New office tower to be built beside OUB Centre by 2011

Source : Channel NewsAsia - 25 Sep 2008

A 38-storey office tower will be built beside OUB Centre, adding some 350,000 square feet of Grade A office space to Singapore’s business district.

Despite growing expectations of falling demand for office space and a slump in office rents, the project’s marketing agent is already talking to interested parties. The S$540 million project is scheduled to be completed in 2011 and is already seeing healthy interest from financial service groups.

Managing director of Singapore & SEA at Jones Lang LaSalle, Christopher Fossick, said, “We see no pullbacks at all. We’re seeing financial service groups still looking for space, still expanding. No evidence at this time that there’s any pull back in financial sector here in Singapore.”

The potential anchor tenants are expected to take up between 25 to 30 per cent of the available office space.

Jones Lang LaSalle expects rents to be in line with rates in the prime area, which range between S$15 to S$20 psf per month.

But not all property players are this bullish on the office segment.

Singapore office rents are seen to have peaked following the almost 100 per cent increase over the past year.

In early September, Merrill Lynch issued a report predicting a fall in Singapore’s Grade A office rents, to S$10 psf per month in 2010.

It expects rents to fall further, to S$8 by 2011, and most analysts agree, especially in light of the financial turmoil in the US.

However, the project’s developers say rental rate softening due to external conditions is likely to be a short-term issue.

General manager of OUB Centre, Henry Kok Moo Yong, said, “This development is for long-term investment. We are confident with the Singapore economy especially with new things coming up like the integrated resort and more demand coming up.”

The new 38-storey tower will complement OUB’s existing building. Together they will be rebranded as One Raffles Place, which also means a name change for the current OUB Centre.

The new building will have environmentally-friendly features like solar panels and rainwater harvesting systems.

S’pore overtakes HK in financial centre ranking

Source : Business Times - 26 Sep 2008

It’s 3rd globally, behind London and NY, with biggest gain of top 20

Singapore has been ranked third in The Global Financial Centres Index (GFCI), behind London and New York, according to a new report published by the City of London.

Singapore gained 26 points in the index, more than any other top-20 centre, which allowed it to overtake Hong Kong. Hong Kong has been ranked fourth this time round.

The GFCI is updated every six months in March and September. This report is the fourth edition.

London and New York still lead the field and ‘continue to be the only two truly global financial centres’, the report said. Both cities, hit by the credit crunch, shed points in this round of the GFCI. But London’s lead as the main banking centre in Europe is consolidated as Frankfurt and Paris have both declined in the ratings relative to other centres, the report noted.

In Asia, Singapore surged past Hong Kong to move into third place overall, albeit by only one point.

Singapore’s 26-point gain also means that the gap between London and New York, and the third place centre fell to 73 points, from about 90 points in previous rankings. Singapore is just ahead of Hong Kong in the banking, insurance and government & regulatory sub-indices and is also ahead in the business environment sub-index. But Hong Kong continues to thrive, the report said.

The GFCI also noted that financial centres in the Middle East continue to generate a lot of interest. Dubai is identified most frequently by respondents as the centre likely to become significantly more important in the next few years; Singapore is second in this respect.

Dubai is also the centre mentioned most often when respondents are asked where their organisations are most likely to open offices in over the next few years.

The GFCI model rated 59 financial centres in this round. The study uses external instruments - such as the United Nation’s Human Development Index and the World Bank’s Ease of doing Business Index - as well as responses to an online questionnaire from 1,406 financial services professionals.