Old Zouk site to be put up for sale for mainly housing development

SINGAPORE — The site at Jiak Kim Street formerly home to the iconic nightclub Zouk will be put up for sale for residential development with a commercial component on the first storey, with analysts expecting it to garner rich bids given its premium waterfront location and heritage.

The Urban Redevelopment Authority (URA) on Friday (Sept 29) said it would launch the site for sale in two to three weeks, with a tender period lasting about six weeks. The 99-year leasehold site, first made available for sale on the Reserve List of the Government Land Sales (GLS) programme in June this year, has been triggered for sale after an unnamed developer committed to bid at a minimum price of S$689.353 million, the URA said.

The site, which sits on about 145,123 sq ft of land, has a gross plot ratio of 3.8, translating into a maximum permissible gross floor area of 551,478 sq ft. This can be developed into an estimated 525 homes, the URA said.

The Jiak Kim Street site was home to Zouk for 25 years until the world-famous nightclub moved to Clarke Quay last December. The land parcel enjoys a waterfront view of the Singapore River, with direct access to the river promenade accompanied by a good mix of retail, dining and entertainment options, the URA said.

Dr Lee Nai Jia, Senior Director and Head of Research at property consultancy Edmund Tie, said: “The trigger of the land parcel at Jiak Kim Street is another sign that the market has turned, given the trigger bid and the time it took to trigger. The site, which was first made available for sale on the Reserve List in June, was triggered in just three months.

Previously, the sites in the Reserve List can remained untriggered for one year or longer. Additionally, the trigger price is relatively high at S$689.35 million for a predominantly residential site, which works out to be about S$1,250 per sq ft per plot ratio.”

“Notwithstanding, the residential site may be worth the high trigger price, as it offers many unique selling points and ticks all boxes. First, many people identify with the location, as the site formerly housed Zouk, and the developer can leverage on its heritage to attract buyers… Second, the site is within District 9 and offers great accessibility to CBD and Orchard/Scotts Road. It is also within walking distance to River Valley Primary School, the upcoming Havelock MRT station on the Thomson East Coast Line (expected to be operational in 2021) and close to many nightlife outlets. The site will attract foreign buyers and investors seeking to rent to expatriates,” he added.

Mr Desmond Sim, Head of CBRE Research in Singapore and South East Asia, said: “Sites offered on the GLS programme have always been a more favoured route for developers to procure land as they are offered unencumbered and the process is more straightforward.”

“This plum site has the advantage of an almost 180-degree view of the Singapore waterfront. With the optimism around the residential market in the mid- to long term, we expect 10 to 15 bids at possibly 30 per cent above the minimum bid.”

The URA on Friday also made available a residential site at West Coast Vale for application under the Reserve List of the second half 2017 GLS programme. The 99-year leasehold site, which sits on about 210,882 sq ft of land, has a gross plot ratio of 2.8, translating into a maximum permissible gross floor area of 590,475 sq ft. This can be developed into an estimated 730 homes, the URA said.

Dr Lee called the site, which is within a short driving distance to Jurong Gateway, the National University of Singapore (NUS) and one-north, an “interesting proposition for some developers.”

“A land parcel in the vicinity was recently awarded for S$291.99 million (or S$591.51 per sq ft per plot ratio) in Feb 2017 to China Construction (South Pacific) Development. Using that as a base and adjusting for the current market conditions, the trigger price is likely to range from S$348 million to S$355 million (S$584.30 to S$601.20 per sq ft per plot ratio),” he said.

“As developers have more options, they may seek sites that offer more unique selling points unless they can get it at cheaper prices. Some may consider triggering the site at a later stage, after the development by China Construction has been launched,” he added. – WITH ADDITIONAL REPORTING BY RUMI HARDASMALANI