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[SINGAPORE] The government has agreed to swop an 8.5-hectare (ha) (about 900,000 sq ft) state land parcel along Holland Road for a 13-ha plot in the same area belonging to the Regent of Johor (ROJ), His Royal Highness Tunku Ismail.

The land swop agreement comes as the ROJ plans to develop his land, said the Urban Redevelopment Authority (URA) and Singapore Land Authority (SLA) in a joint statement on Tuesday (Jun 10).

The 13-ha parcel is part of a larger 21.1-ha swathe of freehold land just outside the Singapore Botanic Gardens, owned by the Johor royal family for generations. With the swop, the ROJ will own 16.6 ha of land in the area (plots A and B in the map).

The plots, bounded by Holland Road and Tyersall Avenue, sit in an exclusive residential neighbourhood and are nestled between designated Good Class Bungalow areas on freehold land.

In nearby Gallop Park, mansions command tens of millions of dollars, with one recently sold for S$58 million, while a 1,733-sq-ft apartment at Gallop Gables changed hands in May for S$4 million.

“When approached for permission, the government assessed that it was preferable for any potential development to be further away from the Singapore Botanic Gardens Unesco World Heritage Site,” said SLA and URA. It was then mutually agreed to undertake a land swop so that any planned development would be further away, to ensure the least disruption to that part of the gardens.

“The land parcels to be swopped are of comparable value,” the agencies said at a briefing on Tuesday, without disclosing the actual amount. All the plots are freehold, including the state parcel transferred to the ROJ.

The exchange is expected to be completed this year. The land owned by the ROJ has been deemed suitable for low-rise and low-density residential use. The plot to be transferred is next to existing residential developments with a plot ratio of 1.4, and can be used for higher-intensity residential developments.  

Tunku Ismail was appointed the ROJ in 2024, ahead of his father’s ascension to the federal throne as the 17th king of Malaysia. He is the eldest of six children of Sultan Ibrahim and Johor queen Raja Zarith Sofiah.

The Business Times understands that the Singapore authorities have assessed that the state land parcel to be transferred to the ROJ can be potentially used for residential development.

Any development plans will be subject to due process, said the authorities. “URA and agencies will assess any development applications, and ensure that the proposed development is sensitive to the surrounding site context.”

Property insiders noted that the transfer of state land on freehold terms was unusual, given that land sold by the government for development is generally 99-year leasehold.

Plot A is currently vacant and vegetated. It has been zoned “special use” since the 1958 Master Plan. After the land swop, the ROJ can determine the use and submit an application for rezoning.

It is unclear how much in land betterment charges (LBC), which developers pay for intensified use of land, will be charged, and the zoning of the area may change in the new Draft Master Plan, due to be unveiled later this month.

Lee Sze Teck, Huttons Asia’s senior director of data analytics, reckons the LBC could top S$1 billion, assuming a proposal is submitted to rezone to a low-density residential development, due to the sheer size of the land.

Nicholas Mak, chief research officer at Mogul.sg, estimates the plot of land to be transferred to the ROJ to be worth around S$1.9 billion, with the plot he already owns worth about the same.

Given the four-storey height restriction in the area, residential developments there could be low-rise luxury apartments or even Good Class Bungalows, said Alan Cheong, executive director for research and consultancy at Savills Singapore.

Desmond Sim, chief executive of ETC, pointed out that future residential projects, assuming plans are approved, will provide more options of luxury low-density apartments in the market, which could prop up supply of low-density housing in the vicinity.

Nearby developments include freehold condos Botanika and Gallop Gables, both of which have a gross plot ratio of 1.4, said Tricia Song, CBRE’s head of research for Singapore and South-east Asia.

“The Tunku could look to develop similar low-rise developments with lush landscaping to capitalise on its expansive land and proximity to the Unesco site,” she added. “He can work with either Singaporean or Malaysian developers as long as they are licensed housing developers.”

The agreement was made between the Singapore government and a private individual, and the Malaysian government and Johor State governments were not involved in negotiations, SLA and URA said.

News of the land swop comes a week after Singapore announced it would acquire two separate small land parcels totalling about 0.79 ha from the Malaysian government, as part of plans to redevelop Woodlands Checkpoint, a major land border crossing between the two countries.

Singapore had previously written to Malaysia in May 2022 and November 2023 to propose the purchase. Expansion works will begin in 2025, with the first phase to be fully operational from 2032.

The government will keep the plot it receives from the ROJ undeveloped for now. The 13-ha Plot C along Holland Road is currently zoned “special use/open space”.

Media reports in 2021 speculated that the Johor royal family had plans to develop the land which housed Istana Woodneuk, a palace built for the royals in the late 19th century, into a “multibillion-dollar luxury residential development”.

The land owned by Johor royalty has shrunk gradually, as the Singapore government acquired land to extend the Botanic Gardens.

According to Bloomberg, the government bought a chunk in 1990 for US$25 million, and another 1.05 million-sq-ft parcel in 2009 for an undisclosed sum. The latter plot brings the total size of the 166-year-old Botanic Gardens to nearly 74 ha.

The latest agreement is not the first instance when land was swopped between the two countries.

In a historic deal inked in 2010, which ended a 20-year impasse over the Points of Agreement signed in 1990, three plots of former Malayan Railway land and three additional plots in Bukit Timah were exchanged for four land parcels in Marina South and two parcels in the Ophir-Rochor area.

A joint venture between Malaysia’s investment arm Khazanah Nasional and Singapore’s Temasek was set up to develop the new plots, with Khazanah holding a 60 per cent stake. Mixed-use projects Marina One in Marina Bay and Duo in Bugis were developed on the 99-year leasehold sites.

Marina One, which has a gross development value of about S$7 billion, spans 3.67 million sq ft and now houses two 30-storey office towers. It also has two residential blocks with more than 1,000 units and a retail podium of 140,000 sq ft.

Duo has a total gross floor area of around 1.73 million sq ft and gross development value of about S$4 billion. It has a 49-storey residential block with 660 units, and a 39-storey commercial tower with a retail gallery, office spaces and hotel.