Beautifully restored CBD commercial shophouse with fresh 99-year leasehold tenure up for sale

SINGAPORE (EDGEPROP) – JLL on 5 July presented for sale a restored CBD commercial shophouse. The CBD commercial shophouse s located at  19 Hongkong Street, and is a brand new beautifully restored part-four part-six storey commercial shophouse. The property is situated within the trendy Hong Kong Street area, one of the up-and-coming F&B and lifestyle destination that is rising in popularity amongst locals, expats and tourists.

The prominent commercial building occupies a land area of approximately 1,858 sq ft and has a total gross floor area of approximately 7,792 sq ft and roof terrace area of 1,050 sq ft. Under the 2014 Master Plan, the site is zoned “Commercial” and is located within the Upper Circular Road Conservation Area. The property underwent an extensive $7 million redevelopment which was completed in 2015.

The initial four-storey CBD commercial shophouse was cleaned out and completely redesigned. Key features of the refurbishment works include construction of a six-storey back extension to maximise the built-up area, extensive structural works, a newly refurbished building façade, installation of a brand new lift, M&E, lighting, air-conditioning system. The heritage property was beautifully restored and completely transformed into a modern commercial building. The lease tenure was also topped-up to a fresh 99 years starting from October 2015.

CBD commercial shophouse

Image credit: JLL

Located between Clarke Quay and Boat Quay, the Hongkong Street area is a rising F&B lifestyle destination that is popular amongst locals, expats and tourists. Various F&B establishments have sprouted in the area, including highly acclaimed restaurants, such as The Kitchen at Bacchanalia (awarded one Michelin Star), FOC (run by Michelin-starred chef Nandu Jubany), Amo, Vasco; stylish cafes such as The Proof Flat, Ronin and Punch and exquisite cocktail bars such as 28 Hongkong Street (named “Best bar in Asia”). The area also houses a co-working space, The Hive.

The CBD commercial shophouse is easily accessible and is within a short walk from Clark Quay and Raffles Place MRT stations. Located within the Central Business District (CBD), the property is also easily accessible to other parts of Singapore via major expressways including the Marina Coastal Expressway (MCE) and Central Expressway (CTE).

The indicative guide price for the CBD commercial shophouse is in the region of $18 million reflecting $2,300 psf on GFA (or $2,035 psf after factoring in roof terrace area).

Mr. Clemence Lee, Associate Director, Capital Markets, JLL, said: “9 Hongkong Street was transacted last month at $2,513 psf approx. while 6 Hongkong Street was transacted at $2,750 psf approx. in May 2018. At a guide price of only $2,300 psf approx. on GFA (or $2,035 psf after factoring in roof terrace area), 19 Hongkong Street presents one of the most compelling shophouse investment opportunities in the CBD.”

“Given the competitive pricing, the property’s fresh 99-year lease tenure, its prime CBD location, close proximity to two MRT stations and the potential capital appreciation from the rejuvenation of the area, we expect strong interest from investors such as boutique real estate funds, family offices and high-net-worth individuals (HNWIs). This opportunity will also be suitable for owner occupiers who are looking to acquire their own flagship building in the CBD.”

“Currently zoned for office use, the property is to be sold with vacant possession allowing flexibility for the new buyers to apply for change of use to alternative uses such as co-working, food and beverage (F&B), serviced apartments, medical suites and entertainment amongst others, subject to approval from relevant authorities.”

As the CBD commercial shophouse sits on land zoned for commercial use, foreigners are eligible to purchase the property.

There is also no Additional Buyer’s Stamp Duty (ABSD) or Seller’s Stamp Duty (SSD) imposed on the purchase of the property. The property will be marketed through an Expression of Interest exercise which closes on Wednesday, 8 August 2018, at 3pm.

The government has acted to cool the residential property market. Additional Buyer’s Stamp Duty (ABSD) rates have been raised for some categories of residential property purchases, and the Loan-to-Value (LTV) limits on residential property purchases have been lowered, all with effect from 6 July 2018. Strata-office and shophouse markets could emerge as the other biggest gainers after the new property cooling measures.

JLL earlier said: “The biggest gainers following this set of measures will likely be owners of strata-offices and shophouses approved for commercial use. The government’s swift response to curb home price growth has tampered the prospects of residential properties as attractive investments. Investors looking for alternatives to park their money could divert their attention to the strata office and shophouse markets as they are not subjected to this round of purchase or sales restrictions/encumbrances.”

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