Weave JV Buys Singapore Hotel for $56M as Rental Housing Operator Goes Regional

Weave Living is leading a S$75 million ($56 million) purchase of a hotel in Singapore’s Bugis district to mark its first acquisition in the Lion City.

The Warburg Pincus-backed rental housing platform is acquiring the row of two-storey shophouses at the edge of Singapore’s downtown core that form Hotel Clover 33 Jalan Sultan through a joint venture with listed builder SLB Development, company founder and chief executive Sachin Doshi told Mingtiandi on Friday.

“We are thrilled to have successfully acquired this premium site,” Doshi said in a release on Friday. “We have been following with interest the booming rental housing market in Singapore are optimistic about developments in this key Asian commercial centre over the coming years.”

Weave is understood to hold a substantial majority stake in the joint venture, and with its first acquisition outside its home city of Hong Kong on the books, Doshi now says new locations in Australia are on the way as Weave transforms into a regional player.

Targeting Financial Hubs

Located just a few blocks from the borders of the central business district, the property spans 35,000 square feet (3,252 square metres) and houses 88 hotel rooms on a leasehold plot with 85 years left on its tenure.

Based on independent calculations, this means the firm is paying S$2,143 per square foot of built area or S$852,272 per room, as it plans to spend S$4-5 million ($3-4 million) for refurbishments before opening Weave Living’s first rental housing in the city-state by the first quarter of next year.

Weave and SLB are buying the hotel from local investor Teo Kok Hwee’s hotel investment firm  Singa Property, and plan to renovate the hospitality asset to include fully furnished rental accommodation homes, several loft units with terraces and kitchenettes, as well as shared spaces like a common dining area, living room, kitchen, gym, yoga studio and workspaces.

Once completed, Doshi said it will fall under the Weave Suites brand, which features hotel-like services and locations close to key business hubs, similar to the company’s 83-unit Central West branch in Hong Kong that opened last year.

“We are confident that the city will see an influx of global talent thanks to its status as an important financial hub combined with its pragmatic approach to dealing with the after-effects of the pandemic,” Doshi added.

He said the parties have already signed the sale and purchase agreement and the deal is set to close in the coming months.

SLB Development will keep a minority stake in the joint venture as the firm diversifies its revenue sources to the living sector segment.

“We are moving in the right direction through strategic partnerships with like-minded partners, global investors, and experienced property developers,” SLB chief executive Matthew Ong said in a separate statement.

The property is nestled in a culture-rich neighbourhood surrounded by museums, art hubs and historical landmarks but remains within reach of the financial district via a quick walk to Bugis MRT station.

“We believe that the high-quality flexible rental accommodation product which Weave is creating at the property will complement and blend in seamlessly,” said Clemence Lee, CBRE’s senior director for capital markets, who also brokered the off-market transaction. “The employees of high-quality occupiers in the nearby Grade A offices such as Mastercard, Facebook, Abbott Labs, Expedia and PayPal will also be drawn to the modern offerings from Weave as they will be able to live near to their workplace.”

Firm Sets Sights on Australia

The acquisition will mark Weave’s seventh location in Asia and will push the firm’s total assets under management to over $850 million, five years after it started its operations in Hong Kong. Having built up a portfolio of 678 serviced units in its home market, the company is still looking for more assets in Singapore.

The firm aims to grow its portfolio in Hong Kong and Singapore to 10 properties with 1,500 rooms over the next 12 months.

While the latest deal marks Weave Living’s first acquisition in the Lion City, the company made attempts to enter the market two years ago after a S$150 million joint venture with Singapore-based 32RE, a subsidiary of SLB Development.

In its home market, the firm has been actively picking up and converting old budget hotels and apartments, with five deals closed since 2019.

Weave Living just opened its sixth serviced apartment in Hong Kong earlier this month, less than a year after renovating the property it acquired in Kowloon East in September for HK$390 million ($50 million).

The company also picked up an apartment complex at 6-8 Hospital Road for HK$295 million in March 2021 to follow its three 2019 deals, which included the HK$515 million purchase of Silka West Kowloon Hotel in Olympic.