VVIP PREVIEW book Now- Hotline: +6594790133

Guillemard Edge set to rise from the heart of Geylang Lorong 30(Address)

Guillemard Edge floor plans soon and Price PSF will be attractively priced to sell for strategic investors. Enjoy sensational shopping, Savour delectable dishes. You will find countless options for entertainment, dining and rejuvenation within minutes of your abode.

Guillemard Edge Attractions
•Only 600m away to Dakota and Aljunied MRT Station
•Located in Centralise City Fringe District 14, Geylang
•Cosy Residential environment that is safe, away from pubs, crowds and motels
•Affordable Low Quantum Investment from only $5xxk… HOT and RARE! RARE!
•Good decent layout, suitable for Rental and Investment
•Excellent Quality Workmanship and interior finishes
•Plenty of famous Eateries and other Amenitiesin the surroundingin the surrounding
•4 mins drive to Bugis Shopping mall and Rochor Centerr
•6 mins6 mins drive to Suntec Cityy, Sands Integrated Resort and Shenton WayShenton Way
•8 mins drive to Orchardd Shopping BeltShopping Belt
•10 mins drive to CBD and Marina Integrated Resortt
•20 mins drive toSingapore Changi AirportSingapore Changi Airport
•Close to East Coast Recreation belt and Parkway Parade
•Walking distance to Paya Lebar Business Hub, great rental opportunities.
•High Rental Demand with good returnsin the Areain the Area
•Hugh Potential when Paya Lebar Business hub is up
•Also easy access to expressway like PIE, ECP and KPE
•Excellent high potential Returns for Resale and Rental

Guillemard Edge Specification

Project Name : Guillemard Edge
Description : Propose Erection of 8 Storey Residential Flat With Roof Terrace ( Total 275 units )
Developer : Macly Equity Pte Ltd
Location : No. 38 Lorong 30 Geylang
District : 14
Site Area : 49,028 Sqft
Tenure : Freehold
T O P : 2017 ( Est 2nd Quarter 2015 )
Recreational Facilities : Swimming Pool , Common Jacuzzi , Gymnasium , BBQ Area , Massage Corner , Outdoor Dinning and Pool Deck / Terrace

Unit Mix :
1 + Home Office – 409 Sqft – 517 sqft = 157 units
2 + Home Office – 549 – 560 sqft = 40 units
2 Bedroom – 474 – 721 sqft = 35 units
Penthouses :
1 + Home Office Penthouse – 775 – 1001 sqft = 29 units
2 + Home Office Penthouse – 1033 – 1550 sqft = 7 units
2 Bedroom Penthouse – 1087 sqft = 7 units
Total Units : 275 units

Hotline- +6594790133 or SMS: +6594790133

Guillemard Edge Developer Sales Team!

FACTORIES and warehouses were the top-performing real estate sector last year, thanks to robust demand for industrial property.

Prices shot up 27.2 per cent over 2010 while rents rose 15.5 per cent. In comparison, prices for office properties were 13.8 per cent higher and prices for shop properties edged up 5.3 per cent.

The numbers released by the Urban Redevelopment Authority yesterday reflect the way investors shifted focus to industrial space last year in response to tougher buying rules to cool the booming residential property.

The economic improvement also contributed to the surge in demand.

Mr Lee Sze Teck, senior manager for research and consultancy at DWG Group, said: ‘Tenants that signed rents in 2008 would have been grappling with the financial crisis and would have been able to negotiate a lower rental.

‘Rents typically last three years, so when they came up for renewal in 2011, rents could have been higher due to the more optimistic economic outlook as compared to 2008.’

Other analysts have attributed the price and rental growth to the record take-up rates.

‘Factory space occupancy rate in the fourth quarter of 2011 achieved a three-year historical record with 93.2 per cent take-up of available space island-wide,’ said Mr Nicholas Mak, head of research at SLP International.

He added that occupancy rates at warehouses performed even better, hitting 94.3 per cent, the highest recorded figure since 1996.

