CapitaLand Integrated Commercial Trust - Annual Report 2021

especially over Grade B standalone offices in the decentralised areas. However, in the CBD Core, premiums are largely dependent on the quality of the building, location and proximity to amenities. As most office buildings in the CBD Core have high specifications and are well located with convenient access to transport nodes and surrounding amenities, these developments, be it integrated or standalone, would share a premium over Grade B buildings in the same area. For the retail component, an important advantage of integrated developments would be the presence of a local catchment. This could include office workers, residents, hotel guests or serviced apartment residents. Landlords of integrated developments also tend to be more active in place-making activities. With a larger catchment, as well as a sustainable and vibrant ecosystem, integrated developments would be more attractive to prospective retailers as compared to standalone retail strips or developments in the same location. Future Supply Three new integrated development projects are expected to complete between 2022 and 2024, including Rochester Commons in the Decentralised Area and Guoco Midtown in the CBD Fringe in 2022, and One Holland Village in the Decentralised Area in 2023. In addition, the Liang Court Redevelopment, also known as CanningHill Piers and CanningHill Square, will enter the Rest of Central Region in 2025. Investment Sales and Transactions There were two notable integrated development investment activities in the past 12 months. One transaction was a white site at Marina View, which was awarded to Boulevard View Pte Ltd, a wholly- owned subsidiary of Malaysian property developer IOI Properties Group, for S$1.5 billion (S$1,379 psf per plot ratio) on 29 September 2021. The 99-year site can yield about 905 private residential units, 21,500 sq ft GFA of commercial space and 540 hotel rooms. The other transaction comprises the acquisition Central Square from Far East Hospitality Trust by City Developments Limited for S$315.0 million (S$10,744 psf), which is expected to complete in 1Q 2022. Integrated Developments Market Outlook Changes in urban trends and ongoing government efforts will continue to drive integrated developments. Through its planning policies, the government continues to encourage more mixed-use and integrated development precincts. Moreover, in line with Singapore’s decentralisation strategies, and with suburban areas showing greater resilience in light of the pandemic, there has been an increasing push for the development of sub-regional centres and decentralised locations. The competition for prospective integrated development land sites is also expected to intensify with greater interest from developers with scale and experience across different uses, or a consortium of developers specialising in different components. The CBDI and SDI Scheme may also encourage more integrated developments in the CBD and Fringe areas. In addition, we expect the quality of integrated developments to improve with more diverse offerings. This improvementwill be further supported as developers continue to invest in innovation and technology to capture demand in the increasingly competitive integrated development sector. MAJOR FUTURE INTEGRATED DEVELOPMENTS SUPPLY (2022-2024) Project Developer City Area Office Est. NLA (sq ft) Retail Est. NLA (sq ft) No. of Residential Units No. of Hotel / Serviced Apartment Units Est. Year of Completion Rochester Commons CapitaLand Decentralised 195,000 15,000 Nil 135 2022 Guoco Midtown GuocoLand CBD Fringe 650,000 24,300 777 Nil 2022 One Holland Village Far East Organization, Sekisui House, Sino Group Decentralised 58,600 117,000 296 255 2023 Source: CBRE Singapore, 4Q 2021 CapitaLand Integrated Commercial Trust 112 Independent Market Review