Tampines Site To Anchor H2 Industrial Land Sales

Source : The Business Times, July 2, 2008

Reserve sites comprise new plot in Jurong, six sites rolled over from H1

The Ministry of Trade and Industry (MTI) yesterday unveiled an industrial land sales programme for the second half of 2008 that could yield a total supply quantum that is a tad above that of the first half.

The latest slate has just one site on the confirmed list, at Tampines Industrial Avenue 4 (opposite the wafer fab park and near the Giant, Courts and Ikea outlets) and seven plots on the reserve list, of which only one is new - a plot in Jurong at Pioneer Road North/Soon Lee Road. The other six reserve list plots are being rolled over from H1 2008.

Both new sites at Tampines and in Jurong are being offered on 30-year leasehold tenures and zoned Business 2, which means they can be developed for a wide range of uses such as clean/light industry, general industry and warehouse.

The 5ha Tampines plot on the confirmed list will have minimum floor-plate size and product-type stipulations. 'The objective of such conditions is to address demand for industrial space for single-users which need larger floor plates,' MTI said.

Colliers International director (industrial) Tan Boon Leong envisages the plot to be developed into a low-rise industrial facility of at most two and a half storeys (with mezzanine offices) as the site has just a 0.8 plot ratio (ratio of maximum potential gross floor area, or GFA, to land area).

'Industrialists like low-rise premises so this site should be well sought after by both industrialists and developers,' Mr Tan reckons. He estimates the site will fetch bids of at least $40-$50 per square foot per plot ratio (psf ppr), or $17.2 million to $21.5 million in absolute terms. The plot, which can have a maximum GFA of about 430,000 sq ft, is slated for launch in November.

Mr Tan expects the Pioneer Road North reserve-list site to fetch around $35-$45 psf ppr. The site will be made available for application in October.

The government releases a site on the reserve list only upon successful application by a developer that undertakes to bid at a minimum price acceptable to the state.

Confirmed list plots on the other hand are launched according to a pre-stated schedule, regardless of demand.

The other six reserve-list plots for H2 2008 that are being rolled over from the H1 list are located at Yishun Avenue 6 (two parcels), Toh Tuck Avenue, Ubi Avenue 4, Kallang Pudding Road and Serangoon North Avenue 4. All six plots are zoned for Business 1 use, meaning they can be developed for clean and light industrial, and warehouse use.

The Toh Tuck plot has 30-year leasehold tenure while the other five are being offered on 60-year leases.

MTI's H2 2008 sole confirmed list site can potentially generate about 40,000 sq metres GFA, similar to the 42,000 sq m from the only confirmed plot in H1 2008 located at Woodlands Industrial Park E5.

The seven reserve plots in H2 may be developed into some 188,570 sq m GFA, or 8 per cent higher than the 174,570 sq m from the seven plots in the H1 slate.

'MTI probably wants to keep the status quo in the industrial property market, which has been pretty stable this year,' Colliers' Mr Tan suggested.