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Friday, Jun 26, 2015
Annabeth Leow
The Straits Times
A totalof 33 strata shop units in the basement of Parklane Shopping Mall have been put up for sale, with an indicative price of about $65 million.
DTZ Debenham Tie Leung (SEA) is holding an expression-of-interest (EOI) exercise, on behalf of developer Hiap Hoe's unit SuperBowl, that will close on July 30.
The 33 units in the Selegie Road mall, which have 58 years left on their leases, represent 17 per cent of the building's share value. All have tenants, including fast-food chain McDonald's which occupies the largest unit.
DTZ senior director of investment advisory services Swee Shou Fern said: "Tenancies for the restaurant and one of the nightclubs are expiring early next year, which offers the investor rental reversionary upside or the end-user the opportunity to operate its business from the premises."
The current indicative pricing for the basement units is $65 million or about $2,500 per sq ft (psf).
Mainboard-listed Hiap Hoe most recently attempted to sell these units last October, asking for about $55.6 million as it sought to sell off non-core assets.
The total strata floor area of 25,317 sq ft means the units were being priced back then at about $2,200 psf.
It was part of a sale attempt that also included leasehold and freehold units in Bukit Panjang Plaza and Balestier Point.
However, the Parklane basement units were still listed under Hiap Hoe's major properties in its 2014 annual report.
During last year's attempted sale, Hiap Hoe was keen to find a single buyer, according to Jones Lang LaSalle's investments and residential head Karamjit Singh. JLL launched last year's EOI exercise on behalf of the Hiap Hoe Group.
This time, Hiap Hoe's SuperBowl unit is offering potential buyers either the entire portfolio of 33 basement units, or any of its three constituent shop clusters. Two of the clusters are approved for nightclub use, and the third is approved for restaurant use.
Parklane's subsidiary proprietors had tried for a collective sale in 2007, but were unsuccessful.
Hiap Hoe is among the local property developers which have faced challenges selling units in a gloomy real estate market.
In March this year, Hiap Hoe Holdings completed the acquisition of all the Hiap Hoe SuperBowl shares in its Treasure on Balmoral condominium project.
It bought all 48 units for a total of $185 million after failing to sell any units since the project's launch in 2012.
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