Published 30 March 2011
The Business Times
A 60-YEAR leasehold industrial site at Ang Mo Kio Street 62 attracted strong demand when its tender closed yesterday.
As many as 13 developers competed for the site, with Sim Lian Development Pte Ltd coming out on top with the highest bid of $128.1 million or $170 per square foot per plot ratio (psf ppr). Its offer is just 1.9 per cent above that of Qinghe Pte Ltd and Qingdao Construction (Singapore) Pte Ltd, at $125.8 million or $167 psf ppr.
Fragrance Group’s unit took third spot. Other developers that participated in the tender include Ascendas Real Estate Investment Trust, Mapletree Investments and Soilbuild Group. ‘It is a very hot site,’ said Colliers International industrial director Tan Boon Leong, pointing out that even the lowest bid was above $100 psf ppr.
The 2.8 hectare Business 1 site has a maximum permissible gross floor area of around 752,200 sq ft and is within five minutes’ walk to Yio Chu Kang MRT station.
The site’s proximity to the MRT station was one reason behind Sim Lian Development’s interest, the company’s executive director Ken Kuik told BT.
There are no concrete plans for the site yet. The company may develop strata-titled units for sale but that will depend on market conditions, he said.
Investor interest in industrial space has been gaining momentum.
CBRE Research executive director Li Hiaw Ho noted that Northstar @AMK, a 60-year leasehold strata-titled development at Ang Mo Kio Avenue 5, has been selling well. ‘In Q1 2011, 10 upper floor units fetched an average of $308 psf, reflecting an increase of 9.2 per cent compared to the transactions that took place in 2010,’ he said.
Colliers’ Mr Tan also said that capital values for industrial space have gone up since the start of the year.