Thursday, May 28, 2009

BTO: STC offers short-term office leases

Business Times - 28 May 2009

STC offers short-term office leases

Six-month lease offer at 18 Cross St part of move to attract clients to China Sq Central



THE Straits Trading Company (STC) is offering short-term leases at 18 Cross Street for companies in search of transitional office space.


Tenants can sign up for leases of at least six months at the 15-storey Grade A office tower, which is part of China Square Central, and asking rents range from $8 to $10 psf.


Some 50,000 square feet of space spread across the 7th to 10th floors are available for this arrangement.


According to STC executive vice-president Eric Teng, short-term leases will be useful for companies which are waiting for office rents to fall further before committing to new leases.


There are also situations where firms need a bit more time before they can move out, but their landlords are not keen to give short-term lease extensions, he said.


Companies guarding against the possible spread of the H1N1 virus can also consider moving some work teams to 18 Cross Street for the time being, he added.


STC hopes that the experience of working at China Square Central may attract some tenants to stay on longer. This is a way to 'encourage 'sampling' of our product', said Mr Teng.


STC said that it can help tenants by footing some refitting or renovation costs first. Tenants will then repay the company through higher monthly rentals.


Knight Frank director of business space (office) Agnes Tay felt that STC's move to attract tenants is creative.


If STC aims to entice them to stay, it can consider offering attractive renewal packages after their short-term leases end, she added.


Around 75 per cent of office space at 18 Cross Street is currently occupied, STC said.


The company previously owned 18, 20 and 22 Cross Street but completed a sale and leaseback deal with Allco Commercial Reit (now known as Frasers Commercial Trust) in 2006.


STC now has a master lease on these properties which ends in 2012.

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