Katong Plaza reduces en bloc reserve price to $188 mil
Singapore-based Fragrance Group has acquired Katong Plaza in Marine Parade for $180 million. This translates to a land rate of $1,809 per square foot per plot ratio (psf ppr), inclusive of the land betterment charge.
The freehold mixed-use development, located at 1 Brooke Road, comprises 132 strata retail units and 14 residential apartments. Owners of the retail units will receive proceeds ranging from $502,000 to over $6 million, while residential owners will get between $2 million and $5.1 million, according to Terence Lian, Huttons Asia’s head of investment sales who brokered the deal.
When contemplating an investment in a condo, it is crucial to evaluate its potential rental yield. Rental yield refers to the annual rental income as a percentage of the property’s purchase price. In Singapore, condos can offer varying rental yields based on factors like its location, overall condition, and current market demand. Generally, areas in close proximity to business districts or educational institutions tend to have higher rental demand and can thus provide better rental yields. It is advisable to conduct thorough research on the market and seek guidance from real estate agents to gain valuable insights on the rental potential of a specific condo.Condo is an important consideration in this process.
Sitting on a total land area of 34,044 square feet with a gross plot ratio of 3.0, Katong Plaza has a maximum gross floor area of 102,132 square feet.
Located in prime District 15 and just 120 meters from the Marine Parade MRT Station on the Thomson-East Coast Line and the Parkway Parade shopping mall, the property is currently zoned for commercial and residential use. However, it has received URA approval for hotel use.
Lian estimates that the new hotel could yield between 300 and 340 rooms, which Fragrance Group could potentially redevelop under one of the Accor brands. The company is controlled by billionaire property developer and hotelier James Koh, who also heads its hospitality arm, Global Premium Hotels. The latter has a portfolio of brands, including Fragrance and Parc Sovereign, and in 2019, tied up with international hotel group Accor to open 13 new ibis Budget hotels. They were previously branded as Fragrance hotels, and the partnership also includes the introduction of the ibis Styles and Mercure brands.
Last month, Fragrance Group and Global Premium Hotels signed another agreement with Accor to open two new-build properties by 2027. The first is the 808-key Mövenpick Singapore, which will be the largest Mövenpick hotel in the Asia Pacific region and will also house Mövenpick Living Singapore, a 37-key accommodation targeted at travelers seeking extended stays. The second property, located at Waterloo Street, will be a 502-room hotel under the Handwritten Collection brand of Accor. This is a redevelopment of the former Min Yuan Apartments which Fragrance Group acquired en bloc in September 2019 for $141 million; and the former Waterloo Apartments, which it acquired in November 2018 for $131.1 million. The two 999-year leasehold sites were amalgamated, and URA approval was obtained for their redevelopment into a 500-room hotel.