wan said in December that four possible sites for hospital development had been identified. He said three of the sites were near existing public hospitals and a fourth was in the north.

The 1.7 ha Novena Terrace/Irrawaddy Road site, near Novena MRT Station, has a maximum permissible gross floor area (GFA) of about 72,350 sq m. At least 35 per cent of the GFA is to be set aside for hospital in-patient wards.

A maximum of 5 per cent of the total GFA may be for retail uses such as gift shops and food and beverage outlets.

Knight Frank director (research and consultancy) Nicholas Mak said that hospital sites are a 'specialised play', and he does not expect more than five bids. Knight Frank estimates that the winning bid could be in the region of $600 million to $670 million. This works out to be about $770 to $860 per square foot per plot ratio (psf ppr).

'I expect that the future development could be a combination of hospital as well as strata-titled medical suites that could be put up for sale,' Mr Mak said.

The URA said Singapore has experienced 'exponential growth' in international patient numbers over the last few years, with more than 410,000 visitors in 2006.

'Growing at a rate of 20 per cent per annum, Singapore expects to receive about one million international healthcare visitors by 2012,' the URA said.

Healthcare sites do appear to be in demand. In September, a consortium called Singapore HealthPartners put in the highest bid of $265.3 million, or $431 psf ppr, for a hospital-cum-hotel site in Race Course Road. Also in the market for hospital sites could be healthcare real estate investment trusts like Parkway Life Reit and First Real Estate Investment Trust. According to its website, URA has fielded questions on whether a trust can be considered a developer for the site.