September 2013

Singapore | Hong Kong

The Office A review of the Singapore office market

Corporate Locations (S) Pte Ltd License No. L3010044A Tel +65 6320 8355 / [email protected] / www.corporatelocations.com.sg New Office Schemes 2

*All rents quoted are estimated target effective rates subject to negotiations and are not the landlords quoted figure

Asia Square Tower 1 / Tower 2

8 & 12 Marina View

Features

• Raised flooring • Column free space • 3m ceiling height $12.00 - 13.50 psf* • Dual power and telecom risers • 313 car parking spaces Units from 2,000 – 35,000 sq ft (G)

One Tower 2

1 Raffles Place

Features

• Floor to ceiling windows • Raised flooring • Prime location • Direct link to MRT $10.50 - 11.50 psf* Units from 1,798 – 21,000 sq ft (G)

Marina Bay Financial Centre Tower 3

10 Marina Boulevard

Features

• High specification • Column free space • Raised flooring $11.00 - 12.50 psf* • Good natural lighting • Dual power and telecom risers Units from 1,430 – 20,293 sq ft (G)

Demand

Demand for office space remains weak, but Reinsurance relocating here from One Raffles modest growth continues. More companies Place Tower 1. Allianz Group is already Summary of Some Larger Leasing Transactions are revisiting their expansion plans, aware committed as the anchor tenant and other that supply in the next few years may tighten new tenants include Mundipharma from before the next wave of new supply in 2016. Keppel Tower, and Fidelity Investments. Next Millennia Tower PayPal 10,000 sq ft The majority of recent tenants for premium door in Tower 1 new tenants grade office space were in the financial here include global information company IHS Republic Plaza AR Capital 11,500 sq ft and business services sectors. However, Global relocating from 78 Shenton Way, and Marina Bay Financial Centre, T3 Louis Dreyfuss 20,000 sq ft activity has been across the board from international drinks company Edrington. Trammo Pte Ltd 20,000 sq ft large companies moving to decentralized locations, to smaller companies needing At Marina Bay Financial Centre, the direct Asia Square, Tower 1 Lloyds of London 32,500 sq ft economy space having to relocate due to rival to Asia Square, leasing has been strong IHS Global 32,500 sq ft the redevelopment of their existing building. in Tower 3 and recent new tenants include Mainstream companies continue to assess China Union Pay, Woori Investment & Edrington 7,600 sq ft upgrading now that the rental gap between Securities (both from ), and Asia Square, Tower 2 National Australia Bank 30,000 sq ft mid-tier and prime office space has narrowed, Louis Dreyfus (Wheelock House). Swiss Reinsurance 30,000 sq ft encouraging the flight to quality. Raffles Place has seen several tenants Mundipharma 17,000 sq ft Demand for office space continued its relocating within the same location such as 6 Shenton Way, Tower 2 Professional Investment Advisory 15,000 sq ft modest growth EDF Trading, who moved from Straits Trading Building to One Raffles Place Tower .2 AXA Tower Rickmers Ship Management 13,000 sq ft Pre-leasing activity for Asia Square Tower 2 Enerfo moved from One Raffles Place to Haw Par Centre Metso 9,200 sq ft has been hitting the headlines recently and Transcu also Ngee Ann City Bulgari 15,000 sq ft with National Bank of Australia planning to relocated to Ocean Financial Centre from relocate here from , and Swiss . Upcoming Office Developments: 2014 - 2017 3

2014

CapitaGreen Paya Lebar Square 138 Market Street Paya Lebar

Size: 700,000 sq ft NLA Size: 430,000 sq ft Height: 40 storeys Height: 13 storeys (10 floors offices) Average floor plate: 20 - 25,000 sq ft Average floor plate: 43,000 sq ft Est. completion: Q4 2014 For sale - 99 years leasehold Est. completion: September 2014

