New Tua sites launched

JTC yesterday launched for sale two far-flung sites at Tuas Bay Close and Tuas South Street 7 (Plot 44) under its H2 2014 Industrial Government Land Sales (IGLS) programme.

JTC said their different land tenures and plot sizes were aimed at catering to different groups of industrialists – those who prefer to buy strata-titled industrial property and those who want the flexibility to custom-build their own facilities on smallish sites.

The 2.7ha site at Tuas Bay Close is one such site that can be strata-subdivided for sale. It is zoned for B2 development, for heavier and more pollutive industrial use such as metal stamping, welding and chemical processing. It comes with a 30-year tenure with a maximum gross plot ratio of 1.7, which means it can be developed into a project with up to 4.6ha gross floor area.

Analysts expect the plot to attract two to five bids, with a winning bid of S$65-80 psf per plot ratio (psf ppr).

Separately, the 0.5ha site at Tuas South Street 7 (Plot 44) was successfully triggered for sale from H1 2014’s reserve list with a minimum bid price of S$3.527 million.

A site on the reserve list is launched for tender only upon successful application by a developer, while confirmed list sites are launched according to schedule, regardless of demand.

This site is also zoned B2 and has a 20-year- 10-month tenure and a maximum gross plot ratio of 1.0. Analysts said this site will likely attract interest from contractor-developers (developers with construction and engineering arms, e.g. Koh Brothers) and average-sized industrialists.

A plot of this size would save these industrialists the need to amalgamate adjacent small sites, said R’ST Research’s director, Ong Kah Seng.

“The end-product on the site is likely to be a no-frills, low-rise single-user factory. Space allocated for such uses is set to diminish as Singapore trends towards modern, high-tech, and value-added industrial activities in sync with its global city image.”

He added that most of the sites to be released by the government in the second half are fairly large, so bidders of this site may bid competitively amid the limited new supply for such “rare” sized Tuas industrial plots.

Five to 10 bids are expected, with the winning bid anywhere between S$68-100 psf ppr.

SLP International research head Nicholas Mak believes the party who triggered this site may want it for corporate strategic reasons. “If this site were launched for tender as a confirmed list site, the possible range of top bids could be lower,” he said.

The tender for the Tuas Bay Close plot closes on Sept 23, while that for Tuas South Street 7 (Plot 44) closes on Sept 9.

The government has been releasing many Tuas sites in recent years to cater to industrialists’ end use – both small plots for those with affordability constraints and bigger ones for major industrialists with mega industrial operations.

These sites are also less likely to attract speculators and investors because of their remote locations, and for B2-zoned plots, their grimey nature. Shorter tenures, while posing some loan financing challenges, further boost their affordability.

http://www.businesstimes.com.sg/premium/singapore/jtc-launches-2-more-tuas-sites-sale-20140730

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