New Marina Downtown on track for completion by year-end

Source : Channel NewsAsia - 21 Apr 2009

Singapore will see a glut of hotel and office spaces when projects at the Marina Bay Downtown come on stream in the months ahead, but developers say they are not worried.

Not only is the Marina Bay Sands Integrated Resort on track for completion, the Double Helix Bridge - which links visitors from the Bayfront to Marina Centre - will also be ready by year-end.

Across the waters at the Fullerton heritage site, a new luxury hotel with 100 rooms will open its doors around the same time, while the Marina Bay Financial Centre - comprising office towers, luxury apartments and retail space - will be ready by the second quarter of next year.

They are all connected by a 3.5-kilometre waterfront promenade and an underground pedestrian network.

To date, the Marina Bay area has attracted investments of over S$22 billion. Of this, S$16.5 billion is from the private sector while the rest are government investments. The government intends to invest another billion dollars in this area over the next 10 to 15 years on infrastructural projects.

With the economic downturn and excess hotel and office spaces in Singapore, will Marina Bay be as vibrant as planners envisioned?

Analysts expect rents to fall by up to 50 per cent this year, amid concerns that Singapore may face an oversupply of office space over the next two years.

But when touring the upcoming Marina Bay Financial Centre, National Development Minister Mah Bow Tan says he is confident demand for office space will return when the economy picks up.

He said: “When we started this in 2000, 2001, there was a similar fear, similar apprehension that we were opening land for sale in Marina Bay when there was a glut.

“And then what happened? When we started building, we were running out of space, and everyone was saying why didn’t we sell the land earlier? When the economy picks up, people will find that we are ready.”

It is a sense of confidence shared by the private sector.

The Marina Bay Financial Centre, managed by Raffles Quay Asset Management, is the second largest development here and will add nearly three million square feet of prime office space between 2010 and 2012.

“There are business cycles but real estate is essentially a long-term game. We are very honoured to have 61 per cent of our space pre-committed to world class tenants,” said the general manager of Raffles Quay Asset Management, Wilson Kwong.

According to the Mr Mah, the correction in office rentals will keep Singapore competitive against regional financial centres like Hong Kong.

Over two million square feet of office space are coming on stream in Singapore this year, and market watchers note that rentals of prime office space in Singapore have dropped some 25 per cent in the first quarter of 2009.

Mr Mah adds that the government is not going to introduce any off budget measures to help landlords for now.

So far, urban planners say about 24 hectares out of 360 hectares of land at Marina Bay have been sold.

Besides commercial spaces, more than 100 hectares of land have been set aside for waterfront gardens.