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Out of the 140,000 sq ft taken up by Lazada and Alibaba at 5One Central, around 105,000 sq ft is leased from the owners of the building – ARA Asset Management and Chelsfield. Image: Google Street View
Lazada and its parent company Alibaba Group have taken up 140,000 sq ft of space at 5One Central in Bras Basah Road.
The Business Times (BT) reported that Alibaba entities, including Lazada, will likely move in from AXA Tower to the new address later in the year.
Out of the 140,000 sq ft taken up by Lazada and Alibaba at 5One Central, around 105,000 sq ft is leased from the owners of the building – ARA Asset Management and Chelsfield.
The remaining 35,000 sq ft was taken up as an enterprise solution offering from flexible space operator JustCo.
Both spaces are covered by a six-year lease that starts later this year.
Flanked by the flanked by Bras Basah MRT station and Bencoolen station, the 11-storey 5One Central is undergoing refurbishment, which is slated for completion by end-Q3 2021.
It is understood that the gross effective monthly rental for the space is in the high-$8 per sq ft (psf) range.
Lazada leases 130,000 sq ft at AXA tower, including around 30,000 sq ft that is being occupied by Alibaba.
Alibaba Singapore, which took a 50% stake in AXA Tower, will jointly redevelop the building near the Tanjong Pagar MRT station with Perennial Real Estate-led consortium members.
Alibaba Singapore will own the bulk of the office space within the new mixed development, which it intends to occupy.
Meanwhile, ByteDance unit TikTok expanded its footprint in Singapore, leasing 58,000 sq ft across two floors at Guoco Tower in Tanjong Pagar.
Observers believe the monthly rental rate stands at about $11 psf, said BT.
TikTok also occupies nearly 100,000 sq ft in the South Tower of One Raffles Quay (ORQ). It initially leased 64,000 sq ft in late-2019, before taking up around 21,000 sq ft more in 2H 2020 and another 13,000 sq ft recently.
Market watchers estimate the gross effective monthly rental rates to hover at the low-$10 psf range.
Average monthly rental value for CBRE’s Grade A CBD Core Singapore office basket dropped 10% in 2020 to $10.40 psf. The property consulting group expects the rental figure for this year to increase 1.4%, with growth seen towards the end of the year.
CBRE Singapore Managing Director Moray Armstrong observed that office rent correction through 2020 presented tenants with “real value”, stimulating leasing activity.
“While it seems counter- intuitive, we have recently seen a few instances of fairly stark competition between tenants looking to secure deals on quality space. Consequently, the range of available office space options to prospective tenants has reduced. There are plenty of large pipeline leasing deals that will demonstrate the point,” he said as quoted by BT.
“While it is fair to point out that a proportion of the increased market activity has been driven by occupier displacement from upcoming redevelopment projects, this belies the fact that we are seeing growth selectively across technology, asset management and the consulting sector,” he added.
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