Published 11 May 2011
The Business Times
By Emilyn Yap
Redevelopment of Market Street Car Park spells shortage of parking lots for neighbours
The impending redevelopment of Market Street Car Park (MSCP) into an office tower – at a time when parking lots have become a scarce commodity in the central business district – appears to have triggered concerns from some building owners.
BT understands that the owners of some developments near MSCP have together written to the Urban Redevelopment Authority (URA), asking for a dialogue.
Behind their move is concern over the supply of parking lots in the vicinity when MSCP is redeveloped. The public car park, which was built in 1964 and has 704 lots, is one of the major sources of lots in the CBD today.
Several buildings near MSCP have either few or zero parking lots, which means that many of their tenants or visitors now rely on MSCP for parking needs.
Across the road from MSCP, Robinson Towers and International Factors Building do not have parking lots. Both are owned by Tuan Sing Holdings, which is said to be among those which signed the letter to URA. According to sources, the group also includes the owners of City House and the Bank of East Asia building.
Property market veterans noted that a few decades ago, the developers of some of these buildings had paid a charge to the authorities for public car parks, and so did not incorporate parking lots in their designs.
Plans for MSCP’s redevelopment emerged more than 15 years ago but firmed up only recently. CapitaCommercial Trust (CCT) said last month that it will work with CapitaLand to re-build the car park into a Grade A office tower for around $1.4 billion. This includes a differential premium for the change of land use.
Going by Land Transport Authority rules for the zone that MSCP is in, the new building should have at least one lot for every 450 square metres of GFA (gross floor area). This means the new building might have a minimum of 177 lots.
At the time of the announcement, CCT said that it was working with the authorities to determine the number of lots.
Some industry insiders have expressed unease – not because they object to MSCP’s redevelopment per se, but because of the potential drop in the supply of parking lots in the CBD.
As it is, finding a parking lot in the vicinity of MSCP can be a challenge. A number of commercial buildings such as AIA Tower, Samsung Hub and One Raffles Quay offer season parking only to tenants.
At buildings which offer non-tenants season parking, demand is high. When BT checked yesterday, there was a waiting list for lots at Capital Square, while less than 20 lots were left at Hong Leong Building.
Smaller buildings around MSCP which do not have parking lots may find it tougher to attract tenants after MSCP’s redevelopment, some observers said.
‘If their tenants can find replacement lots elsewhere in the CBD, then the impact will be minimal,’ said Savills Singapore director (commercial leasing) Agnes Tay. If not, ‘they might turn to other office buildings that can accommodate car park lots when the leases are up’.
Jones Lang LaSalle head of markets Chris Archibold is more sanguine. The issue of parking lots always comes up when tenants look for office space, ‘but the reality is, no CEO is going to make a decision on where he puts his company based on car parks . . . People will make the decision based on the location, the quality of the building and the efficiency of the building’, he said.
In other financial centres such as New York and Hong Kong, few people drive to work, he added. As Singapore gets bigger and more global as a financial centre, the parking situation will get tighter and more people will rely on the train or the bus, he said.