The government has recently announced the extension of the Central Business District Incentive (CBDI) and Strategic Development Incentive (SDI) schemes for another five years. These schemes were first introduced in November 2019 and the latest decision was unveiled by Desmond Lee, Minister of National Development (MND), at the Real Estate Developers’ Association of Singapore (Redas) annual Spring Festival lunch on Feb 7.
The CBDI scheme was implemented to encourage the conversion of older office buildings in certain areas of the Central Business District (CBD) into mixed-use developments. This includes the Tanjong Pagar, Robinson Road, and Shenton Way areas. The goal of this scheme is to increase the number of homes, boost the resident population in the CBD, and introduce a more diverse range of uses into the traditionally commercial-focused district.
On the other hand, the SDI scheme was launched to promote the redevelopment of older developments in strategic areas, in order to bring about transformative changes in the surrounding urban environment. These strategic areas include Orchard Road, the Central Business District, and Marina Centre.
According to information from the Urban Redevelopment Authority (URA), 14 out of 17 CBDI proposals and 7 out of 12 SDI proposals have been granted in-principal approval by the government. Currently, there are four CBDI projects in the Anson-Tanjong Pagar area that are under construction. These include the mixed-use development Newport Plaza on 80 Anson Road, which comprises 246 units of Newport Residences and 198 serviced apartment units. The Skywaters Residences, another mixed-use development on 8 Shenton Way, includes 190 luxury residential units. Additionally, there are two commercial developments at 15 Hoe Chiang Road and 51 Anson Road.
Minister Lee has stated that the five-year extension of the CBDI and SDI schemes will come with improvements to both schemes. The CBDI scheme will be expanded to include commercial developments in the Anson and Cecil areas. Developers and property owners who submit CBDI proposals for buildings in these areas will have the option to retain their commercial zoning (with 40% non-commercial use) if long-stay serviced apartment units are included in the redevelopment plans.
For CBDI applicants seeking redevelopment in Anson and Cecil, they will need to provide at least 200 residential units or allocate their entire non-commercial floor area for long-stay serviced apartments, whichever is lower. Previously, office buildings that were redeveloped under the CBDI scheme were allowed to keep their existing commercial zoning if 40% of the new floor area was dedicated for non-commercial use.
CEO of ERA Singapore, Marcus Chu, says that “by enabling the continual renewal of the many aging buildings in the city center and injecting more residential units, these incentives aim to make the CBD a place to work, live, and play.”
In addition, the revamped CBDI and SDI schemes will include new sustainability requirements. All new CBDI and SDI applications going forward must include a sustainability statement that evaluates the feasibility of retrofitting part or all of the existing building. Minister Lee states that while they support revitalization and rejuvenation through redevelopment, they do not want wasteful demolition and excessive rebuilding, especially for relatively young or well-maintained buildings.
He adds that several projects being redeveloped under the CBDI or SDI schemes are already going above and beyond the mandated sustainability requirements. An example is Union Square, a mixed-use development on Havelock Road, which is incorporating a district cooling system.