Freehold industrial building near Tai Seng MRT sold for S$33.5m

An eight-storey freehold industrial building along Little Road near Tai Seng MRT Station is being sold for S$33.5 million. The price works out to S$771 per square foot based on the net lettable area of 43,451 sq ft.

The seller, Kim Loong & Sons, developed the property which was completed about two years ago, said Kim Chong Wah, the company’s managing director, when contacted by The Business Times. This was a redevelopment project; previously on the site were three low-rise detached factories.

Kim Loong & Sons, which is involved in property investment, is owned by Mr Kim and nine other family members. The family is also involved in the manufacturing of decorative wood-based panels (used in the furniture industry) and the trading of timber.

Mr Kim said the family had bought the three low-rise detached factories along Little Road some four decades ago for its manufacturing business but later found the premises too small and moved its factory to its current location in Sungei Kadut.

It then leased out the three detached factories before redeveloping them into the building that is being transacted. Mr Kim revealed that the family also owns a factory in Ho Chi Minh City which also produces decorative wood-based panels. 3 Little Road is on a 21,111 sq ft site.

The building’s gross floor area is 52,778 sq ft, which means the 2.5 plot ratio for the Business 1-zoned site has been fully tapped. The building comprises 16 units, two per floor. About half the building has been leased at monthly rents ranging from S$2 psf for an entire floor to S$2.50 psf for smaller spaces.

The buyer, Chan Rong Fen Building Construction, is expected to occupy some space in the building. The company is currently located in Woodlands Close. Its shareholders are Liu Yunxia and Sun Renwang, believed to be China citizens turned Singaporeans. Investor interest in entire freehold industrial buildings has been gathering momentum lately as prices have eased from the peak in 2014; despite an overall glut of industrial property, the stock of enbloc freehold industrial buildings available for sale is very limited.

Strata freehold industrial units in the vicinity ranging from 2,314 sq ft to 4,263 sq ft changed hands for around S$630 psf on average last year. In comparison, the S$771 psf achieved for 3 Little Road appears to be a good price for the seller especially given that this is an en-bloc deal for which one would expect a lower psf price, factoring in a bulk discount.

Join The Discussion

Compare listings