Ravi Chandran
The Owner is seeking offers in excess of $155 million for the rare freehold hotel development site. As the site is now hotel use, foreigners are also eligible to purchase with no Additional Buyer’s Stamp Duty (ABSD) or Seller’s Stamp Duty (SSD) imposed.
JLL’s Hotels & Hospitality Group and Cushman & Wakefield announced on Sep 5 that they have been retained as joint exclusive advisors to Lucrum Capital Pte Ltd to offer for sale a rare freehold hotel development site located in the Orchard Road precinct.
Located along Killiney Road, the rare freehold hotel development site occupies a land area of 13,148 sf and it is zoned as “hotel” with a gross plot ratio of 2.8 .
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The proposed hotel would be a 6-storey, 115-room development with a street frontage restaurant on the ground floor. The development would yield a total gross floor area of about 40,000 sf.
The site is strategically located within a short 3-minute walk from both Somerset MRT Station and Orchard Road. Well connected to the rest of the island via the Pan Island Expressway (PIE), Central Expressway (CTE) and East Coast Parkway (ECP), Raffles Place and Changi International Airport are just a 9-minute and 23-minute drive away, respectively.
Within close proximity to Orchard Road precinct and the city, the site is in the heart of Singapore’s main tourism belt. With no shortage of trendy F&B and lifestyle offerings, key developments within the site’s vicinity include Orchard Central, orchardgateway, Design Orchard and TripleOne Somerset.
The rare freehold hotel development site will further benefit from government plans to strengthen Orchard Road’s positioning as a lifestyle destination announced earlier this year. The plans include new retail concepts, attractions, entertainment and events to be introduced to the Tanglin, Somerset, Orchard and Dhoby Ghaut sub-precincts. Notably, new elevated link bridges will help provide enhanced connectivity to Killiney Road while new lifestyle options and the possible transformation of the Grange Road open-air carpark into a dedicated events space aims to cement Somerset as a bustling youth hub.
Mr Adam Bury, Senior Vice President, JLL Hotels & Hospitality Group, commented: “Freehold hotel sites in or around Orchard Road are incredibly rare, with no such sites having been transacted since Grand Park Orchard in 2013. As the Singapore hotel market continues to boom, seeing record occupancy levels on the back of sustained visitor arrival growth, we see this as an excellent opportunity to access the Singapore market. Future hotel supply will increase at less than 1% per annum and thus we foresee that trading performance in the market will only increase from its already strong levels”
“The rare freehold hotel development site will further benefit from government plans to strengthen Orchard Road’s positioning as a lifestyle destination announced earlier this year. The plans include new retail concepts, attractions, entertainment and events to be introduced to the Tanglin, Somerset, Orchard and Dhoby Ghaut sub-precincts.”
Mr Shaun Poh, Executive Director, Cushman & Wakefield Singapore Capital Markets, said: “We are seeing a spike of interest from local and overseas investors in hospitality assets, especially in hotel development sites where the owner can have flexibility in designing their desired hotel concept to attract certain group of travellers such as the millennials. The current proposed concept for this hotel development will be a highly “instagramable” designed hotel featuring contemporary urban lifestyle living space and nightlife concept.”
Over the past 12 to 18 months, interest for hotels and hotel land has risen significantly in Singapore. The most recent government land sale of the Club Street hotel site drew in eight bids and a top bid of $562.2 million ($2,149 psf ppr), a record price for 99-year leasehold land at a state tender. Recent freehold hotel land transactions include Min Yuan Apartments ($141 million), Golden Wall Centre ($276.2 million) and Waterloo Apartments ($131 million). After accounting for development charges, these transactions would equate to nearly $3,000 psf ppr.
The Owner is seeking offers in excess of $155 million for the rare freehold hotel development site. As the site is now hotel use, foreigners are also eligible to purchase with no Additional Buyer’s Stamp Duty (ABSD) or Seller’s Stamp Duty (SSD) imposed.
The rare freehold hotel development site is being marketed through an Expression of Interest exercise, which will close on Wednesday, 16 October 2019 at 3pm.
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