CapitaLand Development subsidiary wins tender to repurpose Kallang Way terraced factories

SINGAPORE - The tender for a 4.41ha industrial site in Kallang Way has been awarded to a subsidiary of CapitaLand Development for $369 million, JTC Corporation said on Nov 20.

CL Savour Property will have to retain and repurpose the existing three-storey terraced factory, which was built in the 1980s and is the last of its kind in Singapore.

Retail shops, food and beverage and entertainment outlets, as well as health and fitness establishments, are among possible uses for the retained block. A multi-user food manufacturing factory is to be built alongside it.

This is JTC’s first Industrial Government Land Sales (IGLS) tender that requires the successful tenderer to reuse an old building.

The tender aims to inject vibrancy into industrial spaces and provide new amenities for residents.

Four bids were received at the close of tender on Oct 1, JTC said.

Ms Tang Hsiao Ling, director of JTC’s urban planning and architecture division, said adaptive reuse is an effective way to reduce carbon emissions in the built environment while preserving the industrial history of the Kallang Way site.

“We are encouraged by the positive response to the tender, reflecting market acceptance by industry leaders like CapitaLand Development, who support our drive towards broader adoption of sustainable practices in the development of industrial estates across Singapore,” she said.

CapitaLand Development Singapore’s chief executive officer Tan Yew Chin said the firm hopes to contribute to Singapore’s advancement as a global food innovation hub.

“We will leverage our proven track record with food and industrial developments as well as understanding of our customers, to create a state-of-the-art facility that meets the evolving needs of the food manufacturing industry,” he said.

Plans for the site include a nine-storey food facility that can serve manufacturers, caterers, storage and central kitchen operators, CapitaLand Development said on Oct 2.

“The proposed development will retain the distinctive design from Singapore’s industrial architectural legacy,” it said.

The developer has seven years to complete the project.

The existing building has a unique “terrace-showroom” design – a purpose-built showroom space facing the road – which the developer will have to work into its plans.

This differs from typical tenders where developers bid for an empty plot of land.

To allow the developer more time to meet this condition, JTC awarded the site on a 33-year lease, longer than other IGLS sites which typically have 20- or 30-year tenures.

The ground floor of the “terrace-showroom” block, as well as parts of the new factory building that face Pelton Canal, will have to be used for retail purposes, adding to the amenities available to existing residents and students in the area.

The 4.41ha site was also made sufficiently large, with a gross plot ratio of 2.5 and a gross floor area of 114,239 sq m, so that a new multi-user food factory can be built alongside the retained block.

Ten rows of terraced workshops in Kallang Way, built in the late 1970s, were cleared to create the tender site.

Mr Lee Sze Teck, senior director of data analytics at real estate firm Huttons Asia, said that demand for food factories has increased among industrialists and investors in recent years, but supply is limited and most sites are not centrally located.

He noted that the Kallang Way site is well connected as it is near Geylang Bahru and Mattar MRT stations and expressways such as the PIE.

“Retaining the existing ‘terrace-showroom’ design factory for retail uses will add to the vibrancy of the area and attract residents to the development,” he added.