Shenton House sale in private talks after S$590 million tender closes without bids

Citi Commercial Pte Ltd

THE collective sale of Shenton House has entered into private treaty negotiations after its en bloc sale tender closed with no bids received.

Shenton House, a 99-year leasehold building in the Central Business District (CBD), was most recently put on the market on Feb 6 with a reserve price of S$590 million. The tender closed on Apr 11. The property had previously been put up for collective sale in March 2012 with an indicative price of S$530 million.

“We have a few expressions of interest which we are following up on,” said Tan Hong Boon, executive director of capital markets at JLL, the sole marketing agent for the property. He said that interested buyers include both local and foreign developers.

The site is eligible for 25 per cent bonus gross floor area (GFA) under the Urban Redevelopment Authority’s CBD Incentive Scheme, and can be developed into a mixed-use or hotel development with a higher gross plot ratio of 14.0. The current plot ratio is 11.2.

The reserve price of S$590 million works out to about S$2,035 per square foot per plot ratio (psf ppr), including the further estimated S$446 million for a land betterment charge and a lease top-up premium to a fresh 99-year lease, said JLL previously.  

If an additional 7 per cent bonus balcony GFA for the residential component is taken into account, the unit land rate would be around S$2,012 psf ppr.

Located on Shenton Way, Shenton House sits on a site spanning some 36,350 square feet (sq ft) zoned for commercial use. It currently houses 203 commercial units and a car park.

Elsewhere in the CBD, two Tanjong Pagar buildings that were put up for sale with a reserve price of S$216 million have moved on to private treaty negotiations. The tender closed on Mar 22 with no bids. 

The asking price translates to about S$2,602 psf ppr for an office development, inclusive of an estimated land betterment charge of S$54.1 million, said sole marketing agent PropNex.

The site comprises two commercial buildings built in 1959, on Hoe Chiang Road and Lim Teck Kim Road. The Hoe Chiang Road site is 8,449 sq ft, while the Lim Teck Kim Road site is 8,450 sq ft. 

Several other commercial properties are still on the market, as sentiment has turned cautious amid higher financing costs.

The last successful commercial en bloc sale in the CBD was Maxwell House on its second launch, after SingHaiyi, Chip Eng Seng and Hong Kong-listed Chuan Holdings jointly won the property for S$276.8 million in 2021.

On Apr 7, 2023, the 99-year commercial development Golden Mile Tower was launched for sale again with a reserve price of S$600 million.

This came after a previous attempt to sell the property at S$650 million, which closed without a deal. The Business Times reported that owners had entered into a private treaty negotiation period with three interested parties, but none reached the reserve price of S$600 million.

Bugis Point, a 999-year commercial property at 530 North Bridge Road, is also up for sale via an expression of interest (EOI) exercise with an indicative price of S$92 million. This works out to about S$4,623 psf, based on the total floor area of about 19,902 sq ft. The EOI exercise will close on Apr 18.

More News