Development boost for northern S’pore

Harvest @ Woodlands-minAn artist’s impression of Harvest@Woodlands. The 60-year leasehold project was among the commercial properties in the
north that had the biggest number of units changing hands last month, according to URA data. Photo: SLP

Commercial belt stretching from Woodlands to Punggol on drawing board

Rachel Scully
The Straits Times
August 31, 2013

THE mature industrial area in Singapore’s north has a well-established record for attracting buyers, given its proximity to the Causeway and Johor Baru.

Now the area is set to become an even more compelling business proposition, with a big boost in economic activity and development on the cards.

Plans are under way to develop a major commercial belt stretching from Woodlands to Punggol, known as the North Coast Innovation Corridor.

This includes Woodlands Regional Centre, a site covering 100ha. The idea is to take businesses closer to population centres over the next few decades.

The projects will get a further lift from the new Thomson MRT line and North-South Expressway, which will connect Woodlands, central Singapore and the Central Business District.

CBRE industrial and logistics services director Bernard Goh said: “Such news has helped to generate renewed interest in the region and industrialists could stand to benefit from these new developments. These include tapping on a larger residential catchment for workers and synergising with the new industrial areas set up in the Innovation Corridor.”

Urban Redevelopment Authority data on transactions in July in north and central Singapore shows that the projects which moved the most units included freehold industrial property Primax. Other strong performers were 60-year leasehold properties North Link Building, Harvest@Woodlands, Woodlands 11 and A’Posh Bizhub.

The largest absolute transaction last month came in at $3.94 million for a 5,877 sq ft space at Primax. Freehold Amtech Building at Sin Ming, however, had the highest transacted price of $1,130 per sq ft among the lot last month.

“Prices of industrial spaces in the north are generally lower than other estates such as Ubi, whose location is perceived as more central and accessible,” said SLP International executive director Nicholas Mak. “But the announcements of the developments in the north have pushed up per sq ft prices by 10 per cent to 15 per cent in the past year, although it seems to be plateauing.”

He added that rental yields have dipped over the past year to about 4 to 5 per cent as prices are rising faster than rental rates.

The Sungei Kadut, Woodlands, Sembawang and Yishun areas are said to be popular with smaller firms from the engineering and automotive-related industries, which have showrooms typically located on the ground floor, said Mr Goh. “You’d also find electrical firms, innovation companies as well as small trading firms in the import-export business taking up industrial spaces here,” he added.

Mr Mak said: “Buyers looking for industrial units in the north tend to be businesses with an annual turnover of less than $5 million, and many of them are start-ups.”

It will be harder to buy freehold industrial units or 60-year leasehold units in future, he warned.

“As the Government is no longer releasing industrial land with a tenure of more than 30 years, the projects which have 60-year leaseholds will be popular choices for buyers and investors, and those which are freehold will become rare in the market.”

This article was first published on August 31, 2013.
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