COMMERCIAL MARKET
Former police station to be part of hotel development
THE former Joo Chiat Police Station is set for a new lease of life as part of a hotel development, with developers needing to conserve the 1920s colonial building.
The Urban Redevelopment Authority (URA) described the East Coast Road station as 'historically and architecturally significant' as it released detailed sales conditions of the site yesterday.
URA said the building is 'well-proportioned with key facades sensitively composed'.
'The inclusion of this stately building within the site will add a unique charm to the future hotel development,' it read.
The building, which is in an area dotted with historic conservation shophouses, is now occupied by a restaurant and is part of Katong Village, a collection of food and entertainment outlets. Tenants have until Oct31 to move out. It is understood that five out of 11 tenants will have done so by the end of the month.
The site is on URA's reserve list of the Government Land Sales (GLS) programme. Sites on the reserve list may not get triggered for sale, unlike confirmed list sites, which go on sale on a particular date. This means that the 8,239 sq m land parcel, on which the station sits, will be put up for tender only if a developer agrees to pay an acceptable minimum sum to the Government.
Any bidder will have to contend with competition from several hotels in the area.
The newly-opened Santa Grand Hotel East Coast, with more than 70 rooms, is nearby. Far East Organization's East Village Hotel and the Grand Mercure Roxy Hotel - with more than 780 rooms in total - are also a stone's throw away.
The 99-year leasehold plot has a maximum permissible gross floor area of 24,716 sq m. It can be built up to a height of 20 storeys, a consultant has estimated. An earlier estimate had said that the site could yield some 600 rooms.
Source: The Straits Times – 27 June 2012
OFFICE MARKET
Office capital values seen easing 5% this year
OFFICE capital values could fall 5 per cent for the whole of 2012 according to an analyst report.
The average capital values of Grade A office space in the Raffles Place/New Downtown micro-market softened by a marginal 0.5 per cent - from $2,459 psf in Q1 to $2,447 psf by end June - following pressure from the third consecutive quarter (since Q4 2011) of easing office rents.
There was sustained interest, however, in the sales market, which was buoyed by low interest rates and continued availability of new strata supply.
Oxley Tower saw 60 per cent of the 56 office units released snapped up within the first few days of its launch at prices ranging from $2,800 psf to $3,490 psf. EON Shenton also saw more than 30 office units sold out of the 50 units released during its preview, at between $2,150 psf and $3,000 psf.
Equally brisk were en bloc sales of strata office units. In April, 51 strata office units in Parkway Centre were collectively sold for $53.4 million ($1,043 psf). In May, 66 strata office units in Burlington Square were sold at $89.3 million ($1,318 psf).
On the rental front, rents of islandwide Grade A office space slipped by 1.2 per cent in Q2 compared with the 4.2 per cent fall in Q1.
In the Raffles Place/New Downtown micro-market, the average monthly gross rents for Grade A office space fell 3 per cent quarter on quarter to $9.47 psf. This segment experienced a 5.3 per cent quarter-on-quarter drop in Q1.
Similarly, rents in other micro-markets moved by between zero per cent and -2.4 per cent in Q2, versus the -2.3 per cent to -8.8 per cent plunge seen in Q1.
The threat of an impending supply overhang remains. This stems from the substantial amount of space that could be returned to the market upon lease expiry, as existing tenants moved to newer premises. It is estimated that some 150,000 sq ft of space could be relinquished in H2 2012.
The erosion of office rents in the Raffles Place/ New Downtown micro-market is expected to continue into the next six months, but the pace of decline could decelerate from the 8.1 per cent fall registered in the first half.
Rental decline is expected to keep within 15 per cent for the entire year.
Source: Business Times – 27 June 2012
Six floors in AA Centre for sale
THE office space used by the Automobile Association of Singapore (AA Singapore) is up for sale.
The first six levels, or 55,774 sq ft, of the 14-storey AA Centre on River Valley Road at an indicative price of $90 million to $100 million was put up for sale.
The first four levels are owned by AA Singapore. There is a reception area, a multi-purpose hall and a cafeteria on the first level, and offices and clubhouse space, including a jackpot room and swimming pool, on levels two to four.
On levels five and six are 32 serviced apartments, all vacant. It is unclear if AA Singapore owns these apartments.
The residential units on the remaining eight storeys are owned by individuals. There are 90 parking spaces in the basement level for common use.
The building, which is on a freehold site, was developed by AA Singapore in 1984. Nearby transport links include the Central Expressway, the Ayer Rajah Expressway and Somerset MRT station.
The property could appeal to a variety of users, such as serviced apartment operators, corporate office users or groups dealing in education or medical tourism.
Source: The Straits Times – 27 June 2012
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