URA revises guideline on proportion of bigger units in non-landed residential developments in Central Area

Singapore (EDGEPROP) - All new flats, condominiums and residential components of commercial and mixed-use developments will be required to provide a minimum of 20% of dwelling units (DUs) with a net internal area of at least 70 sq m (753.5 sq ft), according to a URA circular issued on Oct 18.

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The Central Area spans 11 Planning Areas: Outram, Museum, Newton, River Valley, Singapore River, Marina South, Marina East, Straits View, Rochor, Orchard and Downtown Core.

URA has observed a persistent trend in declining DU sizes for developments in the Central area, and has introduced the revised guideline to ensure a good mix of DU sizes within the Central Area.

As the positioning of the Central Area has shifted to live, work and play, there have been concerted efforts to introduce more mixed uses in the Central Area to encourage more live-in population and inject vibrancy.

“The threshold of 70 sq m is a reasonable size for small families, taking into account the tighter space constraints in the Central Area,” the circular says. URA did not impose a cap on the total number of DUs within the Central Area as new developments are less likely to put a strain on local infrastructure. Meanwhile, developers are encouraged to provide a good mix of DU sizes to cater to the needs of all segments of the market, including larger families, and avoid a disproportionately large quantity of smaller DUs.

Lee Sze Teck, senior research director at Huttons, expects slightly bigger units in the future but sees the overall impact on the market as minimal. Most of the projects in the Central Area are in compliance with this new rule, he notes. Investors may have fewer choices of smaller units in the future and may have to resort to looking to the resale market, driving up prices of smaller units.

However, Lee expects some of the en bloc sites in the Central Area and the Marina Gardens Lane to be affected by the updated guidelines. Developers may re-assess potential bids for en bloc sites due to cost considerations, affecting the success rate of en bloc sites in the Central Area. (See potential condos with en bloc calculator)

In 2018, URA revised guidelines on maximum allowable number of DUs in non-landed residential developments outside the Central Area. The maximum allowable number of DUs is derived by dividing the proposed building gross floor area by 85 sq m. URA says it will continue to monitor and review the guidelines periodically, taking into account factors such as lifestyle changes and infrastructural developments.

The latest guidelines will apply to development applications submitted to URA from Jan 18, 2023, onwards.