More CBD offices, fewer CBD homes, less decentralised office stock
However, the growth of decentralised office locations suffered a blow when the Urban Redevelopment Authority (URA) did not award the master developer white site at Jurong Lake District (JLD).
Developing the 6.5 hectare JLD site was envisaged to yield at least 1.5 million square feet (sq ft) of office space, up to 1,700 homes, and close to 800,000 sq ft of space for other uses such as retail and food and beverage; and help propel the development of Singapore's largest business district outside the CBD.
A five-party consortium – comprising CapitaLand Development, City Developments Limited , Frasers Property , Mitsubishi Estate and Mitsui Fudosan (Asia) – submitted two concept proposals for the JLD site.
However, in September 2024, URA said while one proposal was shortlisted, the tendered price – which worked out to about S$640 per square foot (psf) per plot ratio – was deemed to be too low.
Certainly, other parties can try snagging the JLD white site with a suitable proposal and a higher bid price or the five-party consortium could submit a higher bid for the site.
A NEWSLETTER FOR YOU
Tuesday, 12 pm Property Insights
Get an exclusive analysis of real estate and property news in Singapore and beyond.
Sign Up
Sign Up
However, as uncertainties over US trade tariffs weigh on business outlook and economic growth, chances that a group will try to secure the mega site with a stronger bid appear slim.
Perhaps, the authorities should rethink whether the JLD site needs to have a large office component and if it should push hard on developing decentralised office locations.
Sure, transport connectivity at JLD will be good. Still, some residents living in the east may be reluctant to spend possibly more than an hour commuting by public transport to work at JLD.
Working in the CBD
Indeed, the CBD's pre-eminence as Singapore's choice office location may impede the development of decentralised office locations.
One, as the CBD is centrally located, residents living all over the island can easily access it. Thus, a business located in the CBD is well-positioned to draw talent from all across Singapore.
Two, the CBD is an established business location. Maintaining a CBD office can provide an entity credibility with potential employees as well as business partners at home and abroad.
Three, it offers businesses easy access to various businesses and professional services. Also, CBD-based knowledge workers find its location convenient for networking with industry peers.
Four, the CBD is hardly sterile. It has Michelin-starred restaurants, popular hawker centres, cafes, bars, gyms, recreational amenities, retail outlets, as well as a range of hotels and cultural spaces.
On weekends, when the office crowd disappears, the CBD can transform to host sporting and other events.
Certainly, decentralised office locations may tempt businesses with lower rents versus the CBD. However, rental might not be an overriding consideration for many businesses when choosing an office location. After all, businesses may prefer being in the CBD to better draw talent and for prestige.
Crucially, if companies and knowledge workers like working out of the CBD, the government should consider selling more CBD office sites. Could a CBD office site be on the confirmed list of the government land sales programme for the second half?
Singapore's CBD office market recovered well post pandemic and is still seeing positive momentum. Amid flight to quality with space users, CBD Grade A spaces have outperformed.
Following four consecutive quarters of flat rental growth, core CBD Grade A office rents here rose 0.8 per cent from the previous quarter in Q1, as gross effective rents in this most-coveted subsector reached an average of S$12.05 psf per month, consultancy CBRE indicated.
It noted that top corporations and companies in private wealth asset management showed a strong preference for office spaces in prime locations with premium specifications.
While CBRE's research team was cautious about global trade conflicts and tariffs, it projects core CBD Grade A office rental growth of 2 to 3 per cent this year mainly due to limited supply.
Raising the supply of high-quality CBD office spaces can help meet the need for such spaces and boost Singapore's competitiveness in attracting businesses to set up shop or expand operations amid a tough business climate.
Businesses looking to house high-value functions here might welcome greater choice of efficiently planned, modern and sustainable CBD work spaces, and more competitive rental rates for premier CBD office spaces due to greater supply of such spaces.
Moreover, if CBD office stock increases, businesses seeking to operate from multiple locations for risk management purposes can find it easier to be at multiple locations within the CBD.
Living outside the CBD
Concurrently, the government may wish to pause ambitions to grow housing inventory in the CBD.
