This article was written in collaboration with Tay Liam Hiap, Managing Director of Capital Markets and Investment Sales.

市区重建局（URA）日前宣布将中央商业区奖励计划（CBD Incentive Scheme，简称CBDI）和策略发展项目奖励计划（Strategic Development Incentive Scheme，简称SDI）延长至2030年。这项计划于2019年推出，旨在推动楼龄至少20年的旧建筑重新开发，以提升中央商业区活力。

新加坡的城市发展日新月异，但其中仍不乏一些老旧商业建筑。在鳞次栉比的摩天大厦中，显得有些不那么协调，也已无法满足现代需求。随着建筑老化，维护成本也逐渐增加。落后的通风系统导致空气质量不佳，还可能影响员工健康。这一系列的问题，让地区焕新迫在眉睫。同时，租户也越来越青睐工作环境更舒适的优质办公空间。

两项奖励计划目标相同，但方式不一

中央商业区奖励计划适用于竣工至少20年以上的办公楼，且仅限位于安顺路（Anson Road）、丝丝街（Cecil Street）、罗敏申路（Robinson Road）、珊顿大道（Shenton Way）和丹戎巴葛的指定区域（Tanjong Pagar precincts）。为了保障这些重新开发的质量，项目需满足最低地段面积（site area）要求，即1000至2000平方米，也不允许分层出售。申请成功的项目可获得额外25%至30%的总楼面面积（gross floor area，简称GFA）。

图表1: 安顺

 

图表2：丝丝街

图表3：罗敏申路、珊顿大道和丹戎巴葛的指定区域

此外，政府近期公布的中央商业区奖励计划2.0也进行了更新，允许安顺路和丝丝街的办公楼可将长住型服务公寓作为混合用途开发的一部分。

自2019年计划推出以来，17份申请中的14份已获得原则性批准。其中，铂海综合大厦（Newport Plaza）即前富士施乐大厦（Fuji Xerox Towers）原址、The Skywaters即安盛保险大厦（AXA Tower）原址、海德大厦（Realty Centre）、珊顿大厦（Shenton House）、安顺路51号（51 Anson Road）以及和昌路15号（ 15 Hoe Chiang Road）都已获得批准。随着该计划的延长，源美大厦（GB Building）、同荣大厦（Tong Eng Building）、Cecil Court和春叶大厦（Springleaf Tower）等建筑也有望在未来加入重新开发的行列。

相比之下，策略发展项目奖励计划则是为鼓励在指定区域的旧建筑重建，地区涵盖乌节路、中央商业区奖励计划区域之外的中央商业区以及滨海中心（Marina Centre）地区。要符合此项计划的要求，无论是商业项目还是混合用途发展项目，申请建筑同样须已建成至少20年。更重要的是，重建项目必须涉及至少两个相邻的土地。

目前，12份申请中已有7份获得了原则性批准，包括誉岭峰（Union Square Residences）即中央商场（Central Mall）和市中广场（Central Square）原址、乌节路的新酒店开发项目即华峰大厦（Faber House）原址和奥迪安大厦（Odeon Towers）资产增值项目，以及voco酒店、福临购物中心（Forum The Shopping Mall）和旅店置业大厦（HPL House）的重建。

图表4：福临购物中心

奖励计划推行的局限和挑战

然而，要获得此项奖励计划也非一帆风顺，挑战之一是要在邻近地块寻找愿意共同参与重新开发的合作方，这导致一些项目夭折。其中，远东购物中心（Far East Shopping Centre）就因此而未通过。看到这些挑战和限制后，可能会让部分业主望而却步。
另一方面，尽管这些计划提供了丰厚的奖励措施，但并非所有业主都愿意参与。具体原因除高昂的开发成本外，施工带来的不便以及与其他利益相关者意见不一致等因素也消弱参与意愿。同时，许多分层地契的旧商业建筑，需经过漫长的集体出售流程，包括争得不少于八成业主同意的要求。
目前，这些旧建筑因租金较低，吸引了那些渴望留在中央商业区的中小型企业。同样，老旧的分层地契零售商场也以较低租金吸引着传统的小店铺，实惠的租金帮助它们留住为长期客户，这些客户更倾向光顾熟悉的购物环境。
然而，随着城市区域化战略的推进，中小企业可能最终会搬迁至中央商业区附近的区域，这有利于它们控制运营成本。同时，电子商务的发展和人口结构的变化，使越来越多的年轻消费者习惯通过网络和社交媒体平台购物，这可能导致传统小店铺逐渐失去市场竞争力。

