Four developers pay $243m in joint buy
Koh Bros, Heeton, KSH, Lian Beng acquire freehold Lincoln Lodge
By UMA SHANKARI
PROPERTY developers Koh Brothers, Heeton Holdings, KSH Holdings and Lian Beng Group have joined hands to buy the freehold Lincoln Lodge for $243 million, the companies said in a joint statement yesterday. The four will hold equal stakes in the project.
The price for the site, located in the prime District 11 off Newton Road, works out to $1449.3 per square foot per plot ratio (psf ppr) including an estimated development charge of $413,000.
The consortium is also ‘quite confident’ of acquiring a 3,358 sq ft plot of state land beside the property for about $3 million, said Koh Brothers chief executive Francis Koh.
If the four companies bag the state land, then the price paid for both sites will come to about $1,370 psf ppr, he said. Combined, the two sites will give the developers a total gross floor area of about 177,400 sq ft to work with.
The partners intend to build a 36-storey residential project with 120 luxurious apartments averaging 1,600 sq ft. The project will be launched in the first half of 2008, at prices in the region of $2,500 psf, Mr Koh said. The break-even cost for the project is expected to be around $2,000 psf.
The site was put on the market in May with a reserve price tag of $188 million. The consortium’s offer of $243 million was the highest of a few bids, BT understands.
Mr Koh said that the partners were willing to pay significantly more than the reserve price as they were ‘very interested’ in the site, and the upbeat property market means that they can be confident of making a profit even at higher break-even costs. ‘I think at the moment, it is about how much you can sell for,’ Mr Koh said. He cited the site’s ‘excellent location’ as well as the rising rental market as reasons.
The project will mark the first time all four companies have come together to develop a property. Koh Brothers and Heeton Holdings have worked together in the past - they will soon launch The Lumos in the prime Leonie Hill area, probably in the first week of July.
At the end of yesterday’s trading, the companies’ counters moved up as Koh Brothers’ stock rose 1.5 cents to end at 55.5 cents, while Heeton’s stock climbed 0.5 cents to close at 98.5 cents. Shares of KSH rose 4 cents to close 87 cents, while Lian Beng’s stock ended the day 2.5 cents up at 44 cents.
Source: The Business Times, 22June 2007
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