Ravi Chandran
Cushman & Wakefield (C&W) announced on April 10 that it has been appointed as the exclusive marketing agent for the sale of a high specification industrial building at 115 Eunos Avenue 3, Singapore.
Within a mere 400 metres walk from the Paya Lebar MRT Interchange Station, the high specification industrial building is located within the bustling commercial hub in Paya Lebar Central, home to a full stream of bustling developments including Paya Lebar Square, Paya Lebar Quarter (PLQ), WDA’s Lifelong Learning Institute, Kinex (formerly OneKM Shopping Mall) as well as the revamped Singapore Post Centre and Geylang Serai Market.
The high specification industrial building is a 6-storey detached building completed just three years ago.
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It has a land area of approximately 7,718 sq m with gross floor area of approximately 19,294 sqm. Sitting on JTC (formerly HDB) land, it has a leasehold tenure of 60 years commencing from 1 February 1980 (balance of approximately 21 years).
The high specification industrial building is built with high specifications such as high ceiling, high floor loading, large floor plate, large passenger/cargo lifts, covered carpark and a ground floor canteen. The typical floor plate is regular with approx. 43,000 sq ft. The average floor-to-floor height is approx. 7.0m, making it one of the tallest buildings in the vicinity.
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Mr Shaun Poh, Executive Director of Capital Markets at Cushman & Wakefield said, “It is currently 100% tenanted to 15 tenants with most of the tenancies structured with rental escalation.”
Mr Poh added, “Office and industrial rents in Paya Lebar have been on a steady uptrend. The recent completion of Paya Lebar Quarter (“PLQ”) attracted key tenants like Great Eastern, Bayer, SMRT and NTUC Income which resulted in the median office rent in Paya Lebar rising by almost 20% from the trough to 4Q2018. The lack of supply of high specification industrial space in central areas like Paya Lebar has also pushed the rents for such spaces above $3.00 psf per month.”
Paya Lebar Central is just a ten-minute drive from the Central Business District and is well connected by major expressways with the PIE and the ECP as well as major roads like Sims Avenue, Paya Lebar Road and Changi Road. In terms of public transport, Paya Lebar MRT Interchange Station connects the commuters to the rest of the island through both Circle and East West lines.
The high specification industrial building is being put up for sale by an Expression of Interest (“EOI”) closing on 16 May 2018 (Thursday) at 3.00pm.
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The sale of the high specification industrial building comes at a time when the industrial property market is steadily improving in health. This improvement in the industrial property market comes at the back of a strong pick-up in leasing transactions to a record high. This has likely been underpinned by the more upbeat business sentiment alongside the positive economic and manufacturing data, which has emboldened more tenants and industrialists to review their real estate options.
Leading real estate observers have said that they were optimistic that the industrial property market will likely bottom within the next 12 months, barring any unforeseen external shocks. They took into account the tapering pipeline supply that will allow demand to play catch up amid the positive economic outlook, barring any unforeseen external shocks.
C&W’s own research noted that industrial rents stagnated during 2018 due to the supply overhang from the preceding years. It believes that in 2019, the tapering of supply will lend support to the market and lead to marginal increases in rents despite the slowdown in manufacturing growth.
“Factory rents could see an increase of 0.5%, while warehouse rents may rise by 1.0% as demand for warehouses has picked up due to rising competition in the e-commerce space. Meanwhile, business park demand will be sustained by cost-conscious companies who do not need to be in the CBD. Rents for business parks in the city fringe are projected to rise by 2.0%, while rents for business parks in outlying areas are expected to increase by a smaller 0.5%.”
There are already signs of an uplift in economic and manufacturing sector performances, which may point to an imminent bottoming of the industrial property market.
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