2015 2016 2017

South Beach 5 Shenton Way Duo SBF Centre Beach Road Tanjong Pagar Marina View Rochor Road Robinson Road Size: 280,000 sq ft (New downtown) Beach Road Size: Height: 23 storeys, Size: 850,000 sq ft Ophir Road Size: 340,000 sq ft 500,000 sq ft NLA 14 floors of office Height: 64 storeys, Size: 1,880,000 sq ft Height: 31 storeys Height: 34 storeys space Office floors up to Height: 30-storeys Size: 688,000 sq ft Average floor plate: Average floor plate: Average floor plate: level 38 (twin towers) Height: 39 storeys 11,000 sq ft 15 - 19,000 sq ft 20,000 sq ft (residential above) Average floor plate: Average floor plate: For sale - 99 years Est. completion: Est. completion: Average floor plate: 30,000 sq ft 18,000 sq ft leasehold Q1 2015 Q2 2015 25 - 29,000 sq ft Est. completion: Est. completion: Est. completion: Est. completion: Q4 2016 Q1 2017 June 2017 Q3 2016

Demand cont. Supply

Argus Media moved from RB Capital to Internal Auditors (The Corporate Office).Tower Overall CBD vacancy rate is around 4.5% Novena Square and Shell will be vacating Singapore Land Tower, and Mitsubishi 2 is the newer tower and new tenants here sizeable space in UE Square when they UFJ Lease (there are 4 different companies are Professional Investment Advisory Services The only major office development scheduled both move to The Metropolis in 2014. Allianz starting with Mitsubishi UFJ) moved from () and Global Blue Singapore for completion before the end of this year Group will also be coming out of several UOB Plaza to 6 Battery Road. New tenants (City House). Elsewhere, Rickmers Ship is Asia Square Tower 2 (782,280 sq ft). The floors in Centennial Tower when they relocate moving into Raffles Place include Open Management moved into AXA Tower from ABI scheme is now around 35% pre-leased but to Asia Square. Text into 6 Battery Road, Korda Mentha to Plaza and Wipro moved from Hub Synergy this would still mean that around 450,000 (from Robinson Tower) into GB Building. sq ft will be released onto the market soon, CapitaGreen will be the most important and Orangefield intoOne Raffles Place which in turn will have a short term effect on scheme to be completed in the Financial from Robinson 112. On the edge of Raffles The Orchard Road area has seen limited vacancy rates. The current vacancy rate in District next year Place, Validus Reinsurance moved from activity because of tight supply. Haw Par Raffles Place is around 6% and Shenton Way One Finlayson Green to . Centre has been one of the most active is around 2%. Tanjong Pagar has a lower CapitaGreen will be the most important Cooper Gay also moved to Samsung Hub (4 buildings and new tenants here include Jade vacancy rate and the Marina Bay area has scheme to be completed in the Financial Robinson Road) and Nikon Singapore moved E-Services Singapore, Sibelco (Maybank an approximate vacancy rate of 3%. Orchard District next year, providing some 700,000 sq from Fuji Xerox Tower to Capital Square. Tower) and Metso. Another notable relocation Road remains very tight at around 1% ft of net lettable space. Paya Lebar Square was Bulgari who moved from The Forum to vacancy with very little new supply planned (430,000 sq ft) is for sale on a strata title The Robinson Road / Tanjong Pagar location Ngee Ann City earlier this year. Beach Road for the future. The overall CBD vacancy rate is basis offering a wide range of sizes as small still proves popular despite much tighter has always offered good value for money and around 4.5%. as 500 sq ft up to 43,000 sq ft. 2015 has just supply in this area. Many companies looking Shaw Tower in particular has attracted many two medium sized schemes scheduled for for the most cost effective options were tenants on competitive budgets. New tenants Some good quality stock on the edge of the completion, namely South Beach (500,000 sq attracted to 6 Shenton Way Tower 1 and new to move here include Wego (from Bugis CBD will be released onto the market early ft NLS) and 5 Shenton Way (280,000 sq ft). The occupiers here include Encore Technology Junction), AJM Shipping (from Fuji Xerox next year as a result of a number of major next major wave of supply will come in 2016 (Robinson Tower), Achieve Career Consultants Tower), Cogent Communications and Agilysis relocations. Proctor and Gamble will be with the completion of Guoco Tower (850,000 (Int’l Factors Building) and The Institute of Singapore (from China Square). freeing up a significant amount of space in sq ft) and Marina One (1,880,000 sq ft). Raffles Place 4

