With the increasing trend of working from home, property developers are prompted to launch more small office, home unit (Soho) projects.
The popularity of this concept is also evident in the leasing market, where Soho units can fetch higher rents than flats.
The Urban Redevelopment Authority (URA) has approved around 3,700 private residential owners since the launch of its Home Office Scheme in 2003. The licence allows owners to operate small-scale businesses from their homes. Around 600 applications and licence renewals were authorised in 2010, an increase of 11 percent from 2009 and twice the number from 2008.
Mr. Chia Boon Kuah, Chief Operating Officer and Executive Director of property sales at Far East Organization, said more people are searching for flexible spaces which allow them to live, work and relax under the same roof.
Far East’s The Tennery, a 338-unit Soho-style development located in Bukit Panjang, was partly inspired by the success of its other Soho projects, Soho@Central and The Greenwich. Over 90 percent of The Tennery has been snapped up, with prices averaging S$1,200 psf.
Some consultants said Soho units are popular since they can attract good rents.
Rents of centrally located Soho units averaged S$4.50 psf to S$5.50 psf in 2009, said Patrick Lai, Director of Corporate Residential Leasing at Savills Singapore.
These rents jumped to S$6.50 psf in 2010 and Mr. Lai expects that they could reach S$7 psf later this year.
Rental demand for Soho units will remain strong, particularly among small businesses and entrepreneurs, since they can be used for both business and residential purposes, he said.