Prominent corner 999-year leasehold shophouse in Serangoon Garden for sale at $25 million

JLL today announced that a prominent corner 999-year leasehold shophouse in Serangoon Garden is up for sale. JLL being the exclusive marketing agent, is inviting offers through an Expression of Interest (EOI) exercise for the purchase of 56 Serangoon Garden Way, a 999-year leasehold corner non-conservation shophouse nestled in the heart of the quaint and trendy Serangoon Garden.

leasehold shophouse
image credit: JLL

Occupying a prominent corner location with a land area of 2,122 sf and total built-up area of approximately 3,482 sf, the prominent corner 999-year leasehold shophouse fronts a busy junction, benefiting from a wide dual frontage and high footfall. Located directly beside a large carpark, the property provides patrons with added convenience and accessibility.

Approved for permanent “Restaurant” use on the ground floor and “Shop” use for the upper floor, the prominent corner 999-year leasehold shophouse is currently fully-tenanted.

The ground floor is leased to a popular Indian restaurant whilst the upper floor is leased to a beauty salon. Zoned for “Commercial” use under the 2014 Master Plan, potential alternative uses for the property include retail, education, entertainment and medical amongst others, subject to approval from relevant authorities.

Known for its iconic laid-back character, Serangoon Garden is a vibrant F&B and lifestyle destination offering a plethora of lively restaurants, bars, cafes and local hawker joints. Famous for being home to the popular Chomp Chomp Food Centre and Serangoon Garden Market, the area constantly bustles with activities especially at night and on weekends.

Nestled in an exclusive residential enclave, the charming Serangoon Garden not only is a popular place of hangout to the surrounding population, but also offers a one-stop location for key amenities. Acting as the heart of the neighborhood, F&B, retail and convenience businesses flourish in the vicinity, being mainly supported by the large residential catchment in the area and the Serangoon town.

Identified by the Urban Redevelopment Authority (URA) as an identity node, Serangoon Garden will be well-preserved to safeguard and enhance its current charm and identity.

Mr Clemence Lee, Senior Director, Capital Markets, JLL said: “56 Serangoon Garden Way presents an exceptional opportunity to acquire one of the most outstanding assets in the popular residential enclave. All keen-eyed investors will recognize its excellent attributes, including its superior 999-year tenure, impeccable location, prominent corner plot frontage and stable rental income. We expect good interest from investors, funds, family offices as well as owner-occupiers.”

Opportunities to acquire corner freehold assets in prime affluent residential estates are extremely rare and they are seldom made available for sale. Over the last two years, notable assets of similar attributes transacted include 8/8A Sixth Avenue which sold for $12.5 million ($4,962 psf on GFA) in April 2018 and 22/22A Lorong Mambong which transacted at $16.2 million ($4,830 psf on GFA) in September 2017.

The indicative guide price for the prominent corner 999-year leasehold shophouse is in the region of $25 million.

As the prominent corner 999-year leasehold shophouse sits on land zoned for commercial use, foreigners are eligible to purchase the property. There is no Additional Buyer’s Stamp Duty (ABSD) or Seller’s Stamp Duty (SSD) imposed on the purchase of the property.

The sale of the prominent corner 999-year leasehold shophouse will be conducted through an Expression of Interest exercise which closes on Tuesday, 11 December 2018 at 3pm.

The biggest gainers following the new property cooling measures is likely be owners of strata portfolio of offices and shophouses approved for commercial use. The property cooling measures affected almost all categories of buyers and is predicted to achieve its intended objectives of cooling demand and moderating price growth. One report said investors looking for alternatives to park their money in the wake of property cooling measures, would divert their attention to the strata office and shophouse markets as they are not subjected to this round of purchase or sales restrictions/encumbrances.

In 2014, median shophouse price in Singapore peaked at $3,824 per square foot (psf) on land area. Due to the implementation of  loan curbs such as the Total Debt Servicing Ratio (TDSR) however, demand for shophouses decreased in line with other types of property. In 2017, the median shophouse price stood at $3,301 psf on land area. Even post-TDSR, many shophouses managed to rise in value.

Shophouses are perceived as attractive investments because they can hold their values because of their central locations and the freehold/999-year-leasehold of many of these properties. Shophouses are also valued because they give prominent presence to a business entity for them to be visible in a highly competitive environment.

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Written by Ravi Chandran

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