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 initially introduced in November 2019 and the latest decision was revealed by Desmond Lee, the Minister of National Development (MND) during the Real Estate Developers’ Association of Singapore (Redas) annual Spring Festival lunch on Feb 7.
Under the CBDI scheme, the government aims 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 scheme is designed to inject more homes, increase the population living in the CBD, and introduce a more diverse mix of activities in the traditionally commercial-centric district.
On the other hand, the SDI was introduced to encourage the redevelopment of older developments in strategic areas to drive transformative changes in the surrounding urban environments. These strategic areas include Orchard Road, the Central Business District, and Marina Centre.
According to the Urban Redevelopment Authority (URA), 14 out of 17 CBDI proposals and seven out of 12 SDI proposals submitted to the government have received in-principle approval. Currently, four CBDI projects are under construction in the Anson-Tanjong Pagar area. These include Newport Plaza, a mixed-use development on 80 Anson Road that comprises of 246 residential units and 198 serviced apartment units. The Skywaters Residences, located at 8 Shenton Way, also includes 190 luxury residential units as part of its mixed-use development. Other CBD projects include two commercial developments on 15 Hoe Chiang Road and 51 Anson Road.
However, the five-year extension of the CBDI and SDI schemes will come with some refinements, according to Minister Lee. The CBDI scheme will be expanded to include commercial developments in Anson and Cecil, giving developers and property owners in these areas the option to retain their commercial zoning (with 40% non-commercial use) if the redevelopment includes long-stay serviced apartment units.
Under the revised scheme, CBDI applicants seeking to redevelop in Anson and Cecil will have to provide at least 200 residential units or set aside 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 if 40% of the new floor area was allocated for non-commercial use.
Marcus Chu, CEO of ERA Singapore, says that these incentives, by facilitating the continual renewal of aging buildings in the city centre and incorporating more residential units, aim to transform the CBD into a vibrant place to work, live, and play.
In addition, the updated CBDI and SDI schemes will include new sustainability requirements. Going forward, all new applications for these schemes must include a sustainability statement that assesses the feasibility of retrofitting part or all of the existing building. Minister Lee explains that while the government supports revitalisation and rejuvenation through redevelopment, wasteful demolition and excessive rebuilding will not be tolerated, especially for relatively young or well-maintained buildings.
Choosing the right location is crucial when investing in real estate, especially in Singapore, where the location can significantly influence the value of a condo. In fact, certain areas, such as Orchard Road, Marina Bay, and the Central Business District (CBD), have consistently demonstrated an increase in property values, making them prime locations for potential investments. Moreover, the presence of reputable schools and educational institutions nearby also adds to the appeal of these condos, making them highly desired by families and further boosting their investment potential. Therefore, carefully considering the location is crucial when looking to invest in a condo in Singapore.
He also adds that several projects currently being redeveloped under the CBDI or SDI schemes are already surpassing the required sustainability standards. For example, Union Square, a mixed-use development on Havelock Road, is incorporating a district cooling system.
You can find the latest listings for properties in Skywaters Residences and ask for the latest transaction prices and available units in upcoming new launch projects. You can also check out the project summary for Skywaters Residences to see the total number of units, as well as current and upcoming new launch projects, condo sale transactions in District 1, and recently completed projects.