BH Global to buy Penjuru land for $2.5m

BH Global Marine, a supply chain management company, has entered into an option agreement to purchase a property at 10 Penjuru Lane for $2.5 million. The land, which has area of about 11,700 square metres, is adjacent to BH Global’s headquarters at 8 Penjuru Lane and will add on to the existing land area of 8,533 sq m. The lease period is extendable up to 2049 subject to lessor JTC’s terms and conditions. A warehouse as well as office blocks will be built on the premises.

Source : Business Times – 11 Sept 2007

JTC launches Tuas industrial site for sale after $5.9m bid

ON the back of good demand for industrial space, JTC Corporation yesterday launched a 235,400 sq ft land parcel at Pioneer Road/Tuas Avenue 11 for sale, and market watchers estimate that the site could fetch as much as $7.6 million – or $23 per square foot per plot ratio (psf ppr).

JTC launched the site after it received a bid of $5.9 million on July 18. Observers, however, said that the site could fetch more than the initial bid.

Savills Singapore’s director of industrial business space Dominic Peters pointed out that in February, an industrial site at Tuas Bay Drive/Tuas South Avenue 3 was awarded for $23 psf ppr. That site had a 60-year lease.

While the lease for the site launched yesterday is for 30 years, Mr Peters expects the site to fetch $20-23 psf ppr due to good demand. The price translates to between $6.6 million and $7.6 million.

‘We anticipate very strong demand from end-users,’ he said. Companies in certain sectors – such as oil & gas and construction – are doing well at the moment and could be interested in the site, he said.

The site has a 1.4 plot ratio, giving it a gross floor area of 329,600 sq ft. It is zoned for ‘Business 2′ use, which means it can be used for clean, light and general industrial purposes, and warehousing.

The land parcel was on the Reserve List before its sale was triggered by the $5.9 million bid. Now, it is being launched under the Confirmed List.

The government had previously announced that it will launch two industrial sites under the Confirmed List and seven industrial sites under the Reserve List in the second half of 2007 under its Government Land Sales programme.

The tender for the site will close at 11 am on Oct 18.

Source : Business Times – 7 Sept 2007

Demand for industrial land hits 10-year high

THE take-up of vacant industrial land that is ready for firms to develop their own facilities on shot up 153 per cent to hit a 10-year high last year, reflecting strong demand from local companies.

Singapore’s largest industrial landlord, JTC Corp, said the net allocation of this type of industrial land, which comes with road access/frontage and other facilities, was 174.1ha.

The largest taker was the logistics segment, which includes the chemical logistics industry, JTC said. Other big takers were the services and electronics and precision engineering industries.

Apart from steady economic growth, the cuts in JTC’s industrial land rents and prices in January and July last year also helped to spur demand, said a JTC spokesman. ‘The cuts…have helped to keep our industrial land internationally competitive.’

This prepared industrial land, as JTC calls it, also posted the lowest termination rate last year over the past decade, according to JTC’s industrial facilities report for last year released yesterday.

Total occupancy of JTC’s prepared industrial land last year stood at 81 per cent.

JTC’s ready-built facilities including standard factories and business parks also saw strong demand last year, with net allocation at 180,400 sq m, which was almost double that of 2004.

In the ready-built facilities segment, business park space was the star performer, largely because A*Star, the anchor tenant of Biopolis in one-north in Buona Vista, took up additional space there last year.

Business park space, also found at Changi Business Park and International Business Park, caters to the needs of industries involved in high value-added and knowledge-based activities.

Prepared industrial land is one area that JTC will be keeping as it prepares to narrow its focus on two key areas – strategic developments such as one-north and cutting-edge developments like the proposed underground caverns on Jurong Island.

This was made known in November when JTC said it will sell 2.6 million sq m of gross floor area of industrial facilities including 71 blocks of high-rise factories, three business park buildings and three workers’ dormitories.

Details of the sale will be finalised by the second quarter.

Source : Straits Times – 25 Jan 2006

Industrial property market on track for steady recovery

SINGAPORE’S industrial property market looks set for slow and steady growth with rising occupancies.

More entrants are expected after the anticipated divestment move of Singapore’s largest industrial landlord, JTC Corp, but rents are unlikely to shoot up significantly.

Consultants said they could rise slightly this year as there is still a property glut while rents of some sites could stay flat or fall, said a report last Friday from consultancy Knight Frank.

Unless the positive economic outlook translates into robust demand that can absorb the projected rise in supply, the rentals and capital values of industrial space not acquired by real estate investment trusts are likely to remain flat or fall further, it said.

An estimated 500,000 sq m of factory space is expected to be completed this year and next year, it pointed out.

More will follow.

Last month, the Government said it would launch five industrial sites totalling 12.9ha on the confirmed list for the first half of this year. This is on indications of demand for more land in certain locations. The confirmed list goes for tender at a pre-determined date, with no need for a minimum trigger price.

There are also five other industrial sites totalling 8.9ha on the reserve list, which means land is put up for tender only if a developer agrees to bid a minimum price.

This year, the industrial market will face the challenge of maintaining the take-up rate, which averaged 570,000 sq m of factory space a year in 2004 and last year, said Knight Frank.

But so far, the impressive performance of the economy and the manufacturing sector has not resulted in rising rents and capital values of industrial space, said its research director, Mr Nicholas Mak.

‘There are some weaknesses in the sector, as the economic drivers such as the biomedical and transport engineering clusters did not necessarily translate to strong demand for industrial space,’ he said.

Average monthly rentals of industrial space in areas such as MacPherson, Kaki Bukit and Admiralty fell by 2 to 5 per cent in the fourth quarter last year, he added.

Last year, average rents for high-tech spaces remained flat at $1.75 per sq ft (psf) per month while rents for ground-level factory space stayed unchanged at $1.20 psf on average per month, according to property consultancy CB Richard Ellis. It said rents may rise slightly this year due to a more open market.

The managing director of property consultancy Colliers International, Mr Dennis Yeo, is also optimistic of a continued rent rise. He said the market’s oversupply is in obsolete facilities, which will one day be torn down, reconfigured or replaced.

‘In 2006, we expect demand and rents to improve by 5 to 10 per cent on the back of the continued recovery in the economy,’ he said.

Source : Straits Times – 2 Jan 2006