Bankrupt trader’s bungalow finds buyer

THE freehold bungalow at 85 Branksome Road, vacated by the bankrupted managing director of spice and nut trader Pars Ram Brothers and his family, has found a buyer.

According to caveats obtained by The Business Times, the property was sold to a special purpose vehicle (SPV) named Branksome Realty 1 Pte Ltd for S$15.08 million. This was below the opening price of S$16 million at its first auction, where it had failed to land a successful bid.

This new sale price translates to about S$1,143 per square foot (psf) on the land area of 13,189 sq ft which is quite comparable to another transaction along the same street in the same month.

A check with corporate intelligence portal Handshakes showed that construction and property group Chiu Teng Enterprises is a shareholder in the SPV Branksome Realty 1.

Chiu Teng made headlines last month for purchasing a row of four freehold conservation shophouses along Outram Road for S$23.8 million from a Lee Foundation-linked company. The company was reluctant to discuss the purchase of the 85 Branksome Road bungalow when contacted.

After four rounds of auctions, the bungalow was finally sold in a private treaty brokered by Edmund Tie & Company (ET & Co, formerly known as DTZ). The first two rounds were conducted by DTZ, and the last two rounds by Knight Frank, which has all failed to produce a successful purchase. The price was incrementally reduced over the auctions.

When contacted, ET & Co also declined to divulge information about the buyer. DTZ was relaunched as ET & Co in July this year, after the firm’s original founders bought back a majority shareholding in the company.

This is a mortgagee sale, which occurs when financially stretched borrowers are unable to repay their loans and secure buyers for their properties, resulting in banks repossessing these properties and putting them up for auction. The lender in this case was United Overseas Bank.

Kirpa Ram Sharma, who was Pars Ram’s managing director, once lived in the single-storey bungalow. Mr Sharma, his wife and son were declared bankrupt, following the liquidation of their spice and nut trading business.

Previous media reports reported that Mr Sharma had liabilities of more than US$130 million, and had given personal guarantees to several banks for loans extended to his company, which was put under provisional liquidation last year. His wife and son had reportedly acted as joint guarantors for loans from an Indian bank. The firm was said to have owed money to between 10 and 17 banks.

Pars Ram Brothers was set up in 1937 by Mr Sharma’s father. It had reportedly faced problems collecting payment from customers in the Middle East. There was also speculation that the firm was involved in speculative foreign exchange trades and was hit by market fluctuations.

The property has potential for redevelopment into a two-storey bungalow, under the Urban Redevelopment Authority’s Master Plan 2014. Subject to the authorities’ approval, the property can also be subdivided for redevelopment into a pair of bungalows or semi-detached houses,

Meanwhile, along the same street, another freehold bungalow was also transacted for S$16.88 million to a next-door neighbour last month, according to caveats lodged. This translates to about S$1,170 on a land area of 14,429 sq ft.

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