Several new industrial developments have been asking for significantly higher prices. Oxley Bizhub in Ubi has achieved a selling price of about $612 per sq ft, well up on the average $400 per sq ft price that similar properties in the area are going for.

An increase in the amount of industrial state land released for sale could also have contributed to the overall lift in prices, said analysts, with developers increasingly submitting higher bids in the hope of securing land in order to meet investor demand.

While 2010 and last year were bumper years, the strains are already showing with experts saying a slowdown is imminent, in line with anticipated weaker economic growth.

Industrial sector rent and price growth in the final three months of the year was the slowest for the year.

Fourth-quarter prices were up 4 per cent compared with a 6.9 per cent expansion in the preceding quarter while rents rose 0.4 per cent, well under the 2.4 per cent expansion in the three months to Sept 30.

Mr Mak said these figures indicate the sector’s weakest growth since 2009, a time when the industrial property market was beginning its recovery from the global financial crisis.

A total of almost 38 million sq ft of space is in the pipeline from upcoming projects, as at the end of last year. About 33.2 million sq ft of that is expected to be completed within the next two years.

This new supply will enter a more subdued market, say market watchers.

Mr Ong Kah Seng, director of R’ST Research, said rents for multi-user factories will likely drop 7 per cent within the next 12 months, with older properties coming off worse.

He also said that warehouse rents could fall by up to 4 per cent within the year.

Recently announced regulations on developing state industrial land have put restrictions on how new projects can be sub-divided.

Analysts say this could lead to heightened interest in existing strata-titled industrial space.

But Mr Ong warned that speculation has become a concern in strata-titled industrial properties.

‘The risk for price correction can be high if the speculative investors cannot find new takers should… leasing fundamentals weaken in an economic slowdown.’

cherlim@sph.com.sg

Source: The Straits Times © Singapore Press Holdings Ltd

(Singapore)
PRICE rises for private homes almost ground to a halt last quarter while rental increases also tapered off. The latest official data has sparked a discussion in property circles on whether the market has peaked.

Most observers say that either the peak has already been touched, or will be touched very soon.

The Urban Redevelopment Authority’s benchmark private home price index inched up just 0.2 per cent quarter on quarter (q-o-q) in Q4 last year, its ninth consecutive quarter of moderation. For the full year, the index’s 5.9 per cent rise was a third of the 17.6 per cent gain registered in 2010. The figures were identical to flash estimates released on Jan 3.

And for the first time since Q3 2009, the increase in URA’s landed property sub-index was lower than that for the non-landed property sub-index. The landed sub-index rose just 0.1 per cent q-o-q in Q4 2011, compared with 0.3 per cent for the non-landed sub-index. In fact, for semi-detached houses, the price index actually fell 0.6 per cent q-o-q in Q4.

‘In that quarter, prices of semi-detached houses in the east fell 1.6 per cent while those in the north-east softened by 1.3 per cent. This shows that some segments of the landed market are facing stronger price resistance,’ says Credo Real Estate executive director Ong Teck Hui. ‘However, landed prices have risen 80 per cent from the market trough in Q2 2009, outperforming the 48 per cent increase for non-landed for the same period.’

URA’s overall rental index for private homes rose 0.4 per cent q-o-q in Q4, or half the 0.8 per cent rise it had posted in Q3. Full year 2011, the index was up 3.8 per cent – a fraction of the 17.9 per cent gain it had put on in 2010.

The outlook for private home prices looks bleak. CBRE predicts a price drop of 5-15 per cent this year, with luxury/prime properties taking the bigger hit and mass-market homes being the least affected.

Credo’s Mr Ong says: ‘It’s difficult for prices to regain momentum as the recently imposed ABSD (additional buyer’s stamp duty) and the economic slowdown could ease demand. Sustained supply and competition among sellers will also keep a lid on prices.’

Giving a different take, Savills Singapore research head Alan Cheong said: ‘We still believe it’s difficult to conclude if we’ve reached an inflexion point, if any at all.’

