Industrial building, 3 shophouses sold

Property investment sales perked up towards the end of last year, with an industrial building and a row of shophouses changing hands.

China-based Nanshan Group led a consortium to buy Harper Kitchen, a freehold industrial building in Tai Seng, from scrap gold dealer ValueMax Bullion for $51.1 million, or about $2,138 per sq ft of land area.

Nanshan Group has been steadily increasing its presence in Singapore. The Dec 30 purchase came after it bought nearby Irving Industrial Building for $160 million in March last year.

Both buildings are redevelopment sites. The deals were brokered by Cushman & Wakefield.

Nanshan Group also launched its maiden private condominium project in October last year.

The 288-unit Thomson Impressions had sold 113 of 150 launched units as at end-November, with a median price of $1,396 per sq ft in the month.

Nanshan Group has two hotels as well. It is redeveloping the former Midlink Plaza site, which it purchased in 2014, into a 396-room boutique hotel.

In 2013, it bought the Park Regis Singapore hotel and adjoining office block for about $250 million.

Another sale late last year occurred in Joo Chiat Road, where three adjoining shophouses went for $23 million, a tad below the guide price of $28 million when they were put up for public tender in November.

The buyers are linked to the Wincome Group, a private developer from Hong Kong, while the seller is a hardware company that occupies the premises. The shophouses have a land area of 4,992 sq ft and gross floor area (GFA) of about 14,820 sq ft, which works out to a sale price of about $1,552 psf on GFA.

There are still good buyers in the investment sales market, said Ms Sammi Lim, associate director of investment properties at CBRE.

"They are comparing options in the market. Due to the backdrop of rising interest rates, they will likely commit to a deal if all the supporting reasons are there - good location, good property, price is fair."

There will also be opportunities coming up continually, especially when owners review their assets, she said. Some are funds which would like to divest when the fund life is up, while some are families who feel it is timely to sell their property to retire or reinvest the money in their core businesses.

This article was first published on Jan 13, 2016.
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