Maybank Tower 2 Battery Road • Superb sea views • Exclusive whole floors • Raised flooring • High specification 30 Raffles Place

$11.00 psf* Units from 3,757 - 4,327 sq ft $8.25 psf* Republic Plaza Units from 1,500 - 8,396 sq ft 9 Raffles Place • Prime location • Landmark site • On site car parking

$9.50 - $11.00 psf* Units from 3,057 - 14,824 sq ft

Bank of Singapore Centre 63 Market Street • High quality space • Column free • Raised flooring • Good natural lighting

$8.50 - $9.00 psf* Units from 1,610 - 22,000 sq ft

Rental Guide - Summary of Target Effective Rates

Raffles Place / Marina Bay Tung Centre $9.00-$11.50 GB Building Full AXA Tower $8.00 UOB Plaza 1 $10.00 Grace Global Raffles $8.00 $7.50 16 Collyer Quay $8.50 UOB Plaza 2 Full Great Eastern Centre $7.50 Hub Synergy Point $5.50 55 Market Street $7.00-$7.50 $8.80 International Plaza $6.50-$7.00 6 Battery Road $11.50 International Factors Building TBC Jit Poh Building Full Asia Square Tower 1 & 2 $12.00-$13.50 Robinson Road / Shenton Way Keck Seng Tower $6.50-$7.00 Keppel Towers $6.00 Bank of China Building $8.00 PIL Building Full Mapletree Anson $8.00-$8.50 Bharat Building Full 4 Robinson Road Full PWC Building $8.00 MAS Building Full Bank of Singapore Centre $8.50-$9.00 6 Raffles Quay $8.00 Prudential Tower Full St. Andrew’s Centre Full Chevron House $8.25 OUE Downtown 1 (6 Shenton Way Tower 1) TBC $7.50 Southpoint $6.20 Clifford Centre $8.00 OUE Downtown 2 (6 Shenton Way Tower 2) $7.00 Robinson 112 $7.00 $7.50-$8.00 Equity Plaza $7.50 60 Robinson Road Full Robinson Centre $7.50-$8.00 Tower Fifteen $6.50 Maybank Tower $11.00 71 Robinson Road $7.50-$8.00 Robinson Point $8.00 Twenty Anson $8.50 MBFC Tower 1, 2 & 3 $11.00-$12.50 80 Robinson Road $7.30-$7.50 Samsung Hub $8.50 OCBC Centre $9.50 120 Robinson Road Full SGX Centre $7.50-$8.50 OCBC Centre East $8.50 135 Cecil Street Full SIF Building Full City Hall / Marina Centre / Beach Road Ocean Financial Centre $10.50 137 Telok Ayer Street Full Shenton House TBC One Finlayson Green $8.00 146 Robinson Road $5.00 The Globe $6.00 11 Beach Road Full $9.70 150 Cecil Street $5.50 The Octagon $6.00 30 Hill Street $8.00 One Marina Boulevard $10.00 158 Cecil Street $7.50 Tokio Marine Centre Full 67 High Street Full One Raffles Place Tower 1 $8.50-$9.50 AIA Tower $7.50 Tong Eng Building TBC 700 Beach $6.00 One Raffles Place Tower 2 $10.50-$11.50 ASO Building Full Bugis Junction Towers $7.50 North Tower $12.00 Bangkok Bank Building Full Centennial Tower Full OUE Bayfront $10.80 Capital Square $8.50-$9.00 Tanjong Pagar Keypoint $4.00 RB Capital Building Full Capital Tower TBC $10.00-$11.00 Republic Plaza 1 $9.50-$11.00 Cecil Court TBC 260 Tanjong Pagar Road Full Odeon Towers Full Republic Plaza 2 Full China Square Central $8.50 78 Shenton Way $7.00 One Raffles Link Full Royal Group Building Full City House Full 79 Anson Road Full Parkview Square $7.50 Royal One Phillip Full CPF Building Full ABI Plaza $6.00 Peninsula Plaza $5.50 Singapore Land Tower $10.00 Far East Finance Building Full Amara Corporate Tower Full Raffles City Tower $10.00 Straits Trading Building $9.00 Far Eastern Bank Buidling $6.00 Anson Centre TBC Shaw Tower Full The Arcade $6.80 Finexis Building $6.00 Anson House $9.00 Stamford Court Full Edge of Raffles Place 5

