Perennial Holdings has teamed up with Far East Organization and its Hong Kong-based sister firm Sino Land to buy the Golden Mile Complex in Singapore for S$700 million ($505 million), as they plan to transform the iconic property into an integrated development.
The consortium said in a joint release on Friday that they have exercised an option to purchase the 1973-vintage building through a private treaty with the owners, with the closing price representing a 12.5 percent discount from the S$800 million which the sellers had asked for in a collective sale launched in November.
Dubbed the city’s Little Thailand, the developers are planning to transform the property into an integrated development with office, retail and residential units while preserving the key features of the main building, which has been gazetted for conservation by regulators, intact.
“As the owner of renowned historic landmarks in Singapore, all of which comprise gazetted conservation buildings or National Monuments, we are excited to add another distinctive property to our real estate portfolio,” said Perennial chief executive officer Pua Seck Guan. “With our strong track record in conservation projects and large-scale mixed-use developments, coupled with the proven expertise of our reputable JV partners, we are well-positioned to bring a new lease of life to one of Singapore’s most iconic architectural gems.”
Cruising into a Restoration
A Perennial spokesperson declined to give further details on the planned integrated development, but the buyers pledged to “sensitively restore” the existing 16-storey building at 5001 Beach Road and retain key features of the main structure including its iconic terraced profile.
The consortium is paying around S$803 per square foot of the site’s maximum allowable gross floor area of 81,000 square metres (871,877 square feet) based on independent calculations. The joint venture is 50 percent owned by Perennial with FEO and Sino Land, both of which are controlled by Singapore’s Ng family each holding a quarter stake.
After the 718-unit Golden Mile Complex was marked for conservation by the Urban Redevelopment Authority late last year, Singapore authorities provided extra incentives for prospective buyer-developers including adding bonus GFA of 25,000 square metres and extending the land tenure to 99 years. The bonus floor space would be provided through construction of a new tower of up to 30 floors high beside the conserved main building.
Should the transaction close, which is contingent on official approvals, it would become the first collective sale of a large-scale strata-titled conserved building in the city and also the first cooperative project for Perennial and Far East – developers owned by two of the city-state’s wealthiest families.
“We look forward to partnering with Perennial in our first joint venture project to shape and transform this important heritage asset into a new focal point for the arena,” said Marc Boey, executive director for the property services division of Far East. “Harnessing the combined strengths of this partnership, we will continue to build on the landmark’s rich history and memory, imbuing the city with character and identity, and energising its community socially and economically.”
Edmund Tie acted as the sole marketing agent for the project while lawyers from Wee Swee Teow LLP provided advisory services.
“We look forward to the purchasers – Perennial, Sino Land and Far East Organization – to reimagine and rejuvenate the iconic Golden Mile Complex to serve the new generation, and be an eternal landmark in Singapore’s evolving cityscape, breathing new life and making sense of our past, present and future,” Swee Shou Fern, head of investment advisory at Edmund Tie, said in a separate statement.
Back to Back Developments
Shaped like a cruise ship permanently docked in the Kallang Basin, Golden Mile Complex is on its way to new owners some three years after the property was first launched for sale at the same reserve price of S$800 million in 2019.
Perennial, which is led by Kuok Khoon Hong, a nephew of Shangri-La Hotel founder Robert Kuok, had previously redeveloped Capitol Singapore, restoring historic buildings near City Hall and creating a new mixed-use development.
More recently, the Singaporean developer has been busy with the redevelopment project of AXA Tower at 8 Shenton Way, where it has partnered with Alibaba, Chip Eng Seng Corp, SingHaiyi Group and Haiyi Holdings.
Far East, the largest private developer in the city-state, completed the restoration of the 40-room Barracks Hotel on Sentosa island in 2019, as well as the multiple-phase rejuvenation of the Fullerton Heritage Precinct on the Marina Bay waterfront.
Currently, Far East and Sino Land are working together on an integrated development project in the leafy Jalan Anak Bukit area on a 3.2 hectare (7.9 acre) site, which they won last year for S$1.03 billion.
Note: an earlier version of this story identified Perennial’s City Hall area project as Capital Singapore. The story has been updated to show the proper name, Capitol Singapore.