Mapletree Industrial Trust secures largest build-to-suit project at S$250m

Redevelopment for Hewlett-Packard Singapore.

Mapletree Industrial Trust Management Ltd., as manager of Mapletree Industrial Trust (MIT), is pleased to announce that MIT will develop a S$250 million build-to-suit facility (BTS Facility) at its existing Telok Blangah Cluster for Hewlett-Packard Singapore (Private) Limited.

Mr Tham Kuo Wei, Chief Executive Officer of the Manager, said, “The redevelopment will unlock value for MIT’s portfolio by repositioning the Property as a high-tech industrial cluster and maximising available plot ratio. The long-term lease commitment from a good quality tenant will lengthen the portfolio’s weighted average lease to expiry and provide income stability. This project will be MIT’s largest build-to-suit development to date, underscoring our focus on the development of more customised facilities which meet our tenants’ operational and expansion needs."

Situated on land area of approximately 329,800 square feet (sq ft), the Property currently comprises two seven-storey Flatted Factories and a canteen. It has a gross floor area (GFA) of approximately 437,300 sq ft with a land lease tenure of 60 years commencing from 1 July 2008. Located within the Telok Blangah Industrial Estate, the Property is in close proximity to business and lifestyle precincts at Alexandra and HarbourFront as well as the Central Business District. It is well-served by major expressways such as Ayer Rajah Expressway and Central Expressway as well as the Labrador Park Mass Rapid Transit Station.

The proposed redevelopment, which is subject to approval from the relevant authorities, will comprise two new buildings with high specifications. The purpose-built development will include facilities for manufacturing, product and software development as well as an office, occupying a total GFA of approximately 824,500 sq ft. The Client, a global provider of products, technologies, software, solutions and services in over 170 countries around the world, has committed to fully lease the BTS Facility for an initial period of 10.5 years.

The Property, which will be redeveloped over two phases, is expected to complete in the first half of 2017. All affected tenants at the Property will be informed of the proposed redevelopment and the Manager will actively help them relocate to alternative clusters within MIT’s portfolio.

Added Mr Tham, “We have put in place a comprehensive Tenant Assistance Package to address our tenants’ concerns. We are offering all Flatted Factories’ tenants an extended notice period of 12 months at preferential gross rental rates. In addition, for tenants who choose to relocate to alternative premises within MIT’s portfolio, we will offer discounted gross rental rates, longer rent-free periods and cash subsidies.”

All tenants will automatically be offered preferential gross rental rates for their remaining leases at the Property until the end of their notice periods. They will not be required to reinstate their premises and will not need to compensate for early termination if they choose to move out prior to the expiration of their leases. Flatted Factories’ tenants will be provided with a 12 months’ notice period to vacate their current premises, while the canteen operator will be given a 6 months’ notice period.

More than 388,000 sq ft of space at Alternative MIT Clusters has been shortlisted for tenants considering relocation. This is equivalent to about 1.7 times of the space presently used by the tenants. These premises at Alternative MIT Clusters will be offered at discounted gross rental rates for a new three-year lease. These are about 18 per cent to 38 per cent lower than the average rental rates for new leases at the respective clusters.

Extended fit-out and rent-free periods of up to nine months will be given to tenants who choose to relocate to our premises. In addition, cash subsidies of up to 15 months of gross rents at the Alternative MIT Clusters will be given. Tenants who do not take-up a new lease at an Alternative MIT Cluster will also benefit from a cash subsidy equivalent to six months of gross rent based on preferential gross rental rates.

MIT’s Tenant Assistance Package is put together to offer viable options for tenants planning to relocate their businesses. With a diverse portfolio of properties strategically located across Singapore, MIT has sufficient space to facilitate their relocation.