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With plans in place to transform Woodlands into a commercial hub outside the city centre, the future looks promising for Singapore’s northern corridor.
By Nikki De Guzman
When compared to the Tampines and Jurong regional centres, Woodlands has yet to fully realise its potential as a decentralised commercial hub versus its eastern and western counterparts.
Tampines, which was first developed as a regional centre in 1992, and Jurong in 2008, have both come a long way from being sleepy housing estates to commercial business destinations and growth areas outside the city, while Woodlands has lagged a little in terms of its transformation.
However, this is bound to change as the government begins to set the wheels in motion to develop Woodlands into a commercial hub in the north, and further enhance it as Singapore’s northern gateway.
In this issue, we turn our attention to Woodlands Regional Centre – its selling points, what it spells for the north, the commercial market, and the outlook for this upcoming key commercial cluster.
Two-in-one
In early 2013, then-Minister of National Development Khaw Boon Wan announced preliminary plans for the development of the regional centre in Woodlands.
Offering approximately 100ha of available land for development, Woodlands Regional Centre is poised to become the country’s northern commercial cluster, comprising two distinct precincts: Woodlands Central and Woodlands North Coast.
Woodlands Central
Envisioned as a pedestrian-centric regional retail hub, this precinct around the Woodlands MRT station will have a pedestrian mall that will run through the heart of the district, connecting the existing MRT and bus interchange, as well as Causeway Point and Woodlands Civic Centre in the vicinity.
“The pedestrian mall (will be) flanked by low-rise commercial developments with activities planned to create an intimate street experience,” the URA said.
Woodlands North Coast
Intended as a significant employment cluster, Woodlands North Coast will provide new offices that will cater to different business needs, especially with the first business park in the North, in addition to office developments.
“Land will also be set aside to cater to small and medium enterprises, most of which will benefit from the proximity and convenient access to Malaysia with the future cross-border rail link,” said the URA.
When fully developed, Woodlands Regional Centre will have about 700,000 sq m of commercial space and is expected to offer approximately 100,000 new jobs when fully completed over the next 10 to 15 years.
The early days
The development of Woodlands Regional Centre began in 2014 with the sale of the first two sites for commercial use at Woodlands Square in the Woodlands Central precinct. The sites were the first two commercial Government Land Sales (GLS) sites launched in nearly 20 years.
The first launch was a 99-year leasehold site of 199,873 sq ft. It received a total of eight bids at the close of its tender.
The keen competition, according to analysts, came as no surprise given the first-mover advantage it offers. Colliers International said: “The site is expected to serve as the catalyst to kick-start the development of the Woodlands Regional Centre.”
The site was later awarded to a consortium led by Far East Organization for the highest bid of $634 million.
Source: Far East Organization
A year later, the government launched the second Woodlands Square site under the reserve list of the first half 2015 GLS Programme. According to a statement, the launch was in line with the government’s objective of “decentralising employment centres to bring job opportunities closer to homes”.
Spanning 22,384.8 sq m, the site offers a maximum permissible gross floor area (GFA) of 78,347 sq m. In line with the government’s plans to develop Woodlands Central as an office and retail hub, the proposed development will have at least 47,009 sq m of the maximum GFA dedicated for office use. In addition, up to 8,000 sqm of GFA can be set aside for retail (including food and beverage) uses.
However, unlike the keen interest seen in the launch of the first site, the second site at Woodlands Square has yet to be taken up, which market experts attribute to the impending office space glut.
Since being launched in July 2015, the site remains available on the reserve list. A site on the reserve list will be triggered for sale if a developer’s minimum bid price is acceptable to the government. The government will also consider launching the site for sale if it has received sufficient market interest.
In a statement to the media last year, SLP International Executive Director Nicholas Mak said developers who are interested in this site are likely to be watching the take-up at the upcoming development on the first site closely.
“A strong take-up rate is likely to whet the appetite of developers,” Mak said.
Meanwhile, ERA’s Key Executive Officer Eugene Lim said investors should consider Woodlands because it remains underdeveloped. “Plans are in place,” Lim said, “investors who buy into Woodlands now can stand to gain the first-mover advantage. Once the development starts in full swing, prices will invariably rise.”
Upcoming developments
Future developments in the area have since been revealed following the government’s announcement of the decentralisation plan for Woodlands.
The first major commercial project rising in the upcoming Woodlands Regional Centre is Woods Square, a development by a Far East Organization-led consortium.
Woods Square is an integrated office development comprising four office buildings with retail and dining options, as well as a childcare centre. The development is scheduled to be launched this year.
In the near term, connectivity and transport woes for residents and visitors will soon become a thing of the past with upcoming improvements such as an integrated transport hub at the heart of Woodlands North Coast in the works.
Just this year, the Land Transportation Authority (LTA) announced that it will be refurbishing the 20-year-old Woodlands Regional Bus Interchange by 2019.
The refurbishment works will feature an underpass that will link the interchange with both the North-South Line station and the upcoming Thomson-East Coast Line (TEL). The upgraded interchange will also be equipped with more commuter-centric and barrier-free facilities to serve residents, including enhanced amenities for bus captains, the agency said.
The regional centre’s connectivity to the city will also further be enhanced by the upcoming North-South Corridor, which will be ready during the next decade.
In addition to these enhancements, a cross-border rail service between the upcoming Woodlands North MRT station on the TEL and Johor will also be developed.
Market outlook
Even if the overall commercial market continues to be plagued by the downside factors that have persisted in recent times, such as market jitters amid the uncertain global economic environment, and impending office supply glut (Figure 1), market watchers remain confident in their outlook for suburban areas, including Woodlands Regional Centre.
“While the commercial sector is expected to remain soft in the short term, the brunt of the blow is borne by prime office spaces in the CBD, where the majority of the future supply is held. In the meantime, suburban commercial spaces are seeing more resilience in terms of prices and rents,” Lim said.
He noted that commercial property in a regional centre will benefit from more stable prices given that properties in areas like Woodlands are less susceptible to economic cycles, and tend to offer investors a more stable asset class.
“In addition, Woodlands benefits from its proximity to Malaysia and commercial properties there will probably see some form of demand from Malaysian companies looking to expand their operations into Singapore, or from Singaporean companies looking to venture into Malaysia.
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