The launch of Singapore's proposed new business and financial center may be delayed due to economic uncertainty and the weak office market, an economic daily reported here yesterday.
The Business Times, citing property market players, said the site, located on reclaimed land close to the existing Raffles Place corporate district, has elicited a lukewarm response from potential foreign tenants.
The so-called "New Downtown" was supposed to be launched in the second half of this year but this is now unlikely, the newspaper said.
Mapletree Investments, a unit of state-owned Temasek Holdings appointed as the project's marketing consultant, has reportedly urged local developers to form a consortium to undertake the project after it failed to attract overseas developers to invest in it.
The Urban Redevelopment Authority told the newspaper that it will announce updates on the project next month when it releases details of the government land sales program for the second half of the year.
Property consultancy Colliers International said in a quarterly report issued yesterday that the commercial real estate market will be hit hard by the SARS crisis.
"Just as the whole world was about to sigh in relief for the quick end to the war in Iraq, the SARS epidemic dashed hopes of a recovery," it said.
Average rents for Raffles Place premium offices are down almost 6 percent in the first quarter from the previous three-month period, while office occupancy rates in the whole island fell slightly to 83.6 percent.
"Occupancy rate is unlikely to pick up in the short term as many companies are adopting a wait-and-see attitude," it said, adding that occupancy prospects through to the first quarter of next year "should continue to be depressed."