Top Print Edition Stories
Published February 10, 2007

More development sites at Marina Bay planned, says Mah

Business space in Jurong East, Paya Lebar, Woodlands to be increased


(SINGAPORE) The Urban Redevelopment Authority (URA) is planning to activate more development sites at Marina Bay, while increasing space for business in Jurong East, Paya Lebar and Woodlands.

Speaking at the URA Corporate Plan seminar yesterday, Minister of National Development Mah Bow Tan said: 'The next phase of development of Marina Bay is already being planned.

'As demand picks up, we will release more land.'

He added: 'In addition to Marina Bay, we will also focus on opening up new areas for development to meet the growing demand for space for the business services sector.'

Mr Mah was speaking broadly about planning issues that would be revealed in detail in the Master Plan of 2008, and the decentralising of commercial activities to areas outside the city was one.

Jurong East, Woodlands and Paya Lebar were identified as regional and sub-regional centres in earlier URA Concept Plans of 1991 and 2001, but the upcoming Master Plan 2008 is likely to have detailed planning and zoning information for these areas. Actual parcels of sites for sale could also be identified. How quickly this happens is likely to depend on market demand.

The potential for more development land in the future was welcomed by Savills Singapore director of corporate real estate Simon Hill. 'It will ease the shortage (of office space) in the long term,' he said.

Tampines Regional Centre was the first to be built, in the early 1990s. Savills' data shows that average vacancy there dropped from 3.9 per cent in 2005 to 2.3 per cent in 2006, bolstered largely by companies relocating back-room operations from the CBD. Average rentals have also increased from $3-$4 to $4-$5 per square foot. 'We have a number of clients who are currently considering splitting their office in the CBD,' Mr Hill said.

Although rising rents in the CBD are one of the pull factors for regional centres, Mr Hill said an increasing number of clients had also highlighted the quality of the working environment as a reason for wanting to move out of the city.

'Most companies, especially MNCs, have an environmental policy, and want to look after their staff by providing better amenities,' he said. The companies would like nearby parks, childcare facilities, sports facilities and even ample parking. 'Costs make this prohibitive in the city.'

Mr Hill also pointed out that currently the overspill demand for office space is being absorbed by vacancies in the industrial sector. Common back-room operations here include IT support and call centres. Whether more of such space could be made available for such back-room operations in industrial buildings is not known. 'This is a grey area.'

Jones Lang LaSalle regional director and head of investments Lui Seng Fatt noted that Tampines Regional Centre had not always enjoyed low vacancies. 'During the last recession, rents in the CBD were low so many companies located in Tampines moved out.'

Mr Lui also believes that regional centres in Jurong East and Woodlands would not likely alleviate pressure for office space in the CBD either. 'Jurong could attract companies in R&D while Woodlands could be more focused on manufacturing,' he said, but added: 'These would not be compatible with the CBD though.'

Mr Lui was more bullish about Paya Lebar. 'For the short term, it would be faster to develop Paya Lebar. There is a land bank between Paya Lebar and Eunos that would be suited for development,' he said. On Marina Bay, he said he did not expect too many sites to be 'pushed out soon'.

'The URA will probably push out land near the UIC Building to create another corridor but it will not be another BFC (Business Financial Centre),' he said.