图表5：远东购物中心

实施建筑项目重建与时俱进

去年9月，新加坡推行的强制能耗改善（Mandatory Energy Improvement）制度，要求总楼面面积超过5000平方米的商业建筑须进行能效审计和改进措施。这可能会促使一些旧建筑的业主考虑重新开发，尤其是那些租约即将到期的建筑。

同时，因可持续性发展报告要求的提升，公司租赁旧建筑不利于其满足可持续性指标，这也可能使它们逐步撤离。旧建筑租赁需求的下降，将影响业主整体收益率。因此，现在或许是时候考虑重新开发，以适应未来的需求。

随着更多建筑参与中央商业区奖励计划，预计中央商业区将出现更多的住宅项目。截至2024年底，第一邮区（莱佛士坊、丝丝街、滨海湾）和第二邮区（安顺、丹戎巴葛）已有超过9000个住宅单位。随着铂海综合大厦、The Skywaters、和昌路15号和51号安顺路项目的竣工，安顺-丹戎巴葛地区预计将新增超过1000个住宅、酒店和零售单位。与此同时，更新的中央商业区奖励计划2.0允许部分重建项目把商业用途与长住型服务公寓结合，这为中央商业区内的居民提供了更多住宅选择，以满足不断增长的需求。

总体来说，两项奖励计划的延长，反映了市区重建局推动本地关键战略区域的决心。中央商业区转型将进一步提升其作为居住区的吸引力，并为投资者提供资本增值机会。然而，这些计划的实施仍依赖于业主们的合作与积极参与，来克服短期挑战。重新开发这些建筑，将有助于他们的资产适应未来需求，同时推动新加坡城市的可持续发展。

Disclaimer

This information is provided solely on a goodwill basis and does not relieve parties of their responsibility to verify the information from the relevant sources and/or seek appropriate advice from relevant professionals such as valuers, financial advisers, bankers and lawyers. For avoidance of doubt, ERA Realty Network and its salesperson accepts no responsibility for the accuracy, reliability and/or completeness of the information provided. Copyright in this publication is owned by ERA and this publication may not be reproduced or transmitted in any form or by any means, in whole or in part, without prior written approval. 

This article was written in collaboration with Tay Liam Hiap, Managing Director of Capital Markets and Investment Sales.

The Central Business District Incentive (CBDI) and the Strategic Development Incentive (SDI) schemes were first launched in 2019 by URA to encourage the redevelopment of older buildings in the CBD and strategic areas. One may ask: why is there the need for such schemes?

Singapore’s landscape is always changing. The CBD’s skyline, despite its modernity is still dotted with clusters of older commercial buildings that have since outlived their glory days. These developments may be less relevant to modern-day needs and may be in stark contrast to the sleeker, more modern commercial buildings. As these commercial buildings age, maintenance costs can get increasingly expensive, and poor ventilation or air quality could contribute to the sick building syndrome, impacting the well-being of occupants. All of these factors are driving the ongoing flight-to-quality trend as tenants seeks prime spaces which offer a better, more comfortable working environment.

Why the need for these schemes?

To address this, the CBDI scheme and the SDI scheme were introduced in 2019 to encourage owners to redevelop older buildings into mixed-use developments aimed at transforming the CBD into a vibrant 24/7 mixed-use district.

Same motivation but different approaches

CBDI scheme

The CBDI scheme is confined to office developments, that are at least 20 years from completion, and are within the selected parts of the Anson, Cecil Street and, Robinson Road Shenton Way, Tanjong Pagar precincts. To safeguard the quality of these redevelopments, the sites are required to meet a minimum site area (1,000 to 2,000 sqm) and are not allowed to be strata subdivided. Successful proposals could be granted an additional 25% to 30% Gross Floor Area (GFA).
In 2025, the CBD incentive scheme 2.0 was updated to allow office buildings in the Anson and Cecil Street precincts the new option to include long-stay service apartments as part of their mixed-use developments.