Locals may be lukewarm to living in the CBD. And the popularity of long-stay serviced apartments in the CBD, with a three-month minimum stay requirement, is uncertain.
Given Singapore is small and has excellent public transport, many people working in the CBD seem fine living outside of it in more established residential enclaves.
Families with children might choose neighbourhoods that are close to sought-after schools. Childless households could prefer locales that offer a more residential rather than office vibe for lifestyle reasons.
Over recent months, numerous homes at One Shenton and The Sail @ Marina Bay in the CBD, with initial 99-year land leases, were transacted at under S$2,000 psf. In contrast, the capital values of premier office buildings nearby, with initial 99-year land leases, can be much higher.
Sure, the CBD is livelier on weekends if more people live in it. Nonetheless, Singapore can be great for 'live, work and play', with many people working in the CBD but living outside of it.
Singapore can aspire to have a vibrant office-centric CBD, alongside highly liveable housing-centric suburbs. Growing the CBD serves evolving workspace needs, while going slow on office decentralisation and building homes in the CBD ensures land use is optimised according to the preference of space users.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
International Business Times
6 hours ago
- International Business Times
What is B30A? Nvidia Prepares New, More Powerful Blackwell-Based AI Chip for China
US-based semiconductor giant Nvidia is developing a new artificial intelligence chip for the Chinese market, sources familiar with the matter revealed. The processor, known internally as the B30A, will be based on Nvidia's latest Blackwell architecture and is expected to be more powerful than the H20 chip currently approved for sale in China. Nvidia X The move comes after U.S. President Donald Trump signaled last week that Washington may allow more advanced chips to be exported to China. However, approval remains uncertain as U.S. lawmakers continue to express concerns about providing Beijing with access to high-performance AI technology. The B30A will reportedly use a single-die design, offering roughly half the computing power of Nvidia's flagship B300, which uses a dual-die configuration. Despite the scaled-down performance, the chip will feature high-bandwidth memory and Nvidia's NVLink interconnect, similar to the H20 but built on newer technology. Although the final specifications are not yet confirmed, Nvidia aims to deliver samples of the chip to Chinese clients for testing as early as next month. In a statement, the company said it regularly evaluates new products to remain competitive "to the extent governments allow," emphasizing that all offerings comply fully with regulatory approvals. China accounted for about 13% of Nvidia's revenue last year, making it a critical market despite heavy restrictions. In July, the U.S. allowed Nvidia to resume sales of the H20, which had been halted earlier this year. Trump later suggested that future Nvidia chips for China could come with "30% to 50% off" in computing power compared to flagship models, calling the H20 "obsolete." The question of how much AI hardware China should access remains one of the most sensitive issues in U.S.-China trade relations. Nvidia has argued that continued engagement with Chinese firms is necessary to prevent them from switching entirely to local rivals like Huawei, which is rapidly improving its chip capabilities. Chinese state media have recently raised security concerns about Nvidia's chips, warning local companies about potential risks. Nvidia has denied those claims, saying its hardware contains no hidden vulnerabilities. Alongside the B30A, Nvidia is also preparing another China-specific chip, the RTX6000D, designed mainly for AI inference tasks. This processor, also based on Blackwell architecture, will have reduced specifications to comply with U.S. export thresholds. Small batches are expected to reach Chinese clients by September.
