The industrial property located at 315 Outram Road, known as Tan Boon Liat Building, is currently up for collective sale through public tender at a reserve price of $1.15 billion. The freehold site is situated next to the Havelock MRT Station on the Thomson-East Coast Line (TEL) and is made up of two land plots designated for “Business 1” use, with a combined area of approximately 175,655 sq ft.
At present, the property comprises of a 15-storey building that is renowned for housing numerous furniture and home decor stores. According to Cushman & Wakefield, the appointed advisor and marketing agent for the property, the Urban Redevelopment Authority (URA) has issued an Outline Planning Advice on January 22, recommending that the site be rezoned to “Residential with Commercial at 1st storey” with a plot ratio of 4.9, up from the current 3.1 ratio. This translates to a potential 50% increase in the total allowable gross floor area (GFA).
In addition, the URA has suggested the inclusion of several adjacent state land plots, which would add approximately 20,451 sq ft to the site, pending final survey and approval from the relevant authorities.
Cushman & Wakefield has estimated that the site could potentially yield a GFA of over 1.06 million sq ft, including the state land plots and any bonus GFA entitlement. The first storey of the development can accommodate a commercial GFA of up to around 16,146 sq ft.
Under the residential allocation, a minimum GFA of approximately 161,459 sq ft must be set aside for Serviced Apartments II (SA2), where a minimum stay of three months is required. The permitted heights for the new development range from 130m to 180m.
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Based on the reserve price, which includes land betterment charges on rezoning, the projected premium payable on the state land plots and the 10% bonus GFA for the residential portion, the estimated land rate comes to around $1,888 psf per plot ratio.
Recent industrial sales transactions at Tan Boon Liat Building indicate a potential interest from developers in the site (Source: EdgeProp Buddy).
Christina Sim, Senior Director of Capital Markets at Cushman & Wakefield, believes that the site will attract developers owing to its freehold tenure and prime location on the TEL, which is likely to appeal to homebuyers.
She also notes that the biggest advantage of the property is that there will be no Additional Buyer’s Stamp Duty (ABSD) levied on the purchase, as the original site has a “Business 1” zoning.
The tender for the property will close on March 18 at 3pm.
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