Picture 1: Anson

 

Picture 2: Cecil Street

Picture 3: Robinson Road, Shenton Way & Tanjong Pagar

Since its launch, 14 out of the 17 CBDI applications were granted in-principle approval. This includes projects such as Newport Plaza (former Fuji Xerox Towers), The Skywaters (former AXA Tower), Realty Centre, Shenton House, 51 Anson Road and 15 Hoe Chiang Road.
Following this extension, could we see developments such as GB Building, Tong Eng Building, Cecil Court, and Springleaf Tower take advantage of the scheme and undergo redevelopment in the new future?

SDI scheme

Separately, the SDI scheme is designed to encourage redevelopment of older buildings in strategic areas including Orchard Road, wider CBD areas that fall outside the designated zones for the CBDI scheme, and Marina Centre. To qualify for the SDI scheme, a development must be at least 20 years after completion, be either a commercial or mixed-use development, and more importantly, the redevelopment must involve at least two adjacent sites.
So far, the SDI Scheme has granted seven in-principle approval for 12 applications. These include Union Square (former Central Mall & Central Square), new hotel development (former Faber House and asset enhancement of Odeon Tower), and the redevelopment of voco Hotel, The Forum Mall and HPL House.

Picture 4: Forum The Shopping Mall

The requirements for the SDI scheme are stringent, and finding an adjacent site that is willing to undergo joint redevelopment can be challenging. For that reason, the Far East Shopping Centre was unable to obtain approval to redevelop under the SDI scheme. This underscores the challenges and limitations of the SDI scheme, which can discourage some older developments from pursuing redevelopment.

Picture 5: Far East Shopping Centre

Why are there not more owners taking up the schemes?

Despite the attractive incentives, not all building owners are ready to take the plunge and participate in these schemes. There is a myriad of reasons, but the more commonly cited ones includes the high cost and inconvenience of redevelopment, the complexity of the scheme (particularly in the case of the SDI scheme), and conflicting views among stakeholders regarding redevelopments. For others, it boils down to complacency, as their older assets continue to generate attractive yields since many of them were acquired years ago.
Moreover, many of the older commercial buildings in the CBD are strata-titled and the redevelopment option will entail a lengthy collective sale process whereby 80% of owners’ consensus is required.

But with a shift in demographic trends and evolving real estate needs, it may make more sense for older developments to embark on redevelopment to avoid becoming obsolete or displaced in the medium term.

The Mandatory Energy Improvement (MEI) regime implemented in September 2024, which requires energy audits and energy efficiency improvement measures to be carried out for commercial buildings with more than 5,000 sqm of gross floor area, may also prompt owners of older commercial buildings to consider the redevelopment option, especially for buildings with short remaining lease tenures.

For now, these older buildings carve their niche by offering attractive office rental rates for smaller companies who want to stay within the CBD precinct. Likewise, older strata-titled retail malls served as a haven for mom-and-pop shops where affordable rents allow them to service their long-time customers who value familiarity.
But eventually, as the broader decentralisation strategy gains stronger traction, smaller companies may see more value in relocating to regional centres which are within a short commute to the CBD. E-commerce and shift in demographic could also see the irrelevance of mom-and-pop shops, as young shoppers are increasing purchasing items through websites and social media platforms.

Furthermore, as sustainability reporting becomes more stringent, companies may avoid leasing older buildings completely due to the negative impact on their sustainability metrics.
Over time, rental demand for older buildings may decline, impacting the overall yield. Perhaps it is time to consider redevelopment and future-proofing their assets.

Could CBD become the up-and-coming residential enclave as more are projected to participate in the CBDI scheme?

As more developments participate in the CBDI scheme, we can expect to see more residential homes within the CBD. As at end-2024, District 1 (Raffles Place, Cecil, Marina, People’s Park) and District 2 (Anson, Tanjong Pagar), has over 9,000 homes.