PWC Building 8 Cross Street • High quality space • Column free • Raised flooring • Good natural lighting

$8.00 psf* Units from 2,582 - 30,892 sq ft

One George Street Capital Square George Street 23 Church Street

$9.70 psf* $8.50 - $9.00 psf* Units from 1,000 – 30,000 sq ft Units from 5,000 – 30,000 sq ft

OCBC Centre East 65 Chulia Street • Prime location • Landmark site • On-site car parking • Flush floor trunking

$8.50 psf* Units from 2,500 - 26,000 sq ft

* Light industrial space

Edge of CBD

Suntec Towers 1-5 $8.00-$9.50 The Heeren Full Alfa Centre Full S’pore Science Park* $4.00 The Adelphi $7.00 The Paragon Full Boon Siew Building $4.50 Sime Darby Biz Centre* Full $7.50 Thong Teck Building $6.00 Central Plaza $6.50 Tech Point* $3.00 East and West $7.00 Tong Building TBC Goldhill Plaza Full The Signature* $4.20 TripleOne Somerset $7.50-$8.50 Newton 200 Full UE BizHub* $4.20 VisionCrest Commercial $8.00 Novena Square $8.50 Orchard Road / Dhoby Ghaut Wheelock Place $12.00 Rex House Full Wilkie Edge Full SLF Building Full East 50 Scotts Road $8.50 Winsland House 1 & 2 $10.50 The Metropolis $7.00 Albert Complex Full Wisma Atria Full United Square $7.50 Abacus Plaza $5.00 Burlington Square $7.50 UE Biz Hub $4.20-$4.50 AIA Tampines TBC Faber House $8.00 Changi Business Park* $4.00 Fortune Centre Full Chinatown / River Valley Road Cisco Centre II Full Forum $7.00 West / Others CPF Tampines Building $5.00 Goldbell Towers $8.00 2HR (Havelock Road) Full KA Centre* $2.50 Haw Par Centre $6.50 Central $9.00-$9.50 Alexandra Point $6.50 KA Place* $2.50 Haw Par Glass Tower Full Central Mall $6.50-$7.00 Alexandra Techno Park* $4.00 NTUC Tampines Junction $5.00 International Building $7.80 Chinatown Point $6.00 Harbourfront Centre $6.80-$7.50 NTUC Tampines Point $5.00 Liat Towers Full China Square Central $8.50 Harbourfront Tower 1 $8.20 Parkway Parade $6.00 Manulife Centre $6.80 Great World City A&B Full Harbourfront Tower 2 $7.50 S’pore Post Centre $6.00 Ngee Ann City $10.00 King’s Centre $6.00 Harbour Link TBC Tampines Concourse $4.50 Orchard Building Full Royal Merukh S.E.A Building Full Int’l Biz Park (Jurong)* $3.50 Tampines Grande $5.00 Palais Renaissance $9.00 Shell House $6.50 Keppel Bay Tower $8.00 Tampines Plaza $5.00 Park Mall Full Valley Point $5.75 The Mapletree Business City* $6.00 Techlink* $3.00 Regency House $7.50 New Tech Park* $3.80 Technopark @ Chai Chee* $3.00 Shaw Centre $8.00 Pacific Tech Centre* $3.20 Tech View* $3.00 Shaw House $9.20 PSA Building $7.50 Singapore Pools Building $6.00 PSA Vista Full Sunshine Plaza $6.00 Tanglin Shopping Centre $6.50 The Atrium@Orchard Full *All rents quoted are estimated target effective rates subject to negotiations The Bencoolen $6.00 and are not the landlords quoted figure Robinson Road / Tanjong Pagar 6

