Industrial building, 3 shophouses sold

[reporter2]

http://www.straitstimes.com/business...hophouses-sold

Industrial building, 3 shophouses sold

Jan 13, 2016

Rennie Whang


Property investment sales perked up towards the end of last year, with an industrial building and a row of shophouses changing hands.

China-based Nanshan Group led a consortium to buy Harper Kitchen, a freehold industrial building in Tai Seng, from scrap gold dealer ValueMax Bullion for $51.1 million, or about $2,138 per sq ft of land area.

Nanshan Group has been steadily increasing its presence in Singapore. The Dec 30 purchase came after it bought nearby Irving Industrial Building for $160 million in March last year.

Both buildings are redevelopment sites. The deals were brokered by Cushman & Wakefield.

Nanshan Group also launched its maiden private condominium project in October last year.

The 288-unit Thomson Impressions had sold 113 of 150 launched units as at end-November, with a median price of $1,396 per sq ft in the month.

Nanshan Group has two hotels as well. It is redeveloping the former Midlink Plaza site, which it purchased in 2014, into a 396-room boutique hotel.

In 2013, it bought the Park Regis Singapore hotel and adjoining office block for about $250 million.

Another sale late last year occurred in Joo Chiat Road, where three adjoining shophouses went for $23 million, a tad below the guide price of $28 million when they were put up for public tender in November.

The buyers are linked to the Wincome Group, a private developer from Hong Kong, while the seller is a hardware company that occupies the premises. The shophouses have a land area of 4,992 sq ft and gross floor area (GFA) of about 14,820 sq ft, which works out to a sale price of about $1,552 psf on GFA.

There are still good buyers in the investment sales market, said Ms Sammi Lim, associate director of investment properties at CBRE.

"They are comparing options in the market. Due to the backdrop of rising interest rates, they will likely commit to a deal if all the supporting reasons are there - good location, good property, price is fair."

There will also be opportunities coming up continually, especially when owners review their assets, she said. Some are funds which would like to divest when the fund life is up, while some are families who feel it is timely to sell their property to retire or reinvest the money in their core businesses.

Rennie Whang

[reporter2]

http://www.businesstimes.com.sg/real...r-s511-million

Harper Kitchen being sold for S$51.1 million

By Kalpana Rashiwala

[email protected]

@KalpanaBT

Jan 13, 2016


HARPER Kitchen, a freehold industrial building near Tai Seng MRT Station, is being sold for S$51.1 million to a four-member consortium led by Nanshan Group Singapore.

The other members of the consortium are a vehicle controlled by Zuo Haibin and his wife Li Minghua (the couple also own Vico Construction); a company that is controlled by the owner of the Putien Restaurant chain; and a property group based in Zibo city in Shandong province.

The consortium is expected to redevelop the property, given its substantial untapped plot ratio. Occupying 23,893 sq ft, the site is zoned for Business 1-White use.

The price paid works out to S$834 per square foot of potential gross floor area, inclusive of an estimated development charge (DC) of S$18.65 million. This unit land price is lower than the S$923 per square foot per plot ratio (psf ppr), including DC, which Nanshan paid for the nearby Irving Industrial Building in late-2014 through a collective sale.

The Irving site, also freehold, has the same zoning as Harper Kitchen, but is seen as having more attractive attributes; it is much bigger, at 65,309 sq ft, and fronts three roads.

Irving Industrial Building is slated for demolition, to be followed by a redevelopment of the site. Part of the space in the new building is expected to house Nanshan's headquarters.

Harper Kitchen is being sold by a privately-held vehicle of the Yeah family, which controls pawnbroking chain ValueMax Group.

The building's existing gross floor area (GFA) is estimated at 54,250 sq ft; a further 29,374 sq ft of GFA can be added to reach the maximum 83,624 sq ft allowed for the site based on its 3.5 plot ratio.

Of this, at least 2.5 plot ratio (equivalent to 59,732 sq ft GFA) must be set aside for Business 1 use, which typically includes non-pollutive, light industrial and warehouse use, before white uses such as retail, office and residential will be allowed to take it to the maximum 3.5 plot ratio.

Harper Kitchen is leased to Putien and Crystal Jade.

The building's sale is being brokered via private treaty by Cushman & Wakefield (C&W).

Commenting on the lower unit land price fetched for the Harper Kitchen site, Christina Sim, director of investment (capital markets) at C&W, said: "The vendor has achieved a fair price for the site, taking into consideration the current oversupply situation of industrial space.

"That said, freehold industrial properties in Tai Seng are limited in supply and availability and will continue to command premium values compared with the other parts of the island."