With the completion of Newport Plaza, The Skywaters, 15 Hoe Chiang Road and 51 Anson Road, the Anson-Tanjong Pagar area could see more than 1,000 new homes, hotels and retails offerings. At the same time, with the enhanced CBDI scheme 2.0, selected redevelopment sites can opt to redevelop as commercial spaces with long-term service apartments. These initiatives will expand the residential offerings in CBD to accommodate the growing workforce. Opportunistic investors may view this as a chance to acquire a home in CBD to capitalise on potential future growth.

Picture 5: Newport Plaza

In conclusion

The extension of the CBDI and SDI schemes reflects URA’s commitment to drive rejuvenation in key strategic areas. The transformation of CBD into a vibrant mixed-use district will further enhance its appeal as a residential enclave and present astute investors the opportunity to capitalise on potential future growth. But the success of these schemes hinges on the willingness and collaboration from these owners to drive the redevelopment. Looking beyond the inconvenience, redeveloping these buildings could help owners future-proof their assets, ensuring long-term growth while supporting sustainability efforts in the Singapore urban landscape.

 

Disclaimer

This information is provided solely on a goodwill basis and does not relieve parties of their responsibility to verify the information from the relevant sources and/or seek appropriate advice from relevant professionals such as valuers, financial advisers, bankers and lawyers. For avoidance of doubt, ERA Realty Network and its salesperson accepts no responsibility for the accuracy, reliability and/or completeness of the information provided. Copyright in this publication is owned by ERA and this publication may not be reproduced or transmitted in any form or by any means, in whole or in part, without prior written approval. 

Following the recent submission and closure of a joint bid in March this year, we will be seeing five major real estate players — CapitaLand Development, City Developments, Frasers Property, Mitsubishi Estate and Mitsui Fudosan (Asia) – joining hands to drive a singular visionary goal for Singapore. 

That is to propel the development of the Jurong Lake District over the next two decades – bringing it one step closer to becoming the nation’s next largest business hub outside Central Singapore. 

This undertaking is by no means an easy feat, but it is well within reach of a consortium whose members have played pivotal roles in shaping Singapore’s landscape amidst shifting demands. 

Today, the evolving needs of businesses and consumers have translated into new requirements, whereby the prevalence of hybrid work, omnichannel retail and a focus on sustainability are expected to shape the JLD’s future as well as that of its properties. 

Late last year, the market witnessed the successful launch of J’den – a mixed-use development in the heart of the Jurong Lake District. Buyers snapped up 88% of available units on launch day, with an average price of $2,451 per square foot (psf) thus setting an unprecedented benchmark for new launches in the West. 

With this notch in its belt and status as a regional centre, perhaps Jurong could make the West side the best side – not unlike its counterpart in the East, Tampines. 

Tampines’s emergence as a regional centre  

Tracing all the way back to the early 1990’s, Tampines emergence as a regional centre first arose from the Government’s plans to decentralise economic activity, driving business and growth from the Central Business District (CBD) to other areas in Singapore.  

This was primarily achieved by constructing homes, offices, transport networks and shopping malls – interspersed throughout Tampines to uplift its vibrancy as an urban hotspot for corporations and workers alike.  

In the present day, Tampines is now a thriving town with no fewer than three shopping centres, namely Tampines Mall, Tampines 1, and Century Square. On the commercial front, Tampines is also within distance of key employment gateways, such as Tampines Regional Centre, Changi Business Park, and Changi Airport. 

Furthermore, with the inclusion of Our Tampines Hub in 2017, an integrated community and lifestyle centre, Tampines is on the right track to becoming a compelling live-work-and-play destination in the East, transcending its former identity as a quiet commune in the 1980s.

Foretelling Jurong’s future through present-day Tampines 

Keeping pace with Tampines’s transformation into a mature town, property prices in the neighbourhood have also grown across the years. 

Over the last two decades, resale HDB prices have shown exponential growth, increasing by more than two-fold from an average price of $243 per square foot (PSF) in 2004 to $575 PSF in 1Q 2024. Similarly, non-landed private homes in Tampines more than tripled in price, growing from an average of $450 PSF in 2004 to $1,532 in 1Q 2024. 

