Tag Archives: guoco tower

Super Penthouse in Singapore for S$100M

Who will be buying the most expensive apartment or “bungalow in the sky” in Singapore? The asking price for a new three-storey Singapore penthouse, complete with a private pool on the 64th floor, has reached more than $100 million. This amount of money can well easily buy one a few good-class bungalows (GCBs) in District 9/10.

The Wallich Residence’s penthouse is in the tallest building in Singapore, the island of well-heeled stability that attracts the super-rich from its less-developed South-east Asian neighbours, as well as multi-millionaires from mainland China.

It will test the endurance of demand for luxury property in the city-state – the part of the market that has taken the biggest hit from measures aimed at cooling down prices in recent years.

Prices for luxury homes in Singapore have fallen 15-20 % from a 2013 peak. However the recent events has cause optimism among market insiders to foresee a turnaround – at least at the top end of the market – and is forecasting a 3-5 % increase in luxury prices this year, citing demand from both locals and foreigners who feel the market is bottoming out.

The volume of transactions in the first four months of the year in Singapore’s core central region was 35% higher than in the same period last year. The Core Central Region includes the popular areas among wealthy foreigners — the Orchard Road shopping area and Sentosa island.

Buying by foreigners has picked up since the start of the year at the developer’s high-end Leedon Residence project, near the 150-year-old Singapore Botanic Gardens. GuocoLand is part of Malaysian conglomerate Hong Leong Group, headed by billionaire Quek Leng Chan.

The recent tightening of property market controls in places like Hong Kong and Australia played a part in attracting foreign demand to Singapore’s luxury property this year. While prices in Hong Kong tripled and Sydney’s doubled over the past decade, Singapore prices rose just 29 %.

City Developments (CDL), one of the largest Singapore developers, also said the average sales price at its high-end Gramercy Park project has risen to more than $2,800 per sq ft in recent months, up 8 % from a year ago, and foreign buyers accounted for three-quarters of the project so far.

One may note though that the Singapore’s residential market has fallen for 15 straight quarters to log its longest losing streak since official records began in 1975. Analysts expect a bottoming of prices in the year 2017.

Singapore introduced property price cooling measures to curb speculation for the past 7 years. Some measures were relaxed slightly this year but the authorities announced that there would be no more rolling back of the remaining measures for now.

More information of the Penthouse can be found at the following link.
https://www.guocoland.com.sg/Properties/SG/Resources/WR/Wallich_PentHse.pdf

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Good Take-up at Guoco Tower space

TECH and media companies are making their presence felt at Guoco Tower in Tanjong Pagar, accounting for 37 per cent of the space that has already been committed.

The premium Grade A office component of Tanjong Pagar Centre, a mixed-development project being built by the listed GuocoLand group, has 890,000 sq ft net lettable area of which 80 per cent or some 712,000 sq ft is either taken up or subject of advanced leasing discussions. Of this space, approximately 263,000 sq ft has been committed by tech and media companies, including Amadeus and OpenLink.

Earlier media reports also tipped Agoda, Dentsu Aegis Network, Palo Alto Networks, ING, Itochu Singapore, and SAS Singapore as heading for Guoco Tower. Dentsu Aegis is expected to be the biggest tenant with about 100,000 sq ft.

GuocoLand has also named as new tenants The Straits Trading Company, which will be moving out of 9 Battery Road; Danone, which is exiting Goldbell Towers along Scotts Road; shoemaker Asics, which will be leaving PWC Building; and Teva Pharmaceutical Industries, which is exiting three locations.

The offices, which received Temporary Occupation Permit (TOP) last month, are on the lower 38 levels of the 64-storey tower, which is Singapore’s tallest building at 290 metres. Levels 39 and upwards of this tower comprise the 181-unit Wallich Residence. A second tower houses the 222-room Sofitel Singapore City Centre. Both of these components are expected to receive TOP between late this year and early 2017. The project also has a retail component, part of which has already received TOP.

Guoco Tower is counting on its prime location, flexible, efficient and scalable design, Tanjong Pagar Centre’s tightly integrated retail and lifestyle components, and of course, the prestige factor of being in Singapore’s tallest building as its selling points.

Most of the MNCs in Guoco Tower will be using it as their regional headquarters with average headcounts of 300 to 500 persons, coupled with relocations of many of their senior management staff from their other headquarters or regional offices to Singapore.

This would create a lot of demand for F&B, services, hotels and even housing in the area and catalyse Tanjong Pagar’s transformation. The gross effective monthly rents at Guoco Tower are estimated to be between S$8.50 and S$11.00 per square foot – comfortably above the average of S$7 to S$8 psf in the Tanjong Pagar office micromarket, and comparable to other premium Grade A developments in Marina Bay.

 

Upcoming Office space may not be enough

Fears are emerging of a possible office space crunch despite the soaring skyscrapers framing the ever-changing central business district (CBD) skyline.

No commercial sites were on the confirmed list of the Government Land Sales (GLS) programme for the first half of 2015 released last week. These sites go on sale regardless of interest.

This has fuelled concerns in some quarters that despite a slew of new commercial buildings slated for completion in the next three years, space could still be in short supply down the line.

Industry players say the new buildings should meet demand for office space in the Downtown Core – which covers the CBD, City Hall, Bugis and Marina Centre areas – in the short term.

But some fear a possible crunch, amid an increasingly diversified profile of tenants looking to set up shop in the core business district.

The Straits Times understands that developers are keen to see more commercial sites go on sale.

