The Duxton Reserve hotel is built from a row of conservation shophouses
Investors are about to get a demonstration of the impact of Singapore’s booming travel market on hotel values as local boutique hospitality firm Garcha Group puts a heritage hospitality asset on the market in the city-state’s Tanjong Pagar area.
Formed from the amalgamation of eight three-storey conservation shophouses, the Duxton Reserve Singapore hotel is being offered at a guide price of over S$90 million ($68 million), which is equivalent to S$1.8 million per key or S$2,647 per square foot.
JLL, which is managing the expression of interest exercise for the 49-key luxury hostelry at 80 and 83 Duxton Road, pointed to the limited supply of shophouse hotels in Singapore as potentially offering capital appreciation and stable returns. The marketing effort comes as surging visitor arrivals and record revenue levels continue to drive investor interest in hospitality assets in the Lion City.
“Shophouse hotels in Singapore meet the growing demand for immersive cultural experiences and offer potential for capital appreciation and stable returns due to limited supply in the market,” Ling Wei Tan, senior vice president of investment sales at JLL’s hotels and hospitality group said in a release on Wednesday.
Former Six Senses
Located just a few minutes walk from the Maxwell and Tanjong Pagar MRT stations, the Duxton Reserve is Singapore’s first hotel to be franchised under Marriott International’s Autograph Collection of upscale independent hostelries, with that 15-year agreement set to expire in 2036.
Satinder Garcha
The 3,156 square metre (33,971 square foot) hotel is situated on a 908 square metre site, which has a land tenure of 99 years that commenced in 1988.
The hotel’s room and suites range from 20 square metres to 51 square metres (215 square feet to 559 square feet) in size, with daily rates currently ranging from S$462 to S$953.
Garcha Group founder Satinder Garcha, a Silicon Valley tech entrepreneur turned property developer and hotelier, purchased the property formerly known as the Berjaya Hotel from Malaysian conglomerate Berjaya Group (now Berjaya Corporation) for S$50 million in 2013.
In 2016, Garcha Group partnered with US hospitality firm Starwood Hotels & Resorts to relaunch the hotel as Duxton House but terminated the agreement following the closing of Starwood’s acquisition by Marriott International that same year.
The hotel operated as the Six Senses Duxton from 2018 until it closed in 2020 during the pandemic. With Six Senses having exited Singapore during the tourism shutdown, the property re-opened as the Duxton Reserve under the Marriott franchise in 2021.
Other Garcha Group Singapore hotels include the 138-key Maxwell Reserve, which is also franchised under Marriott’s Autograph Collection, as well as the 41-key Vagabond Club and the 90-key Serangoon House, both of which are part of Marriott’s Tribute Portfolio. The company also has a hotel in the pipeline in Santiago, Chile. Garcha Group had not responded to Mingtiandi inquiries regarding the current marketing effort by the time of publication.
New Delhi-born Garcha, who is now a Singaporean citizen, made his initial fortune from co-founding People.com, an IT recruitment website he sold at the height of the dot-com bubble in 2000 for around $110 million. After relocating to Singapore in 2001, Garcha established rental residential builder Elevation Developments, which specialises in luxury landed homes and Good Class Bungalows.
Singapore Hotels In Vogue
The Duxton Reserve has hit the market amid a hospitality hot streak in Singapore, with JLL predicting approximately $1 billion of hotel transactions in the city-state for the full year after investments in the sector from January through June already matched 2023’s full-year transaction volume, according to a report this week by the consultancy.
Singapore recorded 11.3 million visitors in the first eight months of the year, representing a 33 percent year-on-year increase and just 11 percent below the same period in 2019, with the Singapore Tourism Board expecting 16 million visitors for the full year.
Earlier this month, SGX-listed CapitaLand Ascott Trust agreed to buy the 329-room Lyf Funan in downtown Singapore from a private fund jointly owned by sponsor The Ascott Ltd and the Qatar Investment Authority for S$263 million.
In May, Singapore-based developer and fund manager Frasers Property agreed to sell the Fraser Residence River Promenade, an eight-month-old complex near Singapore’s Robertson Quay which combines 72 serviced apartments with a trio of conserved warehouses, to fellow SGX-listed builder Tuan Sing Holdings for S$140.9 million.
That deal came two months after US private equity firm TPG Angelo Gordon teamed up with Hong Kong’s Far East Consortium and Atelier Capital Partners to acquire the 313-room Capri by Fraser, Changi City serviced residence from Frasers Property for S$170 million.
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