SINGAPORE (July 10): Mapletree Industrial Trust (MIT) will be redeveloping the Kolam Ayer 2 flatted factory cluster into a high-tech industrial precinct.
Expected to be completed by second half of 2022, the total project is estimated to cost $263 million and will be MIT's largest redevelopment project to date.
MIT manager Mapletree Industrial Trust Management (MITM) says the redevelopment is in line with its strategy to build a portfolio of assets for higher value uses and will help unlock value in MIT’s portfolio.
At present, the Kolam Ayer 2 cluster at 155, 155A and 161 Kallang Way comprises two seven-storey flatted factories and an amenity centre. With a GFA of about 506,720 sf, the cluster is sited on a land of about 346,270 sf with an utilised plot ratio of 1.5. The site is currently zoned for Business 2 use with its land lease tenure of 43 years starting from July 1, 2008.
Upon completion, the total GFA of the cluster will increase by 358,880 sf to 865,600 sf while the utilised plot ratio is expected to increase from 1.5 to 2.5.
An anchor tenant has also signed an initial 15-year lease for one of the buildings with GFA of about 211,000 sf, or 24.4%, of the enlarged GFA. This will be developed as a built-to-suit (BTS) facility for a Germany-headquartered global medical device company and will account.
Construction works are expected to commence in the second half of 2020 and should be completed in the second half of 2022.
MITM is also offering a comprehensive Tenant Assistance Package for existing tenants at the cluster. The tenants will be offered an extended notice period of 12 months at preferential gross rental rates for their remaining leases and will not be required to compensate for early termination if they choose to move out prior to the expiration of their leases.
In addition, more than 469,200 sf of space at alternative MIT clusters have been set aside for tenants considering relocation.
Assuming the redevelopment is fully funded by debt, MIT’s aggregate leverage ratio is expected to increase progressively from 33.8% as at March 31, 2019 to 36% upon completion.
As at 11.33pm, units in MIT are up 1 cent at $2.27.
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