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Published October 6, 2006

Partners to pump $2b into new financial centre

Included in Phase 1 price tag is $900m for residential, office complex

By UMA SHANKARI

(SINGAPORE) Hong Kong billionaire Li Ka-shing's Cheung Kong Holdings, together with Hongkong Land and Keppel Land - partners who clinched the site for the Marina Bay Business and Financial Centre (BFC) last year - will be spending $2 billion on the first phase of the development, helping to double the amount of prime office space in the area, they said yesterday.

The $2-billion price tag for the new Marina Bay Financial Centre (MBFC) includes $1.1 billion for the cost of the land and another $900 million to build a residential and office complex.

When completed in 2010, the office component will add around 150,000 sq m of Grade A office space, said MBFC general manager David Martin. Together with the consortium's nearby twin-tower office development One Raffles Quay's (ORQ) 120,000 sq m, the supply of top-tier office space in the central business district (CBD) will be effectively doubled.

The upcoming development is the first phase of a 3.55-hectare site which the three companies bought for $1.8 billion last July.

When asked how the partners were going to fund their purchases, Mr Martin said the three shareholders were all making their own arrangements. Keppel Land managing director Kevin Wong said that the company has cash, but added that it might look at convertible bonds.

The consortium also developed the 1.3 million sq ft ORQ. Due to officially open in early 2007, ORQ is already 100 per cent pre-let to tenants including ABN Amro, Barclays, Deutsche Bank and UBS. Rents at ORQ are pegged at $10 per sq ft per month, and rents at the new financial centre are expected to hit or even surpass this level.

'The MBFC will form a new central zone for Singapore's CBD, drawing in the major players in the banking and financial services sector,' Mr Martin said. He added that the consortium's experience with ORQ shows there is strong demand for space from global financial institutions. The financial centre has already seen a lot of interest from many prospective tenants, according to Mr Martin. He said: 'We are in negotiations with a number of large occupiers.'

Besides offices, the MBFC will also have luxury residences and complementary retail facilities.

The 99-year leasehold luxury condominium with 428 units will be launched towards the end of this year. The developers declined to put a price on the units, but market watchers think that the units could go for about $1,400-$1,650 per sq ft. Apartments in the nearby The Sail @ Marina Bay are being resold for that amount.

'Our agents have received a lot of pre-interest (for the apartments),' said Mr Martin. 'That interest has come from Singapore, it has come from the region and I think some from further afield than that.' He agreed that The Sail @ Marina Bay will be the benchmark for the upcoming residential project.

Yesterday also saw the unveiling of the MBFC's look. Designed by a team led by New York-based Paul Katz, the financial centre's three towers aim to provide a complete environment for 24/7 working and living. Mr Katz said the three towers - the 55-storey Marina Bay Residences, and two office towers of 32 and 46 storeys - have been developed as a series of crystalline forms sculpted to reflect light and provide a sense of depth to the surfaces. Also, the towers have been positioned to maximise the view of the bay, city and seascape.

Officially unveiling the MBFC last night, Minister for National Development Mah Bow Tan said that the MBFC investment brings the total investment committed to Marina Bay by the private sector to $9 billion. The government will invest another $2 billion in the area's infrastructure to support private development. 'The development of the MBFC serves to further entrench and strengthen Singapore's status as a financial hub,' said Mr Mah.