SINGAPORE – International Plaza in Tanjong Pagar, Singapore’s largest collective sale in terms of number of units and value, is launched for sale by public tender at a reserve price of $2.7 billion.
This comes after more than 80 per cent of the owners, by both share value and strata area, agreed on July 7 to put the 50-storey leasehold commercial-cum-residential building – one of Singapore’s biggest integrated developments – on the market for the first time.
The reserve price works out to a land rate of $2,448 per square foot per plot ratio, marketing agent Edmund Tie told The Straits Times on Wednesday afternoon.
If the 25 per cent intensification in gross plot ratio is approved by the authorities, the land rate will work out to approximately $2,170 per square foot per plot ratio.
The property’s commercial zoning also means that developers need not pay Additional Buyer’s Stamp Duty.
The tender will close at 3pm on Nov 30.
Ms Swee Shou Fern, executive director of investment advisory at Edmund Tie, said that the building, which sits at the junction of Anson Road and Choon Guan Street, “represents the last strategic corner plot with main road frontage at the gateway of the Tanjong Pagar precinct”.
Built in the 1970s, the block comprises 209 residential apartments, 559 office units, 192 strata shops, a carpark and a swimming pool on the 36th floor.
The property, which is zoned for commercial use, has a land area of about 0.7ha and 48 years left on the lease. It was developed by the Cheong family, who are related to the Cheongs who control Singapore-listed Hong Fok Corp.
Owner sign-ups for the collective sale began in October 2019 and were supposed to be wrapped up by last October, but it took a further 10 months due to the pandemic.
International Plaza was among several sites granted extensions by the Ministry of Law to their sale deadlines under measures implemented last year.
International Plaza meets the criteria in terms of building age, current land use and site area to qualify for the Central Business District Incentive Scheme.
The CBD Incentive Scheme allows qualifying properties to have their gross floor area increased by 25 to 30 per cent, depending on the proposed land use.
To this end, an application has been submitted to the Urban Redevelopment Authority. If approved, the site can be redeveloped at a gross floor area of 167,826.16 sq m (1,806,464 sq ft) or an equivalent plot ratio of 24.06.
Ageing office developments within the CBD can tap this scheme to convert the property to a residential mixed development – allowing the developer to take advantage of a robust housing market, said Mr Wong Xian Yang, head of research for Singapore at Cushman & Wakefield.
While the recovery in the commercial market is nascent, the economy is positioned to recover in 2021, he added.
“Many projects are gearing up for en bloc sale over the next few months. In view of Singapore’s expected strong recovery, en bloc developments that launch early could enjoy a first-mover advantage,” he added.
An unnamed developer has undertaken to bid at least $1.508 billion for a government land site in Marina View in June. The white site is intended for a mixed-use development with residential, hotel, commercial and/or serviced apartments. The public tender for that site will close at noon on Sept 21.
Depending on what International Plaza’s future proposed use is, the Marina View government land sales (GLS) site may be a rival, Mr Wong said. “GLS sites are a more straightforward route for land acquisition compared with acquiring land from the en bloc market. But there is more flexibility for IP, as it can be developed into a fully commercial development or a mixed development.”
“Given their large quantum, both Marina View and International Plaza would appeal to larger developers or joint ventures. For the Marina View site, the winning bid is expected to be closer to $2 billion,” he said.
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