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Thread: URA white site seen fetching more than $1b

  1. #1
    joe
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    Default URA white site seen fetching more than $1b

    May 30, 2007

    Bids could pass $1b mark for Marina Bay site

    BLUE-CHIP property players from across the region are expected to do battle for a prime piece of Marina Bay land released for tender yesterday.

    Bids of well above $1 billion - although one expert tips $2 billion or more - are expected for the 1.02ha site behind One Shenton and The [email protected] Bay condominiums.

    A project of about 40 storeys can be built on the land, but 70 per cent of the gross floor area must be given over to offices. The rest of the space can hold more offices, hotel rooms, homes or shops.

    Mr Nicholas Mak, the director of research and consultancy at Knight Frank, expects bids to come in at between $830 million and $1.09 billion, based on recent government land sales and an assumed rental yield of about 6.5 per cent to 7.5 per cent.

    This range works out to $580 to $760 per sq ft per plot ratio (psf ppr), he said.

    But Ms Tay Huey Ying, Colliers International's director of research and consultancy, expects even higher bids - 'upwards of $1 billion, or $750 psf ppr', with the winning bid 'likely to be above $2 billion'.

    The likely contenders 'include all the major local blue-chip developers', Mr Mak said.

    These would be CapitaLand, Keppel Land, Lippo Group, Far East Organisation and City Developments, which is the developer behind One Shenton and The Sail.

    Foreign funds could also tie up with local developers for the tender bid, he said.

    The consortium building the nearby Marina Bay Financial Centre (MBFC) - Keppel Land, Hongkong Land and Cheung Kong Holdings - may also be interested, said consultants.

  2. #2
    joe
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    Default Marina View white site expected to attract bids of up to S$1.1b

    Marina View white site expected to attract bids of up to S$1.1b

    By Loh Kim Chin, Channel NewsAsia | Posted: 30 May 2007 1952 hrs


    SINGAPORE : A white site at Marina View is expected to receive bids of up to S$1.1 billion when the tender for the sale closes in September.

    The Urban Redevelopment Authority (URA) launched the tender for the one hectare 99-year leasehold site on Wednesday.

    The site has a gross plot ratio of 13 and can yield a maximum permissible gross floor area of over 133,000 square metres.

    A minimum of 70 percent of the gross floor area has to be set aside for office use.

    This is higher than the 60 percent set for previous URA tender exercises for white sites.

    The URA says this is is to meet the demand for prime office space.

    The remaining 30 percent of the floor area may be developed for additional office space or other uses allowable under the white zoning.

    These include hotel, residential and other commercial uses such as retail and entertainment.

    The site will be connected to surrounding developments at One Raffles Quay, One Marina Boulevard, Marina Bay Financial Centre and One Shenton through an extensive network of underground pedestrian walkways and second storey links.

    It will be served by the Common Services Tunnel.

    This is a system of underground tunnels which house and distribute utility service lines, including power and telecommunication cables.

    This means future office tenants will have access to uninterrupted supply of major utilities, emergency back-up services and the capacity for expansion to meet changing utility needs. - CNA/ch

  3. #3
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    Default URA white site seen fetching more than $1b

    Published May 31, 2007

    URA white site seen fetching more than $1b

    $850-1,000 psf ppr likely for plot next to One Shenton

    By KALPANA RASHIWALA


    (SINGAPORE) A white site behind One Shenton, launched yesterday and slated predominantly for office development, could fetch $850 to $1,000 per square foot of potential gross floor area, property consultants say.

    This translates into bids of $1.22 billion to $1.43 billion. And some analysts reckon that the price could go even higher.

    The tender for the 110,206 sq ft site - offered on a 99-year lease by the Urban Redevelopment Authority - closes on Sept 19.

    At least 70 per cent of the maximum 1.43 million sq ft of gross floor area must be developed as offices. Assuming the successful bidder puts up an all-office development, the net lettable space could be just over one million sq ft.

    The development can rise higher than 40 storeys. And if roof forms are included, the maximum height can go beyond 50 storeys.

    CB Richard Ellis executive director Li Hiaw Ho says that the site could fetch around $900 to $1,000 psf per plot ratio (psf ppr), which would result in a breakeven cost of $2,300 to $2,500 psf for the completed office project.

    Using a yield-based approach and assuming gross monthly average rent of $12 psf and a capitalisation rate of 4.5 per cent, the value of the completed project would be about $2,600 psf.

    Mr Li also notes that $2,500-2,600 psf capital values are in line with current office transactions. BT reported last week that Hong Leong Group had received an offer of about $2,500 psf for 1 Finlayson Green and has since learnt that this offer, from a European property fund, may actually be higher.

    Knight Frank managing director Tan Tiong Cheng predicts a slightly lower price of $850 to $900 psf ppr, saying that bidders may take a cue from last month's sale of nearby UIC Building for $870 psf ppr. He expects the URA site to draw at least four to five groups of bidders.

    Taking a more upbeat view, Credo Real Estate managing director Karamjit Singh predicts that the top bid is 'certain to go over $1,000 psf ppr' because of interest from overseas institutional investors like funds. 'Their perspective on target returns and market outlook may be rather different from local developers,' he said.

    Agreeing, a seasoned market watcher - alluding to the office glut that plagued Singapore a few years ago - pointed out: 'Local players know local history.'

    Some investors may now be concerned that the government could release a slew of new office sites - on 99-year leases and short tenures for temporary structures - to alleviate the current shortage of space.

    Still, CBRE's Mr Li expects URA's latest site to draw strong bidding. 'The future CBD will be in the Marina Bay area and if you want to be in the office market, you have to be there,' he said.

    Knight Frank director and head of research and consultancy Nicholas Mak reckons that the authorities would only release additional office sites selectively, knowing that new developments can be completed only after the first phase of the Business and Financial Centre is ready in early 2010.

    The government's proposal to offer short-tenure sites for temporary or 'transient offices' will have limited appeal, he said. 'Big international financial institutions and other users concerned about image will probably not find such premises appealing. However, perhaps some smaller local firms facing pressure from rising rents - like architectural firms and law firms - may consider them.'

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