Chart 1: Average Home Prices in Tampines Versus OCR Non-Landed Home Prices

Additionally, the increase in resale HDB prices for Tampines has closely mirrored that of the national average, having risen by 32.4% since 2014 – a growth rate comparable to the 33.9% uptick exhibited by the HDB Resale Price Index. 

The growth of private home prices in Tampines also outpaced that of non-landed properties in the Outside Central Region (OCR), with both respectively increasing by 240.4% and 198.7% since 2004. 

Table 1: Growth in Property Prices since 2004 

Accordingly, the sustained price growth and demand for Tampines homes can be attributed to a number of driving factors – which Jurong also shares:

1. Tampines and Jurong are close to key business clusters 

For starters, Tampines is located in close proximity to prominent business and heavy industrial hubs, such as Changi Business Park and Tampines Industrial Park, which in turn function as the hub of operations for major businesses.

Big names that have chosen to plant their roots at these locations include:

• Hitachi High-Tech
• OCBC Bank
• Standard Chartered Bank
• Government agencies (Central Provident Fund Board, Housing and Development Board)

Additionally, Tampines is home to a wafer fab park that houses businesses specialising in semiconductor and electronic component production, such as Jabil Circuit and Hoya Electronics.

Brought in by the Economic Development Board, the entry of these firms has led to the creation of approximately 1,200 jobs as of 2023, with 1,000 of them located at Tampines Wafer Park alone.

In comparison, Jurong is conveniently located between two of Singapore’s prominent business hubs, namely one-north and Tuas.

The former is home to major tech firms, like Grab, Google and Shopee, whereas the latter is where industrial companies, like Norwegian paint manufacturing business Jotun and American oil service company Haliburton, are located.

There is also the Tuas Biomedical Park in the vicinity. Alone, it accounts for nearly 7,000 jobs in Jurong, owing to the fact that it houses facilities for global pharmaceutical companies like Abbott Manufacturing, Pfizer Asia Pacific, and MSD International.

2. Tampines and Jurong both have reputable schools 

Further contributing to housing demand in Tampines is the presence of reputable educational institutes, including Poi Ching School, Chongzheng Primary School, St. Hilda’s Primary School and Temasek Polytechnic – ideal options for young families interested in moving into the neighbourhood.

In the same vein, families with school-going children are likely to find Jurong attractive, thanks to learning institutions like Rulang Primary School, Westwood Primary School, and Jurong Primary School in the vicinity.

The West is also home to world-renowned tertiary institutions, such as Singapore Polytechnic, the National University of Singapore (NUS), and Nanyang Technological University (NTU).

3. Tampines and Jurong are amongst the biggest towns in Singapore

It is also worth noting that Tampines is the third largest township in Singapore, housing some 94,000 HDB flats and non-landed private homes; this is a critical mass of housing that translates into substantial transaction volumes, which in turn drives organic price growth.

Likewise, Jurong houses over 110,000 HDB flats and non-landed homes; this too equates to a fairly significant population density and thus points to the likelihood of healthy transaction activity.

As for retail and entertainment options, Jurong offers a diverse selection of malls, including the popular Jurong Point, Westgate, JEM, and IMM. 

So, will the future Jurong make the West side the best side? 

Distance apart notwithstanding, both Tampines and Jurong clearly demonstrate how a combination of factors – proximity to key business hubs, job creation, credible schools, substantial populations, and perhaps most crucially, future plans for urban development (specifically those involving the Jurong Lake District) – can fuel the popularity of residential towns. 

Hence, given the right qualities, it is possible for any prime location in Singapore, not just Jurong and Tampines, to showcase their region’s best side. 

Disclaimer

This information is provided solely on a goodwill basis and does not relieve parties of their responsibility to verify the information from the relevant sources and/or seek appropriate advice from relevant professionals such as valuers, financial advisers, bankers and lawyers. For avoidance of doubt, ERA Realty Network and its salesperson accepts no responsibility for the accuracy, reliability and/or completeness of the information provided. Copyright in this publication is owned by ERA and this publication may not be reproduced or transmitted in any form or by any means, in whole or in part, without prior written approval.