CapitaLand, CDL, Ascott Reit to redevelop Liang Court into mixed-use complex

CapitaLand, CDL, Ascott Reit to redevelop Liang Court into mixed-use complex

CapitaLand Limited, City Developments Limited (CDL) and Ascott Residence Trust (Ascott Reit) on Thursday said they will together redevelop the Liang Court site.

The site comprises Liang Court mall, midscale hotel Novotel Singapore Clarke Quay and serviced residence Somerset Liang Court Singapore.

This comes as CDL Hospitality Trusts (CDLHT) has proposed to sell its entire stake in Novotel Singapore Clarke Quay to the 50:50 CDL-CapitaLand joint venture (JV) entities and CDL.

At the same time, Ascott Reit will sell part of its interest in Somerset Liang Court to CDL. In a separate filing on Wednesday, Ascott Reit said it signed a put and call option agreement with CDL to sell 15,170 square metres (sq m) of the site’s gross floor area (GFA) for S$163.3 million to CDL, and retain 13,034 sq m of GFA.

Subject to approval from the authorities, the Liang Court site will be turned into an integrated development with total GFA of 100,263 sq m.

The proposed project will comprise two residential towers offering some 700 residential units, a commercial component, an “upper midscale” hotel with 460 to 475 rooms, and a 192-unit serviced residence with a hotel licence.

The residential and commercial components will be owned by the 50:50 CDL-CapitaLand JV entities, while the serviced residence will be owned by Ascott Reit, which is a wholly-owned subsidiary of CapitaLand.

CDLHT will own the hotel under a forward purchase agreement with CDL. CDLHT will make the forward purchase at the lower of either the fixed price of S$475 million for the property or 110 per cent of the actual development costs incurred in developing the new hotel.

The proposed mixed-use project will open in phases from 2024.

The new hotel will be operated under the Moxy brand by Marriott International when it is completed around 2025, while the new serviced residence will keep its Somerset branding when it opens in the second half of 2024.

Ascott Reit said in its filing that it will use its net proceeds from selling part of its interest in Somerset Liang Court to develop the new serviced residence, from the retained 13,034 sqm of GFA. The land’s lease tenure will be refreshed from 57 years to 99 years. Upon completion, the estimated project development expenditure of the new serviced residence will be about S$300 million. Ascott Reit noted that the existing Somerset Liang Court is an ageing serviced residence and has been facing competition from newer hotels.

Along with the redevelopment, the consortium will also rejuvenate the river promenade next to the property, in line with the Urban Redevelopment Authority’s Draft Master Plan 2019 to enhance the area’s vibrancy.

The promenade’s facelift is expected to generate social activities around the proposed integrated development, increase foot fall and improve pedestrian accessibility along the Singapore River.

Within the Singapore River precinct, CDL owns Central Mall, an office-and-retail development along Magazine Road, while CapitaLand has a stake in the Clarke Quay mall – housed within five blocks of shophouses – through CapitaLand Mall Trust and a stake in Park Hotel Clarke Quay through Ascott Reit.

The Liang Court site marks another collaboration between CDL and CapitaLand, after their successful joint bid last year to develop a commercial and residential site in Sengkang Central atop Buangkok MRT station.

CDLHT is managed by subsidiaries of Millennium & Copthorne Hotels plc, which is the hotel arm of the CDL group.

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