Business Times
10 hours ago
- Business Times
India suspends cotton import duty in signal to US, relief for garment industry
[NEW DELHI] India has suspended an 11 per cent import duty on cotton until September 30, in a move seen as a signal to Washington that New Delhi is willing to address US concerns on agricultural tariffs, while also easing pressure on its garment industry. The temporary suspension, announced late on Monday, could benefit US cotton growers and provide relief to India's apparel sector, which faces tariffs of nearly 60 per cent on shipments to the United States from later this month. A planned visit by US trade negotiators to New Delhi from August 25-29 has been called off, delaying talks on a proposed bilateral trade agreement and dashing hopes of relief from an additional 25 per cent US tariff on Indian goods from August 27. President Donald Trump earlier this month announced an extra tariff on Indian goods as punishment for New Delhi's purchases of Russian oil, doubling the total duty to 50 per cent on US imports of Indian goods from later this month. Indian exports had previously faced levies of 0-5 per cent, with duties on some textiles ranging between 9 per cent and 13 per cent before Trump raised tariffs in April. The United States is the biggest market for India's garment exporters, who say steep tariffs are leading to order cancellations and making them uncompetitive against Bangladesh and Vietnam, which have US duties of 20 per cent, and China at 30 per cent. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up India's labour-intensive sectors, including textiles, footwear, engineering goods an shrimp, have been jolted by US tariffs, and are now seeking alternative markets. 'The largest beneficiary of the duty free import will be the US, the second-largest supplier to India,' said Ajay Srivastava, founder of Global Trade Research Initiative, a New Delhi-based think tank, adding India already allows duty-free cotton imports from Australia within a quota. Cotton imports more than doubled to US$1.2 billion in the 2024/25 fiscal year to March, from US$579 million a year earlier, led by US$258 million from Australia, US$234 million from the United States, US$181 million from Brazil and US$116 million from Egypt, Srivastava said. The sharp rise in US tariffs comes just as India was emerging as a stronger alternative for American garment buyers, with Bangladesh facing political uncertainty and companies seeking to diversify supply chains beyond China. Industry bodies such as the Confederation of Indian Textile Industry (CITI) had urged the government to scrap the cotton import duty to help make the sector more competitive. Reuters earlier reported that some Indian exporters were scrambling to explore manufacturing options overseas to offset the impact of the higher tariffs. India's garment sector was already grappling with a labour crunch and limited production capacity. The prospect of exporters relocating production abroad poses a further challenge to the government's 'Make in India' manufacturing drive. Industry officials now expect the government to extend duty-free cotton imports beyond September. reuters
Business Times
11 hours ago
- Business Times
Foreign investment in Singapore real estate surges in Q2, but small market may limit further gains
[SINGAPORE] Foreign investment in Singapore property jumped in the second quarter of this year to US$2.3 billion, 572.5 per cent higher than the US$342 million from the same period in 2024, led by mixed-use and industrial real estate, according to real estate consultancy Knight Frank. This was also the biggest increase in the Asia-Pacific (Apac). However, it is uncertain that this pace of growth will be sustained, said Christine Li, head of research for Apac at Knight Frank, to The Business Times. 'Foreign investors always have an interest in Singapore's assets, but the market proves challenging as Singapore does not have a large pool of institutional-grade assets available for acquisition, unlike some larger economies in the region. Asset owners also hold Singapore assets for (a) longer-term horizon,' she noted. PGIM Real Estate, which manages US$210 billion of property assets globally, agrees. 'This is a market which we like, but it's a relatively small market, and it's difficult to deploy capital,' PGIM's Raimondo Amabile, co-head of real estate and global chief investment officer, told BT recently. Still, the Newark-based firm bought Stamford Court with Elevate Capital Group for S$132 million in October 2024. The building is currently being redeveloped into a mixed-use lifestyle hub that will feature a co-working space by Singapore-based co-working brand The Great Room when it opens in the second half of 2026. