Thursday, October 11, 2007

$253m for Upper Pickering plot with plan including Soho units.

It bids $253m for Upper Pickering plot with plan including Soho units.

UOL Group subsidiary Hotel Plaza plans to develop small office, home office (Soho) units as well as a 350-400 room hotel on a choice plot at Upper Pickering Street, for which it emerged as the top bidder at a tender yesterday, UOL Group chief operating officer Liam Wee Sin said yesterday.

Hotel Plaza’s top bid of $253.2 million or $805 per square foot of potential gross floor area was 21 per cent higher than the next highest offer of $209 million ($664 psf per plot ratio) from a unit of Park Hotel Group.

The highest of the nine bids at yesterday’s state tender for the hotel site was also at least 40 per cent higher than the prices paid for two hotel sites along Tanjong Pagar Road awarded recently, CB Richard Ellis noted.

Market watchers suggest UOL/Hotel Plaza’s scheme to include Soho units may have given it the edge in outbidding the other contenders at yesterday’s tender. Besides Park Hotel unit Park Plaza, other bidders were:

City Developments’ unit Glades Properties ($201.8 million);

Hiap Hoe Superbowl JV ($185 million);

Hotel Properties’ unit Op Investments ($161.08 million);

Ho Bee Investment & Multi Wealth Singapore ($153.53 million);

Amara Holdings & Garden City Hotel Holdings ($151.89 million);

AAPC Hotels Singapore ($150 million);

and Soilbuild Group Holdings ($128.82 million).

Analysts estimate that UOL/Hotel Plaza’s all-in investment in the project (including land and construction) may be around $400 million. The longish plot, with a frontage of about 200 metres along Upper Pickering Street, is right across the road from Hong Lim Park and diagonally opposite One George Street.

‘We’re likely to build the hotel on the side closer to One George Street while the Soho tower will be on the other stretch of the plot facing Chinatown Point and Furama,’ Mr Liam said yesterday evening when contacted by BT.

‘The Soho tower may be about 16 to 20 storeys high and will have about 120-150 units, mostly studio units of about 60-80 sq metres (646 to 861 sq ft) each. We may sell the Soho units or just decide to keep them for lease.

‘The hotel is likely to be 16 storeys high and will have about 350-400 rooms. Hotel Plaza will most likely flag it as a Parkroyal. In fact, this will be the flagship Parkroyal hotel in Singapore when it is completed around 2011,’ Mr Liam said.

However, hotel industry watchers pointed to the possibility that the group has the option of targeting a higher tier of the market and flagging the new property as a Pan Pacific hotel, since UOL recently bought this brand.

Industry observers said the Upper Pickering Street site is probably one of the choicest plots allowed for hotel development to have been released by Urban Redevelopment Authority in recent years other than the former NCO Club site in Beach Road.

Hotel Plaza owns two other hotels in Singapore - Parkroyal hotels at Beach Road and Kitchener Road - while UOL directly owns 100 per cent of The Negara on Claymore and has an interest of about 30 per cent in Marina Centre Holdings, which has stakes in the Pan Pacific, Oriental and Marina Mandarin hotels here.

Source : Business Times - 11 Oct 2007

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