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22 industrial sites to be offered for sale

Bumper supply of 25ha for first half of 2013 aimed at cooling soaring prices

Published on Dec 20, 2012

By Melissa Tan


THE Government has stepped up its supply of industrial land for the first half of next year, to meet rising demand and to bring soaring prices back to earth.

A total of 22 sites will be released for sale under the industrial Government Land Sales (GLS) programme for January to June, the Ministry of Trade and Industry (MTI) said yesterday.

The ministry also said that land tenures will continue to be capped at 30 years, and successful bidders for certain sites will be required to build a minimum number of large factory units.

This rule could cut business costs and give genuine industrialists more options, analysts said.

DWG senior manager Lee Sze Teck said it would make it easier and cheaper for industrialists to own one larger unit "rather than buying several units and combining them into one".

The sites up for sale are on 30-year and 22-year leases, and most of them are in Tuas.

There are 13 sites on the confirmed list, which means they go on sale regardless of interest.

All are zoned for heavy industrial use, which shows the Government's intention to offer more supply for manufacturers, said SLP International research head Nicholas Mak.

Mr Roland Ng, managing director of crane company Tat Hong, said he hoped industrial prices would fall as his business is land-intensive. It would be "operationally easier" to use land in Singapore rather than Malaysia but if prices here are too high, he would have to go abroad, he said.

Out of the nine sites on the reserve list, two were carried forward from the GLS reserve list for the second half of this year.

Sites on the reserve list are put up for tender only if a developer makes an acceptable initial offer.

This new supply comes amid a sharp and sustained surge in industrial land prices this year, as cooling measures in the residential market directed investors' attention to other sectors.

Industrial prices were 31.7 per cent higher in the third quarter year on year, and shot up 26.7 per cent in the first nine months of this year, according to Urban Redevelopment Authority data.

The MTI said yesterday that the Government would "continue to release ample land... to meet the needs of industrialists and to moderate industrial land prices".

The proposed total site area of 24.84ha exceeds the supply released for each half of this year, already considered a bumper crop. This year, 47.69ha of industrial land was released, about 1.4 times more than last year. But the number of smaller plots suited to small and medium-sized enterprises (SMEs) has fallen for the first half of next year, said Mr Lee.

"The strong Singdollar and higher business costs have resulted in some industrialists moving their manufacturing operations to the Iskandar region (in Malaysia)... the Government probably decided that there is less need to sell industrial land to SMEs. But should there be a need, the SMEs can apply to trigger the sites on the reserve list."

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