Deal Brewing for Portfolio of 50 Conservation Shophouses at About S$500 Million in Tanjong Pagar

The portfolio is believed to be largely held by Hillington International, a British Virgin Islands-registered company that indirectly owns Singapore-registered Arcc Holdings, led by seasoned property investor Tony Chen. Industry players said the shophouses within the portfolio are individually held by separate groups of investors including Chen himself.

Word on the street is that Chen roped in EY-Parthenon, the global strategy consulting arm of EY, to conduct a sale process to find a buyer for the conservation shophouse portfolio.

The intended buyer is said to be 8M Real Estate, a property investment and management company set up in 2014 that owns a S$1.5 billion portfolio in Singapore largely comprising conservation shophouses. Singapore-based 8M is wholly owned by Hong Kong-based Crane Capital, which is backed by the Washington State Investment Board, a US pension fund primarily for public employee retirement funds.

Most of the properties are understood to be on land with remaining land tenures of about 61 or 62 years. Those on Tras Street have balance leases of about 67 years.

Although the portfolio is substantially on land with about 60-plus years of balance lease, market watchers said that there is room for 8M to extract greater value out of the shophouses through its tenant curation and other asset management skill sets.

For the vendor, the plan to sell the portfolio of about 50 shophouses is thought to be part of a divestment strategy. According to industry circles, the next generation of the Chen family may not be keen on the shophouse investment and management business. Instead, they may prefer to deploy the sale proceeds for other businesses.

The shophouse portfolio includes a row of seven shophouses along Duxton Road, next to the Duxton Reserve hotel. They are on sites with 99-year leases that started from September 1988, leaving a balance of about 61 years.

Another asset comprises four adjoining shophouses in Duxton Road, just off Neil Road, with nearly 62 years’ balance lease. A row of shophouses at Tras Street is also said to be in the collection. The five properties are on sites with 99-year tenures from March 1995, which leaves a balance of about 67.5 years.

Also part of the bundle are four Craig Road shophouses, where the 99-year land tenure kicked off in 1989, and a shophouse pair on Neil Road with nearly 62 years’ balance site lease.

A noteworthy deal in Neil Road in the past couple of years is that of 27 Neil Road, opposite Maxwell MRT station. The corner, two-storey shophouse was sold in November 2024 for S$7.2 million, or S$3,000 per square foot on a gross floor area of about 2,400 square feet.

The psf price achieved is said to be on the high side for a 99-year leasehold conservation shophouse in the vicinity. This could be due to the relatively small floor area. Moreover, the property is on a site with a 99-year lease from January 2000, leaving about 74 years remaining lease at the time of the transaction.

The property was sold by Dr Hong Hai, a traditional Chinese medicine practitioner and the former president and chief executive officer of Haw Par Corp. Boutique property agency Mondania is said to have brokered the deal.