Mr Cheong cites the oligopolistic nature of the Singapore residential property market, with large developers with deep pockets who’re likely to resist any price cut. ‘A cocktail of low interest rates till at least late-2014 (as pledged by the US Federal Reserve) and higher inflation will in due course reignite another round of interest in the residential market as it’s deemed a good hedge against inflation,’ he said.

Credo’s Mr Ong paints two scenarios. ‘In the best-case scenario, if the economic slowdown is milder than expected, then buying sentiment may remain positive, translating to sustained buying activity which will help to keep prices stable amid the build-up in supply. In the worst-case scenario, if there’s a recession, we can expect demand to slacken, creating downward pressure on prices.’

Lamenting the difficulty in making accurate predictions, Knight Frank chairman Tan Tiong Cheng said: ‘Each time after the government has announced cooling measures in the past two years, I thought the measures would be sufficient to cool the market. But things have turned out to be otherwise.’

He admits that the ABSD will have some effect in curbing investment and foreign demand for private homes. ‘Prices will come down – but to what degree before they go up again? What’s the alternative for people with savings? Where should they put their money? If you believe in the longer term, property is as good a bet as any. After all, interest rates are expected to stay low for the next couple of years.’

Price declines could be exacerbated by the secondary market, where volumes have slowed down more sharply than in the primary market (that is, developer sales). The number of units (excluding executive condos, or ECs) sold by developers fell 2.4 per cent from 16,292 units in 2010 to 15,904 units in 2011. However, the number of homes sold in the secondary market (resales and subsales combined) slipped 27.6 per cent, from 22,608 in 2010 to 16,357 in 2011.

Developers are wooing buyers with nice showflats and appealing ad pitches. The ease of stretching out progress payments over a few years – compared with having to pay the full price upfront when buying a completed home in the secondary market – is another reason to buy a home directly from a developer.

DTZ’s Asia Pacific research head Chua Chor Hoon said: ‘When secondary volumes come down, eventually it will affect prices. If demand slows down and sellers find it hard to sell after a few months hanging on to their prices, some owners will start to reduce prices. There will be more bargaining power for buyers as well as occupiers as rents start to ease.’

URA stats also show that developers completed 12,469 private homes (excluding ECs), up 19.9 per cent from the 10,399 in 2010. This has begun to weigh on residential rents, which are rising at a slower rate.

Savills Singapore expects a ‘mild correction’ of 5 per cent in rentals this year as more new apartments come on stream in the months ahead. It also expects the number of private residential leasing deals (excluding ECs) to hover around 45,000 in 2012, after hitting an all-time high of 45,062 leases last year. The figure for 2010 was 41,573.

‘The strong 2011 showing may be attributed to Singapore becoming the preferred location among MNCs for their regional HQs. This has also attracted more senior and top executives to relocate here,’ said Savills’ residential leasing head Patrick Lai.

DTZ’s Ms Chua said rental pressure is greater in Core Central Region but this is likely to shift to Outside Central Region in three to four years due to expected completion of projects in suburban areas arising from the ramp-up in Government Land Sales since the second half of 2010.

Source: Business Times © Singapore Press Holdings Ltd.

PRIVATE property owners paid the highest median cash over valuation (COV) amount for resale HDB flats in the last quarter of 2011, National Development Minister Khaw Boon Wan said yesterday.

Writing in his blog under the heading ‘Who Bids High?’, Mr Khaw revealed that private property owners paid the highest median COV of $45,000 in the fourth quarter of 2011.

Second-timers paid $34,000, first-timers paid $33,000, permanent residents $32,000, and singles paid the lowest median COV of $31,000, according to Mr Khaw’s data.

The issue of high COVs – which is the cash premiums paid to the seller above a flat’s valuation – was raised in Parliament on Jan 16. Mr Khaw said then that former private property owners make up the buyer segment that is pushing up the COV, not permanent residents.

He released more data to support his point yesterday.

‘We monitor HDB resale prices and publish them for information of potential buyers and sellers. Transparency helps make the market run better,’ Mr Khaw wrote in his blog.

