Singapore’s Urban Redevelopment Authority on Thursday launched the tender of a 6.5 hectare (16 acre) mixed-use development site in Jurong Lake District as the city-state ramps up government land sales this year.
The so-called white site in Singapore’s western region can potentially yield 146,000 square metres (over 1.5 million square feet) of office space, 1,700 dwelling units and 73,000 square metres of gross floor area for complementary uses like shops, restaurants, entertainment and hotels, the URA said in a release. The tender will close at noon on 26 March of next year.
The winning bidder will be required to build at least 70,000 square metres of office space and 600 private housing units as part of the first phase of the project but will have flexibility to phase out the remaining supply according to market demand. The integrated development in JLD — a growth area touted as Singapore’s second central business district — is to be progressively completed over the next 10 to 15 years.
Tay Huey Ying, head of research and consultancy at JLL Singapore, said the completion of the first phase by 2028 or 2029 would “help to alleviate the tight supply of good-quality office space” as the Lion City rises in prominence and popularity as a global office hub.
Choose Your Own Duration
The site up for tender is bisected by Jurong Town Hall Road and Jurong Gateway Road and comprises three plots linking the existing commercial centre at Jurong East MRT interchange station to the future Jurong Lake District station of the Cross Island Line.
The aim is to comprehensively master-plan the entire site to integrate the various uses, coordinate implementation of the development and adopt district-level urban solutions such as a district cooling system and district pneumatic waste-conveyancing system.
Under an option scheme, the master developer can choose the duration in which it intends to complete the purchase of the entire land parcel, only paying upfront for the land required to be developed under the first phase. For the right to buy the rest of the land parcel, the developer will have to pay an option fee based on the land price of the remaining gross floor area and the chosen duration, topping out at 13 percent for an eight-year period.
Tricia Song, head of research for Southeast Asia at CBRE, said the development land cost could be at least S$1,300 per square foot of built area, with the total land cost exceeding S$5 billion ($3.7 billion). By comparison, the Guoco Midtown site providing over 700,000 square feet of office space was sold in October 2017 for S$1,706 per square foot, while the IOI Central Boulevard Tower site yielding 1.26 million square feet of office space was sold in November 2016 for S$1,689 per square foot.
CBRE estimates the first phase’s minimum requirement at 35 percent of total space, with a cost between S$1.8 billion and S$2 billion.
“Given the scale and importance of the project, we do expect a lot of interest from developers, both local and foreign, and expect them to form consortiums or JVs to tender for this project,” Song said. “Based on the nine months of tender period, and an estimated five years completion period, we expect the earliest office completion will likely be in 2029.”
Busiest in a Decade
With the JLD site bringing up the tail end of Singapore’s first-half government land sale programme, the government unveiled plans this week to put up for sale eight residential sites in the second half of the year in a bid to boost private home supply and tame a red-hot housing market.
The URA is set to auction off projects that can be developed into up to 5,160 new private homes, including 560 subsidised condos, under the confirmed GLS list for August to December.
In terms of housing units, the second-half scheme marks the highest half-year home total announced in a GLS programme in a decade, representing a 26 percent rise from this year’s first-half total of 4,090 new homes at seven sites.