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Office investment sales continue apace, with high prices achieved in the Cecil Street / Robinson Road and Tanjong Pagar office micromarkets, according to a Business Times report.
RCL Centre, a 12-storey freehold office block with three façades along Tanjong Pagar, Lim Teck Kim and Keppel roads, is believed to have been sold for approximately S$175 million. This translates to around S$1,890 psf, based on the property’s current net lettable area (NLA) of about 92,500 sq ft.
Completed in 1994, RCL Centre is being sold by Thai-listed Regional Container Lines (RCL) to an unnamed Indonesian buyer.
An analyst estimates the price being paid for RCL Centre to represent a net yield of slightly higher than two percent, based on average rents of approximately S$5 psf per month. The occupancy rate in the building is believed to be currently in the low-90 percent range, with RCL occupying about 30 percent of the office block.
Under Master Plan 2008, the site is zoned for commercial use, with a maximum gross floor area (GFA) of 5.6+ ppr.
Meanwhile, the market is abuzz as to whether a transaction may materialise for 135 Cecil Street, the former LKN Building. Its owner, a unit of Alpha Investment Partners, is believed to have received an offer of around S$2,200 psf for the freehold office block, which has been renovated extensively.
Donald Han, Vice Chairman of Cushman & Wakefield Singapore, said that if 135 Cecil Street is sold at S$2,200 psf, it will set a new benchmark for the Cecil Street area.
“For bite-sized investments of below 100,000 sq ft NLA or under S$200 million, there’s a ready pool of buyers, particularly among high net worth individuals from Singapore and the region looking to buy their own flagship office buildings,” he added.
135 Cecil Street is a 13-storey freehold building with a NLA of 85,431 sq ft. Market observers noted that the price range for the property will be around 20 percent higher than the S$1,822 psf reaped last December for Robinson 112 (the former HB Robinson), which is diagonally located at the back of 135 Cecil Street.
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