Hiap Seng Engineering said on Wednesday it accepted an offer from JTC Corp. to extend its leases to August 15, 2038, for its properties at 24, 28, and 30 Tuas Crescent for .leases which have or will expire on 31 May 2019, 15 August 2018 and 31 May 2019, respectively.
The conditions call for Hiap Seng to make an aggregate investment on plant and machinery at the lots of at least S$18.06 million, of which S$14.74 million must consist of new investments on plant and machinery, within the development period through 13 August 2021, it said in a filing to SGX after the market close on Wednesday.
It also must ensure that at least 86.5 percent of the total land area is developed, excluding driveways/parking spaces, statutory building setbacks/buffers, vacant land/greens for safety distances and land reserved for any future expansion, it said.
The lots have a final survey area totaling 55,736.5 square meters, it said.
The land rental will be at an initial rate based on the prevailing market rate and will be subject to annual revision to market rent, Hiap Seng said, but added that the increase wouldn’t exceed 5.5 percent of the land rent for each year.
“We are pleased with the outcome of the negotiations with JTC Corporation to extend the leases, and will remain committed to further strengthen our business through prudent cost measures and maintenance as well as capital expenditure,” Frankie Tan, executive chairman of Hiap Seng, said in the statement.