Published December 24, 2010
Robertson Quay hotel site up for tender
Industry watchers expect to see keen demand for the land parcel
By EMILYN YAP
THE Urban Redevelopment Authority (URA) will be putting a hotel site at Robertson Quay up for tender, after a developer committed to pay at least $51.5 million or $378 per square foot per plot ratio (psf ppr) for it.
Industry watchers expect to see keen demand for the site, even as several other hotel plots enter the market.
Interest in hotel development has grown this year along with swelling tourism numbers and a smooth economic recovery.
The 99-year leasehold land parcel at Robertson Quay is 0.45 hectare big and has a maximum gross floor area of 136,174 sq ft. URA estimates that it can yield 350 hotel rooms.
The site is near the Singapore River and is located within a hotel cluster which includes developments such as Gallery Hotel and Studio M Hotel. It is also next to residential projects such as Rivergate and Robertson 100.
In addition, food and beverage and entertainment outlets at Robertson Quay and Clarke Quay are within walking distance.
URA will launch the tender for the hotel plot in two weeks' time. Cushman & Wakefield Singapore vice- chairman Donald Han believes there will be a 'healthy dose of demand' for the site, with bids going up to $750-$800 psf ppr.
That estimate comes close to the price fetched by a hotel site nearby at the junction of Clemenceau Avenue and Havelock Road in August. The top bidder had paid $101.1 million or $813 psf ppr.
The Robertson Quay plot does not enjoy the same road frontage as the one at Clemenceau Avenue/ Havelock Road, but that may make the former suitable for building some residential units, and the residential play could enhance the value of the site, Mr Han said.
Under zoning guidelines, developers can use up to 40 per cent of a hotel site's total floor area for commercial or residential use, subject to official consideration.
Although developers have triggered the sale of a number of hotel sites this year, demand should stay strong if the economy does well and visitors keep coming, Mr Han said. He added that several hotel operators are still trying to gain a foothold in Singapore.
CBRE Hotels Asia-Pacific executive director Robert McIntosh believes that the site will fetch a 'good price' and attract some five to 10 bidders.
Hotel room rates and occupancies in Singapore have been rising this year and the outlook remains 'pretty positive' even with more supply coming on stream, he said.
According to a CBRE Hotels report, revenue per available room gained 24 per cent to about $181 in the first nine months of this year, and room rates rose 11 per cent to around $211.
With sentiments improving, developers have gotten hungrier for hotel sites this year. Two other hotel sites are still up for tender - one at Gopeng Street/Peck Seah Street and another at Ogilvy Centre.
Sites with a mandatory hotel component have also been sold this year, such as that at Peck Seah Street/ Choon Guan Street and another at Stamford Road/ North Bridge Road.
Source; www.businesstimes.com.sg
