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Published November 2, 2011

$15m top bid for Mountbatten Road transitional office site

By UMA SHANKARI


A TRANSITIONAL office site on Mountbatten Road, which was put up for sale by the government last month, drew 11 bidders at the close of the tender yesterday.

The top bid of $15.01 million or $119 per square foot per plot ratio (psf ppr) came from an individual, Chen Chew Yen. If the site is awarded, it will be the first time in more that 18 months that a transitional office site - that is, office sites that are launched for sale with 15-year leases - will be sold.

Mr Chen's bid was 12.6 per cent higher than the second highest bid from Heeton Holdings. Heeton bid $13.3 million or $106 psf ppr.

Analysts expected a top bid of $100-120 psf ppr when the site was launched for sale.

The Mountbatten Road land parcel has a site area of about 1.17 hectares and a maximum permissible gross floor area of about 126,000 sq ft. The site was first made available for sale through the reserve list in October 2008.

The Urban Redevelopment Authority (URA) first launched transitional office sites in 2007 as a creative solution to tackle immediate shortages in office space. Six sites have been sold since.

Analysts said that the site could be popular with office users who have budgetary constraints.

Some of these users may now be operating in industrial buildings, with questionable legality of use, paying rentals of $3.50-4.50 psf per month, said Alan Cheong, Savills Singapore's associate director for research & consultancy. Attractively priced office space would appeal to these users who could then operate openly without fear of enforcement checks, he added.