Industrial site for public tender launched by JTC in Gambas Way

JTC has accepted an application to put up an industrial site at Gambas Way (Plot 2) for sale by public tender. The land parcel was made available for application through the Reserve List system under the first half 2019 IGLS Programme.

JTC received an application with a committed bid price of not less than $19,310,000.00. As the minimum price committed by the applicant is acceptable to the Government, the site will be released for sale by public tender.

Under the Reserve List system, JTC is to make public the minimum price committed for the site. However, the identity of the applicant will not be released. The public tender for the land parcel is scheduled on 26 March 2019 with a tender period of six weeks.

Zoned for Business-2 development, the Reserve List industrial site is a 1.20 ha land parcel with a 30-year tenure and a maximum permissible gross plot ratio of 2.5.

The allowable development on the Land Parcel shall be for any use(s) that may be permitted by the Competent Authority under the Planning Act (Cap 232) for a Business 2 zoning in accordance with the Master Plan Written Statement. The development shall be subjected to the approval of JTC and all the relevant Competent Authorities.

The maximum building height for the industrial site is subject to a technical height control which is inclusive of all structures and fixtures on / above the roof top such as TV antennae, water tanks, lift motor rooms, cranes, maintenance equipment, lightning conductors. All construction equipment and temporary structures such as cranes, piling rig etc are subject to the same height limit.

The project completion period for the industrial site is computed from the date of acceptance of the tender by JTC up to the date of issue of Temporary Occupation Permit for the whole of the proposed development.

A recent JTC quarterly report said that property prices for industrial sites remained relatively stable. The report showed that industrial property prices increased by 0.1 per cent from the previous quarter, while industrial rents slipped 0.1 per cent.

Compared to a year ago, industrial property prices softened 1.1 per cent, while rents dipped 0.4 per cent. Commenting on a JTC Quarterly Report, Tay Huey Ying, Head of JLL’s Research and Consultancy for Singapore said industrial property prices remained on a path to recovery in spite of escalating trade wars. She added that the industrial property market here continues to display signs of bottoming.

JLL predicted that the industrial property prices will see a turnaround by end-2019.

“Barring a worsening of the external environment or other unforeseen external shocks, we are hopeful that all industrial property indicators (rents and prices) may turnaround by end-2019 as the low pipeline supply in 2018 and 2019 will allow demand to play catch up with supply.

According to JTC’s 3Q18 data, another 0.5 million sqm gross floor area of new industrial space is expected to be ready in 4Q18. Including the net addition of 0.4 million sqm net floor area in the first three quarters of 2018, this works out to around 0.9 million sqm of estimated net floor area in 2018 (assuming 80% to 90% efficiency for the 4Q18 supply pipeline), significantly lower than 2017’s net new supply of 1.9 million sqm. 2019’s pipeline supply of around 1.3 million sqm gross floor area or about 1.0 to 1.2 million sqm of estimated net floor area (assuming 80% to 90% efficiency) is also lower than the average annual net new supply of 1.4 million sqm net floor area for the 10 years from 2008 to 2017.”

Commenting on the industrial property price performance, Desmond Sim, CBRE’s Head of Research for Singapore & Southeast Asia said:

“Based on JTC’s Q3 2018 statistics, overall industrial occupancy rate increased by 0.4% q-o-q to 90.0%. Improvement in occupancies were mainly from the single-user factory, business parks and warehouses. In Q3 2018, there was an uptick in leasing volume for both islandwide factories and warehouses on a y-o-y basis. Factories leasing volume increased by 7.1% y-o-y to $10.851 mil.

“There was a noticeable increase in demand for storage space in recent quarters, driven by a build-up of inventory from the growing gap between higher output and lower exports. JTC statistics showed that warehouse leasing volume saw growth of 82.3% y-o-y to $5.553 mil. This contributed to the stronger net absorption for warehouse space in Q3 2018 at 1.81 mil sq. ft., which shored up occupancy by 0.9 percentage points to 89.4%.”