URA tightens approval for applications for hotel, boarding house, back- packers' hostel uses

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A New Urban Redevelopment Authority (URA) policy to tighten approval of new development applications for hotel, boarding house and backpackers' hostel uses will likely dampen demand for contiguous shophouses - unless they already have prior approval for such use.

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In a circular last week, URA noted that hotels, boarding houses and backpackers' hostels - which provide accommodation for visitors to Singapore - are generally found in commercial areas.

Within the Central Area, such proposals will generally not be allowed within certain areas inside the Outram, Rochor, Downtown Core and Singapore River Planning areas.

The affected areas include a big chunk of Chinatown and Little India shophouses.

In Chinatown, the affected area is bounded by Upper Cross Street, New Bridge Road, Cantonment Road, Neil Road, Craig Road, Tanjong Pagar Road and South Bridge Road. The stretch includes Mosque, Pagoda and Temple streets, Keong Saik and Kreta Ayer roads, Duxton Hill and Duxton Road.

In Little India, the affected area is bounded by Sungei, Race Course and Kitchener roads extending to Rochor Canal. Other areas hit by the new policy include a stretch near Bugis MRT Station - covering Tan Quee Lan, Liang Seah, Purvis and Seah streets.

Also affected is an area surrounded by North Canal, South Bridge, Upper Circular and New Bridge roads.

For proposals in other parts of the Central Area, URA will evaluate them individually, considering its planning intention for the locality and the potential traffic impact generated by the proposal.

Although there was no mention of "shophouse" in URA's circular, Mary Sai, executive director at Knight Frank, said: "We interpret these locations straightaway as shophouses because these streets are dominated by shophouses."

"Morever, in some areas, we're seeing commercial amenities like retail shops, bakeries, coffee shops, all being replaced by hostels and hotels," she added.

Currently, most people buy a row of adjoining shophouses with the intention of converting them to a hotel or hostel.

Summing up the impact of the new policy, Ms Sai said: "While demand for shophouses may be dampened by the new rules, on the other hand, owners of shophouses already approved for hotel use will find their assets rise in value over time because of difficulty in getting hotels sites."

For a detailed map of the locations in Central Area affected by the new policy go to: http://www.ura.gov.sg/uol/circulars/2014/jul/~/media/User%20Defined/URA%20Online/circulars/2014/jul/dc14-18app1-4.ashx