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17-05-12, 23:09
http://www.businesstimes.com.sg/archive/thursday/specials/property/guthrie-sun-make-fresh-strata-investment
Published May 10, 2012
Guthrie, Sun make fresh strata investment
They pay $89.3m or $1,318 psf for 66 Burlington Square office units
By Kalpana Rashiwala
GUTHRIE and Sun Venture continue to tap the strata commercial property market.
A tie-up between the two earlier this week snapped up all 66 office units in Burlington Square along Bencoolen Street from a Wing Tai-City Developments Ltd venture for $89.3 million or $1,318 per square foot of strata area. But they are open to selling the units "if attractive offers come along".
"But for now, our priority is to take an active role in the MCST (management corporation strata title) by getting elected to the management council to see how we can enhance the value of our units. If we wish to do any asset enhancement works on our units, it may concern the common property and we'll need the cooperation of other owners," Guthrie GTS executive director Michael Leong told BT yesterday.
About 90 per cent of the 66 strata office units are currently occupied. Based on the current rental income of these units, the net yield on the purchase price is about 3.5-4 per cent, said Mr Leong.
The office units are on the fifth to 12th floors of the mixed development and represent 35.4 per cent of total share values. Burlington Square is on a site with a remaining lease of about 83 years.
CBRE brokered the sale of the 66 strata office units. Colliers International conducted an expression of interest exercise that closed on April 18 on behalf of Wing Tai and CDL aimed at helping to secure the highest price for their asset.
Mr Leong also revealed that another Guthrie-Sun Venture tie-up which acquired 86 office units and 77 retail units at The Adelphi near City Hall MRT Station in January last year has sold or issued options on all the office units at $1,650-2,350 psf or an average price of $1,900 psf. It has also divested 11 of the retail units at an average price of about $2,300 psf.
CBRE, the sole marketing agent for the Guthrie-Sun Venture space in Adelphi, is currently in talks to find a single buyer for the remaining retail units. The price tag is $67 million - comprising $62 million or about $2,000 psf for all the units on the fourth level and about $4,300 psf or about $5 million for two ground-floor units.
"We're seeing interest from both end-users and investors," said CBRE executive director (investment properties) Jeremy Lake. "The 86 office units have been sold for $257 million and the 11 shop units, at $22.5 million," he added. CBRE began marketing the units in March last year.
The Adelphi is a 10-storey, 999-year leasehold building.
Guthrie and Sun Venture each have a 10 per cent stake in the Paya Lebar Square project, with Low Keng Huat holding the majority 80 per cent. Since the preview for the 99-year leasehold project began in late December, 82 per cent or 457 of the 556 office units have been sold at $1,550-2,000 psf or an average price of $1,750 psf.
Offices start from 484 sq ft. The consortium has yet to announce a decision on whether it will hold or sell Paya Lebar Square's retail component, which will have about 95,000 sq ft of net lettable area.
However, pre-leasing efforts have begun. Tenancies for the supermarket and foodcourt space are expected to be finalised soon.
The project is expected to be completed in 2014.
Published May 10, 2012
Guthrie, Sun make fresh strata investment
They pay $89.3m or $1,318 psf for 66 Burlington Square office units
By Kalpana Rashiwala
GUTHRIE and Sun Venture continue to tap the strata commercial property market.
A tie-up between the two earlier this week snapped up all 66 office units in Burlington Square along Bencoolen Street from a Wing Tai-City Developments Ltd venture for $89.3 million or $1,318 per square foot of strata area. But they are open to selling the units "if attractive offers come along".
"But for now, our priority is to take an active role in the MCST (management corporation strata title) by getting elected to the management council to see how we can enhance the value of our units. If we wish to do any asset enhancement works on our units, it may concern the common property and we'll need the cooperation of other owners," Guthrie GTS executive director Michael Leong told BT yesterday.
About 90 per cent of the 66 strata office units are currently occupied. Based on the current rental income of these units, the net yield on the purchase price is about 3.5-4 per cent, said Mr Leong.
The office units are on the fifth to 12th floors of the mixed development and represent 35.4 per cent of total share values. Burlington Square is on a site with a remaining lease of about 83 years.
CBRE brokered the sale of the 66 strata office units. Colliers International conducted an expression of interest exercise that closed on April 18 on behalf of Wing Tai and CDL aimed at helping to secure the highest price for their asset.
Mr Leong also revealed that another Guthrie-Sun Venture tie-up which acquired 86 office units and 77 retail units at The Adelphi near City Hall MRT Station in January last year has sold or issued options on all the office units at $1,650-2,350 psf or an average price of $1,900 psf. It has also divested 11 of the retail units at an average price of about $2,300 psf.
CBRE, the sole marketing agent for the Guthrie-Sun Venture space in Adelphi, is currently in talks to find a single buyer for the remaining retail units. The price tag is $67 million - comprising $62 million or about $2,000 psf for all the units on the fourth level and about $4,300 psf or about $5 million for two ground-floor units.
"We're seeing interest from both end-users and investors," said CBRE executive director (investment properties) Jeremy Lake. "The 86 office units have been sold for $257 million and the 11 shop units, at $22.5 million," he added. CBRE began marketing the units in March last year.
The Adelphi is a 10-storey, 999-year leasehold building.
Guthrie and Sun Venture each have a 10 per cent stake in the Paya Lebar Square project, with Low Keng Huat holding the majority 80 per cent. Since the preview for the 99-year leasehold project began in late December, 82 per cent or 457 of the 556 office units have been sold at $1,550-2,000 psf or an average price of $1,750 psf.
Offices start from 484 sq ft. The consortium has yet to announce a decision on whether it will hold or sell Paya Lebar Square's retail component, which will have about 95,000 sq ft of net lettable area.
However, pre-leasing efforts have begun. Tenancies for the supermarket and foodcourt space are expected to be finalised soon.
The project is expected to be completed in 2014.