CapitaLand joint venture acquires Collective Works' co-working business

The Business Times - Oct 04
A joint venture between CapitaLand and The Work Project, known as The Work Project Kingdom (TWPK), has acquired Collective Works’ co-working business for an undisclosed amount.

Co-working operator Collective Works was founded in 2012 and has two locations in Singapore. In March 2016, CapitaLand and Collective Works entered into a joint venture to establish Singapore’s first premium co-working space in a Grade A office building in the central business district known as Collective Works Capital Tower.

Duncan White, Head of Office Services:
Colliers have been monitoring the emerging trends in the flexible workspace sector as various stakeholders position themselves for further growth. We are seeing the various alternative business/operating models building traction : 1) a developer/landlord going it alone and setting up their own proprietary flexible workspaces within their development; 2) a developer/landlord acquiring an existing flexible workspace operator; and 3) a joint venture / partnership between developer/landlord and flex operator. There are various pros and cons to each model. 

Generally, one of the main reasons behind opting to self-provide is around the service offering - controlling the look and feel of the flexible workspace centre to match the development and traditional tenant mix. Having ownership of such spaces also allows landlords and developers to be more nimble, adjusting their strategy and offering to match their tenant mix and evolving needs in a more timely manner, without any drawn-out third party negotiations. However, it does mean that the developer or landlord would need to resource, manage, run or hire an in-house team with the right credentials to curate the space and build a pool of occupiers.

Meanwhile, acquiring a flexible operator or partnering up with one, will enable the landlord to retain some form of control of the offering, while being able to tap the operator's experience and resources such as human capital. Developers with a large-scale regional or global portfolio reach are in a good position to leverage their greater tenant mix to translate into additional multi-market opportunities. We anticipate to see more of these partnerships in the near future. Download Colliers' latest Flexible Workspace report.

Shophouse at 21 Boon Tat Street fetches record price in District 1

The Business Times - Oct 04
A 999-year leasehold shophouse at 21 Boon Tat Street in the Telok Ayer Conservation Area is being sold for S$16.5 million, which works out to S$4,259 per square foot on the estimated built-up area of 3,874 sq ft.

According to property agents, the psf price is a new high for a conservation shophouse in District 1. In the past 12 months, the prices in the area have not crossed the S$4,000 psf mark.

In August, a corner shophouse at 64 Club Street, also with 999-year leasehold tenure, fetched S$3,880 psf on the estimated built-up area of 5,618 sq ft.

Tricia Song, Head of Research:
According to Colliers International’s research, total shophouse transactions in H1 2018 came to SGD784.3 million, surpassing even full-year shophouse investment sales from 2014-2017, reflecting strong demand for such properties. With the fresh cooling measures effective since 6 July on residential property purchases, we had expected shophouses to gain even more popularity given their palatable quantum and vintage characteristics. In particular, prime well-located shophouses with freehold or 999-year leasehold tenures have seen cap rates compress to record low levels of sub-two percent signaling very bullish expectations.

Amara to launch Newton boutique project at upwards of S$2,400 psf

The Business Times - Oct 05

Amara Holdings will launch its 10 Evelyn boutique development next weekend at upwards of S$2,400 psf, chief executive Albert Teo told The Business Times on Thursday.

Located off Newton Road, the 56-unit freehold development will comprise mainly one bedders (46 sq m to 57 sq m) and two-bedroom units (68 sq m to 77 sq m), with four three-bedroom penthouses (114 sq m to 116 sq m). Pricing will start from S$1.2 million for the one-bedrooms.

Tricia Song, Head of Research:

The project fits well in our strategy for developer launches post the recent measures. Developers with sites that are in locations with less competing supply from existing projects on the market and new launches, may go ahead with planned launches without any price reset, as demand is deemed to be less price sensitive. The amalgamation of the two plots enables the developer to recalibrate the overall product and unit mix, in addition to offering more or better facilities, and in this case, a fuller-sized utility car park. In addition, the right-sizing of the units allows for capturing demand in this prime District 11 at the sweet spot of SGD1.2 million to SGD1.8 million per unit.  Click here for our analysis