Robinson 77 SOLD to Gaw Capital Partners for S$710 Million

Robinson 77 SOLD to Gaw Capital Partners for S$710 Million

Robinson 77 Office Tower is being bought by an entity controlled by Gaw Capital Partners, Hong Kong’s leading private equity property group.

A deal worth S$710 million has been finalized with CLSA Real Estate managed fund. As per the price the rate translates to S$2,300 psf for NLA (net lettable area) encompassing 307,585 sq ft. This includes 6,018 sq ft of retail area apart from 301,567 sq ft office space.

74 years of lease remain for the property which was once known by the name SIA Building.

It is interesting to know CLSA had undertaken an extensive refurbishment in 2017. Interestingly it has bought this property in 2016 for S$530.8 million.

According to realty experts the fund is estimated to have spent more than S$30 million in the refurbishment of the 35-storey building.

The Buyer, Gaw Capital Partners was founded by two brothers, Kenneth and Goodwin Gaw, Gaw Capital Partners is also the owner of Selegie Road’s PoMo and also Bencoolen Street/Middle Road area’s Hotel G.

The group has raised nearly US$9.8 billion and its net assets well over US$18.3 billion as of Q2, 2018 as per declarations on its official website.

Realty experts assume that the group would have acquired Robinson 77 with the aim of rental yields in the immediate future given the amount of money that was invested by previous owner towards property enhancement.

Robinson 77 Situated in Excellent Location

With a 90-meter front façade on Robinson Road, Robinson 77 offers several incentives to the buyer. It is in close vicinity of several MRT stations that include Telok Ayer and Tanjong Pagar and also ones that are under construction namely Prince Edward and Shenton Way.

There is also a car park that can accommodate 137 cars.

It is interesting to note that following the recent renovation works carried out the net lettable area in the property increased from 293,269 sq ft when CLSA bought the property from SEB ImmoInvest to 307,585 sq ft.

All this ensures that Gaw Capital Partners will have to make little expenditure on the property to enjoy good rental yields.

Sale of Manulife Centre

In another development British property group Chelsfield and ARA Asset Management are inching closer towards a tie-up by the end of January.

They are set to acquire 51 Bras Basah Road Manulife Centre for a sum of S$556 million that would translate to around S$2,300 psf for the eleven-storey commercial property.

It has 242,000 sq ft net lettable area and also has 96 years of its lease tenure remaining. This property is being sold by Alpha Asia Macro Trends Fund II which is managed by City Developments and Alpha Investment Partners.

It is interesting to note that Manulife Singapore’s lease in this property expires in the near future. It is an anchor tenant has leased 100,000 sq ft which is almost half of the office space in this property.

This presents great opportunity for the new owners to go for a makeover of the property and increase its rental yield. Given its attractive location with two MRT Stations in the vicinity – Bras Basah (Circle Line) and Bencoolen (Downtown Line)

At present this building houses retail spaces at the street level and offices above but realty analysts feel that having retail space on Level 2 and 3 can increase rental yield for this property as yield from retail stores tend to higher when compared offices.

Also doing away with unused car parks can help in increasing the lettable area. What would definitely work as an advantage for the new buyers is the upward trend in office rental market and when they sign fresh lease agreements they’d definitely look to capitalize on the increased demand.

In related development a fund managed by one of Kenedix Inc.’s subsidiary recently bought 25% share in Church Street’s Capital Square.

They acquired this stake from ARA Asset Management managed fund at S$270 million. There is 388,118 sq ft of leasable area ion this building and 77 years of lease tenure remains for the property.

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