In response, property analysts said that data on the number and types of flats purchased by the respective groups would give a better understanding of the causes of high COVs.

For example, private property owners could be buying larger flats (such as four-room and five-room flats) and therefore the COV paid is higher in absolute terms, noted SLP International research head Nicholas Mak.

On the other hand, singles, who usually buy smaller HDB flats, are likely to pay a smaller COV for the smaller units.

Mr Mak added that HDB resale prices have been rising since 2002, while the information provided was only for Q4 2011. ‘This snapshot of information is hardly enough to explain which group of buyers is contributing to the rise in COV,’ he said.

ERA Realty Network’s key executive officer Eugene Lim similarly noted that the data released by Mr Khaw is general and not flat-type specific. But it does show that private property owners are the ones paying higher COVs, he said.

‘As private property prices are at an all-time high now, those that have cashed out would have easily made significant profits. So they have the capacity to pay higher COVs, especially for the larger flats that they usually buy (five-room or executive). The other group consists of those that have made profits from en-bloc sales,’ Mr Lim said.

Source: Business Times © Singapore Press Holdings Ltd

(SINGAPORE) Suburban sites continue to receive keen interest in spite of market cooling measures and the wider economic uncertainty.

Yesterday’s tender closing for the prime residential site at Kovan Road/Simon Road garnered 11 bids, of which a consortium comprising Hoi Hup Realty, Investment Focus, and Oriental Worldwide Investments emerged the top bidder.

Its bid of $194.6 million translates to about $507 per square foot per plot ratio (psf ppr).

Credo Real Estate executive director Ong Teck Hui noted that the top bid is ‘roughly in line’ with recent tenders for residential sites in Clementi ($554 psf ppr) and Mt Vernon ($495 psf ppr).

This, he said, ‘appears to be the current land price range for good suburban residential sites’.

The site, which has a 99-year lease period, has an area of about 1.7 hectares, and a gross floor area (GFA) of about 384,142 square feet.

‘The healthy list of bidders from this and recent tenders shows that developers are confident, and that their balance sheets are strong enough to weather through concerns that the ABSD (additional buyer’s stamp duty) will lead to abject market conditions,’ said Alan Cheong, head of research at Savills Singapore who estimated the project’s breakeven cost to be about $980 psf.

Lee Sze Teck, senior manager of research and consultancy at Dennis Wee Group, added that the keen contest shows that attractively located sites will continue to draw strong participation from developers despite the uncertain market conditions.

‘The breakeven for the site could be between $900 and $1,000 psf . . . The developer could be looking at a price range between $1,100 and $1,300 psf,’ he added.

According to a spokesman from Hoi Hup, the consortium intends build a condominium comprising fewer than 400 units. They include a mix of Soho-style units and townhouses.

The project should be launched later this year.

The tender’s second highest bidder was a group made up by Frasers Centrepoint’s FCL Topaz, F E Lakeside and Sekisui House Singapore. Their bid of $192.8 million translates to some $502 psf ppr.

Li Hiaw Ho, executive director at CBRE Research, expects units on the site to fetch between $1,100 and $1,200 psf, citing the location’s strong attributes.

‘The site is less than five minutes’ walk to Kovan MRT station on the North- East Line. It is surrounded by an established landed housing estate and low-rise apartments or shophouses. Kovan Melody and Kovan Residences are also situated nearby. Shopping and retail outlets are available at Heartland Mall-Kovan and Hougang HDB estate,’ he said.

SLP International research head Nicholas Mak noted: ‘There has been no new major condominium launched in the Kovan area since the launch of Kovan Residence in June 2008. After the sale of this site, there is also an absence of another major condominium development site near the Kovan MRT station.’

Other bidders included UOL unit, United Ventures Development, which placed a bid of $180.8 million ($436 psf ppr), and Mezzo Development, which submitted the lowest bid of $128 million ($333 psf ppr).

Source: Business Times © Singapore Press Holdings Ltd.

HOME buyers, undeterred by recent tough market cooling measures, turned up in strong numbers at the preview of Watertown at Punggol Central yesterday.

