Cautious bids foreseen for Jurong Lake District GLS site

SINGAPORE, 22 JUNE 2023

Ms. Tay Huey Ying, Head of Research and Consultancy, Singapore
郑惠匀, 研究与咨询部主管 (新加坡)

The Urban Redevelopment Authority launched for sale by public tender today, the eagerly awaited 6.5-hectare Master Developer White site in the Jurong Lake District (JLD) under the Confirmed List of 1H23 Government Land Sales Programme.

If awarded, the completion of the first phase of the development on the JLD white site offering at least 70,000 sqm gross floor area of office space around the year 2028/9 will help to alleviate the tight supply of good quality office space foreseen on the back of Singapore’s rising prominence and popularity as a global office hub.

The site has garnered substantial interest from developers, both domestic and foreign, since it was placed on the 1H23 GLS confirmed list in December 2022. We expect the market to be optimistic about the long-term potential of JLD to be the largest commercial node outside the CBD. However, in the short-term, prior to the attainment of critical mass, and the completion of infrastructural works, particularly those affecting connectivity such as the Jurong Region Line (JRL) and Cross Island Line (CRL) stations, there will be challenges in attracting office occupiers to the location.

Coupled with the host of planning requirements such as the lower car parking provisions, stringent central courtyard, and green building conditions, this could moderate the bid prices for the site. The economic climate at the time of the tender closing date in March 2024 will also have a bearing on bidders’ sentiment and their bid prices. 

We expect the large investment outlay and the medium to long-term commitment of 10 – 15 years to limit bidders to experienced large-scale mixed-used developers with deep pockets who are likely to form consortiums to jointly participate in the tender in order to share the development risks.