IOI Properties Group said on Wednesday it was optimistic about the long-term outlook for Singapore’s property market after the developer won the auction for a mixed-use hotel and residential site in Marina Bay.
Boulevard View, a wholly owned subsidiary of Malaysia-listed IOI Properties, was the sole bidder for the 7,817 square meter site when the state land auction ended last week, surprising some analysts given the property’s strategic location in Singapore’s downtown new financial district. . The Urban Redevelopment Authority said yesterday it has decided to lease the site for 99 years to Boulevard View, which is offering S $ 1.51 billion ($ 1.1 billion).
The site can be built up to 101,629 square meters of gross floor area, of which 51,000 square meters will be used for residential use and 26,000 square meters will be used for a hotel, while the rest can be used for offices. as well as retail businesses. and F&B outlets. The site is strategically located behind the Asia Square office tower and near the next Shenton Way MRT station.
“The proposed development of residential units and a hotel on the ground is expected to meet pent-up demand for city living opportunities in Singapore’s CBD, as the last residential launch in the area was Marina One Residences in 2014” IOI said in a statement. statement to Bursa Malaysia. “In addition, the proposed hotel development is expected to complement the group’s existing developments in Singapore and be a valuable addition to its investment property portfolio.”
URA had estimated that the project could bring in around 905 apartments and 540 hotel rooms. While residential sales in the city-state have rebounded strongly this year, the outlook for the hospitality industry remains bleak with the recent spike in Covid-19 cases.
“While uncertainty persists for the hospitality sector, the long-term horizon until completion of development should alleviate short- and medium-term concerns related to Covid-19, ”said Calvin Li, manager transaction advisory services for hotels and hospitality in Singapore. JLL Asia-Pacific said via email.
The project will run for 84 months, which will give the company the flexibility to determine the product line and the launch schedule, IOI said in a statement. “Singapore is on a roadmap to transition to endemic life when it comes to Covid-19,” he said. “In line with this, moving forward, the company is optimistic about the long-term outlook for the Singapore property market.”
This will be the second Marina Bay project undertaken by IOI, which is developing another mixed-use commercial property on Central Boulevard. It acquired the site for around S $ 2.6 billion in a state land auction in 2016.
The IOI Central Boulevard Towers, expected to be completed by the third quarter of 2023, will have 1.26 million square feet of office space and 30,000 square feet of retail and food service on two towers and one block of the podium, IOI said on its website. The Class A office building is easily accessible via connecting bridges to Raffles Place and Shenton Way MRT stations.
“Investor appetite for residential and commercial properties in Singapore remains strong thanks to a gradual economic recovery,” said by email WeiLeng Tang, Managing Director of Colliers in Singapore.
Across Marina Bay, IOI has partnered with billionaire Kwek Leng Beng’s City Developments to develop the mixed-use development of South Beach, which the partners completed in 2018. The residential component of the project is sold to more than 70% at prices above S $ 3,000 per square foot, Lee Yeow Seng, executive vice president of IOI, said in the company’s latest annual report.
Yeow Seng and his brother Yeow Chor inherited the palm oil and real estate empire from their father, Lee Shin Cheng, who died in June 2019. With a net worth of $ 4.9 billion, the brothers ranked # 6 on Malaysia’s 50 richest list. was released in June of this year. Their father, who grew up in poverty on a rubber plantation, built palm oil giant IOI Corporation and developer IOI Properties. The two companies are commonly referred to together as the IOI group.