MYP ABI Plaza to Be Sold to Artemis Ventures for S$200 Million

MYP ABI Plaza to Be Sold to Artemis Ventures for S$200 Million

MYP, the leading real estate investment firm has made an announcement regarding the sale of Tanjong Pagar’s ABI Plaza.

The firm where the billionaire Tahir family from Indonesia has controlling stakes is selling this commercial property for S$200 million.

Artemis Ventures, an investment holding company incorporated in Singapore is expected to buy this property. CapitaLand Fund Management manages Artemis Ventures.

Grace Shine, the wholly-owned unit of MYP which is listed on the mainboard and Artemis signed the SPA (sale and purchase agreement) on September 24.

The 12-storey freehold office tower is located along 11 Keppel Road. It has 92,498 square feet NLA (net lettable area) apart from 4-level car park.

There is 12,500 sq ft of area for each floor plate in this structure. This commercial office tower completed in 1994 would be a direct beneficiary of the incentive scheme announced for the Central Business District announced by the Urban Redevelopment Authority.

Announcing the sale, a representative of the MYP said that the Sale and Purchase Agreement would be executed on the “as is, where is” basis as per the SPA date.

This will be applicable to and benefit all the existing leases, licenses, tenancies and/or occupation agreements with respect to the completion of the deal.

Grace Shine Bought ABI Plaza in 2011

Grace Shine had acquired the commercial property in 2011 for a sum of S$175 million. The total cost of acquisition of the property back then was attributed around S$165.8 million.

While the deal is at a mark-up of 20.6% compared to the acquisition cost, it is substantially down as compared to the valuation of the property arrived at on March 31 which stood at S$260.1 million. The sale price is thus 23.1% lower than the valuation.

MYP had engaged an independent firm Teho Property Consultants for the valuation of the property. This valuation was a part of the group’s annual valuation of its entire portfolio with regards to investment properties.

Teho had arrived at this valuation based on capitalisation of income and market comparison methods.

ABI Plaza Put Up for Sale Earlier in June 2020

In its official announcement MYP stated that various factors were taken into account before arriving at the decision to sell this property and these include the market value and the present economic conditions which have affected the property market.

ABI Plaza was listed in the market for sale earlier in June with a guide price of approximately S$280 million. However, there were only few parties who submitted their Expression of Interest by the close of the EOI exercise in July and all of those were below the current price of S$200 million.

Artemis Ventures then entered into the fray with its offer of S$206 million became the frontrunner for the office tower and also undertook a due diligence exercise.

According to MYP on the proposed sale is aligned with the group’s vision to ensure a strong balance sheet and also have sufficient capital to make investments in the future.

With this sale the group would be able to use the proceeds for higher yielding properties to improve the returns for its shareholders.

This sale comes in the backdrop of one of the worst economic crisis the world has ever seen due to the outbreak of the Covid-19 pandemic. MYP is expected to pocket S$197.5 million net proceeds from this deal part of which will go towards repayment of loan and rest would be used as general working capital.

The proposed sale would have to be approved by MYP’s shareholders at an EGM (extraordinary general meeting) or get a waiver from the Singapore Exchange. In either of the cases the firm has a 16-week deadline from the date of Sale and Purchase Agreement to meet the required obligations.

In case there are no further hurdles from the shareholders or the Singapore Exchange the deal would be completed after 4 weeks from the date of the SPA, 4 weeks from the waiver date and 2 weeks from the date of the EGM

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