Airbus puts Seletar Aerospace Park facility up for sale at S$20 million upon Kelley Aerospace’s exit 

AIRBUS has put an industrial building in Seletar Aerospace Park on the market this month for S$20 million. This comes after tenant Kelley Aerospace vacated the building following a legal dispute over unpaid rent. 

Located at 110 Seletar Aerospace View, the three-storey property sits on a 189,338-square-foot (sq ft) plot of land and has direct runway access. It also houses a hangar, simulator halls, ancillary office and 75 car park lots. 

The plot has a tenure of 30 years that began on Dec 1, 2009, with a further term of 10 years granted. The purchaser has the option to renew the lease for 20 years when the lease expires on Nov 30, 2049. 

In December 2020, aerospace company Kelley Aerospace announced that it would invest around S$150 million over the next five years on initiatives that included job creation and manufacturing, and that the projects would be undertaken at the Singapore facility. 

Prototypes in development included a business jet that could fly at the speed of sound for corporate and private clients worldwide. It claimed to have had orders for about 100 of these jets. It also planned to design, manufacture and assemble unmanned aerial vehicles (UAVs) in Singapore. 

The company said it would train and upskill at least 250 Singaporeans to retrofit private jets and manufacture carbon fibre for planes. It is not known how many of those roles were filled.

But less than a year later, aviation news source Flight Global reported that Kelley Aerospace and Airbus were in a legal dispute over the tenant’s non-payment of rent.

In response to queries from The Business Times, Airbus said: “In 2022, we were successful in obtaining a court order for Kelley Aerospace to pay the outstanding rent and for it to deliver up vacant possession of our premises.” 

Before Kelley Aerospace, Airbus Helicopters occupied the building. It was there from 2010 to 2019, after which the helicopter unit moved into the new Airbus campus, which is also in Seletar Aerospace Park.

The three-storey warehouse up for sale is suitable for occupiers in the aviation industry and can be used to maintain, repair and operate aircraft, said Graeme Bolin, head of occupier and leasing, industrial and logistics services, at CBRE, which is marketing the property.

He said: “The outlook for Singapore’s aerospace sector looks highly promising, with international passenger traffic expected to double by 2040. The global maintenance, repair, and operations, or MRO market, is projected to grow over 33 per cent from 2023 to 2033.

“Singapore’s status as a leading one-stop provider for aircraft MRO services positions it to capitalise on increased investments and downstream opportunities arising from this growing demand, with Seletar Aerospace Park poised to be one of the primary beneficiaries.” 

Aviation industrial assets tend to be tightly held, with sites transacting infrequently and occupiers tending to stay for several years. 

In 2022, ESR Real Estate Investment Trust said it would divest its aerospace training facility at 70 Seletar Aerospace View for S$7.1 million, a 4.8 per cent premium to valuation. 

Singapore Aero Engine Services announced this month that it was moving into a 25,000-square-metre space in Seletar Aerospace Park, which Rolls-Royce vacated when it moved some of its operations to the United Kingdom during the Covid-19 pandemic. 

Under the Urban Redevelopment Authority’s Master Plan, the site being sold by Airbus is zoned as Business 2 – the land-use category for heavy manufacturing and production activities. It has a floor area of 99,028 sq ft.