Thursday, February 10, 2011

Peace Centre site back on sale at $700m

IT IS round two for the owners of Peace Centre and Peace Mansion, who are making a second attempt to sell their Sophia Road commercial redevelopment site.

This time they are going for collective sale tender with a hefty guide price of $700 million. That works out to $1,355 per sq ft per plot ratio - inclusive of an estimated $150 million charge to reset the 40-year-old development's leasehold tenure to 99 years, marketing agent Savills Singapore said yesterday.

The asking price is also significantly higher than the $470 million indicative price when it was first put up for sale, through an expression of interest exercise in March 2007.

The prime District 9 site - zoned for commercial use under the 2008 Masterplan - sits on a 76,618 sq ft plot and consists of a seven-storey commercial podium with 232 office and retail units, and a 32-storey residential tower with 86 apartments.

The site has a gross floor area of about 627,852 sq ft.

Savills said that besides being used for retail, alternative uses may include medical suites, offices, Soho - small office, home office - or even serviced apartments.

Apartment owners are expected to pocket about $2 million, if the guide price is met, said Savills' director of investment sales Suzie Mok.

She said that with the successful rejuvenation of the Civic District and the expected ongoing strength in the local and regional economies, there is tremendous potential for expansion of the retail scene beyond the main tourist and shopping belt of Orchard Road and into the nearby Selegie Road area.

Ms Mok also said the higher asking price compared to 2007 resulted from price trends moving up 'a fair bit' and rejuvenation of the area.

'Many plans have taken place with the whole area seeing transformation since 2007,' she added.

Experts said that while the guide price is optimistic, its central location and commercial zoning might be attractive to developers looking beyond the residential market.

Cushman & Wakefield's senior manager of Asia-Pacific research, Mr Ong Kah Seng, said although market sentiment is generally more cautious, there are still opportunities for sites in good locations.

'This site is fairly central, and enjoys proximity to Orchard Road and various educational institutions,' he said.

Nearby, the former Paradiz Centre in Selegie Road - now called PoMo - also launched an expression of interest exercise in December.

While no price has been specified, a price guide of about about $1,400 psf based on the net lettable area, or $255 million, was given.

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