Tuesday, March 22, 2011

Orchard site up for redevelopment and lease

(SINGAPORE) The carpark development adjoining International Building, off Orchard Road, is being offered for redevelopment and lease for 21 years (less one day).

The property is owned by a unit of Hong Fok Group. It is zoned for commercial use and has a potential gross floor area of about 173,200 square feet.

Hong Fok obtained provisional permission to redevelop the site to a new 23-storey office tower with carparks and restaurants on Feb 28 this year. The successful tenderer will pay for redevelopment costs, but the estimated development charge of around $115 million for the redevelopment will be borne by Hong Fok.

The tender could fetch upwards of $85 million, market watchers said.

Jones Lang LaSalle (JLL), which is marketing the site, said that the successful tenderer will have the choice to develop and manage offices, retail shops or a hotel (or a combination) on the site, up to a maximum building height of 30 storeys, subject to approval.

'We expect keen interest in the site as it represents an extremely rare opportunity for a long-term lease of a prime site along Orchard Road,' said Quek Soh Hoon, JLL's head of commercial investments. 'The flexible development options for the site will appeal to a wide group of investors given that Orchard Road is the prime retail and entertainment belt in Singapore.'

She added that the supply of retail, commercial or hotel space along Orchard Road is extremely limited.

Tom Oakden, senior vice-president for investment sales at Jones Lang LaSalle Hotels, expects the site to appeal to domestic and regional developers who will be keen to exploit the significant trading potential of a hotel in this prime Orchard location.

The tender will close at 3pm on April 29.

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