Sultan Plaza, a commercial strata retail space located at 100 Jalan Sultan off Beach Road, has recently been put up for sale through Expression of Interest with a guide price of $39 million. The property has a strata area of 30,946 sq ft, which amounts to $1,260 per sq ft on total strata area. The net leasable area is approximately 17,000 sq ft, excluding the void space of around 14,000 sq ft.
The 99-year leasehold asset consists of 211 commercial units and 33 offices, making up a total of 244 strata lots spread across nine storeys. With its lease commencing in May 1978, the property has a remaining lease term of about 46 years. Fully zoned for commercial use, the development boasts large single-floor plates and holds a public entertainment license, a rare feature in commercial buildings. This presents an exceptional opportunity for investors as established tenants can easily occupy the large units on a single floor, without the need for separate units on different storeys. The unit also has direct access to the carpark, which ramps up to Level 6, providing a VIP experience for tenants and visitors.
Investors can look forward to high rental yields and strong rental demand for the development. Based on rental data from the last 12 months, commercial units at the property have a rental yield of 9%, significantly higher than nearby commercial properties like City Gate (3.5%) on Beach Road and Textile Centre (5.6%) on Jalan Sultan.
The Sultan Plaza commercial space will be sold with tenancy, offering investors immediate monthly rental returns. The current anchor tenant, Grand Dynasty KTV, a veteran in the entertainment and nightlife business with over 20 years of experience, has signed a lease with an option to extend. According to Chai Chin Yun, vice-president of homegrown real estate agency Master Real Estate, the tenant is likely to extend their lease.
“The tenant has invested over $6 million in renovations and takeover fees, significantly enhancing the value of the property. Additionally, it is rare to find large-sized public entertainment units in commercial buildings, making this perhaps the only one of its size currently available in the market,” Chai notes. He adds that Sultan Plaza is an ideal choice for investors looking for immediate rental income, as well as those already investing in the entertainment industry.
Other businesses at Sultan Plaza, such as 24/7 eateries and beauty and wellness establishments, support the entertainment business. Located between Beach Road and North Bridge Road, both of which offer a diverse range of F&B, entertainment and lifestyle retail options, the area is enlivened by a variety of activities. The Kampong Glam Conservation Area, just across the street, is an iconic tourist spot, further contributing to higher foot traffic in the vicinity.
The residential developments nearby also contribute to the area’s high footfall, such as City Gate, the 360-unit Concourse Skyline on Beach Road, and the 197-unit Southbank condo on North Bridge Road.
Sultan Plaza has excellent connectivity to the rest of Singapore. Located just outside the building, a bus stop offers services to the north, such as Sembawang and Woodlands, and to Shenton Way in the Downtown Core area. The nearest MRT station, Nicoll Highway on the Circle Line, is also just a short walk away.
Investing in condos has numerous advantages, including the opportunity to leverage the property’s worth for future investments. This means that investors can use their condos as collateral to secure additional funding for other real estate ventures, thereby diversifying their portfolio. With the option to amplify returns, this approach also brings certain risks that need to be addressed in a solid financial strategy. It’s essential to carefully consider the potential effects of market fluctuations before using this tactic. Additionally, keeping an eye out for new condo launches can contribute to the success of this investment method.
Chai adds that the building has potential for future en bloc sales. He points to the neighbouring City Gate mixed-use development, an en bloc redevelopment of the former commercial building, KeyPoint. Alternatively, he notes that there were plans for Sultan Plaza – which had attempted an en bloc sale previously – to be redeveloped into a mixed-use development, subject to approvals from the authorities.
Chai also highlights that the same property owner is looking to sell their over 3,000 sq ft Bukit Timah Plaza F&B unit, which has en bloc potential and offers a rental yield of more than 4%. For investors, this presents a rare opportunity to negotiate for ownership of both units in a bundle deal.
For more information, interested parties can contact Chai Chin Yun at 96303137, Vice President (R044875G) of Master Real Estate Pte. Ltd.