Springleaf Tower Target Effective Rates per sq ft 3 Anson Road • Raised flooring • Good natural lighting • Direct link to MRT

Anson House 6 Shenton Way, Tower 2 Anson Road Shenton Way

Units from 2,400 – 9,375 sq ft $8.00 psf* $7.50 psf* $7.00 psf* Units from 1,087 - 9,375 sq ft Units from 1,991 – 8,676 sq ft Units from 1,800 - 16,000 sq ft

Robinson 77 77 Robinson Road • Flexible sizes • Raised floor • Close to MRT

$7.50 psf* Units from 1,800 – 24,000 sq ft

History of Average Prime Grade A Office Rents

Forecast 3,750

Global Financial 3,500 $26 Crisis

3,250 $24

3,000 $22

2,750 $20 STI INDEX 2,500 $18 Asian Financial Crisis Dot Com Crash 2,250 $16

STI Index First Gulf War 2,000 $14

1,750 $12 Gross Rentals PSF 1,500 $10

1,250 $8

1,000 $6

750 $4

500 $2

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Average Top Prime Grade A Office Rentals in Singapore − Per sq ft per month City Hall / Marina Bay / Orchard 7

Suntec City, Towers 1 - 4 Target Effective Rates per sq ft Temasek Boulevard •Extra large floor plate • Underfloor trunking • Generous car parking • 16 passenger lifts

$8.50 - $9.00 psf* Units from 1,000 - 12,000 sq ft

The Gateway TripleOne Somerset Beach Road 111 Somerset Road • Good value for Orchard • Large floor plates

$7.00 psf* Units from 1,484 - 6,161 sq ft

Bugis Junction Tower Orchard Gateway Rochor Road Orchard Road

$7.50 psf* $8.50+ psf* $8.50 psf* Units from 3,600 - 6,000 sq ft Units from 2,700 - 6,000 sq ft Units from 2,854 - 10,732 sq ft

