Infosys co-founder's family office buys its first Singapore hotel

Nadathur Group picks up New Cape Inn in Tiong Bahru for S$67m

Tue, Nov 28, 2017

Kalpana Rashiwala


NEW Cape Inn, a 76-room freehold hotel in Seng Poh Road in Tiong Bahru, is being sold for S$67 million to a unit of Nadathur Far East, a part of the Nadathur Group.

The price works out to about S$881,579 per room.

The transacted price reflects about 2 per cent gross yield on the assumption of an average room rate of S$70 per night and 85 per cent occupancy, said Jaggi Nadig, the chief executive of Nadathur Far East.

New Cape Inn is a six-storey building on a land area of 10,568 sq ft.

Its site is zoned for hotel use under the Urban Redevelopment Authority's Master Plan 2014. (In the 2008 Master Plan, the site was zoned "residential with commercial at first storey".)

The Nadathur Group is the family office of Nadathur S Raghavan, one of the co-founders of India-based Infosys. He retired and left Infosys around 2000.

The group, which has offices in Bangalore and Singapore, has three key activities - business, investments and philanthropy. Its businesses include hospitality, healthcare and technology.

The hospitality arm, which was previously known as SilverNeedle Hospitality, was renamed Next Story Group earlier this year.

It will oversee the running of the New Cape Inn when the acquisition is completed in February next year. Nadathur Far East is expected to invest a few million Singapore dollars to spruce up the asset and rebrand it.

Next Story Group is involved in hotel operations, brand marketing and design. Its hotels arm, Next Hotels, manages around 30 hotels, and has another 10 slated to open by the end of next year.

The 40 hotels, ranging in size from 24 rooms to 304 rooms, are in markets such as Australia, Thailand, Laos, Vietnam, Bali, Sri Lanka and soon, Singapore.

Next Hotels' brands include Sage, Next, Linq and Country Comfort.

Next Story Group has also minted a new concept called Kafnu - shared lifestyle spaces blending elements of live, work, learn, play and rest and aimed at building a community of entrepreneurs and creative minds.

Kafnu operates on a membership model. So far, only one Kafnu property - in Hong Kong - is trading; more are slated to open in Taipei, Bangalore, Sydney, Melbourne, Brisbane, Ho Chi Minh City and Colombo by the first half of next year.

Nadathur Far East is expected to rebrand New Cape Inn as one of Next Story Group's brands.

The property is the Nadathur Group's first hospitality property acquisition in Singapore. The group does not own the vast majority of the hotels in its portfolio at the moment; rather, Next Story Group has been entering into lease, hotel management or franchise agreements with their owners.

The group is looking for hotel opportunities in Singapore in all the above channels, said Mr Nadig.

The sale of New Cape Inn was brokered by Zoe Zhou of Savills Hotels Asia Pacific, but she declined to provide details.

The seller is Sunway Realty, believed to be a owned by a low-profile Singapore business family which is understood to have paid S$32 million for the property in 2011, when it was already operating as a hotel.

Based on previous media reports, the building changed hands in 2006 for S$10.2 million as a mortgagee property at an auction.

At the time, it had an eating house on the first storey, a carpark on the second and third storeys, and 61 serviced apartments in the upper levels.