Oversea-Chinese Banking Corporation (OCBC) is poised to divest a portfolio of more than 30 shophouses and strata shop units across Singapore which market watchers estimate could be worth around S$150-200 million.
The shophouses are in locations such as Havelock, Geylang, Upper Thomson and Upper Serangoon roads, while the strata shop units are in places such as Jalan Besar Plaza, Hoa Nam Building along Foch Road, Balestier Point, Sixth Avenue Centre and Upper Serangoon Shopping Centre.
Also for sale are shops in HDB estates such as Ang Mo Kio and Bukit Batok as well as HDB shophouses in locations such as Bishan, Aljunied, Jurong Gateway Road and Yishun Ring Road.
OCBC is believed to have arranged the properties in several bundles to be marketed by property agencies.
Some of these properties were previously used for bank operations but the majority are investment properties held for rental income.
When contacted, the bank noted that it reviews its overall property holdings from time to time, for opportunities to unlock value.
OCBC Property Services managing director Vincent Soh said: “We recently engaged agents to help us market a portfolio of investment properties that includes shophouses and shop units located across Singapore. The majority of these were bought by OCBC Bank and its subsidiaries in the last 10-30 years.”
No mortgagee sales were involved in the portfolio, he added.
“If we receive satisfactory offers, we will consider divesting the investment properties in the portfolio.”
OCBC did not comment on the specifics of the properties.
BT understands, however, that the portfolio includes three 999-year leasehold shophouses along Havelock Road comprising a pair of adjoining properties – Nos 743 and 745 – and another a few doors away at No 735. The ground floor of the shophouses is leased to eateries.
Assuming a buyer wanted to pick up all three shophouses, the price is expected to exceed S$16 million.
Under the Urban Redevelopment Authority’s (URA) Master Plan 2014, the three-storey shophouses are on land zoned for residential use with commercial at the first storey, and have a 3.0 plot ratio (ratio of maximum gross floor area to land area) with a six-storey height limit. This suggests there is redevelopment potential to tap unutilised plot ratio.
Also in the OCBC portfolio is a conservation shophouse at 382 Geylang Road on a site with commercial zoning and 3.0 plot ratio. The land area is 2,081 square feet and the built-up area around 3,300 sq ft. The guide price is believed to be S$5.2 million.
Among the strata shop units for sale are a ground-floor unit each at Balestier Point and Sixth Avenue Centre.
The pricing expectation for the 1,540 sq ft Balestier Point unit is S$3.4 million (or around S$2,200 per square foot on strata area) while that for the 3,509 sq ft shop at Sixth Avenue Centre is S$5.8 million, reflecting S$1,653 psf. “These psf price levels are considered attractive for freehold/999-year leasehold ground-floor retail units with good frontage – compared with the S$4,000-5,000 psf at some new projects, some of which are 99-year leasehold,” said an industry observer. “Rarely do owners of prime ground-floor shop units put up their properties for sale.”
Among the HDB shophouses in OCBC’s portfolio is a nearly 2,700 sq ft unit on Jurong Gateway Road, with an expected price of S$6.9 million. The property has a balance lease term of 69 years. Buyers seeking a lower price point may prefer a shophouse on Aljunied Avenue 2 or another on Bishan Street 11 – with respective guide prices of S$2.2 million and S$2 million.
A 1,447 sq ft HDB shop unit on Ang Mo Kio Avenue 8 – with about 64 years balance lease – is expected to cost around S$5.8 million. This works out to slightly above S$4,000 psf.
BT – 8 Apr 2015