Rentals Market Forecast

Generally rates have been fairly stable Rentals in Raffles Place have not moved much The Singapore market is in good shape The quality of some of the new schemes and still range from $9.00 to $10.50 per sq ft with ample choice, stable rentals, quality coming on stream in the next few years The rental market bottomed out around Q4 although there are some exceptions, such as stock and a well-planned future. is truly impressive, with large floor plates 2012 after 7 consecutive quarters of decline Maybank Tower circa $11.00 to $13.00 per (Marina One will have two podium office since 4Q 2011, although top prime rates sq ft. Rates in Shenton Way average around The slow recovery is expected to continue but floors of over 100,000 sq ft each), state of the only fell to around $11.00 per sq ft which $7.50 - $8.00 per sq ft. Marina Bay rates there are no sudden spikes expected for the art specifications and many with the highest is still higher than the peaks in 2001 and have seen mixed fortunes with Millenia Tower next 4 years. The gap between the prime and ‘Green’ credentials possible - all this available 1996. Rates are beginning to show signs of needing to compete hard with other major secondary markets will continue to narrow as at very competitive rental rates compared a gradual recovery particularly in the new locations and has done well attracting new supply in the secondary is absorbed faster. with other regional finance centres such as downtown area which saw an increase of tenants such a PayPal, whilst Suntec City has Vacancy rates may increase marginally with Hong Kong. around 2% quarter on quarter and Orchard enjoyed a relatively high occupancy rate. the completion of Asia Square Tower 2 and Road which saw an uplift of 5%. This was then gradually decrease until the next wave of Generally, the Singapore office market is in due to demand outpacing supply for certain Average effective rates are in the region of supply arrives in 2016. very good shape with ample choice, stable locations, sizes and/or budgets. $9.00 per sq ft in this location. Beach Road rentals, quality stock and a well-planned remains one of the most competitive locations future ahead. Generally rates have been fairly stable with ranging from $5.75 to $6.50 per sq ft effective. Top Grade A rates still around $12-$13.00 per Edge of CBD locations have a wide range sq ft. Some developers, particularly for the such as Novena Square at $8.50 per sq ft and The quality of some of the new schemes coming on larger schemes, are holding firm on their face Shell House / UE Square at $6.50 per sq ft. rates and will not manoeuver much but are Business parks still range from $4.00 to $4.25 stream in the next few years is truly impressive offering very attractive long rent-free periods, per sq ft except for Mapletree Business City sometimes up to 4-5 months, making their ($6.00 psf). effective rates very competitive. Edge of CBD / Decentralised Office Locations 8

Mapletree Business City Shell House / UE Square 10 Pasir Panjang Road • Business Park Space Clemenceau Avenue

$6.00 psf* upwards $6.50 psf* Units from 10,000 - 30,000 sq ft Units from 2,000 - 20,000 sq ft

The Signature Novena Square • Column free design • 24-hour security • Fully accessible raised floor 51 Changi Business Park Central 2 Thomson Road

$4.20 psf* $8.50 psf* Units from 1,539 - 49,415 sq ft Units from 2,000 - 20,000 sq ft

UE Biz Hub 6 & 8 Changi Business Park Ave 1 • BCA Greenmark GoldPlus • Walking distance to Expo • 10 passenger lifts & 9 cargo lifts

$4.20 psf* Units from 5,000 - 28,000 sq ft

Useful Contacts

Interior Designers Office Movers Telecommunications & Systems Integration Office System Furniture

Ai Associates Crown Worldwide First Aurora. Contact: Greg Parkhurst BW Furniture Contact: Jeff Choo Contact: Andrew Soon 9633 3057 / [email protected] Contact: Charlie Brazier 9875 1825 / [email protected] 9820 7247 / [email protected] www.firstaurora.com 6339 2285 / [email protected] www.ai-associates.com www.crownworldwide.com www.bwfurniture.com Renovation Contractors Chez Design Four Winds International C&R Interiors Contact: Melvyn See Contact: Jasmine Tan Pratt Design and Space Planning Contact: Mr Chong Sun Song 9616 1858 / [email protected] 6777 1166 / [email protected] Contact: Tony Tan 9638 8310 / [email protected] www.chezdesign.com.sg www.agsfourwinds.com 9694 6716 / [email protected] www.cnrinteriors.com.sg www.prattdesign.com.sg ID Inc K.C. Dat Steelcase Contact: Jeffrey Chong Contact: Desmond Lim MKS Global. Contact: Michael Wu Contact: Caslin Liu 9383 0622 / [email protected] 9459 0606 / [email protected] 9388 8022 / [email protected] 9431 3078 / [email protected] www.idinc.com.sg www.kcdat.com.sg www.mksingapore.com www.steelcase.asia

M.Moser Associates Contact: Nicholas Schifferle 9451 8132 / [email protected] www.mmoser.com

Sennex Consultants ‘Finding office space for you, with you’ Contact: Nick Jones 8168 7988 / [email protected] www.sennexconsultants.com www.corporatelocations.com.sg