DEVELOPERS welcomed a new bonus gross floor area (GFA) incentive scheme aimed at transforming the built environment sector, although the all-or-nothing approach to qualify for the bonus GFA and the costs associated with fulfilling certain criteria were among key concerns flagged by some.
Under the five-year Built Environment Transformation GFA Incentive Scheme, private developments outside the Government Land Sales (GLS) programme will be able to enjoy up to 3 per cent bonus GFA if they achieve enhanced standards in productivity, digitalisation, sustainability and quality. The new scheme applies to residential developments such as condominiums as well as non-residential developments such as offices, retail, business parks, hotels, or white sites. Mixed-use developments can also qualify. To participate, sites must have a GFA of at least 5,000 square metres (sq m).
The new GFA bonus scheme will also be extended to GLS sites until Q2 2022, but the bonus GFA will be capped at up to 2 per cent; after Q2 2022, the government plans to raise the minimum requirements for GLS sites where productivity, digitalisation and sustainability are concerned.
Michael Ng, executive director of CEL Development, highlighted that GFA incentives are useful to offset any additional costs that may come with adopting digital solutions as well as sustainability and productivity initiatives – as long as the costs don’t outweigh the gains. Adopting prefabricated prefinished volumetric construction (PPVC), for instance, could result in much higher costs, he said.
Under the scheme requirements, a residential development would need minimum 65 per cent PPVC – among other things – to fulfil the criteria for productivity.