Record $72 psf ppr bid for a 30-year leasehold industrial site

Record $72 psf ppr bid for a 30-year leasehold industrial site

By KALPANA RASHIWALA
AN URBAN Redevelopment Authority tender at Kaki Bukit Road 3 yesterday drew seven bids, with a top offer of $72 per square foot (psf) of potential gross floor area - the highest-ever unit land price for a 30-year leasehold industrial site, according to CB Richard Ellis.
And this top bid, made by Eastpoint Development Pte Ltd, was a whopping 58 per cent more than the second-highest bid of $46 psf per plot ratio (ppr), which came from EL Development, a unit of Evan Lim & Co.

The top bid at yesterday’s tender worked out to nearly $5.7 million in absolute terms and the bidder, Eastpoint Development, is controlled by Lim Kim Hong and Lim Huixing.

The Lims also took part in Wednesday’s tender for the maiden transitional office site next to Newton MRT Station, bidding under MV Land Pte Ltd, which entered the fourth-highest bid at that tender.

The Kaki Bukit site is zoned for Business 1 use, which means it can be developed for a range of clean and light industrial, and warehouse use.

Colliers International director (industrial) Tan Boon Leong reckons the 131,917-sq-ft plot, which has a plot ratio of just 0.6 and a triangular shape with a narrow pointed tip at one end, is optimally suited for development into single-storey (with mezzanine floor) terrace factories or two/three-storey terrace factories. ‘The plot can be built into about 23 single-storey (with mezzanine floor) units with an average saleable area of 3,500 sq ft per unit,’ he added.

‘The break-even cost to the developer could be around $150-$180 psf of saleable area and it could sell the units for about $220-230 psf. It should be able to command a premium for such factories, despite the 30-year leasehold tenure, because there’s a dearth right now for single-storey terrace factories in the Paya Lebar, MacPherson and Kaki Bukit areas,’ Mr Tan added.

CB Richard Ellis executive director Li Hiaw Ho said the Kaki Bukit site can be developed into a high-tech industrial building.

Yesterday’s tender also drew bids from KNG Development, Sin Hong Hwa Pte Ltd, Union Contractors (Singapore), Eng Seng Lee Construction Co and Soilbuild Group. Soilbuild was the lowest bidder at $2.44 million or $31 psf ppr. It was also the lowest tenderer at Wednesday’s tender for the 15-year leasehold transitional office site next to Newton MRT Station.

CBRE’s Mr Li noted that the high number of bids received as well as the robust prices for the industrial site indicate continued strong demand among developers and manufacturers.

‘It is not surprising as occupancy rates for industrial space are still on an upward trend. Industrial rents are also on a healthy growth path, driven by a buoyant manufacturing sector,’ he added.
Source : Business Times - 24 Aug 2007

Majority owners of Horizon Towers sued

Majority owners of Horizon Towers sued
HPL consortium goes to court, claiming breach of contract

(SINGAPORE) The Hotel Properties-led consortium yesterday filed a suit in the High Court against the majority owners of Horizon Towers for allegedly breaching the option to purchase agreement for the $500 million collective sale of the Leonie Hill property.

Horizon Towers: $500m collective sale deal lapsed when owners chose not to extend the sale agreement
The proceedings that HPL instituted in the High Court also seek to get an order that the vendors of Horizon Towers ‘do everything in their power to obtain a collective sale order from the Strata Titles Board’, it was mentioned in a statement to the Singapore Exchange yesterday evening.

In addition, HPL could seek damages for breach of contract.

The law suit came about after the Strata Titles Board dismissed on Aug 3 an application by Horizon Towers’ majority owners seeking STB’s order for the collective sale. Earlier, the HPL-led consortium, which also includes Morgan Stanley Real Estate and Qatar Investment Authority, had exercised their option to purchase.

The STB’s dismissal of the application was greeted with jubilation by some of Horizon Towers’ owners, given the steep rise in prime district residential values since the deal with the HPL-consortium was sealed.

Following STB’s decision, the sales committee representing Horizon Towers majority owners chose not to extend the sale agreement with the HPL consortium when it expired on Aug 11.

The HPL-consortium had earlier threatened to sue the majority owners for lost profits - estimated at $800 million to $1 billion - from a redevelopment of the site. They also wanted the sale deadline extended by four months and the STB decision appealed.
Source : Business Times - 24 Aug 2007

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Ng Teng Fong tops Singapore rich list

Ng Teng Fong tops Singapore rich list
Elite group gets wealthier; 12 new members break into top 40
By NISHA RAMCHANDANI
(SINGAPORE) The property boom, while churning out millionaires by the dozen, has also sprinkled its gold-dust on the billionaires driving the market.
Riding the wave, property tycoon Ng Teng Fong, with an estimated net worth of US$6.7 billion, has topped the Forbes Asia 2007 Singapore Rich List, nudging the Khoo family down to second place.

The Khoo family’s fortune swelled 14 per cent to US$5.7 billion, but this was nowhere near enough to keep pace with Mr Ng, who controls Far East Organization and Yeo Hiap Seng. From an estimated wealth of US$4.9 billion last year, his fortune grew a staggering 36 per cent, placing him firmly at the top of the table.

United Overseas Bank’s Wee Cho Yaw and his family came in third with an estimated wealth of US$3.3 billion - a drop from last year’s US$3.4 billion. Occupying fourth spot was China-born property developer Zhong Sheng Jian - now a Singapore citizen - whose wealth was estimated at US$2.5 billion.

Kwek Leng Beng of Hong Leong Group is at number five since Forbes Asia divided up his extended family’s holdings - an exercise that enabled his cousins Kwek Leng Kee and Kwek Leng Peck, who also have stakes in the group, to make this year’s list.

