Singapore
Keppel, a well-known global asset manager and operator, has recently completed their flagship project Keppel South Central and is now shifting their focus to other brownfield redevelopment projects, according to Samuel Ng, the president of Keppel’s real estate division in Singapore. Ng refers to Keppel South Central as their “showpiece”.
Keppel South Central is a redevelopment of 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. The commercial tower, located in Tanjong Pagar, offers about 650,000 sq ft of office, retail, and event space. The typical office floor plates range between 20,000 and 22,000 sq ft with a clear ceiling height of 3.2m. It was announced last month that nearly 50% of the office space and retail units have either been leased or are in active negotiations. The first anchor tenant, a leading financial services group, has already signed a lease for two whole floors and is expected to move in from June.
One of the key features of Keppel South Central is its retail and event spaces on the ground floor, which were not present in the original Keppel Towers. Other upgrades include technology such as facial recognition access, 5G Wi-Fi, and an indoor air-quality management system. The office space has also been adapted to support the needs of modern tenants, with designated floors having micro ACUs for localised cooling and after-hours operations. The tower also has health and wellness spaces, a landscaped terrace, and end-of-trip facilities available for tenants.
The redevelopment of Keppel South Central has been certified by BCA as a Green Mark Platinum Super Low Energy building. This represents a significant improvement in energy efficiency and cost savings compared to before. Keppel estimates that it will save about 6.2 million kilowatt hours (kWh) per year, equivalent to the power consumption of 1,300 homes in Singapore. This translates into approximately $1.8 million in savings annually. Keppel has incorporated several green solutions that were previously tested at another ageing property, Keppel Bay Tower, which was built in 2002. In 2018, Keppel Land leveraged a BCA grant to test five new technologies in the building, resulting in Keppel Bay Tower becoming Singapore’s first zero-energy commercial building in 2020. These technologies have now been applied at Keppel South Central, ranging from physical hardware to software applications, all aimed at improving energy efficiency.
Following the success of Keppel South Central, Keppel is looking to replicate this across the region as part of its Sustainable Urban Renewal (SUR) strategy. According to a report by JLL, 87% of occupiers surveyed across Asia Pacific are looking to comprise their portfolio with entirely green-certified properties by 2030. This presents a significant opportunity for sustainability-focused retrofits, and Keppel is well-positioned to take advantage of this trend. In addition, the completion of projects like Keppel South Central provides fresh office supply at a time when there are no available sites for an office tower development in the core CBD area.
To fund the redevelopment of brownfield projects across the region, Keppel has launched its flagship Keppel Sustainable Urban Renewal Fund (KSURF) with over $2.3 billion in total funds under management. The fund will target properties in Singapore, South Korea, Japan, Australia, and first-tier cities in China across various segments, including commercial, living, life sciences, hospitality, and logistics. To date, Keppel has applied its SUR initiative to eight projects across five countries, with three projects still in progress. With Keppel’s in-house capability and operational knowledge, they are well-equipped to execute these renewal works and divest them within the fund’s seven-year life span.