Experts React To Planned Conservation Of Golden Mile Complex
SINGAPORE – The government is proposing to conserve the Golden Mile Complex due to its historical and architectural importance, revealed the Urban Redevelopment Authority (URA) on Friday (9 October).
The agency will also provide planning incentives to pique the interest of developers in acquiring the commercial property via collective sale. However, the announcement drew mixed reactions from real estate experts.
“Golden Mile Complex is a symbol of the architectural and engineering ingenuity of Singapore’s pioneer generation of building professionals,” stated the URA. It was designed by trailblazer architects Tay Kheng Soon, William Lim, and Gan Eng Oon of home-grown company Design Partnership, which is now called DP Architects.
“The 16-storey building was one of the earliest government land sale sites, located along the newly reclaimed Beach Road coined as the “Golden Mile”, which gave the building its name. Completed in 1973, it was one of the first large mixed-use developments in Singapore that integrated commercial, recreational and residential uses in a single building.”
Given its significance, the government agency plans to conserve Golden Mile Complex’s main building with its distinct terraced profile above the podium block as crucial features to be retained.
The move comes after an extensive two-year research on the proposal, in which feedback was sought from unit owners at the commercial property, developers, and heritage groups. While there is robust support for conserving the Golden Mile Complex, industry stakeholders said they are uncertain if developers here would be interested in acquiring a large-scale strata-titled conserved project as it could be the first transaction of its kind in Singapore.
Similarly, unit owners raised issues that conservation requirements could affect their plans for en bloc sale due to design limitations and related building maintenance costs. Previously, unit owners made two collective sale attempts each at S$800 million, but both tenders closed with zero bids received.
As such, URA and pertinent government agencies intend to offer incentives if the conserved Golden Mile Complex changes hands. For instance, they will offer a bonus floor area that will lead to a gross plot ratio of 5.6. This translates to a 1/3 increase in the current development intensity, allowing the buyer to construct an additional 30-storey tower on the site.
The government agency will also partially waive the development charge (DC) on the additional floor area. This is capped at 10 percent of the entire project’s market value, or 10 percent of the estimated land value of the entire project, whichever is lower. This depends on the approved usage mix and is based on DC Rates as of September 2020.
It will also fully waive the development charge for enhancement in value of the conserved gross floor area (GFA) resulting from a change of use.
Apart from giving the buyer the option to refresh the site’s lease to 99 years and the versatility to operate different kinds of property uses, the URA also intends to adjust Golden Mile Complex’s site boundary so that it will be more regular.
“In addition, URA is prepared to work closely with owners and industry experts to facilitate adaptive reuse possibilities within the requirements of conservation.”
Mixed reactions from experts
While some property experts think that the conservation of the Golden Mile Complex could lead to a successful en bloc sale, some are doubtful, reported The Business Times on Saturday (10 October).
“With the conservation, some owners will find there is more certainty and may be reluctant to vote for en bloc sale knowing that the land lease will be renewed at the end of the leasehold term because the building is conserved,” said Chris International’s Director Chris Koh.
“If the owners still get the required votes to proceed with the en bloc sale, they will be tempted to ask a higher price, but this may not be in their favour as developers may not be willing to pay more knowing that they have less flexibility to redevelop the site and may even incur additional cost to conserve the building.”
Research head of ERA Realty Nicholas Mak also thinks the buyer of the commercial property may find it hard to find space for the construction of a new 30-storey building on the site, as the main building and its façade needs to be conserved.
Meanwhile, Institute of Real Estate and Urban Studies’ Deputy Director Lee Nai Jia, believes that URA’s incentives could help attract an en bloc buyer.
“The incentives, such as increasing its gross plot ratio and waiving part of the development charge among others, make the site more appealing to developers,” he added.
