Sultan Plaza has hit the market again. The en bloc sale for the property that is located in Jalan Sultan along the Beach Road area hit the market on July 11.
As per the 2014 Master Plan the site has been zoned for commercial use. The reserve price for the property has remained unchanged from the previous collective sale attempt at S$380 million.
Increased redevelopment option is expected to attract developers to this sale this time around.
The Collective Sales Committee has approached the Urban Redevelopment Authority with an outline application for the use of this site for hotel development with a plot ratio of 5.3.
According to reports, the URA had revered to this application offering thee options for redevelopment – hotel use, residential and commercial use along with full commercial use which is how the property is being used at the moment.
The plot ratio for all these three options has been fixed at 5.0. This would allow developers to explore 262,354 sq ft of Gross Floor Area for the site which is 52,471 sq ft in size.
ERA Realty Network, the marketing agents for this collective sale in a statement said that Sultan Plaza’s development baseline has been determined to be 244,667 sq ft (22,730.35 sq m) and this would translate into a plot ratio of 4.66.
To maximize redevelopment in this site, the developer would need to pay a differential premium which shall allow them to make use of the development potential with plot ratio of 5.0.
The differential premium for Sultan Plaza has been estimated to be around S$12 million in case of residential and commercial use; S$16.1 million for commercial use only and S$57.5 million if it is converted into a hotel according to an official spokesperson for ERA.
The 99-year lease tenure for the en bloc site started in 1978 and 58 years remain on this tenure.
The developer may need to pay tease top-up premium if they wish to upgrade the lease.
Sultan Plaza’s tender shall close on Augusts 1, 2019.