Tanglin Shopping Centre collective sale gets nod

Published November 5, 2010

OWNERS controlling at least 80 per cent of the share values and strata area of the freehold Tanglin Shopping Centre have given consent for its collective sale.

The tender for the sale is slated to be launched around the end of this month by marketing agent ERA Realty Network. With a reserve price of $1.25 billion, it will be the biggest collective sale launched for a commercial building in the Orchard/Tanglin area.

The reserve price works out to about $4,021 per sq ft of potential gross floor area - a record price if it is achieved. The assumption in the unit land price calculation is that no development charge is payable and the new owner will be able to build up to the property's existing gross floor area of 310,800 sq ft (pending verification by Urban Redevelopment Authority) - even though this slightly exceeds the maximum 287,750 sq ft allowed for the site under Master Plan 2008.

Millennium & Copthorne Hotels (M&C), the London-listed hotel arm of City Developments Ltd (CDL), disclosed in June that it had signed the collective sale agreement for Tanglin Shopping Centre. M&C holds its stake in the shopping and office complex through its wholly owned subsidiary King's Tanglin Shopping Pte Ltd. The company owns 85 freehold strata retail/office units and 325 car parking lots that have been held as a long-term investment since 1981. This works out to about 34 per cent interest in the total strata area.

Tanglin Shopping Centre has a freehold land area of 68,512 sq ft. Under Master Plan 2008, the site is zoned for commercial use with a 4.2 + plot ratio - the ratio of maximum potential gross floor area to land area - and a maximum height of 20 storeys.

'This will be a very attractive site for redevelopment into a super luxury residential project with a commercial or hotel tower, or residential units with a retail podium,' ERA said. 'Some developers are already eyeing the property in view of its prime location.'

While market watchers agree the site is prime, they say it remains to be seen whether developers will be willing to pay the steep reserve price.

The 12-storey centre comprises retail space from basement two to level six, including about two levels of medical suites; offices from levels seven to 12; and parking lots in the basement and a rear multi-storey block.


Source: http://www.businesstimes.com.sg