Far East Organization said more than 160 units out of the 250 units launched were snapped up, with Singaporeans making up more than 90 per cent of buyers.

The enthusiastic response means that the official launch, originally scheduled for next week, will now be brought forward to tomorrow.

Industry analysts say developers seem eager to push out projects quickly, possibly before more uncertainty emerges.

In the case of Watertown at Punggol, the developers bought the site for the 992-unit project less than a year ago and have yet to finish the showflat.

But agents had been fielding inquiries on the mixed-use development even before the authorities’ approval for the launch had been given, sources say.

They say at least 100 buyers were ready to hand over cheques on Tuesday. But building plan approvals were issued yesterday and only then could agents collect cheques and grant options to purchase last evening.

The $1.6 billion project is being jointly developed by Far East, Frasers Centrepoint and Japanese firm Sekisui House. It will be integrated with a mall of 370,000 sq ft of net lettable shop space and a Shaw Theatres Imax cinema.

Developers had earlier said that prices will start from $1,080 per sq ft (psf), which they said included a discount.

Even so, the development will still set a benchmark in Punggol, trumping Sim Lian Group’s A Treasure Trove, priced at $866 psf at its launch last September.

Buyers were unfazed at picking units off the plan as the showflat is not yet up.

Key attractions are the waterfront location and the fact that the project is integrated with Punggol MRT station, experts say. Recent mixed-use launches like Bedok Residences have also seen robust sales and benchmark pricing at a median of $1,359 psf.

SLP International research head Nicholas Mak said that developers are pushing out projects as quickly as possible before more uncertainty hits the market.

‘Especially in the Punggol area, developers face increasing competition as the Government has pushed out a lot of land there,’ he added.

He said the 11-month turnaround for the site, bought in February last year, was ‘fairly quick’.

It typically takes a year or more for integrated projects of this size to be launch-ready, he added.

The Dec 7 cooling measures included an extra stamp duty of 10 per cent on all home buys by foreigners. Some analysts tip price falls of 10 per cent to 20 per cent this year.

Separately, Sekisui House said it will tap its network of retailers to introduce new-to-market brands and concepts from Japan into the upcoming mall.

Source: The Straits Times © Singapore Press Holdings Ltd

THE recent property cooling measures might have to be fine-tuned, depending on how persistently sales volumes drop, according to Far East Organization chief executive Philip Ng.

He told a briefing yesterday that the 10 per cent additional buyer’s stamp duty for foreigners is ‘a very big number’.

He also said that the measures had led Far East and its partners to drop the prices for the upcoming launch of its Watertown project in Punggol Central.

Foreigners, the main target of the new cooling policies, have shown less interest in the project than at launches before the measures, noted Mr Ng.

He said the measures may eventually need to be tweaked.

‘Indeed, there could be some calibration or tiering perhaps, but that’s something that has to be discussed with good data between developers and policymakers.

‘At this point, it’s pretty early days and you can see that there was already a drop in December,’ he said, referring to the 63 per cent plunge in new private homes sales last month.

He added that the policy should be allowed to run for a while to gauge if the sales decline is persistent before deciding if the policy needs calibrating.

Mr Ng made his comments at a briefing on the upcoming Watertown launch.

The 992-unit estate has a development cost of more than $1.6 billion and is being jointly developed by Far East, Frasers Centrepoint and Japanese firm Sekisui House. It will be integrated with a mall of 370,000 sq ft of net lettable shop space and a Shaw Theatres Imax cinema.

Prices have been cut by 5 per cent to 8 per cent in response to the cooling measures.

The first 250 units will be sold at a starting price of $1,080 per sq ft (psf) after the discount and are expected to go on the market next week.

Even with the price reduction, the development will still be the priciest project in Punggol, trumping Sim Lian Group’s A Treasure Trove, which was priced at $866 psf at its launch last September.

Watertown will consist of suites, ‘small office, home office’ (Soho) apartments, sky patios and residences. About 55 per cent of the units will be less than 700 sq ft.

