CapitaLand pares Gillman Hts stake

Published May 16, 2007

CapitaLand pares Gillman Hts stake

It sells 50% stake in project to HPL, two private funds

By ARTHUR SIM


JUST three months after CapitaLand acquired Gillman Heights for $548 million, it has decided to sell a 50 per cent stake in the project to Hotel Properties Ltd (HPL) and two private funds.

CapitaLand would not say who the private funds are but revealed that one would take a 15 per cent stake while the other would take a 10 per cent stake, with HPL taking the remaining 25 per cent.

CapitaLand has partnered HPL on development projects in London and Shanghai but the Gillman Heights project will be the first joint venture development in Singapore.

Patricia Chia, CEO of CapitaLand Residential Singapore, said: 'Together with our partner Hotel Properties, we will bring extra value to this prime Alexandra Road site. We plan to make it a branded residence featuring new lifestyle concepts.'

The Gillman Heights project is targeted at the 'high mid-tier' market and is slated for launch in 2008. 'We will continue to be active in the market to invest in sites that will cater to the broad spectrum of home-buyers,' added Ms Chia.

In a statement released yesterday, CapitaLand said that it will place out 500,000 ordinary shares representing 50 per cent of the total issued share capital of Ankerite Pte Ltd - also the company used to acquire Gillman Heights - for a cash consideration of $500,000.

CapitaLand said the placement is in line with the group's 'capital productivity strategy', and plans to deploy the capital from the placement to invest in other residential sites.

CapitaLand said it will be the lead development manager for the project, responsible for the full spectrum of sales and marketing, product design and development and project management.

HPL and the two private funds will extend proportionate shareholders' loans, which currently comprise primarily the stamp duty amounting to $16.4 million and the 5 per cent deposit paid for Gillman Heights. Upon completion of the deal, CapitaLand's interest in Ankerite will be reduced to 50 per cent and Ankerite will become an associated company of CapitaLand.

In statement released yesterday, HPL said that its interest in Ankerite through its wholly-owned subsidiary HPL Orchard Place will be funded by internal resources and/or bank borrowings.

May 16, 2007

HALF THE STAKE

HPL, private funds invest in Gillman Heights


HOTEL Properties Limited (HPL) and two private funds are to take a stake in CapitaLand's investment in Gillman Heights, a former HUDC estate off Alexandra Road.

They will acquire 50 per cent of Ankerite, a CapitaLand subsidiary that bought Gillman Heights en bloc in February for $548 million.

CapitaLand will place out 500,000 shares of Ankerite to HPL and the funds for $500,000 in cash. HPL, controlled by tycoon Ong Beng Seng, will take half this stake while the funds will take the other half.

Under the deal, HPL and the funds will also extend shareholders' loans based on Ankerite's net tangible assets. These comprise $16.4 million in stamp duty for Gillman Heights and another $27.4 million, which represents a 5 per cent deposit on the purchase price.

CapitaLand said a statement yesterday that it will use the funds from the Ankerite placement to buy other sites 'to cater to a broad spectrum of home buyers'.

It will be the lead development manager for the project that will replace Gillman Heights and will be responsible for 'the full spectrum of sales and marketing, product design and development and project management'.

The deal is forecast to be completed by next month. It is not expected to have any impact on the financials of CapitaLand or HPL for the financial year ending Dec 31.

FIONA CHAN