Shun Tak buys Singapore commercial complex for nearly HK$2 bln

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Hong Kong-based conglomerate Shun Tak Holdings Ltd has acquired a majority stake in a commercial development in Singapore for a total consideration of S$350 million (HK$1.92 billion/US$239.1 million), the company announced late on Wednesday night.
The statement reads that the company has purchased a 70 per cent interest in a commercial complex located at 111 Somerset Road, while the other 30 per cent stake in the project is held by Singapore-based Perennial Real Estate Holdings Ltd that Shun Tak describes as a ‘longstanding strategic partner in both its Tongzhou and Hengqin integrated projects’.
The complex, occupying a total gross floor area of some 766,550 square feet, will comprise a total net strata area of 572,000 square feet including 13 stories of office units, two stories of medical suites and office units, as well as two levels of retail podium, the statement reads.
According to Shun Tak, the property is currently undergoing a substantial asset enhancement program, which is expected to be completed by late next year or early 2019, while the retail portion of the property has been vacated for renovation and the offices are approximately 75 per cent leased.
‘The Group believes the Singapore office market will remain healthy in the medium to long run, backed by sound government policy and solid underlying fundamentals,’ the company said in the announcement, noting this investment opportunity offers ‘attractive return potentials and short payback period’.
In fact, this is the second property in Singapore acquired by the conglomerate in less than 12 months.
Last May, the company acquired a 25,741 square foot freehold site in the central business district in Singapore for a consideration of HK$835.2 million, for which a hotel development is planned.
‘The Group is pleased to build its presence and commitment in Singapore with this second property acquisition it made over the last six months. The decision is also consistent with its strategy to expand its real estate portfolio into international gateway cities,’ it noted in Wednesday’s statement. K.L.