Redevelopment of Ocean Building to take place soon

PLANS are finally under way to tear down the ageing Ocean Building in Collyer Quay, more than a year after owner Keppel Land (KepLand) was first said to be considering a redevelopment.

Sources said that KepLand intends to construct a brand-new office building on the site to help meet soaring demand for prime office space here.

A KepLand spokesman stopped short of confirming this, telling The Straits Times yesterday that the developer expects to clear the Ocean Building site by early next year to make way for an as-yet-unspecified new building.

It said the plans are still at a preliminary stage with details being worked out.

About 40 per cent of the building's tenants have already moved out, with the rest expected to follow by the middle of the year.

They had been informed of the redevelopment plans in the second half of last year, KepLand said yesterday. Many are relocating to other nearby KepLand buildings, with the developer's assistance.

Major tenants Ernst & Young and the Bank of Nova Scotia have moved across the road to One Raffles Quay, newly developed by KepLand in conjunction with Hongkong Land and Cheung Kong Holdings.

Others such as Lim & Tan Securities will move to Equity Plaza by June, while HSBC is closing its safe deposit box operations in basement one of the building altogether.

These four key tenants together occupy about 170,000 sq ft of Ocean Building's total 401,931 sq ft of net floor area.

The current 29-storey building is KepLand's flagship office block. It was completed in 1974 after a few redevelopments previously.

KepLand has also recently received written approval for its plans to revamp Ocean Towers, just next door to Ocean Building.

It intends to improve on the existing basements and build a new office block as an extension to Ocean Towers, according to the latest Urban Redevelopment Authority data.

After these changes, Ocean Towers is expected to have 626,000 sq ft of gross floor area dedicated to office space and 1,800 sq ft of gross floor area for shops.

Both Ocean Building and Ocean Towers sit on 999-year leasehold sites, although the current Ocean Towers is newer, having been completed in 1992.

Consultants believe that Keppel could inject the two buildings into its office trust after the redevelopments are completed.

In fact, they were already widely expected to be included in the initial portfolio of K-Reit when it was launched in April.

Experts said the redevelopment of Ocean Building is 'timely', given the acute shortage of prime office space, which has sent rents shooting to new highs.

fiochan@sph.com.sg