Developers Backed By Asian Billionaires Bid For $6 Billion Singapore Project

Thai billionaire Charoen Sirivadhanabhakdi’s Frasers Property and City Developments—controlled by Singaporean real estate tycoon Kwek Leng Beng—have forged an alliance with three other Asian developers to bid for the development of a central business district in the western Singapore suburb of Jurong.

The group—which also includes Singapore-based property giant CapitaLand Development and Japanese developers Mitsubishi Estate and Mitsui Fudosan—emerged as the sole bidder for the development of the 6.5-hectare Jurong Lake District (JLD) when the tender closed on Tuesday.

The project—which will be built on three parcels of land near the Jurong East MRT interchange and the future Jurong Lake District station—comprises 1,700 residential units, 146,000 square meters of office space and 73,000 square meters of commercial space allocated for shops, restaurants, entertainment facilities and a hotel.

The government is pursuing its biggest initiative to build the biggest business district outside of the city center as vacancies at prime office rents in the Raffles Place and Marina Bay climbed to a 15-year high in the first quarter of this year amid increasing demand for office space from multinational companies relocating to Singapore. The project will be progressively constructed over 10 to 15 years, the group said in a joint statement.

While the group did not provide an estimate of the project cost, real estate website Mingtiandi said building the suburban central business would cost about S$8.8 billion ($6 billion). With the entire development expected to have a total built space of 3.9 million square feet, and an estimated land cost of about S$1,000 per square foot per plot ratio, analysts expect the consortium to pay the government about S$3.9 billion for the site.

“We look forward to collaborating with our reputable partners to realize our shared vision of JLD as a vibrant, global business district that will set a new benchmark for Singapore and contribute towards the future of sustainable cities,” Soon Su Lin, CEO of Frasers Property Singapore, said in the statement. Frasers Property has developed master-planned projects across the region, including One Bangkok, the largest holistically integrated district in Thailand.

Frasers Property, CapitaLand Development, and City Developments will each own 25% stakes each in the consortium, while their Japanese partners will hold 12.5% stake each.

“These companies have superior credentials and strong track records in master planning and developing mixed-use precincts that are vibrant, sustainable and commercially successful in Singapore and overseas,” Tricia Song, head of research for Southeast Asia at property consultant CBRE, said in a note. “We believe the results should be positive.”

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