Orchard Towers and its infamous nightclubs could soon be a thing of the past, should it become the latest along Singapore’s premiere shopping belt to feed the en bloc frenzy.
TODAY understands that early last month, the owners of the building — one of the oldest shopping centres on Orchard Road — elected a sale committee at its annual general meeting to study the possibility of a collective sale.
The freehold property, which is well past its 30th year and made up of two 25-storey blocks, comprises a car park, offices and retail space, as well as several apartments.
But it is the nightclubs and pubs — which have earned the notorious tag of “four floors of whores” — that make the building come alive at night, attracting droves of expatriates.
With the property market booming, commercial and residential developments along Orchard Road are in high demand. An en bloc bid could command prices of up to $1,800 per square foot, property analysts told TODAY.
At the nearby Tanglin Shopping Centre, owners were reportedly considering an en bloc sale that could see them pocket about $500 million. Another ageing shopping centre in the vicinity, Ming Arcade — a 10-storey building where units mainly served as storage spaces — was sold collectively last year for $61 million.
While predicting a keen interest in Orchard Towers, Knight Frank research director Nicholas Mak said a collective sale could fetch more were the adjacent property, Palais Renaissance, included in the redevelopment.Mr Donald Han, managing director of Cushman & Wakefield, felt that an en bloc sale would help Orchard Towers shed its sleazy reputation. “Orchard Towers is in a very prime location, except that it has a certain stigma attached to it. The best way to get rid of it is to redevelop it with a fresh concept,” he said.
The area, while “not as active” as other parts of Orchard Road , has “a lot of potential”. There has been market talk that Hotel Properties Limited, which owns Forum The Shopping Mall and Hilton Hotel just across the road, would redevelop these properties, creating “a new cluster altogether”, said Mr Han.
Any redevelopment of Orchard Towers would likely retain its original mix of retail, offices and residential units, said Mr Mak. “This is Ochard Road, after all. A shopping space would make the most sense.”
But the very nature of the mixed development could make consensus for a collective sale harder to come by. For one, the distribution of proceeds would be controversial, with shop-owners arguing over whose shop is better located and hence, more valuable.
Orchard Towers is managed by Chesterton International and, according to the residents, the management corporation has put up notices informing them of the en bloc attempt.
Should the sale committee decide to proceed, under current legislation, an 80-percent consent majority in terms of share values would be required.
But with the Government’s proposed changes to the law the majority consent would also have to be based on ownership of units. This would give more say to residents, vis a vis commercial owners, in a mixed development.
Mr Eric Lim, who has been living in Orchard Towers for 24 years, said there are 58 residential units, including two penthouses — which make up 10 per cent of the share values, according to another resident.
Source: Today, 15 May 2007