Mr Ng said: ‘We’re reflecting the trends of major global cities like Hong Kong, Tokyo, London and Paris. They do have a sizable amount of small units in their stock… Most of our sales of small units have been quite well-received.’

He expects foreigners to account for less than 10 per cent of Watertown’s sales.

Mr Lim Ee Seng, chief executive of Frasers Centrepoint, did not give the briefing his forecasts on how the residential market might pan out but alluded to land tenders that closed after the cooling measures were imposed on Dec 7 as a gauge of sentiment.

Bids for these tenders were between 10 per cent and 20 per cent lower than those for nearby sites tendered earlier.

Source: The Straits Times © Singapore Press Holdings Ltd

A JOINT venture comprising Singapore Press Holdings (SPH) and the United Engineers Group has lodged the top bid of $328 million for a commercial site in Sengkang.

The offer by Earth Holdings, as the joint venture is called, works out to $1,156 per sq ft per plot ratio (psf ppr).

Market watchers had expected a top bid of about $800 psf ppr for the site, which is next to the Fernvale LRT station.

It was also about 21 per cent above the second-highest bid of $272.2 million submitted by Alpro Management Services.

There were 12 bids – from experienced mall developers and new entrants – vying for the plot at the junction of Sengkang West Avenue and Fernvale Road. The developers include Frasers Centrepoint, Mapletree and Sim Lian Group.

The 99-year leasehold site of 94,619 sq ft can be developed to a maximum gross floor area of 283,856 sq ft.

Any development is likely to be about 30 per cent smaller than Compass Point, the nearest mall.

Property experts believe the strong response could be attributed to developers being more optimistic about suburban retail.

Mr Ong Teck Hui, head of research at Credo Real Estate, yesterday said: ‘A retail centre with a trade mix that caters more to the needs of heartlanders is likely to be well patronised by shoppers, thus ensuring its viability.’

He added that many retailers are keen to establish a presence in new retail centres.

Sengkang’s healthy growth prospects are another draw for developers, noted market watchers.

Many plots in the area are primed for residential development, said Mr Png Poh Soon, Knight Frank’s head of consultancy and research.

Sengkang is a fairly new township, with a significant portion of its land already taken up by public housing.

While it is unclear whether those undeveloped plots would be allocated for public or private housing, Mr Png said any additional residential developments in the area would bring in new households, which could consist of young families with high income growth potential.

He also pointed out that malls in such areas are in short supply, another reason for the bullish bids.

‘You have to consider what is the immediate catchment of the site in the next few years,’ he said.

‘Looking at the location itself, you won’t see any malls within a 500m radius.’

cherlim@sph.com.sg

MALLS IN SHORT SUPPLY

‘You have to consider what is the immediate catchment of the site in the next few years… Looking at the location itself, you won’t see any malls within a 500m radius.’

Mr Png Poh Soon, Knight Frank’s head of consultancy and research

Source: The Straits Times © Singapore Press Holdings Ltd

The firm’s top executive said in a recent interview with The Business Times that Surbana’s expertise in developing HDB flats in Singapore will put it in good stead to exploit the growing demand for affordable homes in overseas markets as well.

‘We are upbeat about prospects in the next two to three years,’ said Soh Wah Meng, chief executive of Surbana’s consultancy arm, Surbana International Consultants.

‘Surbana International Consultants’ strength as a leading expert in designing integrated townships and mass housing means that it will be well-placed to exploit the growing demand for affordable homes worldwide,’ Mr Soh added.

Surbana has two main business arms – consultancy and township development. The consultancy unit, which has created a million homes for Singaporeans over the last 50 years, is now expanding overseas.

‘Outside Singapore, we will focus on a few key markets such as China, Malaysia and Vietnam while exploring new opportunities in the Middle East and Africa where there is growing demand for well-designed mass housing,’ Mr Soh said.

His business unit recently successfully broke into the Brunei market, where it won a government contract to design 4,000 landed homes. That project is progressing well, Mr Soh said.

