A six‑storey, 999‑year leasehold commercial building at 402 North Bridge Road will remain on the market for an additional month after sole marketing agent ETC extended the expression of interest (EOI) exercise till July 9.
Launched for sale at $70 million on May 12, the EOI exercise for the property on a 3,268 sq ft site opposite the iconic Raffles Hotel was originally slated to close on June 11.
The extension follows new planning guidelines that now allow greater flexibility for hotels, backpacker hostels and serviced apartments within two heritage precincts at Upper Circular Road and Beach Road, announced by National Development Minister Chee Hong Tat on June 5.
New hospitality proposals were generally not allowed in the Upper Circular Road and Beach Road street blocks. The Urban Redevelopment Authority (URA) has lifted restrictions in Upper Circular Road and Beach Road to provide visitors with more accommodation options in the area.
In a circular released on June 5, URA says it is “prepared to consider new hotels, backpackers’ hostels and serviced apartments within these areas” to provide “greater flexibility” for businesses and offer a wider range of options for building owners. The circular is effective till May 31, 2028.
402 North Bridge Road is located within the boundary of the Beach Road street block demarcated by URA. Hence, it stands to benefit from an expanded range of potential uses, says ETC on June 9.
See also: 999-year leasehold commercial building at 402 North Bridge Road up for sale at $70 million
Located on a prominent corner plot with dual frontages along North Bridge Road and Seah Street, 402 North Bridge Road commands excellent visibility within the City Hall-Bugis precinct, adds ETC, a member of Realion Group. The property also offers potential naming and signage rights.
Swee Shou Fern, ETC’s head of investment advisory, says URA’s announcement is “very timely” and the firm has received “overwhelming enquiries” from both local and foreign investors regarding the sale of 402 North Bridge Road.
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“The relaxation in planning guidelines now provides regulatory assurance for such change-of-use proposals,” adds Swee. “The policy shift enhances the long-term attractiveness of the asset, given the wider range of value-creation opportunities now. The extension of the EOI exercise will allow interested parties additional time to fully evaluate the property and formulate their proposals.”
Under URA’s Master Plan 2025, the site is zoned for “Commercial” use, with a plot ratio of 4.2 and a maximum allowable building height of six storeys. Open to both local and foreign buyers, the property is not subject to any additional buyer’s stamp duty or seller’s stamp duty.
The guide price translates to $3,948 psf based on its total gross floor area (GFA) of 17,729 sq ft, and the site has 800 years remaining on the lease.
Flexible use could drive ‘stronger all-day spending’
Relaxing the regulations for Upper Circular Road and Beach Road could result in a “broader range of hospitality options across additional areas”, says Marcus Chu, CEO, ERA Singapore. This is likely to benefit visitors to Singapore, he adds.
Instead of relying on zoning, the increased flexibility fosters a healthier market by allowing demand to “organically” determine each building’s “highest and best use”, says Clemence Lee, executive director of capital markets, Singapore, at CBRE. “Some properties that have been marketed purely as commercial may now make more sense as living assets, especially where the layout works for rooms and circulation.”
These areas sit in a “sweet spot” as they are popular among tourists and conveniently located near MRT stations, says Lee to City & Country. “Add in backpackers and budget travellers who have always liked these neighbourhoods, and you have a deep pool of demand for beds across different price points.”
Professionals on projects or short assignments who are staying near the Central Business District or Bugis office cluster will also enjoy the wider range of accommodation options available, Lee adds.
Increasing the number of guests and residents in the immediate catchment means higher footfall for food and beverage, retail, convenience stores and nightlife in the area, says Lee. This could translate into “stronger all-day spending” as businesses cater to the working population during the day and the live-in population at night, “which supports higher passing rents over time”, he adds.
Looking ahead, “older and under-utilised” walk-up commercial buildings and shophouses with “low-rent” office or storage tenants on their upper floors could be converted into hostel or serviced apartment units, says Lee. “As operators prove a viable model in the first few converted assets, more neighbouring owners will re-evaluate whether pure office or traditional retail is still the highest and best use [of the property].”
Potential deals marketing the conversion of properties into boutique hotels, serviced apartments or hostels can “reset expectations for the wider precinct”, says Lee — even for owners who choose to keep their assets for commercial use. “Over the medium to long term, that usually translates into higher capital values and sharper yield compression for well-located assets.”
Photos: URA, ETC
