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| Business Times: Thu, Mar 15 | Properties expected to fetch $306m and $300m respectively
15 Mar 2012 19:11
by KALPANA RASHIWALA
(SINGAPORE) US property fund
manager AEW has put Robinson Point in the Central Business District and
2HR at Havelock Road on the market with pricing expectations of about
$306 million and $300 million respectively, BT understands.
The
group is also said to have recently granted an option for the sale of
four adjoining three-storey shophouses at Amoy Street for nearly $33
million.
The AEW-managed fund that holds the three Singapore
properties is also said to have sold assets in China and Hong Kong last
year. The fund still has a few more years to run but reaping a profit
from divesting assets could prove to be a strategic move in terms of
cementing the track record of the group, which is said to be in the
midst of raising a new Asia fund, suggest some market watchers.
Sales of both 2HR and Robinson Point are expected to be structured
through sale of shares in the respective companies which own the two
assets.
For 2HR, AEW is said to have secured outline permission
from Urban Redevelopment Authority to convert the property to a
12-storey hotel. Alternatively, potential buyers could be keen on the
asset on its existing commercial use with an eye on positive rental
reversion. The existing building has seven storeys, an attic and two
basement levels with a total net lettable area of about 175,300 sq ft
comprising about 36,200 sq ft of retail space and close to 139,100 sq ft
of offices. 2HR has 96 car park lots in the basements.
AEW
bought 2HR, formerly Apollo Centre, for $205 million in 2007 and
completed an extensive refurbishment of the property in 2009.
The building is currently nearly 100 per cent occupied. Estee Lauder is
the major tenant, occupying about 50,000 sq ft. Other tenants include
DSM Nutritional Products and MOL Tankship Management.
Based on
2HR's existing rental income stream, the $300-million pricing
expectation could reflect a net yield of about 2 per cent, according to
some market estimates. The building is on a site with a remaining lease
of about 70 years.
It was previously in the market early last
year - but without approval for conversion to hotel - at a price tag of
about $302 million.
The current expression of interest
exercise, being conducted by exclusive marketing agent DTZ, will close
towards the end of this month.
For Robinson Point, AEW is said
to have appointed CBRE as the exclusive agent for a private treaty deal,
say sources. It is thought that the guide price is $2,300 psf on net
lettable area of 133,214 sq ft, or a lumpsum of around $306 million. The
freehold 21-storey office block was previously on the market in Q4 last
year at a slightly higher expectation of $2,300-2,350 psf or $306.4
million to $313.1 million.
While the office block was not sold
back then, the next door 20-storey Robinson Centre, on a site with a
balance lease term of about 85 years, changed hands for $293 million or
$2,225 psf, also late last year.
Robinson Point, which is
around 15 years old, has a gross floor area which reflects an 11.2 plot
ratio, which means the property has been developed to its maximum
potential under Master Plan 2008. However, a potential angle for buyers
is the possibility of strata titling the building into smaller office
units and reselling them for a gain, given the buoyant strata office
market of late as seen in brisk sales at Far East's PS100 in Tanjong
Pagar earlier this month. All 100 office units - ranging from 420 to 517
sq ft - found takers during the weekend launch. The average price
achieved was $3,000 psf.
AEW bought Robinson Point for $203.25 million in early 2010 from CapitaCommercial Trust (CCT).
Last month, CCT picked up Twenty Anson, a Grade A office tower near
Tanjong Pagar MRT Station completed in 2009, for $2,121 psf. That has
been the only sizeable office investment deal so far this quarter (up to
March 12).
Meanwhile, in the industrial property sphere, 17
strata units on the top two levels of the seven-storey Boustead House at
Ubi Avenue 1 (near MacPherson MRT Station) were sold earlier this month
for $14.63 million or about $325 psf, based on their total strata floor
area of about 45,015 sq ft. Boustead House is on a site with a balance
tenure of about 45 years.
The buyer, a local company, is acquiring the space for its own use. DTZ brokered the sale. Source: Business Times |
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