SINGAPORE: More than half of the office space at the upcoming Paya Lebar Quarter has been leased or is in the process of being leased, its developer Lendlease announced at the topping out ceremony of its first office tower on Monday (Jan 15).
Close to one million square feet of grade A prime office space will be made available at the upcoming regional business hub, which is the "most centrally located commercial centre outside of the downtown area", National Development Minister Lawrence Wong said at the ceremony.
More than half of the office space across its three towers has either been leased, are under final offer or are in advanced negotiations.
According to Lendlease, prospective tenants include those from the financial services, infrastructure and real estate sectors, as well as a premium gym. The office towers will be progressively occupied starting this September and can take up to 10,000 workers when fully occupied.
One analyst Channel NewsAsia spoke to said that this take-up rate is "healthy" in light of the improved market sentiment for office space.
"If you look at the last two years, (the) office (property market) went through a correction," said Christine Li, research director of Cushman & Wakefield.
"The bulk of the supply is in the Central Business District (CBD), which means that the CBD is getting most of the action in the office leasing market."
"We thought it’s interesting that over the last couple of months the leasing momentum really spilled over to the suburban area and city fringe. Once the Marina One is completed we actually don't have a lot of CBD supply," Ms Li said.
"On average we’re only seeing about 700,000 sq ft of office space going into the CBD location," she said, noting that this might encourage tenants to look outside the downtown area.
SPACE FOR START-UPS
Up to 15 per cent of office space has also been set aside for co-working facilities to cater to growing demand.
"Customers want that space flexibility … That allows us to bring in start-ups but also allows people who have multinational businesses to have their staff work together and share a common space. So all of this is bringing in more connectivity to the workers across different businesses," said Tony Lombardo, CEO, Asia, of Lendlease.
The S$3.2 billion mixed-use development will also include a residential and retail component. So far, more than half of its 400 apartment units have been sold, while more than 40 per cent commitment has been secured for its retail mall ahead of its targeted temporary occupation permit in the fourth quarter of 2018.
The mall, which has a net lettable area of 340,000 sq ft or approximately 200 shops, has confirmed key tenants including food court Kopitiam and supermarket FairPrice Finest.
“PEOPLE-FRIENDLY”, PLACE-MAKING PRECINCTS
Apart from well-planned regional centres, precincts should also be "people-friendly", Mr Wong said.
"As we go about developing these regional centres, we are very mindful that it’s more than just the business infrastructure. We’re not just going for the biggest or tallest buildings – the kinds you can see in any other global city."
"I am happy to see that the plans for the development of Paya Lebar Central and Paya Lebar Quarter include a comprehensive network of walking and cycling paths, that are integrated with our park connector network. There is a wide range of public spaces for people to interact and come together," he said.
Mr Wong also encouraged more developers to consider forming Business Improvement Districts (BIDs) to help coordinate place-making efforts.
The partnership model, which was first announced by the Government last year, refers to a business-led and -funded body set up with the aim to improve a defined commercial area.
The pilot model aims to increase private sector involvement in the Government's development plans, with the Government co-funding private sector projects to help improve precincts.
Mr Lombardo said that Lendlease is in the process of exploring a BID.
The 99-year leasehold site was bought for S$1.67 billion dollars in 2015, with a total gross floor area of about 1.8 million sq ft. According to Lendlease, an annual footfall of close to 45 million is projected once the 3.9 ha precinct is fully completed in 2019.