Keppel, a homegrown global asset manager and operator, has announced their plans to focus on other brownfield redevelopment projects after the completion of Keppel South Central, according to Samuel Ng, President of Keppel’s real estate division in Singapore. Ng adds: “The redevelopment of Keppel South Central is our crowning achievement.” He is referring to the former Keppel Towers, a 27-storey office tower completed in 1991, and Keppel Towers 2 (formerly known as GE Tower), a 13-storey building completed in 1993.Keppel has announced the completion of their flagship 33-storey commercial tower, Keppel South Central, last month. Situated along Hoe Chiang Road in Tanjong Pagar, the building boasts about 650,000 square feet of office, retail, and event space. The usual office floor plates range from 20,000 to 22,000 square feet, with a ceiling height of 3.2 meters. Read also: Hotel Clover at Hongkong St on sale for $27 million; Hongkong St commercial building priced at $22.6 millionClose to 50% of the commercial tower’s retail spaces and office areas are either leased or under negotiation. A reputable financial services group has been secured as the first anchor tenant, leasing two whole floors. The office tenants are expected to start moving in from June onwards.
The tower boasts retail and event spaces on the ground floor. (Photo: Samuel Isaac Chua / EdgeProp Singapore)On par with other Grade-A officesThe renovated property now comes equipped with a range of technological improvements, bringing it on par with other Grade-A office buildings in the Central Business District (CBD). These include facial recognition access, 5G Wi-Fi, and an indoor air-quality management system.
The office space has been designed to accommodate the needs of modern tenants and support after-hours operations. Various floors have been fitted with micro ACUs (air conditioning units) that provide localized cooling when necessary, optimizing energy usage when certain areas are occupied. The tower also has retail and event spaces on the ground floor, health and wellness spaces on the fifth and sixth floors, a landscaped terrace on the 18th floor, and end-of-trip facilities on Basement 1.
These facilities were lacking in the original Keppel Towers and further enhance the development, bringing it up to the standard that office tenants expect from Grade-A office spaces, says Ng. To top it off, Keppel has a team in place to activate event spaces all through the tower. Read also: United House relaunched for collective sale at $166 millionThe application used by mobile users to connect to the building management and facilities can also be used to connect directly with them, rather than through the office manager, adds Ng. “This allows us to collect feedback and host events based on their interests.”
The $1.8 million energy savingsThe redevelopment of Keppel South Central has been certified by the BCA as a Green Mark Platinum Super Low Energy building. It’s achieved a significant improvement in energy efficiency and cost savings when compared to before the redevelopment.Keppel estimates the energy savings to be about 6.2 million kilowatt-hours (kWh) per year, which equates to the power consumption of 1,300 Singaporean homes. This amounts to approximately $1.8 million in yearly savings.
In order to achieve this, Keppel integrated several green solutions they had previously tested at another ageing property—Keppel Bay Tower, which was constructed in 2002. In 2018, Keppel Land leveraged a BCA grant to test five new technologies in the building that could improve energy efficiency by 20% when compared to other BCA Green Mark Platinum Buildings. Consequently, Keppel Bay Tower became Singapore’s first zero-energy commercial building in 2020.
“The experience has given Keppel the knowledge to efficiently apply those technologies to the various buildings that we own or operate all over the world,” says Ng.
The improvements implemented at Keppel South Central range from physical hardware like treated external windows to software applications like smart building management systems that optimize energy usage.
The tower’s redevelopment has introduced wellness spaces and shared facilities on the second floor, including a swimming pool. (Photo: Samuel Isaac Chua / EdgeProp Singapore)Brownfield projects in APACKeppel is looking to replicate the success of Keppel South Central throughout the region as part of its Sustainable Urban Renewal (SUR) strategy.
Read also: Keppel completes build of 33-storey commercial tower Keppel South Central; secures anchor tenant in financial services“In Asia-Pacific alone, there is already a massive pool of office buildings completed in the 1990s or earlier, and practically all of them won’t meet the new standards for Grade-A office space,” says Ng. “Unless something is done to upgrade them, their capital value will continue to drop.”According to a JLL report from March 2024, 87% of occupiers surveyed across APAC are looking to comprise their portfolio of exclusively green-certified properties by 2030.
“The catch, however, is that for every 5 square feet of demand across APAC, only two square feet of low-carbon space is projected for development from now till 2028,” says Ng. “With a limited supply of new office buildings, this presents a significant opportunity for retrofitting sustainable solutions.”
In Singapore, ageing office buildings typically go through redevelopment to recycle prime commercial land in the CBD, says Leonard Tay, head of research at Knight Frank Singapore.
He adds: “The completion of projects like Keppel South Central provides fresh office supply when no sites are available for office tower developments in the core CBD area.”
Keppel South Central is the redevelopment of Keppel Towers and Keppel Towers 2. (Photo: Samuel Isaac Chua / EdgeProp Singapore)The first close of KSURF fundEarlier in April, Keppel announced the first close of their flagship Keppel Sustainable Urban Renewal Fund (KSURF), with more than $2.3 billion of total funds under management.
KSURF will target properties in Singapore, South Korea, Japan, Australia, and first-tier cities in China across the commercial, living, life sciences, hospitality, and logistics segments. “Keppel’s in-house capability to execute the renewal works ourselves helps us stand out from other asset managers,” says Ng.
“Whether it is an industrial building, an office, or a data center, our operational knowledge will help us streamline the process of selecting new technologies to implement, saving on capex costs if the expected savings are not achieved,” he adds.
After acquiring the property, the fund will enable Keppel to complete the asset enhancement works, stabilize occupancy, and divest it within the fund’s seven-year lifespan.
So far, Keppel has applied its SUR strategy to eight projects across five countries. Along with Keppel South Central and Keppel Bay Towers, their completed projects include Park Avenue Central, a mixed-use office and retail development in Shanghai; The Kube, a four-storey office building also in Shanghai; and Saigon Centre, a mixed-use office and retail development in Ho Chi Minh City.
Three projects are yet to be completed: Ocean Financial Centre, a 43-storey Grade-A office tower in Raffles Place; Inno88 Tower, a 367,210 square feet office building in Seoul; and Kohinoor, a 1.1 million square feet office block in Maharashtra, India. Check out the latest property listings for Commercial Real EstateAsk BuddyPrice trend for commercial property salesCompare price trend of Commercial vs. Industrial propertiesListings for commercial propertyRecent Commercial sale transactionsRecent Commercial rental transactionsPrice trend for commercial property salesCompare price trend of Commercial vs. Industrial propertiesListings for commercial propertyRecent Commercial sale transactionsRecent Commercial rental transactionsRELATED NEWS:Keppel completes build of 33-storey commercial tower Keppel South Central; secures anchor tenant in financial servicesCentral Region office rents dip 1.7% in first quarter of 2024, reversing nine straight quarters of growthKeppel launches Keppel South Central commercial building in the CBD