Published June 28, 2008

Thakral seeks up to $99m for rest of Sovereign units


THAKRAL Land is selling the remaining 17 apartments it owns at The Sovereign, a freehold condo in Meyer Road that it developed more than a decade ago.

En bloc potential: The 15-year-old property is built up to 1.8 plot ratio, lower than the maximum 2.8 allowed currently

Based on asking prices of $1,300-1,500 psf for lower-floor units and $1,800-2,500 psf for upper floor units, the total price works out to between $75 million and $99 million

Thakral is open to selling the units individually or to a single party. Market watchers reckon a bulk buyer who takes the whole 17 apartments would get some discount.

All the units are leased or about to be leased. Based on current monthly rents of $3.20 to $4.50 psf, the net yield works out to around 2.5 per cent, says Jones Lang LaSalle's Singapore and South-east Asia managing director Chris Fossick, whose firm is sole marketing agent for the 17 apartments, each of which has four bedrooms.

A party that buys all 17 units may also hold the key to a potential collective sale of the condo, which has a total of 87 units. The 17 units that Thakral is offering represent 19 per cent of share value and about 26 per cent of the total sq ft area.

There is redevelopment potential as the site's current Masterplan plot ratio - ratio of maximum potential gross floor area to land area - is 2.8, which is higher than the 1.8 plot ratio tapped by the existing property.

The unutilised plot ratio may be tapped by building an additional block or tearing down the existing project and redeveloping the 143,918 sq ft site into a brand new condo.

The 30-storey Sovereign, at 99 Meyer Road, received its Temporary Occupation Permit in 1993.

It is next to a 115,300 sq ft plot of land at 97 Meyer Road sold by Della Suantio Lee last year to Hong Leong Group for around $200 million. The price worked out to around $760 psf of potential gross floor area, including development charges (DC), according to an earlier report.

Dr Lee is the wife of Lee Foundation chairman Lee Seng Gee.