In addition, the firm is also pursuing a 12,000-unit housing project by the Penang state government and will continue to provide consultancy services for shareholder CapitaLand’s projects, both overseas and in Singapore.

However, Surbana, which is HDB’s former building and development unit, said that the bulk of its business will continue to come from the HDB market in Singapore as the government agency ramps up its building programme over the next two years.

‘HDB will remain our key client for two reasons. First, our core expertise is in designing well-planned townships and mass housing. Second, as one of Singapore’s largest consultancy firms, it is only natural that we target the largest developer in Singapore,’ Mr Soh said.

But since Surbana was allowed to compete for non-HDB jobs in 2008, it has widened its horizon and made inroads into the private sector in Singapore.

Notable non-HDB projects that it has secured include CleanTech One in JTC’s CleanTech Park, the Aquatic Science Centre, the Singapore University of Technology and Design, Clementi Mall, The Canopy Executive Condominium and the Nautical condominium.

‘In a short span of four years, we have built up a good order book of institutional, commercial and private residential projects,’ Mr Soh said. ‘We certainly want to do more such projects going forward.’

Source: Business Times © Singapore Press Holdings Ltd

The networking and communications specialist is expected to be the first tenant to be signed up for the business park component of the project, which is scheduled to receive Temporary Occupation Permit in a few months.

Cisco is expected to exit Capital Tower along Robinson Road, where it occupies about 80,000 sq ft; its lease runs out in Q1 2013, BT understands.

Market watchers reckon cost savings would be the main factor behind the move. They estimate that if Cisco had renewed its lease at Capital Tower, it could expect to pay a monthly rental of about $9-10 psf. On the other hand, it may pay an amount closer to the $4 psf mark at UE BizHub East, reckons an office leasing agent.

UE BizHub East is a stone’s throw away from Expo MRT Station. Its nine-storey business park component will have 423,216 sq ft net lettable area in two linked blocks. Cisco is expected to lease three mid-level floors.

The project, being developed by United Engineers (UE), will also have 251 hotel rooms and serviced suites (both under UE’s Park Avenue brand), about 100,000 sq ft of retail space (including a FairPrice Xtra hypermarket) and convention/exhibition and auditorium space.

Jones Lang LaSalle is understood to have brokered Cisco Systems’ leasing deal but declined to comment on the transaction. However, its head of markets Chris Archibold observes: ‘Given the current economic uncertainties, most occupiers are very much in cost-saving mode. In terms of their real estate requirements, this is manifesting itself as occupiers look towards cost-effective locations for their businesses.’

Market watchers say large office leasing deals in Singapore’s CBD have slowed considerably in the past six months amid the weaker economic outlook. Financial institutions, which were major office leasing drivers in the CBD in 2010 and 2011, have been told by head offices to put expansion plans on hold.

‘But at the same time, some of these financial institutions are looking at options for their back office functions with a view to saving costs,’ says Mr Archibold. ‘Over the past five years, 14 major FIs (financial institutions) here have split their front- and back-end functions, as their operations here have grown to a size that gives them the critical mass to do such a split. Another motivating factor for such a move is the lower real estate cost of locating back office functions outside the city. And rentals in such locations are also less volatile to market cycles,’ he added.

‘Changi Business Park has seen a lot of such activity over the past four years, with more than one million sq ft of expansion in the park by major FIs like Stanchart, DBS, Citi and Credit Suisse,’ said Mr Archibold.

Last year, Credit Suisse inked a lease for 315,000 sq ft with an option to take up a further 175,000 sq ft, at One@Changi City, which will be completed by end-2012 and is next to UE BizHub East.

One@Changi City has about 650,000 sq ft net lettable area of business park space. It is part of an integrated development which also includes Changi City Point (a mall which opened in November) and a hotel.

The project is being developed by Ascendas Land and Frasers Centrepoint. ‘One@Changi City has drawn interest from a variety of companies, including financial and IT companies,’ said an Ascendas spokeswoman.

Source: Business Times © Singapore Press Holdings Ltd