Two commercial buildings in Tanjong Pagar launched for en bloc sale at S$216m reserve price

Jan 18, 2023

A PAIR of five-storey buildings on a 999-year leasehold commercial site on Hoe Chiang Road and Lim Teck Kim Road will be launched for collective sale on Thursday (Jan 19) at a reserve price of S$216 million.

The price works out to an estimated land rate of S$2,602 per square foot per plot ratio (psf ppr) for an office development – inclusive of an estimated land betterment charge (LBC) of S$54.1 million.

Sole marketing agent PropNex said the buyer also has the option to redevelop the site as a hotel development. This will see the reserve price translating to a land rate of S$2,662 psf ppr inclusive of the estimated LBC of S$60.4 million.

The site comprises two commercial buildings (1, 3, 5, 7 and 9 Hoe Chiang Road and 2, 4, 6, 8 and 10 Lim Teck Kim Road) with their backs facing each other, and a piece of remnant land between them. Both built in 1959, the Hoe Chiang Road site is 8,449 square feet (sq ft) and the Lim Teck Kim Road site is 8,450 sq ft.

The amalgamation of the two buildings and the remnant land will take the total estimated land area to about 18,540 sq ft. This creates a rectangular-shaped plot that would be ideal for a hotel or Grade A office development amid the ongoing transformation in Tanjong Pagar, said PropNex.

Under the Urban Redevelopment Authority’s Master Plan 2019, the site is zoned for commercial use, with a gross plot ratio of 5.6. It is not subject to additional buyer’s stamp duty.

The Business Times first reported the buildings’ impending sale in September last year, after the requisite 80 per cent consensus was achieved from owners. PropNex said then that the sites will be launched together for collective sale when an exercise to verify their gross floor area is complete.

With the two buildings currently being five storeys high, the successful buyer can redevelop the site into a 35-storey tower to realise potential gains from its 5.6 plot ratio, said Tracy Goh, head of investment and collective sales at PropNex.

Redevelopment projects underway in the vicinity, such as Keppel South Central, Newport Tower, the former Realty Centre, as well as the government’s plan to further enliven downtown Singapore, present a good opportunity to build a hotel or serviced apartments on the site, Goh noted.

She believes a sustained recovery in Singapore’s hospitality sector and the site’s proximity to the future Greater Southern Waterfront precinct means there could be further upside for the site over the mid to long term.

“In view of the site’s strong location attributes and redevelopment potential, we expect keen buying interest for this collective sale plot,” said Goh.

The future development on the site may potentially enjoy views of the waterfront and is within walking distance to the Tanjong Pagar MRT station, as well as two upcoming stations, Cantonment and Prince Edward Road stations on the Circle Line, which are slated to be ready in 2026.

The tender will close on Mar 22 at 2 pm.