Central Boulevard Office Project To Be Completed At A Favourable Time
SINGAPORE – IOI Properties Group’s anticipated office development within the city-state’s central business district (CBD) in Central Boulevard is poised to obtain its Temporary Occupation Permit (TOP) in Q3 2023, at a time when there’s tight supply in Singapore’s office market, reported The Business Times on Wednesday morning (1 June, SGT).
Previously, the site for the project was awarded to the Malaysian property developer in November 2016. Back then, the acquisition became a headline as the company’s top bid of S$2.57 billion (S$1,689 psf per plot ratio) set the record for the highest selling price for a Government Land Sales (GLS) site here in both absolute quantum and in terms of per plot ratio.
While the project was supposed to be completed this year, market watchers said it was delayed partly because of the site’s technical constraints and building disruption caused by the COVID-19 pandemic.
Recently, it has been reported the tech giants Amazon and Facebook parent company Meta are said to be in advanced talks to lease office space at IOI Central Boulevard Towers. Altogether, they could rent about 650,000 sq ft to 670,000 sq ft of office space there, or around 50 percent of the development’s 1.26 million sq ft net leasable area (NLA) for its office component.
Some office market watchers estimate that Amazon could be negotiating for a lower office rent within the S$10.50 psf range as it started negotiations much earlier with IOI Properties, while Meta could be nearer to the S$11 psf range as it just started talks to occupy office space there more recently.
For IOI Properties to attain an overall office average monthly rent of S$12.50 psf, which is at the lower end of its target range, it would need to secure tenants to lease the remaining office space in the project of about 600,000 sq ft for around S$14.50 psf per month.
As the Central Boulevard Towers will be the only CBD Grade A development slated for completion in 2023, this office rental rate is quite achievable, particularly for part-floor office tenants. In fact, some office landlords that own premium CBD office buildings are already seeking rents of at least S$12 psf.