Source: Straits Times
13 March 2013
Industrial carparks being used as offices
But URA says such conversions not allowed on industrial premises
By Melissa Tan
Cubicles have squeezed out cars in some industrial buildings as tenants try to maximise the use of their space amid rising business costs.
A check by The Straits Times of a few strata industrial projects found that some tenants had converted the private parking spaces in their units into glass-fronted offices.
Industrial strata units typically have two private carpark spaces included in each unit. They are behind metal roller shutters at the unit's entrance.
The conversion of these private parking spaces into offices could be a violation of usage guidelines laid down by the Urban Redevelopment Authority (URA).
"Conversion of these (carpark) lots to independent offices is not allowed as industrial premises are intended to serve industrial activities," the URA told The Straits Times last week.
A sales manager at one unit where private carpark space had been turned into an office told The Straits Times the conversion was done by the landlord.
He declined to be named or specify the landlord, but said the conversion was done before his company took the lease in 2010.
He added that besides the glass-fronted office, the firm has a larger sales office which includes technical staff and occupies the rest of the unit.
The developer of the building this unit was in, Midview Realty, declined to comment.
Some tenants may be tempted to convert industrial space to office usage because industrial space is much cheaper.
Industrial rents are typically $1.50-$2 per sq ft (psf) per month, though newer developments in areas like Bukit Merah can command up to $3.50 psf per month, said PropNex head of business space Roy Chong.
In contrast, suburban office rents are $5-$7 psf per month.
Mr Chong said the presence of private carpark spaces was "insignificant" in determining the rent of a strata industrial unit.
SLP International research head Nicholas Mak said industrial tenants "may feel entitled" to convert private parking spaces since they paid for the space, but have to check with regulators on whether the conversion is allowed.
He noted that such conversions were more prevalent at older developments.
In newer industrial buildings, developers tend to offer common parking space, instead of building private parking spaces located within the strata units Mr Mak said.
Tenants have also used the private parking spaces for storage.
Using such space for storage or industrial production is allowed under certain conditions, the URA said. The individual unit's tenant or owner has to submit a formal application to URA for such a conversion. This application can also be made by the building's management corporation.
"We have given approval for such conversion in a number of industrial buildings but we are not able to share the list for confidentiality reasons," the URA said.