Tai Sing Industrial Building is valued at $23 million
Cushman & Wakefield has been appointed as the exclusive marketing agent for the sale of an industrial building at 17 Tai Seng Drive, Singapore, known as Yew Lee Building.
Located near Tai Seng MRT Interchange Station, the Tai Sing Industrial Building is located within the bustling industrial park and data centre cluster in Tai Seng area. The buildings in the immediate vicinity include DHL, Eu Yan Sang, Starhub and several data centres such as Equinix, Global Switch and China Mobile.
The Tai Sing Industrial Building is a purpose built 6-storey single user detached industrial building completed in 1990s. It has a land area of approximately 3,168.9 sq m with gross floor area of approximately 6,504.3 sqm. Sitting on JTC land, the Tai Sing Industrial Building has a leasehold tenure of 30+30 years commencing from 1 February 1993 (balance of approximately 34 years).
Under the draft Master Plan 2019, the Tai Sing Industrial Building is zoned as “Business 2” with a plot ratio of 2.5.
According to Mr Lynus Pook, Director of Commercial/Industrial at Cushman & Wakefield, “The immediate vicinity has seen a buzz of transaction activities with most of the buildings snapped up by institutional investors such as China Mobile, Ascendas-Singbridge, Starhub and Mapletree Industrial Trust to convert into data centres.
Mr Pook added, “The Property will be sold on a vacant possession so that the purchaser can take immediate possession to carry out their plans which might include redevelopment or refurbishment given that it has unutilized plot ratio.”
The Tai Sing Industrial Building is being put up for sale by an Expression of Interest (“EOI”), closing on 6 August 2019, Tuesday at 2.00pm.
The sale of the Tai Sing Industrial Building comes at a time when the industrial property market is steadily improving in health. 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.
Compared with data from the previous three months, industrial space rent and prices remained relatively stable in the first quarter of the year suggested the JTC All Industrial Rental Index in Q1 2019. The report showed that overall occupancy rate for the industrial market remained flat q-o-q at 89.3% in Q1 2019. The JTC index showed that prices of industrial space saw minor declines in the 1st quarter of 2019.
Property observers have noted that although it is evident that industrial rents in general have bottomed, a significant rental recovery may be premature in the industrial space. Analysts have suggested that going forward, new business park properties and high-spec spaces should continue to enjoy rental improvements due to limited stock and tighter new supply, while warehouse supply is expected to slow down over the rest of 2019.
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.
One research in particular noted that industrial rents stagnated during 2018 due to the supply overhang from the preceding years. It believes that in 2019, the tapering of supply will lend support to the market and lead to marginal increases in rents despite the slowdown in manufacturing growth.
There are already signs of an uplift in economic and manufacturing sector performances, which may point to an imminent bottoming of the industrial property market.
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 mortgage loans in the region. The industrial property market price recovery is observed to be broadening,” Mr Ho noted.
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