BT : Landmark site at City Hall up for sale

Business Times - 02 Apr 2010

Landmark site at City Hall up for sale

The developer has to retain and restore the three buildings - Capitol Theatre, Capitol Building and Stamford House - on the site

By UMA SHANKARI

THE government will soon put up for sale a commercial site with three landmark buildings - Capitol Theatre, Capitol Building and Stamford House - on it.

The site, which is located at the junction of Stamford Road and North Bridge Road and which also comprises Capitol Centre and a subterranean parcel below North Bridge Road that will link directly to City Hall MRT station, will be launched for sale in about two weeks. It has been on the government's reserve list since December 2008.

Analysts expect an 'interesting' retail-cum-lifestyle-cum-hotel development will come up on the 99-year leasehold site, which has a maximum permissible gross floor area of about 542,400 sq ft.

The land parcel will be sold through a 'concept and price revenue' tender process, said the Urban Redevelopment Authority (URA). Under this system, tenderers are required to submit their concept proposals and tender prices in two separate envelopes. The concept proposals will be first evaluated against a specified set of specified criteria and only those that meet the criteria will be considered. The site will then be awarded to the tender with the highest bid price among those with acceptable concept proposals.

The developer of the site is required to retain and restore the three 'historically and architecturally significant buildings' - Capitol Theatre, Capitol Building and Stamford House - for re-use. In particular, URA said that Capitol Theatre is required to be used as an arts or entertainment-related performance venue. Capitol Centre, on the other hand, can be torn down.

The winning bidder is also required to set aside 25 per cent of the total gross floor area for hotel use. This will help to strengthen the hotel cluster in the area, which now includes Swissotel The Stamford, The Fairmont and Grand Plaza Park Hotel, URA said.

URA is releasing the site as it has received an application from an unnamed developer, who has committed to bid a least $100 million - or $184 per square foot per plot ratio (psf ppr) - for it. But the site can fetch $400-$600 psf ppr, analysts said.

'With a predominantly retail development at this historical central landmark, the land cost of site is likely to range from $400 to $500 psf based on the maximum permissible gross floor area,' said Li Hiaw Ho, executive director of CBRE Research. 'This would translate to an estimated amount of between $220 million to $270 million.'

Others put the eventual selling price as high as $600 psf ppr. However, analysts said that the number of bids will be limited as the site will be challenging to develop.

'Basically, the conservation element will limit the number of bidders,' said Tay Huey Ying, Colliers' director for research and advisory. URA's criteria requires the tenderer and design team to have 'proven track record and experience in developing developments of similar quality' - which automatically eliminates many potential bidders.

Separately, JTC Corporation also said yesterday that it has launched a 5 ha industrial site at Tampines for sale - the first industrial site this year to be released from the government's confirmed list, which was reinstated in December 2009 to meet the demand for industrial land arising from improved economic conditions.

The site is located at the junction of Tampines Industrial Avenue 4 and Tampines Industrial Avenue 5, within the Tampines Wafer Fab Park. It will be sold with a 30-year lease and can yield a total gross floor area of close to 431,000 sq ft. Analysts said that the plot can fetch $40-$50 psf ppr, which translates to some $17.2-$21.5 million for the entire plot.