It Will Rename to Oakwood Premier AMTD Singapore After Approval
OUE, Singapore’s leading property developer is selling Oakwood Premier OUE Singapore.
The property group has found buyers for the luxury serviced apartments and hotels located in Shenton Way in a deal totalling S$289 million.
The property is being bought by a Hong Kong based JV that has Dorsett Hospitality International, the hospitality group and AMTD Group the financial services firm. (FEC) Far East Consortium International listed in Hong Kong owns Dorsett.
Oakwood Premier comprises of the serviced apartments and the hotel component in OUE Downtown Complex.
Part of Singapore’s CBD, there are 268 rooms in the property apart from two dining facilities and several other amenities.
They occupy Levels 7 – 32 in OUE Downtown 1. Together they have a floor area of 25,054 square metres and 23,234 square metres in strata title area. Oakwood Worldwide (Asia) manages this property.
Alkas Realty, the property holding firm which is wholly-owned by OUE has inked the property sale and purchase agreement for the sale and transfer of leasehold interest in Oakwood Premier with DHI Holding (S).
This agreement includes transfer and sale of the plant along with the equipment and machinery.
The 99-year leasehold tenure of the property shall expire in 2066. The sale figure of this deal was arrived at taking the market value into consideration.
In related developments OUEDTPL (OUE Downtown Pte Ltd), the serviced apartment operator which is also a wholly-owned subsidiary of OUE has signed a business agreement to sell its entire Oakwood Premier assets to DHI Downtown.
This deal has fetched OUEDTPL S$1.9 million and this figure was arrived at considering the business’ book value.
DHI Downtown will now have to approach the Hotels Licensing Board to seek approval to rechristen the property as Oakwood Premier AMTD Singapore.
FEC is looking at the Oakwood Premier as a great opportunity to build strong footing in Singapore.
The new commercial property will help it diversify its footprint along with the existing Dorsett Singapore Hotel.
According to the conglomerate they found the price of S$289 million competitive for the property’s potential as well as its location.
Earlier in the year the Oakwood Premier had been granted the hotel license which allows it to cater to the short-term stay of travellers.
This makes the property profitable as compared to offering customers long-term accommodation in typical serviced apartments.
In its filing the FEC said that there is an option to remodel the property in the medium term where it would take up small enhancements to improve the amenities to increase the revenue per square foot.
In the filing, it also stated that business and the property transactions are conditional to its simultaneous completion.
They will also need to obtain approval from Singapore’s President to who is the head lessor.
This transaction won’t affect net tangible assets and earning per share for OUE for the fiscal year of 2019.
It must be mentioned here that OUE have proposed to buy the serviced apartments under OUE Hospitality Trust before entering this deal.
The H-Trust was bestowed with first refusal right. The Trust declined to use this right as purchase of the Oakwood Premier as per the proposed term wouldn’t have been beneficial to OUE Commercial Real Estate Investment according to the trustee manager and the trustees.
OUE Hospitality Trust now becomes a sub-trust of OUE Commercial Real Estate Investment after their merger earlier this month.