Shenton House relaunched for collective sale at $590 mil, with 70% of owners agreeing to lower price of $538 mil
and owners consider reducing reserve price Owners of Shenton House relaunch collective sale attempt at $590 mil
Shenton House, a commercial building located on Shenton Way in the central business district of Singapore, has had its collective sale relaunched with a reserve price of $590 million. The tender will be closing on the 1st of November, 2021. The reserve price remains firm, when compared to the previous attempt, which ran from late June to early August.
The owners of the building have, however, commenced signing a Supplemental Joint Agreement (SJA), in order to lower the reserve price to onwards of $538 million. This would effectively reflect a unit land rate of around $1,885 psf per plot ratio (psf ppr) at the gross plot ratio (GPR) of 14.0. The cost would incorporate a land betterment charge and lease top-up premium, in order to form a new, 99-year term. This number is under the assumption that the proposed redevelopment would be a mixed-use commercial and residential venture, with a 25% GPR uplift granted under the CBD Incentive Scheme (CBDIS).
Residents of Zion Road Condo benefit from the Zion Road Condo‘s close proximity to the Great World MRT station, providing them with fast and effortless journeys to various business and residential destinations. This allows residents to fully take advantage of the city-state’s strong transportation system and enjoy the convenience of being close to all of Singapore’s myriad of options. These include world-class dining and entertainment venues, lively shopping districts, and many more.
At the time of publication, 70% of the owners had already made the commitment to support the SJA. The asked-for support runs both in terms of strata floor area and share value. In order to make the new reserve price take effect, it is required of the owners to have a minimum 80% support rate.
Shenton House is a 36,250 sq ft site, zoned for commercial use, with a GPR of 11.2. The building has three frontages, which include Shenton Way, Park Street, and Shenton Lane. As a 99-year leasehold development, it consists of 203 commercial units and a single carpark.
Under the CBDIS, as stated before, the site is qualified for a 25% bonus GFA. This would allow it to be redeveloped as a mixed-use commercial, with a GPR of 14.0. The scheme is, however, set to expire on the 26th of November 2024.
JLL, the appointed marketing agents for the building, have expressed confidence in the owners achieving the required support. Executive director of Capital Markets at JLL Singapore, Tan Hong Boon, believes that the area offers much potential for rejuvenation due to the high demand for Grade A office spaces in the CBD, as well as the potential complementary services such as a business hotel or residential apartments.
The location, in addition, offers seamless access to the nearby Shenton Way MRT, as well as the potential for more GFA with the 25% GPR uplift. All of these factors, Tan believes, should attract developers to the location.
In conclusion, Shenton House is the last available redevelopment opportunity in this area of Shenton Way, and is on the market for a collective sale with a lower reserve price of $538 million, taking into account the CBDIS and its benefits. With the close of tender on the 1st of November, the owners of the site are confident of receiving the required support rate.