For sale: Two 30-year industrial sites

TWO 30-year industrial sites were launched for sale by public tender yesterday - the first batch following a recent government move to slash the leases for such sites.

Leases have been capped at 30 years for all Government Land Sales (GLS) plots that remain unsold and industrial sites to be put up for sale in the second half of the year.

Yesterday's two sites - at Bukit Batok and Yishun - had carried 60-year leases when put on the GLS confirmed list for the first half of this year.

Property consultants expect cautious response to the two relatively small sites, with three to six bidders for the Bukit Batok site and up to seven bids for Yishun.

Demand won't be so strong because there's already a lot of supply at the two established industrial areas.
Bids are tipped to range from $40 million to $53 million for the 15,011 sq m land parcel at Bukit Batok Street 23. That works out to about $100 to $130 per sq ft per plot ratio (psf ppr).

The site at Yishun Avenue 9 is 20,075 sq m, with bids expected to be between $54 million and $76 million, or $100 and $140 psf ppr.

Both sites are zoned for Business 1 uses, which include light and clean industry, and utilities or telecommunications.

Rules imposed last year, strata-titled units and those in multi-user industrial developments will have to be at least 150 sq m. This could cost more and detract investors.

The tenure reduction is intended to give the Government more flexibility for land redevelopment and to help make industrial property more affordable.

The industrial sector is looking at a possible downturn, given the 'huge oversupply'.

Source: The Straits Times – 28 June 2012