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Indonesian business magnate, Dr Tahir, has offered to purchase the Straits Trading Building in the central business district (CBD) for S$560 million.
Tahir is said to have inked an offer letter to buy the 999-year leasehold Grade A office building on Battery Road from Sun Venture Group, according to Singapore-listed investment holding firm MYP.
Tahir is the founder Mayapada Group. His son Jonathan Tahir is MYP’s executive chairman.
In an SGX filing, MYP said the older Tahir had paid 1 percent of the purchase price as deposit, and the firm is currently “conducting due diligence with a view to signing a definitive agreement”.
If the deal pushes through, it would set the record for Singapore’s most expensive office space in per sq ft terms. Experts revealed that the S$560 million price translates to about S$3,520 psf based on the property’s net lettable area of 158,897 sq ft. This would exceed the current record of S$3,125 per sq ft set by 71 Robinson Road when it was sold in 2008.
The seller is also expected to profit handsomely from this deal as Sun Venture Group had acquired the 28-storey building from the Straits Trading Company for S$450 million or around S$2,800 per sq ft in September 2014.
According to Knight Frank Singapore, although the per sq ft price may be high, the total selling price of S$560 million is still “palatable”.
This is because it’s not easy for a single investor to acquire a CBD office block with a long leasehold tenure, noted Alice Tan, the property consultancy’s head of research.
“The Indonesian buyer, I believe, is probably buying it for the location and the long lease, and he is going in with a longer investment horizon,” she opined.
Chestertons Managing Director Donald Han added: “I think the proposed acquisition is strategic – in that they are moving from the assets on the fringe of the financial district to the heart of the CBD.”
Currently, MYP owns two freehold commercial properties here, namely MYP Plaza in Cecil Street and ABI Plaza in Keppel Road.
Image: Straits Trading Building (Source: stock image)
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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