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10 Jalan Kilang – light industrial development launched for sale

by • March 6, 2019 • Buying a propertyComments (0)487

CBRE announced on Feb 5 that it was pleased to be appointed as the exclusive marketing agent for the sale of 10 Jalan Kilang, located off Jalan Bukit Merah. The sale will be by way of an Expression of Interest exercise which is slated to close on 5 April 2019.

10 Jalan Kilang is an eight-storey light industrial development with a roof terrace and a basement carpark, offering a total gross floor area of approximately 59,236 square feet.

10 Jalan Kilang sits on a 20,584-square-foot site that is zoned for “Business 1” use with a plot ratio of 2.5. The site has a balance lease of 42 years.

10 Jalan Kilang

Image credit: CBRE – 10 Jalan Kilang has the possibility of its units being sold on a strata-title basis

Mr Rimon Ambarchi, Executive Director of Industrial and Logistics Services at CBRE is confident that 10 Jalan Kilang will appeal to both private and institutional investors. “The subject property generates a strong and stable yield due to its high-quality tenancy mix. Based on a net lettable area of approximately 47,824 square feet, the building is currently 80% tenanted comprising companies from the electronics, biomedical, information technology, shipping and trading sectors, among others. Coupled with this stable rental income, the property’s fringe CBD location with a prominent frontage along Jalan Bukit Merah will attract strong investor interest.”

Mr Ambarchi adds, “This sound investment opportunity provides immediate cashflow and rental upside. Subject to authorities’ approval, the successful buyer can also consider selling the units on a strata-title basis.”

10 Jalan Kilang is easily accessed through a wide variety of public transport nodes, with a bus stop located directly at the doorstep and Redhill MRT station in close proximity. The vicinity of 10 Jalan Kilang comprises a mixture of purpose-build single-storey factories, flatted factories and public housing flats.

Nearby prominent developments include Dadlani Industrial House, E-Centre @ Redhill, Pacific Health Care Nursing Home, Pacific Tech Centre, Panasonic Building and Redhill Forum. There is easy vehicular access to major arterial roads and the Ayer Rajah Expressway.

Mr Paul Ho, Chief Mortgage Consultant at iCompareLoan, said that despite the property curbs introduced by the Government last year, Singapore is still an attractive residential market for investors.

Although the property market exuberance has been curbed to some extent with the property cooling measures introduced last year, Singapore as a property market investment destination still remains among the top – shoulder to shoulder with other cities in the world like London, New York, Shanghai and Sydney.

“We have to be mindful that there is a lot of excess capital fluidity here and at 1.9 – 2 percent, Singapore has one of the lowest interest rates for home loans in the region. The industrial property market price recovery is observed to be broadening,” he noted.

Flexible workspace: Making room for growth and more collaboration

The sale of the Jurong Island facility comes at a time when the industrial property market is steadily improving in health. In 2018, the decline in industrial property market prices finally halt to a brake for both single-user and multi-user factories. Additionally, the multi-user factory segment joined the business park segment in posting rent upside.

This improvement in the industrial property market comes at the back of a strong pick-up in leasing transactions to a record high. This has likely been underpinned by the more upbeat business sentiment alongside the positive economic and manufacturing data, which has emboldened more tenants and industrialists to review their real estate options.

Leading real estate observers have said that they were optimistic that the industrial property market will likely bottom within the next 12 months, barring any unforeseen external shocks. They took into account the tapering pipeline supply that will allow demand to play catch up amid the positive economic outlook, barring any unforeseen external shocks.

Despite the Sino-American trade frictions, Singapore’s economic outlook as well as the outlook for 2019 is expected to remain positive. Observers say that the tapering pipeline supply will allow demand to play catch up. As new supply starts to taper in the coming years, prices and rentals should stabilise in tandem with occupancy rates, they added.

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