Key Commercial Developments & Infrastructure in Singapore
Singapore remained Asia’s wealthiest country per capita, ranking 3rd worldwide in 2019. To sustain this wealth and economic activity, infrastructure and other key developments are required. With worldwide interest rates at an all time low and Singapore’s interest rates currently at 1.74%, investment is relatively cheap. So, Singapore has been busy developing office buildings and transportation to continue to fuel its growth.
Key Commercial Developments
Mixed use developments and office buildings dominate commercial development across Singapore. Ten recent and nearly completed developments (shown below) add over 800,000sqm to Singapore supply.
CBD Incentive Scheme
Singapore’s CBD Incentive Scheme is making developers happy. Office developments are incentivised by the potential for gross plot ratio (also known as floor space ratio) with the incentive increasing for residential and hotel developments. Similar schemes exist worldwide, particularly rewarding innovative design and greener buildings
The hope is that the incentives will make housing more affordable in Singapore’s CBD. However, the scheme could put upwards pressure on office rentals, particularly A-Grade properties. Consequently, this could cause a shortage of office space supply as redevelopment continues.
Infrastructure development is a key driver of efficiency gains within an economy, promoting growth and productivity. In Singapore, the development of Changi Airport into an international hub has been the most significant infrastructure development over the last decade. By 2015, the aviation sector accounted for 3% of Singapore’s GDP. Furthermore, total transport expenditure doubled over the period from 2011 to 2017 .
In 2017, the Singaporean government declared that it would nearly double the train network by 2030, including the construction of 30 more stations. A high-speed rail line is also under construction from Singapore to Kuala Lumpur.
With maritime trade accounting for 7% of the economy, the Maritime and Port Authority of Singapore is determined to develop Tuas, a major sea port. A $2.42B upgrade will be completed by 2021. The development projects will ensure that Tuas has over double its capacity by 2040.
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