The GLS programme for the first half-year has only a 0.78ha plot in Marina View and Union Street and a 2.1ha commercial site on the reserve list – requiring bidders to first submit an acceptable opening offer to trigger a tender.

The two sites could yield 1.89 million sq ft of commercial space.

“As office developments tend to be large, we do not always need to supply an office site on the confirmed list every half-yearly,” the Urban Redevelopment Authority (URA) said in response to queries from The Straits Times.

“New office supply from the GLS programme is intended to meet demand in the medium term, after factoring in a construction period of about five years.

“Our supply of office space in the Downtown Core will also need to be balanced against our efforts to build up new commercial centres outside the city centre to bring jobs closer to homes.”

About two-thirds of 11.8 million sq ft of commercial space are in the central areas, which will be enough to meet demand “in the next few years”, said URA.

But experts believe supply will be patchy up to 2018. Beyond that, the lack of new supply is “becoming starkly obvious”.

CapitaCommercial Trust’s 702,000 sq ft CapitaGreen will be completed by the end of the year. The 500,000 sq ft office component of the South Beach integrated project is set to be ready too.

After a dearth of fresh supply next year, about 3.2 million sq ft of office space – the size of Marina Bay Financial Centre – from four projects is expected to flood the market in 2016: M+S’ DUO in Beach Road and Marina One in Marina Bay, GuocoLand’s Guoco Tower in Tanjong Pagar and UOL Group’s 5 Shenton Way.

The supply will be trimmed yet again in 2017, with just 805,100 sq ft coming on stream from Frasers Centrepoint’s commercial site in Cecil Street and Tuan Sing’s redevelopment of Robinson Towers.

“Historically, it’s always been a feast or famine in Singapore’s office space if you look at the supply chart. Landlords and occupiers will have to time their renewals and leasing plans according to that,” noted Mr Desmond Sim, research head at CBRE, Singapore and Asia Pacific.

The result is that rents of Grade A space – in top-quality buildings – could pick up at a faster clip in 2018, said Mr Sim.

Already, monthly rents have picked up 17 per cent, from $9.66 per sq ft (psf) since the trough in the third quarter of last year, to $11.20 psf now.

However, Ms Tan Li Kim, head of research at Cushman and Wakefield, estimated demand for office space would be 4.4 million sq ft by 2018, against the 5.3 million sq ft of space that could be available by then, if the upcoming projects are developed on time.

This supply would be from different office micro markets within, so any rental fluctuations are expected to even out, she said.

One micro market that has stood out would be the offices in the Marina Bay precinct, for instance, said Mr Moray Armstrong, executive director of office services at CBRE.

The URA has made plans for 10.8 million sq ft of new office space under its Master Plan 2014.

But, as Mr Armstrong put it: “The million sq ft question is where and when the next landmark Marina Bay development will arise.”

http://business.asiaone.com/news/after-the-feast-the-famine-may-be-lurking

Commercial space crunch in central area

Space crunch drives up office rents in CBD and Suburbs, as reported in today’s ST.

A space crunch in the Central Business District (CBD) and the completion of new suburban developments drove up office rents islandwide in the second quarter, consultants said.

The data underlines two key trends: One is that firms that do not need a downtown address are relocating to the cheaper sites on the outskirts while CBD rents are rising on the back of robust demand for limited space.

Average rents for Grade A office space in the CBD jumped 10.7 per cent overall to $10 psf per month in the second quarter from the preceding year, according to property consultancy Cushman & Wakefield.

The average gross rent in Marina Bay was $12.95 psf per month, a marginal 0.4 per cent higher than in the first quarter.

Another consultancy, DTZ, also estimated yesterday that average gross rents in Marina Bay rose 6.5 per cent to $12.25 per sq ft per month in the second quarter from the preceding three months.

Consultancies may come up with different rental estimates due to the varying baskets of properties that they track.

Rents in the Raffles Place and Shenton Way areas were cheaper than in Marina Bay.

In Raffles Place, Cushman said the average gross monthly rent grew 3.5 per cent in the second quarter from the first to $10.25 psf per month.

Rents in the older part of the CBD around Shenton Way, Robinson Road and Cecil Street stayed stagnant at $8 psf per month on average, said DTZ.

Cushman said the leasing momentum in the CBD would likely continue in this half of the year, with keen interest expected from companies in the business services and technology sectors.

Businesses that do not need to have a presence in the CBD are relocating to city fringe areas or the suburbs where rents are more competitive, it added.

Still, suburban rents shot up faster than those in the CBD in the second quarter compared with the same period last year, according to a report by consultancy Chestertons.

They leapt 22.6 per cent in April through June over 2013 to $5.70 psf per month on average while CBD space climbed 4.7 per cent to $9.64 psf per month.

This jump in suburban rents was mainly because newly completed Grade A office space there bumped up prices.

These completions include The Metropolis in Buona Vista and Jem in Jurong.

However, he said that landlords were unlikely to raise rents much soon.

“We expect landlords to adopt a tenant-retention strategy instead of raising rents significantly in 2014 or 2015, losing ‘loyal’ tenants and facing looming vacancies in 2016 when supply and relocation options are aplenty.”

DTZ said yesterday that around 2.7 million sq ft of office space will be completed between now and the end of next year.

Beyond next year, however, the pipeline supply of office space will reach a new peak of about 3.9 million sq ft in 2016, with about 60 per cent of that located in the CBD, it said.

Major buildings expected to be completed in 2016 include Guoco Tower in Tanjong Pagar and Duo Tower in Bugis.