SINGAPORE (EDGEPROP) – A freehold boutique hotel at the corner of Outram and Tiong Bahru Road is being sold for $46 million. Wangz Hotel which is a prominent landmark in that area because of its distinctive barrel-shaped aluminium-clad look is being sold by Glastech Pte Ltd.
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The sale works out to about $1.12 million per room for the six-storey, 41-room, freehold boutique hotel. The boutique hotel was controlled by Wang Kwang Yu, his wife Kwee Lee Chien (daughter of Pontiac Land Group founder Henry Kwee) and their children through Glastech Pte Ltd, before the successful sale. TCRE Partners Pte Ltd (which is equally owned by Tower Capital Asia founder Danny Koh and Y Developments, owned by Ben Yeo and his family), is the buyer of the freehold boutique hotel. Mr Yeo was the former managing director of engineering and property group Guthrie GTS. His son Nicholas heads TCRE Partners.
Wangz Hotel is an urban sculpture of gleaming aluminium cladding and asymmetrically-placed wide windows. This boutique hotel offers a sophisticated setting that celebrates its unique architecture in an area that is distinguished for its eclectic blend of Art Deco and Straits Settlement styles.
The freehold boutique hotel houses a private collection of original artworks, specially commissioned to reflect the hotel’s flora and fauna theme.
All rooms feature modern-day amenities and state-of-the-art technology that address the aesthetic wishes and practical needs of the sophisticated traveller. The site area of the hotel is 400 m² and the Gross Floor Area (GFA is) 2,300 m². The hotel’s rooms range from 26 square metres to 47 sqm and there is a lounge in the lobby and an acclaimed rooftop restaurant.
Glastech bought the property in 2007 when it was a commercial and residential building and embarked on additions and alterations to convert it to a hotel. The freehold boutique hotel which opened 9 years ago, in 2009 was designed by CPG-Timothy Seow Studio. The daily rate for the rooms in the hotel range from $200++ for a superior room and up to $350++ for a deep suite.
The Business Times which reported on the sale of the boutique hotel quoted Chee Hok Yean, managing partner of hotel consulting firm HVS Asia Pacific, as saying that “assuming an average room rate of S$230 and average annual occupancy of 90 per cent, the net yield on the S$46 million price works out to about 3.4 per cent…with hotels’ profitability expected to improve, Ms Chee is positive on the outlook for the Singapore hotels investment market.”
The newspaper further reported: “Singapore hoteliers are looking forward to increasing room rates this year on the back of tightening net new supply and buoyant visitor arrivals. Ms Chee projects revenue per available room (RevPAR) for Singapore hotels to grow by nearly 3 per cent to S$187 this year, with occupancy and average room rate expected to edge up about one percentage point to 86 per cent and about 2 per cent to S$219, respectively.”
Glastech is expected to lease back the hotel from the buyers after the sale completes in the fourth quarter of this year, until end-2019. Since launching their first boutique hotel in 2009 with no prior experience in this industry Glastech has owned and operated other commercial properties in the city-state – such as Forest by Wangz, a serviced apartment development in Moulmein Road; and Wangz Business Centre, a serviced office offering on the top level of Suntec City Tower 1.
Mr Yeo explaining how his real estate investment firm chooses niche properties to invest in, said: “Our strategy focuses on ‘blue-chip’ properties across sectors. These would be properties with excellent attributes – island or corner sites, wide frontage, panoramic views, proximity to good transportation nodes and importantly, being anchored to established and dynamic neighbourhoods. As an active investment manager, we aim to invest heavily in our properties to ensure the best living and working environment for our customers and clients.”
The purchase of the freehold boutique hotel comes at a time when the economy has improved, healthy tourist arrivals have been recorded and the Trump-Kim summit has been successfully hosted.
Recognising this, the Government also released a site for hotel development (390 rooms) in its Industrial Government Land Sales (IGLS) programme in the 2nd half 2018 confirmed list. The last time a site with a hotel component was included in the confirmed list of the IGLS programme was 7 years ago.
Ms Chee had earlier said that investors eyeing Singapore hotel assets in Singapore tend to be high net worth individuals and Asian family businesses, rather than institutional investors.
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