Artist's impression of the revamped 1 Science Park. (Photo: Ascendas REIT)

Ascendas REIT and CapitaLand Development (CLD) have formed a joint venture to redevelop 1 Science Park Drive into an asset with Grade A offices and retail spaces.

The asset will undergo an SGD883 million rejuvenation that will see it transform into a life science and innovation campus.

The venture follows the sale of 1 Science Park Drive by Ascendas REIT to the joint venture for SGD103 million.

CLD owns a 66% interest in the joint venture, while Ascendas REIT owns the remaining 34%.

1 Science Park Drive has a site area of 31,856 square metres and sits at the main entrance to the park and adjacent to the Kent Ridge MRT station.

The upcoming development will have a total gross floor area (GFA) of 116,200 square metres comprising three interconnected Grade A buildings – one 15-storey-tall and the other two 9-storey-tall.

It will also feature an event plaza with retail, F&B and supporting amenities.

The asset will provide 112,500 square metres of business park space and 3,700 square metres for retail and F&B uses.

The gross plot ratio (GPR) of 3.6 represents a threefold intensification of the current maximum allowable GPR of 1.2.

Expected to be fully completed by 2025, 1 Science Park Drive caters to demand from tenants in new economy sectors such as biomedical sciences, digital and technology, said a joint statement from Ascendas REIT and CLD.

These sectors are expected to expand in Singapore amidst a greater focus on healthcare, deep tech and accelerating digital transformation, the companies added.

About 71% of the business park space has been designed to accommodate biomedical research and development (R&D) activities.

“On a stabilised basis, the investment is expected to generate a net property income yield of approximately 6.3%, re-creating value for Ascendas REIT’s unitholders”, said William Tay, CEO of Ascendas REIT’s manager

“We will also have the first right to acquire the remaining 66% interest when the redeveloped property achieves stabilised occupancy”, he added.

Ascendas REIT was last done on the SGX at SGD3.10, which presently implies a distribution yield of 4.94% according to data on the Singapore REITs table.

By Shariffa Al-Habshee

Shariffa joined REITsWeek in 2017, and monitors Asia-Pacific REITs for the publication.