Serangoon Plaza's future not certain yet

The future of recently sold Serangoon Plaza - home to part of the well-known retail giant Mustafa - is undecided.

But the authorities have already ruled out three high-rise plans proposed by the firm that now owns the building.

The site of the five-storey mall cannot be used for a hotel, for instance, or any development that would worsen the area's traffic woes.

The commercial complex was sold en bloc earlier this month to its majority owner Feature Development in a deal that values the property at $400 million.

The building's Management Corporation Strata Title had floated three options in a proposed outline application submitted to the Urban Redevelopment Authority (URA) in July last year.

All were rejected a month later.

Two ideas nixed were 20-storey developments made up of an office tower or residential block, with a three-storey podium of shops and a carpark.

These were refused as they would worsen the heavy traffic on Serangoon Road, said the URA in an official document. The third option was a 24-storey tower with medical suites and hotel rooms.

This, too, was rejected, owing to concerns it would aggravate the area's "social and vice-related problems", about which nearby residents had complained to URA.

"It would not be in the public's interest to allow new hotels, boarding houses, serviced apartments or backpackers' hostels in this area in order not to worsen the current problem," said URA in its written refusal.

The site could also not support developments that tall, it added. Buildings surrounding Serangoon Plaza are six to eight storeys high.

DTZ Singapore research head Lee Lay Keng noted that the area has quite a number of developments, including the nearby Parkroyal Hotel on Kitchener Road and City Square Mall

"The roads can be quite congested. These are some of the things Feature will have to take into account when planning for the development," she said.

For Feature, an associate of property developer Tong Eng, netting the 128-unit Serangoon Plaza gives it a chance to redevelop the mall.

Its investment manager Terence Teo said: "By buying 100 per cent of the building, we have the option of redeveloping it. Whereas if we only had 90 per cent, our options would only be addition and alteration."

Built in the 1960s as President Shopping Centre, the mall was bought in 1984 by Feature, which then sold 10 per cent of the units.

This month, nearly 30 years later, Feature bought back this remaining one-tenth of the building for about $40 million.

The decision was made because "the commercial market is quite a good (property) sector now. The area is quite up and coming, so we thought it's quite a good time", said Mr Teo.

Also, the building is underdeveloped, as its floor area of 104,765 sq ft is only about half the maximum floor space possible.

But its future is up in the air.

"We're exploring all design options for redevelopment but subject to the authorities' approval," said Mr Teo.

Tenants get to stay put for at least another 10 months, said investment sales director Suzie Mok from Savills Singapore, which brokered the deal.

Anchor tenant Mustafa, which owns Mustafa Centre next door, first moved into Serangoon Plaza in 1985 and now rents three storeys there for an undisclosed sum.

Managing director Mustaq Ahmad said he was unable to comment on whether it would move to other premises.

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