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Property News 16 Feb 2017

Govt reviewing land-use policies and planning guidelines

jtc

A number of Singapore government agencies are working together to review land-use policies and planning guidelines to facilitate flexibility in land use, the Ministry of National Development (MND) has said.

"The implementation details are being finalised, and we will share them when ready," it said.

The brief comments came in response to queries from The Business Times following the call by the Committee on the Future Economy (CFE) for greater land-use flexibility by allowing complementary activities to be located near each other; this way, value chains and industries can be integrated and synergies enabled among developments in a precinct.

The CFE also proposed that flexibility of land use be allowed in industrial areas, given the blurring line between services and manufacturing; it added that this will open the way for businesses of different sectors and functions to co-locate, find synergies and catalyse innovation.

The Urban Redevelopment Authority (URA) is working with state industrial landlord JTC and the Economic Development Board (EDB) in the review. JTC and EDB are statutory boards under the Ministry of Trade and Industry.

Industry players BT spoke to hailed the ongoing review of the land-use regime as long over-due, but some say the review may not translate to material changes for existing sites, as the government still prefers to try out new ideas in pilot projects.

Knight Frank chairman Tan Tiong Cheng said greenfield sites, such as those freed up with the relocation of the Paya Lebar airbase and Tanjong Pagar seaport, are logical choices to execute innovative technologies and better ways of using space. Such greenfield sites present the opportunity to build shared infrastructure - transport modes, amenities and energy-saving initiatives.

Ku Swee Yong, key executive officer of International Property Advisor Pte Ltd, expects that any changes that come will likely be limited, either in geography or in the number and types of properties.

"In line with announced plans for Jurong Innovation District and North Coast Innovation Corridor, I believe the government will create a new combination of education-industrial mixed use, or education-office mixed use.

"This is not a huge departure from putting the science parks next to universities, except that instead of being located 'adjacent' to one another in their respective traditional zonings, we can expect these uses to be 'co-mingled'," he said.

To allow for this co-mingling of use - such as having an industrial building within a university campus - the government may need to create new zoning categories, he added.

Dennis Yeo, CBRE managing director of industrial and logistics for Asia, said that, to create new clusters of modern industries, the government has to create supply-led demand. This is exemplified by the success of one-north, a 200-ha development comprising businesses in the biomedical sciences, infocomm technology (ICT) and media industries.

"We should take advantage of our small location to allow for flexible (land) use," he said. He says low-cost manufacturers who cannot afford rents of more than S$1.50 per square foot (psf) a month will still be able to find space in the current industrial stock. (Rents in industrial estates with units suitable for production are typically under S$2 psf in this market.)

Mr Yeo dismissed concern that the changes in allowable uses for industrial land could affect office rents, saying that the market would find its own equilibrium. Besides, the government is able to calibrate future office supply to guide rents.

Regardless what form the changes take, "we've got to be clear with the rules, and the rules have to change with the times", he said.

Industry players say Singapore may need to create more zoning categories or expand existing definitions of use for industrial space.

They also cited another planning guideline which they deem too restrictive - that of the "60-40 rule", which requires at least 60 per cent of gross space in a building or strata unit to be used for industrial activities, with at most 40 per cent left for ancillary purposes.

Imagine a building with 300 strata units, Mr Yeo suggested. Going by the 60-40 rule, production activities will have to take up 60 per cent of each unit of at least 150 sq m - and this is repeated 300 times.

He proposed that one way to relax this rule may be to apply this principle at the precinct level, instead of at the building or strata unit level; this will open the way for certain floors within an industrial building to be used purely as offices.

The government has, in the past, rolled out "white" sites and business park white zones in the Master Plan to offer developers some autonomy in deciding the most appropriate mix of uses for each site. However, it has remained prescriptive in listing permissible uses and planning specifications for these sites.

JLL head of research for South-east Asia and Singapore Chua Yang Liang suggested that instead of spelling out acceptable ways to use the space in each zone, the government take a discretionary approach on what should be excluded in each zone and leave the rest to the private sector.

Dr Chua proposes that Singapore considers alternative ways of zoning that do away with narrowly defined, highly specific uses typical of traditional zoning.

The US practises what is called "performance zoning", under which land development and use are circumscribed by performance standards; for example, these standards can limit the intensity of development by stipulating the maximum level of noise or strain on the transportation system.

Dr Chua said: "The concept of work has changed, especially with the rise of the Internet of Things. Industry 4.0, as the Germans call it, is a major disruptor, but also a paradigm shift. The old single zone or industrial - clean and heavy - may not be sufficient."

The Business Times

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