Complete Property Market Updates of Singapore

June 19, 2008

Live, Work, Play at a neighbourhood near you

Filed under: Commercial,General,Regulators — Propertymarketupdates @ 5:10 am

The Urban and Redevelopment Authority’s (URA) Live, Work and Play mantra has been so successful in the Downtown Core precinct – as evidenced by the rapid development of offices, condos, hotels and leisure hotspots – that plans are now underway to export the concept to outlying districts in earnest.

The URA has already rolled out ambitious plans to transform Jurong East into a bustling sub-metropolitan hub of parks, offices, hotels, edutainment centres and homes.

Now, with the launch of the Draft Master Plan 2008 yesterday, it has included similar blueprints for Kallang and Paya Lebar as well.

The three new hubs – Jurong Lake District, Kallang Riverside, and Paya Lebar Central – all have one objective in common, and that is to balance the elements of Live, Work and Play.

Speaking at the launch of the Draft Master Plan 2008 exhibition at URA Centre yesterday, Minister for National Development Mah Bow Tan highlighted three key objectives of the latest Master Plan. Of these, it was the need to ‘enhance accessibility and reduce commuting by bringing jobs closer to home’ that underscores the need for the three new hubs. Not surprisingly then, Mr Mah added that public transportation has been ‘prioritised’.

The other two objectives are to ‘ensure that we have enough land to support economic opportunity’, and to ‘provide quality housing and leisure options for our people’.

Currently, the three areas have the potential to be sub-metropolitan hubs as they are, or will be, transportation nodes with the completion of existing and future rail, bus and road networks.

However, looking at each area reveals that at least one of the three important ingredients of Live, Work and Play is missing.

In the current Jurong East, for instance, there lacks a central office zone even though it has a relatively large population catchment area. As such, URA has designated 500,000 square metres of office space, 250,000 sq m of retail and entertainment space, 2,800 hotel rooms, but just 1,000 units of new homes for Jurong Lake District.

Also bringing jobs closer to home is Paya Lebar Central, which is in the centre of another large population catchment area.

Here, URA is planning for 294,000 sq m of office space, 200,000 sq m of hotel and retail space, but no new housing.

Kallang Riverside, which is on the fringe of the city is, however, relatively under-populated and will have space for 4,000 new waterfront homes and 3,000 hotel rooms. Being a much larger area and close to the new Sports Hub, it will also have 300,000 sq m of office space and 300,000 sq m of hotel, retail and entertainment spaces.

So, will it work?

City Developments Ltd (CDL), which helped kick-start Marina Bay with The Sail, had initially planned the project as being half-commercial. Even then, many market watchers thought that only a complete office would work. Going against conventional wisdom of the time, it was eventually designed as two residential towers in 2003.

Looking back, CDL managing director Kwek Leng Joo, says: ‘Ultimately, we strongly believed that developing the very first residential development in the vicinity – a truly iconic one for that matter, would be most synergistic and truly reflect the ‘Live’ component of URA’s vision.’

That Marina South remains largely untouched in the Draft Master Plan 2008 suggests that there is more emphasis on decentralisation compared to the previous Master Plan which emphasised the Downtown Core.

Knight Frank managing director Tan Tiong Cheng said: ‘With the new Master Plan, there is a drive to develop areas with potential that have not been previously emphasised.

‘Marina South will be quite easy to roll out because it sits on vacant state land. And when sites are available, they should sell quite fast.’

URA’s decentralisation strategy was first adopted in 1991, with the Concept Plan that maps out the long-term 40-50-year vision.

The Master Plan, which translates the Concept Plan strategies into detailed statutory land use plans to guide development over periods of 10-15 years, is reviewed every five years and may have different priorities.

The Master Plan 2008 also goes some way in addressing the widening gap between high-end and mass market homes.

Jones Lang LaSalle’s head of research (South-east Asia), Chua Yang Liang, said: ‘The strategy is really a bi-polar one.’

He explained that the Master Plan has to deal with planning issues that involve communities revolving around manufacturing in the north, and wealthier communities who are choosing to move downtown, especially to waterfront homes in the south. And recently, the disparity between high-end waterfront homes at Sentosa Cove and those in the heartlands has widened.

As such, Dr Chua notes that much of the new housing that has been highlighted in the outer regions all face the water.

‘This emphasis on providing more waterfront homes would greatly enhance social equity by making such homes more affordable to the regular guy on the street and not limited to just the affluent,’ he added.

If water is the new social glue, then the Rail Transit System (RTS) is its life blood.

Industry players are perhaps a little disappointed that not much has been done by way of increasing plot ratios, a move that usually adds zest to the property market.

But Savills Singapore director (marketing and development) Ku Swee Yong notes that property values, and possibly even plot ratios, tend to rise around new MRT stations.

And with the RTS already reported to be doubled from 138 km today to 278 km by 2020, with an addition of over 40 new stations, Mr Ku is hopeful that the next Master Plan review could see more plot ratio goodies. ‘I think URA might just be waiting for the new infrastructure to be completed,’ he added.

Source : Business Times – 24 May 2008

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