It’s opening at Jurong’s Westgate may lead to more brands following suit. American brand Coach is set to become the first big luxury retailer to.
A TENDER for a commercial site in Jurong East, at Venture Avenue that drew nine bids outstripped market expectations.
Experts said the keen response to the Jurong East commercial site could signal that developers are responding to potential demand from investors looking for alternatives to residential property.
Colliers International director of research and advisory Chia Siew Chuin added: “The commercial sector has not yet been affected by the Government’s property measures, although the planning authority is likely to be monitoring the unit sizes of planned commercial developments.
“As a result, interest from both investors and end-users is expected to be robust.”
Sim Lian JV (Vision) lodged the top bid of $701.1 million – or $1,009 per square foot – which was nine per cent above the $643 million offered by Capitaland unit Victory One for the commercial site in Jurong East.
Sim Lian’s $1,009 psf bid for the commercial site in Jurong East easily exceeded market expectations of $800 psf ppr, said CBRE research associate director Desmond Sim.
The Sim Lian offer makes the expected breakeven price of the commercial property in Jurong East to be about $1,700 to $1,750 psf, said Mr Nicholas Mak, head of research at SLP International.
Jones Lang LaSalle national director of research and consultancy Ong Teck Hui also noted that the highest bid exceeded the top offer for Paya Lebar Square at $872 psf ppr in April, 2011.
“Since the Paya Lebar Square tender, demand for strata offices has surged tremendously resulting in optimistic bidding in today’s tender,” he said.
Jurong East is seen as a key commercial hub in the west, and includes existing and upcoming retail and lifestyle offerings like JCube, JEM and Westgate, said Mr Sim.
Ms Chia added: “With the prospects of growth for the entire Jurong East area as a regional commercial hub, a new project on the subject site would enjoy steady demand for its office units when completed.”