How to make the CBD a more liveable and vibrant place

The Urban Redevelopment Authority’s (URA) announcement of Singapore's Draft Master Plan 2019 has cast the spotlight on the core central region, particularly the Central Business District (CBD).

URA has announced two new schemes aimed at transforming the CBD into a vibrant mixed-use zone with more homes and hotels so that the area will not be the ghost town it is now at night or during the weekends.

But will the proposal work?

The idea of city living is in fact not new as the vision of a vibrant 24/7 Marina Bay was first unveiled more than a decade ago, but the earlier efforts have not yielded the desired outcome.

One of the biggest stumbling blocks in city living is affordability.

Under the current framework and regulation, developers can hardly get around making city living affordable as they pay a premium for land.

This is why apartments in the CBD today remain exclusive to the affluent.

The lack of amenities as well as childcare and school options for young children also means that residents remain mostly expatriates, singles and DINKS (dual income no-kids couples).

The traditional CBD has also not kept up pace with attracting a new breed of young urbanites looking for a new lifestyle.

Commercial buildings, particularly in Cecil Street, Shenton Way/Tanjong Pagar and Anson area are largely isolated when office workers leave in the evenings.

The average building age is around 24 years and only a handful have undergone redevelopment.

The Draft Master Plan 2019 is trying to correct this by introducing the CBD Incentive Scheme, which encourages the conversion of older office buildings into mixed-use projects with residential and hotel to attract a larger pool of residents and transient populations such as business travellers and leisure tourists.

By granting bonus plot ratio increases of between 25 per cent and 30 per cent, together with a potential lease top-up for the entire mixed-use developments, it opens up many permutations for redevelopment for commercial landlords.

Private owners can also take advantage of this incentive scheme to divest the older assets to developers and operators who have the expertise in mixed-use developments.

As such, we can expect more redevelopments in the CBD over the next 10-20 years.

Apart from the CBD, URA also said that more homes will be introduced in city locations such as Orchard, Pearl’s Hill, Marina Bay and Marina South, offering residents with greater variety of city living options, with easy access to transport and employment nodes, lifestyle and recreational choices.

The radical shift to move people to the city centre is a right move if Singapore were to truly become a liveable global city like London.

One way to make it happen is to extensively adopt co-living concepts in the city area, so that the average Singaporean could also have the opportunity to live closer to their workplace.

This particularly appeals to the tech-savvy millennials, who would take well to living with others in shared spaces within residential or commercial buildings. An example is Lyf, a coliving concept by serviced apartment operator Ascott.

It has announced three such spaces and the first one will be at Funan in the CBD, slated to open in 2020.

We can also consider allowing training facilities, fintech institutes or wealth management campuses to be included in the future mixed-use developments near or even inside the CBD.

This also gels with the goal of lifelong learning and skills upgrading for workers.

With technology being the enabler, these training facilities can be compact and be integrated on site with other higher value uses such as office and residential to make better use of prime land.

This would present greater opportunities for people movement in and out of the city centre, through more student exchange and internship programmes.

Building Housing and Development Board (HDB) flats in the city centre is not feasible at the moment, as it would only encourage speculation due to the lottery effect which benefits only a small group of lucky buyers who get to reap huge capital gains.

The example of owners at Pinnacle@Duxton selling their flats for over a million dollars, well over double of what they paid for, is a case in point.

Hence, sacred cows will need to be slaughtered in order to make HDB housing in the CBD work.

Can HDB start building flats that are not for sale but for lease only?

It is common to see multifamily apartments for rental in many global cities and in fact, it has been turned into an attractive alternative investment asset class on its own.

Or can we build flats in the CBD with shorter leases so as to weed out speculation?

We also used to have the Financial Investor Scheme which accords those who invest in the country with permanent residency, but the scheme has since been axed.

Can the scheme be tweaked to encourage successful international entrepreneurs to come and live in the city?

This is likely to increase the chance of foreigners buying Singapore properties not purely for investment purpose but for owner-occupation.

Can we re-look at the Additional Buyer's Stamp Duty for foreign buyers intending to buy properties in the city centre? In this way, we may well create our own vibrant neighbourhoods in the CBD, akin to New York’s Upper East Side and Tribeca, attract more top talents to want to live and work there.

Under the CBD Incentive Scheme, residential developers and hotel operators should also be allowed to explore innovative ways to inject life into the residential and hotel developments with few boundaries.

One option is to allow CBD condominiums to offer Airbnb style home-sharing.

As long as the objectives of optimising CBD land and bringing life back to the city centre after office hours are met, rules such as having no more than six unrelated people in a tenanted unit should be relaxed so as to increase the attractiveness of city living, making this transformational journey for the CBD most meaningful.

In sum, to inject life into the CBD, both the public and the private sectors must be prepared to try new concepts and ideas.

With the constant evolution of urban lifestyle, a more consultative and innovative approach involving all stakeholders will also be necessary so that government agencies, building owners, operators, residents and office occupiers can work hand in hand to improve the quality of city life for future generations.

ABOUT THE AUTHOR:

Christine Li is senior director and head of research at global property consultancy Cushman & Wakefield Singapore.