Indonesian developer Peak Tower Corp taps Marriott to run hotel at former Selegie Centre site

It plans to build an 8-storey hotel with 132 rooms, with a total gross floor area of 4,724.52 million sq m

Dec 22, 2021

PEAK Tower Corporation - which is backed by the Surabaya-based Anggasaputro family - has inked a 25-year contract with the Marriott hotel group to operate a 132-room hotel at the site of the former Selegie Centre after Peak Tower received the greenlight from the Urban Redevelopment Authority (URA) to develop a hotel on the plot of land.

The site is presently zoned for commercial and residential use with a plot ratio of 4.2, but will be rezoned for hotel use at a maximum permissible gross plot ratio of 4.2. An earlier application by the Indonesian developer to construct a hotel on the site and to change the use of the site was turned down by the URA in March 2019.

Located at the junction of Selegie and Mackenzie roads, freehold mixed development Selegie Centre in District 7 was successfully sold en bloc to Peak Tower in a third attempt at a collective sale at its reserve price of S$120 million, or S$1,942 per square foot per plot ratio (psf ppr). The acquisition of the site was completed in July 2020.

Peak Tower's chief executive, Vinson Keefe Anggasaputro, said that Peak Tower has acquired additional land spanning 125.1 square metres (sq m) of state land at the site's boundary for some S$6 million. This allowed for additional gross floor area (GFA) and sufficient clearance area for the movement of vehicles. He said that Peak Tower's earlier application faced issues linked to the hotel's coach bay and possible traffic congestion at the hotel entrance as coaches enter and exit. These issues have since been addressed.

The total estimated cost of the development is S$200 million, including the land cost, stamp duties, construction cost as well as the differential premium for the change of use of the site.

According to the grant of written permission issued by URA, Peak Tower is proposing to build a single block, 8-storey hotel with 132 rooms, 2 basement car parks, sky terraces and a rooftop garden. The total GFA of the proposed building is 4,724.52 million sq m, of which 4,386 sq m is set aside for the hotel GFA (including 403.14 sq m for bonus balcony space under the incentive scheme) and 338.52 sq m of commercial GFA.

Anggasaputro added: "We chose the Marriott's Tribute Portfolio as a brand because Tribute Portfolio allows flexibility for the owners to create our own concept and let us work on our own brand identity, following Marriott's standard of design and operations. Our hotel will be positioned in the upscale to luxury segment, targeting business tourism as well as the staycation market." The hotel is slated for launch in the third quarter of 2024.

While the pandemic and accompanying border restrictions has hit the hotel industry hard, Anggasaputro is unfazed, adding that the overall economy should recover by 2024.

However, he went on: "We are facing some problems in the overall construction budget as the prices of construction materials have yet to stabilise. To control the budget, we have decided to proceed with the building works at a slower pace and anticipate that prices of materials will stabilise."

Singapore's construction industry has been besieged by headwinds since the pandemic first broke out with border curbs resulting in a manpower crunch, while lockdowns around the world have resulted in supply chain disruptions, pushing overall costs higher.

The Anggasaputro family's main business is a leading adhesive tape manufacturing group PT Nachindo, which was founded by Anggasaputro's father, Andrie Anggasaputro. The family is diversifying by branching out into other areas, such as real estate, entertainment and gaming.

Gautam Bhandari, Marriott International's regional vice-president (hotel development), said that the Tribute Portfolio property will feature 132 urban resort-style rooms as well as a rooftop infinity pool.

Bhandari added: "Tribute Portfolio is a growing global family of characterful, independent hotels drawn together by their passion for captivating design and their drive to create vibrant social scenes for guests and locals alike."

There are over 50 hotels worldwide under the Tribute Portfolio banner.