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Seven strata units on the ground floor of the freehold Holland Road Shopping Centre have been sold for over S$61 million (S$4,976 psf on the total area of 12,260 sq ft), reported The Business Times.
The transaction was brokered by property consultancy CBRE, and the buyers are Loi Keong Kuong, the owner of Macau’s Rio Casino, and his family. The sellers consist of companies controlled by members of the Ng family, who built the four-storey mall in the 1970s.
Currently, all seven strata units are occupied by Cold Storage under a lease that will expire in 2020. As such, the buyers do not have to look for tenants in the meantime. But after the lease expires, the new owners could achieve higher returns by renting out the units individually, or separating the space into smaller areas.
Sammi Lim, CBRE’s Director of Investment Properties, said it is “extremely rare” for a contiguous row of prime freehold ground-floor retail units facing the road to be offered for sale in Singapore.
Previously, the seven strata units were put up for sale via an expression of interest (EOI) exercise in June 2014. Back then, the broker cited a valuation of around S$92 million (S$7,500 psf). However, the owner withdrew the property from the market after the EOI exercise closed the next month.
According to Mary Sai, Knight Frank’s Executive Director for Investment and Capital Markets, the current selling price is lower than the appraised value two years ago, as the strata retail sales market was more robust back then. Nevertheless, she deemed it a fair market value for a prime freehold retail space located close to Holland Village MRT station.
“Higher-paying tenants may be found in the F&B business, jewellery store chains or upmarket retail services,” explained Sai. On the other hand, supermarkets usually pay lower rents.
Furthermore, The Straits Times revealed that the buyer, Loi Keong Kuong, had also completed the acquisition of two shophouses in Pagoda Street for S$12 million and S$12.2 million earlier this year.
Image: CBRE
Cheryl Marie Tay, Senior Journalist at PropertyGuru, edited this story. To contact her about this or other stories, email cheryl@propertyguru.com.sg