Singapore Telecommunications (Singtel) has announced its plans to appoint a developer to jointly redevelop its Comcentre headquarters along the Orchard Road belt.
The redevelopment will maximise the Comcentre’s site potential and increase building efficiency with a view to unlocking value from the property, says the telco in its Feb 23 statement.
The total cost of development, including land costs, is estimated to be in excess of $2 billion.
As part of its capital recycling strategy, Singtel will divest Comcentre to a joint venture company formed with the appointed developer and hold a majority stake in this joint venture.
The building will be redeveloped into a next-generation office development, which will house Singtel’s modern new headquarters besides offering progressive and optimised hybrid workplaces to other tenants.
The new building is expected to have a total gross floor area (GFA) of over 110,000 sqm comprising Grade A office buildings, a retail component and Singtel’s existing Orchard Exchange.
See also: Singtel denies report it is 'exploring options' over Australia unit
It plans to include a future underground connection to Somerset MRT station on the North South Line.
Singtel has also obtained in-principle approval from the Singapore Land Authority to extend the lease on all the lots that make up Comcentre to 2089.
The redevelopment will incorporate the latest sustainable designs and digital technologies.
See also: Singtel secures $535 mil five-year green loan, its first
As the anchor tenant, Singtel will occupy around 30% of the space. The remaining space will be leased out to other tenants, which will generate recurring income for the telco in the long term.
"We’ve had the privilege of working out of the iconic Comcentre building in the Orchard Road belt since 1979. We’re truly excited to be working with the authorities to rejuvenate the Orchard Road precinct to prepare for the post-pandemic world and reinvigorate our future workplaces,” says Singtel group CEO Yuen Kuan Moon.
“With the redevelopment of Comcentre, we aim to establish a new standard for the global office of the future by combining the latest technologies and sustainable workspaces to create pleasant, collaborative and connected environments for our employees and other building occupants, catering to the increasing adoption of hybrid work strategies,” he adds.
Maximising the unique development potential of Comcentre will significantly enhance its value in a vicinity where Grade A office developments are in short supply. We strive to optimise the capital we can unlock from existing assets to fund our growth initiatives including 5G and the regional expansion of our data centre business. We will continue to seek out opportunities to crystallise value from our extensive portfolio of assets.”
The new Comcentre is expected to be completed in 2028.
"The new Comcentre will cater to our evolving business needs and showcase the digital workplace of the future featuring 5G solutions. This reimagined Comcentre is the latest exciting step in Singtel's transformation since we started our strategic reset last year. We aim to create an environment that stimulates greater innovation, collaboration and engagement, inspiring our people to do their best work and serve our communities. This will be a magnet for talent who want to co-create and collaborate in an innovative environment. The redevelopment of our headquarters also supports our vision to build a greener and sustainable future and will further facilitate our efforts to reach net zero for our own operations,” says Yuen.
Singtel will relocate from the Comcentre in 2024 to prepare for the redevelopment.
Shares in Singtel closed at $2.56 on Feb 22.
Photo: Samuel Isaac Chua/The Edge Singapore
