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26-07-12, 16:57
http://www.businesstimes.com.sg/archive/thursday/premium/top-stories/robinson-point-said-be-changing-hands
Published July 19, 2012
Robinson Point said to be changing hands
Deal could value the 21-storey CBD office block at $284m
By Kalpana Rashiwala
[SINGAPORE] Robinson Point is said to be changing hands in a deal that values the 21-storey freehold CBD office block at $284 million or about $2,132 per square foot based on its existing net lettable area.
The transaction is being effected through a sale of shares in the company which owns Robinson Point; a real estate fund managed by US-based AEW is understood to be selling all the shares in the company to a small group of Asian investors.
The AEW fund picked up the property from CapitaCommercial Trust (CCT) for $203.25 million in early 2010.
Robinson Point, which is about 15 years old, has a gross floor area which reflects an 11.2 plot ratio, which means the property has been developed to its maximum potential under Urban Redevelopment Authority's Master Plan 2008. However, an obvious potential angle for the buyers would be the possibility of strata titling the building into smaller office units and reselling them for a gain, given the buoyant strata office market as seen in projects like PS100 in Tanjong Pagar, Oxley Tower along Robinson Road, and Eon Shenton.
Robinson Point's net lettable area is 133,214 sq ft, a substantial chunk of which is leased to various units of CapitaLand Group.
Earlier this year, CCT picked up Twenty Anson, a Grade A-quality office tower near Tanjong Pagar MRT Station completed in 2009, for $2,121 psf. The 20-storey tower is on a site with a remaining lease of about 95 years. The Platinum LEED-certified property was sold by LaSalle Investment Management's Asia Opportunity III fund. The asset offers CCT upside income potential from lease renewals. Rental rates on existing leases are said to have been agreed mostly in 2009, when the office market was still in a slump. The average passing rent (based on current leases) in the building is about $6.18 psf a month, significantly below the estimated $8 psf that a Grade A building in the area could fetch today. Leases for about half of Twenty Anson's space come up for renewals next year.
Right next to Robinson Point, the 20-storey Robinson Centre was sold last year for around $293 million or slightly over $2,200 psf. It is on a site with a balance lease term of about 85 years.
Activity in the strata office market began to pick up in the second half of 2011, and the trend has continued in the first half of this year. Buying interest could strengthen further as the fundamentals which have supported the sector - notably, low interest rates and high entry barriers in the residential sector - are now complemented by positive sentiment for this asset class, he explains.
Some market watchers believe the government's clampdown on unauthorised use of industrial premises may have led some investors who had initially switched from the residential to industrial property market to look at offices instead.
CBRE is understood to have brokered the sale of Robinson Point through a private treaty deal.
Another Singapore asset that the AEW fund has been trying to sell is 2HR at Havelock Road. According to an earlier media report, AEW is said to have secured outline permission from URA to convert the property to a 12-storey hotel. AEW acquired the property, formerly Apollo Centre, for $205 million in 2007 and completed an extensive refurbishment in 2009. The building now has seven storeys, an attic and two basement levels adding up to 175,300 sq ft of office and retail net lettable area.
Published July 19, 2012
Robinson Point said to be changing hands
Deal could value the 21-storey CBD office block at $284m
By Kalpana Rashiwala
[SINGAPORE] Robinson Point is said to be changing hands in a deal that values the 21-storey freehold CBD office block at $284 million or about $2,132 per square foot based on its existing net lettable area.
The transaction is being effected through a sale of shares in the company which owns Robinson Point; a real estate fund managed by US-based AEW is understood to be selling all the shares in the company to a small group of Asian investors.
The AEW fund picked up the property from CapitaCommercial Trust (CCT) for $203.25 million in early 2010.
Robinson Point, which is about 15 years old, has a gross floor area which reflects an 11.2 plot ratio, which means the property has been developed to its maximum potential under Urban Redevelopment Authority's Master Plan 2008. However, an obvious potential angle for the buyers would be the possibility of strata titling the building into smaller office units and reselling them for a gain, given the buoyant strata office market as seen in projects like PS100 in Tanjong Pagar, Oxley Tower along Robinson Road, and Eon Shenton.
Robinson Point's net lettable area is 133,214 sq ft, a substantial chunk of which is leased to various units of CapitaLand Group.
Earlier this year, CCT picked up Twenty Anson, a Grade A-quality office tower near Tanjong Pagar MRT Station completed in 2009, for $2,121 psf. The 20-storey tower is on a site with a remaining lease of about 95 years. The Platinum LEED-certified property was sold by LaSalle Investment Management's Asia Opportunity III fund. The asset offers CCT upside income potential from lease renewals. Rental rates on existing leases are said to have been agreed mostly in 2009, when the office market was still in a slump. The average passing rent (based on current leases) in the building is about $6.18 psf a month, significantly below the estimated $8 psf that a Grade A building in the area could fetch today. Leases for about half of Twenty Anson's space come up for renewals next year.
Right next to Robinson Point, the 20-storey Robinson Centre was sold last year for around $293 million or slightly over $2,200 psf. It is on a site with a balance lease term of about 85 years.
Activity in the strata office market began to pick up in the second half of 2011, and the trend has continued in the first half of this year. Buying interest could strengthen further as the fundamentals which have supported the sector - notably, low interest rates and high entry barriers in the residential sector - are now complemented by positive sentiment for this asset class, he explains.
Some market watchers believe the government's clampdown on unauthorised use of industrial premises may have led some investors who had initially switched from the residential to industrial property market to look at offices instead.
CBRE is understood to have brokered the sale of Robinson Point through a private treaty deal.
Another Singapore asset that the AEW fund has been trying to sell is 2HR at Havelock Road. According to an earlier media report, AEW is said to have secured outline permission from URA to convert the property to a 12-storey hotel. AEW acquired the property, formerly Apollo Centre, for $205 million in 2007 and completed an extensive refurbishment in 2009. The building now has seven storeys, an attic and two basement levels adding up to 175,300 sq ft of office and retail net lettable area.