HONG KONG-LISTED Shun Tak Holdings, a company founded by casino tycoon Stanley Ho, has acquired its first property here for S$145 million.
Its wholly-owned unit Shun Tak Real Estate (Singapore) Pte Ltd has acquired a prime freehold site at 9 Cuscaden Road, belonging to the late Tan Hoon Siang, the great-grandson of famous philanthropist Tan Tock Seng.
The sale price reflects a land rate of about S$2,145 psf per plot ratio on the potential gross floor area, after factoring an additional S$87 million for development charges for a hotel project.
The property has a land area of 25,741 sq ft and is zoned “hotel” in the 2014 Master Plan, with an allowable gross plot ratio of 4.2.
The Urban Redevelopment Authority (URA) has advised that it is also prepared to consider a redevelopment proposal to turn the site into a residential project, subject to approval and payment of development charges.
Shun Tak’s core businesses are in property, transportation, hospitality and investment sectors, with a prominent track record in Macau and Hong Kong. It is likely to build a hotel on the site.
The property, where a two-storey grey bungalow now stands, was put up for sale by Mr Tan Hoon Siang’s three sons, acting as trustees for his estate. They were initially asking for S$160-170 million.
Mr Tan had bought the freehold property in Cuscaden Road for S$18,591 in May 1949 at an auction. His family is said to have lived in the bungalow.
The sale was brokered by JLL, which ran a public tender campaign for the property last month on behalf of the trustees of the estate. The tender closed on May 12.
JLL international director Karamjit Singh said that the site’s location and its attractive redevelopment options were a huge draw, garnering strong interest from both local and foreign hotel owners and residential developers.
“Opportunities to acquire land for hotel development in and around Orchard Road are few and far between. Based on our records, this is the first sale of a redevelopment site for hotels to take place in this location in more than 10 years,” he said.
The site is opposite Tanglin Shopping Centre, and is between St Regis Hotel and Orchard Parade Hotel.
Cushman & Wakefield research director Christine Li noted that the developer will have to take into consideration the hotels coming up in the vicinity, including the Biltmore (216 rooms) on Cuscaden Road, Ibis Singapore on Stevens (528 rooms), Yotel Orchard Road (600 rooms) and Novotel Singapore on Stevens (259 rooms) in 2017-2018.
“That’s quite a lot of rooms to be absorbed by the market in the midst of a challenging hospitality landscape given lower tourism spending and intense competition from the region,” she said. “Given that a hotel typically takes three years for the room rates and occupancy rates to stabilise, it will be ideal for the project to hit the market beyond 2019-2020 so as to avoid clashing with the immediate supply pipeline.”