Remembering Lee Kuan Yew - Thank you - The nation with you in your final journey - See u in heaven

Remembering Lee Kuan Yew - Thank you - The nation with you in your final journey - See u in heaven
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Thursday, 2 April 2015

Bids for Paya Lebar site likely to top $1b - Government Land Sale (GLS)


Bids for Paya Lebar site likely to top $1b - Government Land Sale (GLS)

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Experts predict the top bid for the parcel could fall between $700 and $850 per sq ft per plot ratio, or $1.24 billion to $1.51 billion, with five to 10 players throwing their hats into the ring. 

A large mixed-use site that can play a key role in plans to develop Paya Lebar into a major commercial hub went on sale for the second time yesterday, with bids expected to go well over $1 billion.
The 3.9ha plot's connectivity to a major transport hub and its proximity to the city - coupled with government moves to decentralise businesses - could entice developers but it will require one with deep pockets given its size and construction challenges.
The 99-year leasehold site, with a potential gross floor area (GFA) of 1.78 million sq ft, is on the confirmed list of the Government Land Sales programme. It first went up for tender in July 2011 but was not sold after the UOL Group offered a lone bid of $529.5 million - a price deemed "too low". At that time, the site was a smaller 2.07ha.
Experts predict the top bid for the parcel now could fall between $700 and $850 per sq ft per plot ratio, or $1.24 billion to $1.51 billion, with five to 10 players throwing their hats into the ring.
A new development on the larger plot will have up to 969,000 sq ft of GFA set aside for offices, a maximum of 419,800 sq ft for retail with an additional 10,800 sq ft for an outdoor "public plaza" featuring a mall. About 440 residential units or serviced apartments can also be built as part of the development. It will have transport links to the Paya Lebar interchange and MRT station, where the Circle and East-West lines meet.
But the site comprises two plots separated by Sims Avenue and developers will have to bear significant costs for work to link the plots underground, noted Ms Ong Choon Fah, chief operating officer of DTZ. Construction costs from building above the Geylang Canal would also be sizeable.
The complexity of construction means the larger developers are likely to throw their hats into the ring, experts said.
The UOL Group is expected to join the fray again, having developed the nearby One KM mall in Tanjong Katong Road as well.
The new development will add to the 12ha of land available for development in the Paya Lebar Central precinct, which could yield up to 5.38 million sq ft of commercial space, said the Urban Redevelopment Authority.
Mr Chris Archibold, head of markets at JLL, said the quantum of office space that will be made available through the new site will have enough critical mass to change the dynamics in the area.
The site's layout makes it tougher for strata subdivision of office units but healthy leasing demand is expected from bigger firms keen on larger floor plates and eager to locate their operations out of the city, added Mr Ong Kah Seng, director of R'ST Research.
The tender closes on March 31.
The Straits Times / Money                                              Published on Friday, 31 October 2014
By Cheryl Ong                                                                    ocheryl@sph.com.sg

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