With New Interesting Discoveries, the land Rate Can be Much Lower
The attractive commercial property Sim Lim Square has launched for 2nd tender at collective sale in 2019.
Pleasant surprises have erupted during the investigations on Sim Lim Square at its relaunch for collective sale, this sentiment has proved to be true with the discovery of more values that has augmented the site manifold.
When the Collective Sales Committee under the Chairmanship of Vikas Gupta appointed an Architect to redraw the building map, they found the built-up space to be an astounding 499,715 sq ft that was 27% higher than 391,000 sq ft found in the records.
Another interesting factor unearthed was that the actual land area of Sim Lim Square had been 8,066.7 sq m until a part was surrendered to road reserve that resulted in the present land area of 7,260.6 sq m.
If this is verified and approved by the authorities, that presents huge discounts on development charges to the prospective developer.
It could potentially reduce the land rate from S$3,300 psf ppr to S$2,501 psf ppr, as indicated by Francis Tan, Chief Investment Officer, SLP Scotia, the Marketing Agent of Sim Lim Square.
Furthermore, URA’s Strategic Development Incentive (SDI) Scheme encourages new, innovative proposals of different uses and concepts that could have transformational impact and rejuvenate the neighbourhood.
Under the scheme, the land rate could possibly reduce further, apart from approvals for change in land use, plot ratio and building height.
Another possibility to lower the land rate becomes applicable as Sim Lim Square has been reserved for community use, which presents the future developer the opportunity to allocate community space and claim additional Gross Floor Area (GFA).
Necessary licence obtained recently to operate nightclubs and pubs on the sixth floor for liquor, entertainment and permission to be open until 3 AM adds more value to the property without a doubt.
Zoned for commercial use with plot ratio 4.2, it has a balance 63 years leasehold without any obligation for top up.
Moreover, being a commercial property, it has no ABSD & SSD charges, and potentially attracts foreign investments.
In spite of the positive developments between its earlier tender launched in July and the present, the Collective Sales Committee has not revised their asking price upward but maintained the same at S$1.25 billion.
Since it opened in 1987, Sim Lim Square strategically located at the apex of Ophir-Rochor Corridor, the extended downtown area, in the junction of Rochor Canal Road and Bencoolen Road has served as the technocentre for IT goods and services.
Interestingly under the Master Plan 2019, many developments in Rochor Canal have been categorized for hotel use.
Being close to Kampong Glam, Little India, Bugis and similar tourist locations, Sim Lim Square has high potential for hotel use.
All the recent successful collective sales in the Sim Lim Square neighbourhood within the last twelve months namely the Golden Wall Centre, Waterloo Apartments and Selegie Centre have been converted for hotel use.
With an excellent frontage, seamless connectivity, high footfall and located in tourist zone, the Sim Lim Square presents a rare opportunity for developers to choose, especially when commercial collective sales fail to achieve consensus among the owners like the recent Queensway Shopping Centre.
Probably the first sale tender in July closed unsuccessfully for good, as gloom over global economic uncertainties loomed the property market, already hit by the cooling measures.
Because many positive aspects of Sim Lim Square have been discovered in the meanwhile to the excitement and hope of all its stakeholders for a successful tender.
The tender for Sim Lim Square closes on December 30, 2019.