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up For overseas investors seeking to deploy funds in the city-state, Li suggested looking into value-add opportunities to reap benefits, given the number of ageing assets, in sectors such as office, industrial and hotels. Knight Frank's data covers completed and pending transactions. These include City Developments Ltd's agreement to sell its 50.1 per cent stake in the South Beach mixed hotel-office project to its Malaysian partner, IOI Properties Group, for about S$834.2 million. Another sizeable deal is Mapletree Industrial Trust 's sale of three industrial assets for S$535.3 million to Canada's Brookfield Asset Management. Both are scheduled to be completed in the current quarter. JLL is slightly more bullish, seeing the return of so-called core funds – owned or managed by the likes of pension funds, insurance companies and those with a low-risk profile – to Singapore. Dominance of funds with higher risk 'Core funds that are geography-agnostic are divesting office assets elsewhere with plans to invest into Singapore. Post-capital recycling, 2026 will likely see core funds re-enter Singapore,' it said in a July report. Currently, capital in the city-state is dominated by value-add and opportunistic players, referring to those with a medium-to-high risk appetite, it noted. These usually include the likes of private-equity players, real estate investment trusts and high-net-worth individuals comfortable with higher risks. JLL's data on foreign investment in Singapore property shows similar strong growth. In the nine-month period ended Jun 30, overseas investors pumped US$3.7 billion into Singapore – a year-on-year surge of 442 per cent. Global investors accounted for 68 per cent of the inbound volumes. Apart from Singapore, Australia and Japan were among the top three biggest recipients of foreign investments in Apac during Q2 2025. While American investors are driving the majority of the interest in the Apac region, European buyers have also been active, particularly as they seek to diversify away from the US. 'We are seeing an increase in interest from European investors in the Asia-Pacific region, with many considering reducing their exposures to the US market and reallocating it to other regions,' said Guy Sainsbury, head of investment operations, Asia-Pacific, at Savills Investment Management. Comprising mostly pension funds and private-equity funds, and family offices on a smaller scale, these European investors are most interested in Australia and Japan when considering investments in the region, he added. 'One of the best propositions' Australia captured US$3.8 billion worth of foreign investment in Q2, according to Knight Frank. Apart from being a 118 per cent jump from the same period in 2024, it was also almost a third of the total US$12.1 billion in cross-border activity for Asia-Pacific, noted the real estate consultancy. 'Australia is one of the best propositions right now,' PGIM's Amabile said. A growing population, positive net immigration and low unemployment are spurring demand for residential sectors such as co-living. He added that PGIM is investing a lot of capital in the country, particularly in the build-to-rent sector. It also appears to be positive on Australia's retail sector. In June, PGIM teamed up with Australia's Assembly Funds Management to buy the Woodgrove Shopping Centre in Melbourne for A$440 million (S$366.5 million). Rising net immigration, as well as an anticipated increase in foreign students, is also driving optimism in Australia's student accommodation market. Earlier in August, the Australian government said the country will lift its cap on foreign students by 9 per cent to 295,000 next year. It will also prioritise applicants from South-east Asia. The announcement led the shares of Wee Hur, a Singapore-listed operator/owner of purpose-built student accommodation (PBSA) in Australia, to jump 6.5 per cent to a record high on Aug 6. Growing optimism is leading overseas investors, including those from Singapore, to 'actively' form joint ventures with local players to buy assets in the PBSA sector, said the JLL report. These include Temasek's Mapletree Investments, which said in July that it had started looking at opportunities in Australia , where it said there is growing demand and structural under-supply in the asset. Australia's office sector has also been drawing foreign investors, particularly from Japan. During Q2, Odakyu Electric Railway bought a 10 per cent stake in Salesforce Tower, Sydney's tallest office building. That follows a US$375 million purchase by Daibiru of 135 King Street at the end of March. Foreign investors are likely to continue favouring the country, particularly if the Reserve Bank of Australia sticks to the path to lower interest rates, said market players. The central bank cut the main cash rate by a quarter point to a two-year low of 3.6 per cent on Aug 12. Active Japanese market Japan was also a top pick for foreign investors during Q2. Knight Frank's data showed foreign investors buying around US$2.4 billion in assets, mostly in the residential and industrial sectors. This was despite a 14.8 per cent year-on-year drop in transaction volumes. Given the push by the Tokyo Stock Exchange for companies to restructure their balance sheets to enhance shareholder value, some real estate assets have been made available. The restructure has also fuelled dealmaking in Japan, with mergers and acquisitions hitting a record US$232 billion in the first half of the year. Reforms to tackle chronic low valuations among Japanese firms are fuelling a flurry of foreign and activist-investor interest. The appetite for more deals remains strong, bolstered by Japan's low interest rates. The active private-equity market in Japan is spilling over to real estate, said PGIM's Amabile. And the foreign investors include those hailing from Singapore. CapitaLand Investment in June announced that its private fund, CapitaLand Ascott Residence Asia Fund II, bought a prime mixed-use asset in Tokyo for more than 30 billion yen (S$267.2 million) European investors are also drawn to the residential and multi-family build-to-rent market in Japan, said Savills' Sainsbury.
