Freehold commercial building United House has launched its third collective sales tender at an unchanged reserve price of $166 million, according to a June 10 press release. ETC has been appointed as the exclusive marketing agent facilitating the tender.
Located along Kramat Lane in the Orchard Road area, United House is a 10-storey commercial building spanning a land area of about 12,383 sq ft with a plot ratio of 4.9, according to the 2019 URA Master Plan. This works out to about $3,045 psf per plot ratio (ppr) for a commercial redevelopment or $3,254 psf ppr for a hotel redevelopment, based on its reserve price.
ETC first launched the property for sale last October. However, the tender was retracted after obtaining in-principle approval from URA for hotel use with the same gross plot ratio. United House was then launched for collective sale at the same reserve price in February, but the tender was unsuccessful.
“There is a growing appetite for quality hospitality assets in Singapore, fuelled by the resurgence of tourism, MICE, and music-related travel,” says Swee Shou Fern, head of investment advisory at ETC.
She adds: “United House’s rare freehold tenure, central location and in-principle hotel-use approval offers a unique opportunity to create a flagship or lifestyle boutique hotel right in the heart of Orchard Road.”
Swee points to several high-profile hotel acquisitions in recent months that exemplify the demand for hospitality assets in prime areas.
In March, the 49-key Duxton Reserve sold for $80 million, or about $1.63 million per key. The hotel was acquired by local family office Lotus Singapore. Duxton Reserve comprises eight conserved shophouses along Duxton Road in Tanjong Pagar.
A month later, Singapore-based Indonesian billionaire Leo KoGuan entered into an agreement to acquire the 48-key boutique hotel 21 Carpenter from 8M Real Estate for $100 million. This works out to about $2.08 million per key. Located along Carpenter Street, 21 Carpenter is an amalgamation of four conservation shophouses at 27, 29, 31 and 33 New Bridge Road.
Swee also notes United House’s location outside areas with strata subdivision restrictions, allowing a successful buyer the option to redevelop the property into a strata-titled commercial project.
The property is also located within walking distance from Dhoby Ghaut MRT Interchange along the North East, Circle and North South Lines and Somerset MRT serving the North South Line.
The tender for the property closes on July 1.
