The government has recently announced the extension of the Central Business District Incentive (CBDI) and Strategic Development Incentive (SDI) schemes for another five years. These schemes were first introduced in November 2019 and the decision to extend them was revealed by Minister of National Development, Desmond Lee, at the Real Estate Developers’ Association of Singapore (Redas) annual Spring Festival lunch on Feb 7.
The CBDI scheme was introduced to encourage the conversion of older office buildings in certain areas of the Central Business District (CBD) into mixed-use developments. These areas include Tanjong Pagar, Robinson Road, and Shenton Way. The aim of the scheme is to increase the number of homes, enhance the population in the CBD, and introduce a diverse mix of uses in the traditionally commercial-focused district.
On the other hand, the SDI was introduced to promote the redevelopment of older developments in strategic areas to drive transformative changes in the surrounding urban environment. The strategic areas include Orchard Road, the Central Business District, and Marina Centre. Interested buyers can find information on the latest New Launches to discover the transaction prices and available units.
According to the Urban Redevelopment Authority (URA), out of 17 proposals submitted for the CBDI, 14 have been granted in-principle approval. Similarly, out of 12 proposals submitted for the SDI, seven have been granted in-principle approval. Currently, there are four CBDI projects under construction in the Anson-Tanjong Pagar area, including Newport Plaza, a mixed-use development on 80 Anson Road, which comprises 246 residential units and 198 serviced apartment units. Another project, Skywaters Residences, will offer 190 luxury residential units as part of a larger mixed-use development on 8 Shenton Way. There are also two commercial developments at 15 Hoe Chiang Road and 51 Anson Road.
However, the five-year extension of the CBDI and SDI will come with some refinements, according to Minister Lee. The CBDI will now be expanded to include commercial developments in Anson and Cecil. Developers and property owners who submit proposals for these areas will have the option to retain their commercial zoning (with 40% non-commercial use) if the redevelopment includes long-stay serviced apartment units.
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In order to be eligible for the CBDI, applicants looking to redevelop in Anson and Cecil will have to provide at least 200 residential units, or allocate their entire non-commercial floor area for long-stay serviced apartments, whichever is lower. Previously, office buildings redeveloped under the CBDI were allowed to retain their existing commercial zoning as long as 40% of the new floor area was dedicated to non-commercial use.
CEO of ERA Singapore, Marcus Chu, says, “By promoting the continual renewal of aging buildings in the CBD and adding more residential units, these incentives aim to transform the CBD into a place where people can work, live, and play.”
Moreover, the revamped CBDI and SDI schemes will now incorporate new sustainability requirements. All new applications must include a sustainability statement evaluating the feasibility of retrofitting part, or all, of the existing building. “While we support revitalisation and rejuvenation through redevelopment, we do not want wasteful demolition and excessive rebuilding, particularly for buildings that are relatively new or in good condition,” says Lee. He also notes that some projects being redeveloped under these schemes have gone beyond the mandated sustainability requirements, such as Union Square, a mixed-use development at Havelock Road, which is incorporating a district cooling system.
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