SLA To Move Out Of Shenton Way To Revenue House

Source : The Straits Times, Feb 27, 2008

Agency cuts amount of office space it needs and will likely save on rental costs

THE Singapore Land Authority (SLA) will move its offices from Shenton Way to Novena this year, freeing up precious downtown office space for the private sector.

It will take up five floors, or 6,600 sq m, at Revenue House in Thomson Road. This is about three-quarters of what it occupies currently at 8 Shenton Way - formerly known as Temasek Tower.

The move is in line with the Government's efforts to ease the shortage of office space in the central area. The acute supply crunch, coupled with rising space demands from expanding businesses, has sent prime office rents soaring in the last year.

SLA said yesterday that it is able to cut its space requirements at Revenue House as it is moving towards space-efficient work practices.

As an added benefit, SLA is also likely to save on rental costs with the relocation, property consultants said.

SLA said it will be paying 'market rent' for the space at Revenue House, owned by the Inland Revenue Authority of Singapore (Iras). This is likely to be in the 'single-digit' per sq ft (psf), said Mr Donald Han, managing director of property consultancy Cushman & Wakefield.

In contrast, asking rents at 8 Shenton Way are $11 to $12 psf - roughly what SLA would have had to pay to renew its lease there.

The 24-storey Revenue House, Iras' headquarters, is now full, so information on its asking rent is not available.

Other buildings in the area go for as little as $9 psf, depending on their age, said Mr Han.

Goldhill Plaza, which is about 30 years old, offers single-digit rents. Newer buildings such as United Square and Novena Square are said to be asking for $10.50 to $11.50 psf.

Revenue House, which opened in 1996, is likely to command 'high single-digit rents' psf, Mr Han estimated.

He said prime office rents in Novena are not much lower than in some downtown buildings as the area is becoming popular with multinational corporations that do not need to be in the heart of the city.

However, SLA may get a bulk discount in Revenue House. The space was set aside by Iras, which may have decided not to renew the leases of some tenants when they expired, Mr Han said.

Other agencies moving out of the Central Business District include the Infocomm Development Authority and the Economic Development Board.

Fittingly, SLA is one of the state departments tasked with tackling the office crunch by leasing out the vacant properties it manages. It has tendered out 104,000 sq m of space to meet immediate office needs.

The agency will release another 32,300 sq ft of space in the current quarter, including the former Civil Aviation Authority of Singapore office in Upper Changi Road North and the former Siglap-Changi Community Centre.