ST : Citi signs lease for 8 floors at Asia Square

Nov 24, 2010

Citi signs lease for 8 floors at Asia Square

Marina Bay deal part of bank's expansion, including hiring few hundred staff each year

By Esther Teo

IN A fresh sign of continuing strong demand for prime office space, Citi Singapore has signed up as a tenant at Marina Bay, Singapore's newest financial and business district.

Citi said yesterday that it has signed a 10-year lease for more than 250,000 sq ft - or eight floors - at Asia Square Tower 1.

This will accommodate up to 2,700 staff across its consumer, corporate and private banking businesses. It is expected to cost the bank $85 million in renovation and relocation costs.

This mega deal brings total leasing for Asia Square Tower 1 to about 50 per cent of the 1.26 million sq ft of available office space. There is 'substantial interest' in the rest of the space, said MGPA Asia chief executive John Saunders.

Asia Square is a mixed-use development being established by private equity real estate advisory company MGPA.

It comprises two towers, with the first be completed by June next year. Tower 2 is set to be ready in 2013 and will boast 780,000 sq ft of office space along with a five-star hotel with about 280 rooms.

Rents at Asia Square will be higher than the market range of about $10 per sq ft per month. A new tenant looking at mid- to top-floor space is likely to pay double-digit rents, Mr Saunders said.

Citi said the move to the Marina Bay premises will allow it to consolidate its trading rooms as part of its expansion and growth plans in Singapore. The headcount is expected to rise by a few hundred each year, said country head Michael Zink.

'More and more of the economic growth in the world economy is here in the Asia-Pacific region and Citi...has to figure out how to deal with that rebalancing. Singapore is the place where we're putting a lot of our incremental Asian business to serve our clients, not only here, but around the region,' Mr Zink added.

Employees currently in Centennial and Millenia Towers, and some in Capital Square, will move to the new location from the last quarter of next year through to 2013 as existing leases expire, Citi said.

Although Singapore's office market has suffered a downturn over the past few years, rents have been rising of late and companies are starting to realise that the amount of prime space available is becoming more finite, Mr Saunders said.

'When you look at Singapore in a regional context, I think with the rent levels we have at the moment, Singapore is still a competitive place to do business. Rents are very substantially lower than, let's say, Hong Kong and other comparable cities,' he added.

Asia Square will feature green elements such as a biodiesel generation plant to recycle food oil waste produced at catering firms on site. It will also have 400 bicycle racks, shower facilities and lockers, to encourage more people to cycle to work.

Other tenants secured by Asia Square include American law firm White & Case, Pure Fitness, Swiss bank Sarasin, Swiss private banking group Julius Baer, and insurance giant Lloyd's.

esthert@sph.com.sg