The collective net worth of Singapore’s 40 wealthiest increased about 14 per cent to US$32 billion. The top 10 on the list alone have a combined worth of nearly US$23 billion, constituting an impressive 72 per cent of the US$32 billion that the wealthiest 40 are said to possess. According to Forbes Asia, the net collective wealth of Singapore’s 40 richest could easily dwarf that of their other South-east Asian counterparts.

The 2007 list was dominated by those in real estate, shipping and palm oil - a clear reflection of Singapore’s booming industries - while those in the banking sector saw a slight decrease in fortune in the wake of the recent worldwide downturn in mortgages.

The list also boasted a significant number of entrepreneurs. ‘If you read through the list, you’ll see there are a lot of very highly qualified and successful entrepreneurs here. All these individuals have been very entrepreneurial in finding ways to make money in different industries,’ said Mr Justin Doebele, contributing editor of Forbes Asia and project editor, Forbes Asia Rich Lists.

Some 19 of the top 40 saw a growth in their net worth this year, while eight saw a dip in fortunes and one was unchanged. Twelve on the list were newcomers. Among them is fourth-placed Mr Zhong, who has a 71.4 per cent stake in Yanlord Land Group. He attributed his substantial fortune to being able to ‘understand the phase that the economy is in at any particular time’.

Founder and CEO of main-board listed Chemoil Corporation, an established supplier of marine bunker fuels, Robert Chandran has a net worth of US$490 million, which placed him at number 14. The Mumbai native, who pursued his masters degree in Manila and made his first fortune in the United States, moved to Singapore recently where he opted for citizenship. He, too, was not on the list last year.

Another new addition to the list, at number 36, is Christina Ong, wife of Malaysian tycoon Ong Beng Seng. Ms Ong is the managing director of Club 21, which owns Ishop and a share in luxury brand Mulberry.

The two other women on the list are Olivia Lum, founder of water treatment firm Hyflux, and Margaret Lien, who inherited wealth from late banker husband Lien Ying Chow.

Forbes calculated various fortunes using stock prices and exchange rates as at August 10, 2007. Privately-held wealth was ‘estimated’. Mr Doebele said that the spillover effects of the sub-prime mortgage crisis in the US wouldn’t change the order of the listings. ‘We’re looking over a 12-month period so if they drop 10 per cent less over two weeks, that’s not going to wipe out the entire gains they’ve made,’ he said.

The cut off for the 2007 list was also upped to US$100 million, nearly double last year’s minimum net worth of US$55 million. Still, number 40, chairman and CEO of Creative Technology Sim Wong Hoo, whose wealth was estimated at US$105 million, made the cut with a cool US$5 million to spare.
Source : Business Times - 24 Aug 2007

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Horizon Towers sellers sued for botched collective sale

Horizon Towers sellers sued for botched collective sale
$500m deal scuppered by simple technical error of missing signatures on the sale application
By Joyce Teo, Property Correspondent
MISSING SIGNATURES: The original committee members representing the Horizon Towers sellers had made a statutory declaration that the signed documents were included, without realising that they were not. — ST FILE PHOTO

A LEGAL battle looms for the sellers of Horizon Towers units, after it was disclosed yesterday that a simple technical error on sale documents had derailed the estate’s collective sale.
The intended buyers - Hotel Properties (HPL) and its two partners - are taking the 173 majority owners to the High Court over their failure to go through with the $500 million sale.

Their move comes after the Strata Titles Board (STB) released the grounds for its Aug 3 oral decision to halt the sale application of the Leonie Hill property. The sellers had requested the clarification.

The STB said documents carrying the signatures of three majority owners - who are sellers - were not included in the sale application.

The original committee members representing the sellers had made a statutory declaration that the signed documents were included, without realising that they were not.

And the STB - which only convenes to hear a case once documents are declared to be correct and in order - could not allow any changes to be made to the application.

The STB said there were concerns over whether it had the power to allow an amendment.

But under the law, once a sale application is found to be defective, the board’s role ceases.

The STB’s clarification, coincidentally, was followed by a statement from HPL, which said that proceedings have been started in the High Court against the sellers.

HPL and its partners Morgan Stanley Real Estate-managed funds and Qatar Investment Authority said the sellers are in breach of the sales contract and are ordering them to ‘do everything in their power’ to obtain a collective sale order from the STB.

That will result in the sellers having to refile the sale documents, which also means that they must sell their 99-year leasehold estate at the $500 million price inked in February.

This rankles with many owners - those who backed the sale and some who did not - as property prices have rocketed since then. The Grangeford estate nearby has sold for more than double the Horizon Towers price, on a per sq ft basis.

If they do not go ahead with the sale, HPL and partners said they will sue for damages for breach of contract.

But even if a sale order is obtained, the HPL consortium said they can still sue for other damages.

Any damages will be assessed by the court but the buyers - represented by Allen & Gledhill - have earlier put lost profits at $800 million to $1 billion.

The 173 majority owners of Horizon Towers, including the sales committee, will be liable.

The majority owners were originally represented by Drew & Napier, and subsequently replaced by Tan Rajah & Cheah.

Yesterday’s developments - just the latest in a saga stretching back to the contentious sale in February - puts the ball back into the sellers’ court.

Because the STB’s oral decision was made solely because the documents were defective, and not on the merits of the case, it said the sellers can refile a fresh set of documents.

The case has been made even more complicated by the fact that the sellers had an Aug 11 sale deadline written into their contract with the buyers.

When the STB killed off the sale on Aug 3, it left the owners just eight days to devise a strategy.

HPL and partners asked the sellers to extend the deadline by four months from Aug 11 and file a new sale application or appeal to the High Court to reconsider STB’s decision.

The sellers rejected this option.
Source : Straits Times - 24 Aug 2007

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