Temp office site in Newton draws four bids

[mr funny]

http://www.businesstimes.com.sg/sub/suite/story/0,4574,277344,00.html?

Published May 1, 2008

Transitional office site gets top bid of $226 psf ppr

Offer is 7% below last week's top bid for nearby plot

By ARTHUR SIM


THE Urban Redevelopment Authority (URA) has closed the tender for a transitional office site at Scotts Road/ Anthony Road - receiving a top bid of $32.99 million.

This works out to be $226 per square foot per plot ratio (psf ppr) for the 97,284.1 sq ft site which has maximum permissible gross floor area of 145,926.2 sq ft.

Four bids were received with the highest bid coming from Sun Venture Investments, a subsidiary of interior design and build firm DB&B Developments Pte Ltd. Its bid was 3 per cent higher than the next highest bid of $32 million from Scotts Development Pte Ltd.

DB&B chief executive Billy Siew Kim Leng said that if it is awarded the site, it intends to lease the building fully. Already, Mr Siew said that it is talking to two potential tenants who may lease the entire building.

While Mr Siew did not say who these might be, a check with the DB&B website reveals that its current clients include ABN Amro Bank and Korea Development Bank.

If awarded, this will be the first development project for DB&B. Still, Mr Siew said this is the normal progression in terms of 'vertical integration' for its business.

He also said he was bullish on the office sector and is setting its sights on a monthly rental of $9.50 psf.

Cushman and Wakefield managing director Donald Han agreed that the site could eventually attract big companies. 'I think corporations would be favourable to an address like this.'

He also said that as long as the locations were good, there would still be developers interested in such sites. 'The entry level is low so it would be good for new developers,' he added.

The potential over-supply of new office space after 2010 is not likely to affect demand for this site either. Savills Singapore director (marketing and business development) Ku Swee Yong said: 'The future supply is likely to be more spaced out than originally expected due to construction delays.'

Even so, Mr Ku estimates that rentals for transitional office space in the Scotts Road area is more likely to be around $7 psf a month.

While the DB&B's bid is about 7 per cent lower than the top bid for the neighbouring transitional office site last week, Knight Frank director (research and consultancy) Nicholas Mak believes it is very likely that the government will award this site to DB&B, 'taking into consideration that this average price of $226 psf ppr is slightly higher than the price paid for the first transition office site at Scotts Road last August'.

He added: 'In an effort to ease the office space crunch, up to now, the government has awarded four transition office sites, which could yield about 650,000 sq ft of office space.'

[mr funny]

http://www.straitstimes.com/Money/Story/STIStory_233175.html

May 2, 2008

Temp office site in Newton draws four bids

By Joyce Teo, Property Correspondent


A TENDER for a second temporary office site on Scotts Road and Anthony Road has attracted less interest than the first site adjacent to it.

Temporary sites are being offered for development as offices as part of efforts to ease an office space crunch.

Sun Venture (S) Investments, a development and property asset management company owned by interior design firm DB&B, put in a bid of nearly $33 million.

This price translates to $226 per sq ft (psf) of gross floor area, which is about 7 per cent lower than UOB Kay Hian's recent bid of $242.50 psf for the first transitional plot at the same location.

Nevertheless, these bids remain above the top bid of $219 psf for an earlier transitional site in the area - Scotts Spazio, which is just across Scotts Road - that was released in August last year.

The second plot on Scotts Road and Anthony Road has a size of 97,284 sq ft and, like the first, comes with a 15-year lease. The other bidders were Scotts Development ($219 psf), Centurion Scotts ($171 psf) and Hersing Corporation ($157 psf).

All four also participated in last week's tender for the other transitional plot, which attracted eight bids. Sun Venture was the second highest bidder in that tender, with a bid of $208 psf.

Last week's tender would have weeded out those who could not pay, said Cushman & Wakefield's managing director, Mr Donald Han.

The Government has now offered four transitional office sites, which would yield about 650,000 sq ft of space, said Mr Nicholas Mak, Knight Frank's director of research and consultancy.

Office rents have shot up significantly on tight supply in the past two years, though growth has slowed.

Separately, the Government has made available a commercial site in one-north for application. Developers who are keen have to commit to a minimum bid before the site can be put up for sale.

If triggered, the fairly large plot - it allows for a total gross floor area of 1.29 million sq ft - could attract bids of between $300 psf and $400 psf, said Mr Han.

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http://www.businesstimes.com.sg/sub/news/story/0,4574,278077,00.html?

Published May 7, 2008

Sun Venture awarded Scotts Road site

It bid $32.99m or $226 psf ppr for the office site

By ARTHUR SIM


DB&B subsidiary Sun Venture Investments has been awarded a transitional office site at Scotts Road after emerging as the highest bidder last week.

http://www.businesstimes.com.sg/mnt/media/image/launched/2008-05-07/BT_IMAGES_ASDBB7.jpg
Coming up: Artist impression of DB&B's transitional office building at Scotts Road

Its bid of $32.99 million or $226 per square foot per plot ratio (psf ppr) for the 97,284.1 sq ft site was 3 per cent higher than the next highest bid received by the Urban Redevelopment Authority in the public tender.

DB&B develops and manages property assets and its CEO Billy Siew Kim Leng revealed that the overall construction costs could be in the region of $35 million, taking the overall development cost to about $68 million, including land cost.

The project, which has a maximum permissible gross floor area of 145,926.2 sq ft, will be partially funded through bank loans but even in the light of tightening credit markets, 'funding will not be an issue', Mr Siew said. This is probably because of the positive response from potential tenants.

Mr Siew had said last week that DB&B was in talks with two potential anchor tenants when it first ventured to bid for the site. However, since emerging as the top bidder, DB&B has received between eight and 10 expressions of interest, he said.

And the asking rent of $9.50 psf a month has apparently not put potential tenants off either, even though the first transitional office building being leased by Prudential Assurance Company Singapore on the other side of Scotts Road is being leased for $6.50 psf a month.

Mr Siew explained that as a built-to-suit office space provider, the office building will come fully fitted with raised floors, back-up generator and, more importantly, interior fittings, representing a cost savings for the future tenants.

The completion date is set for mid-2009.