
The Zhou family, which controls Shanghai Hengda Group, now own 137 Cecil St (left) as well as 139 (right)
Mainland investors have gained a reputation for paying top dollar for real estate assets around the world, and now a Shanghai developer may be translating this same pricing strategy to its plan for selling an 11-storey office block in downtown Singapore.
The Zhou family, which controls Shanghai Hengda Group (上海恒大集团) bought a 60% stake in 139 Cecil Street at a valuation of S$125 million ($91.7 million) in September last year, according to data from real estate information provider Real Capital Analytics. The Zhou family, which purchased the property as individuals, rather than through Hengda, added the 36-year-old building to a neighboring one they had bought the previous year on the commercial street just south of Raffles Place.
Now the mainland players and their partners are asking S$210 million price for the vacant commercial block – a 40 percent markup after less than eight months.
Plans for Creating a Boutique Office Block

Plans for the new 139 Cecil would add five floors, plus retail and a pool
“This sale represents a great opportunity for investors to acquire en bloc a rare and sizable office building along the coveted Cecil Street in the heart of Singapore’s CBD,” says Shaun Poh, executive director of capital markets at Cushman & Wakefield, which has been retained as the sole marketing agent for the project.
The Zhous bought their stake in the 99-year leasehold property, which occupies a 7,936 square foot (737 square metre) site, one year after its previous owners had won government approval to refurbish the property. The planned renovation would add five floors to the structure, bringing the leasable area to 85,000 square feet from its current 67,550, as well as introducing a roof terrace with a swimming pool, gym, jacuzzi and al fresco dining area.
The project has approval to sell off 99 office units and three retail units on a strata-title basis. At S$210 million for 67,550 square feet of net leasable area, the asking price works out to S$3108 per square foot.
Shanghai Developer Becoming a Singapore Player
The remaining 40 percent stake in the property is owned by a joint venture between Singapore-listed Vibrant Group and local developer DB2 Group, which had owned 139 Cecil outright before the Zhou family bought in last year. Cushman & Wakefield indicated in a statement that they expect refurbishment of the property to be completed in the second quarter of 2018.
On the mainland, Shanghai Hengda group owns the Shanghai South golf course, as well as a broad portfolio of commercial and residential assets in China’s commercial capital.
One year before buying into 139 Cecil Street, the family had purchased the 12-storey office block at 137 Cecil Street — adjacent to 139 — for S$210 million ($150 million). That property, formerly known as the Aviva Building, is currently leased out.
Singapore Office Market Stabilising

GSH Plaza was sold to the Hong Kong-listed Fullshare for S$725.2 million ($512 million)
The owners of 139 Cecil could be counting on a shift in Singapore’s depressed office market to boost their sale prospects.
“The office leasing market appears to be stabilizing as evidenced by the marginal rental decline in the last quarter of 2016 and healthy take up of new office projects such as Marina One, 5 Shenton Way and Guoco Tower,” Poh indicated.
On the rental side, however, developers are still facing tough sledding. In JLL’s Singapore Property Market Monitor for the first quarter of 2017, rental rates in the office market fell 1.1 percent quarter-on-quarter and capital value growth fell 0.9 percent. The report noted that overall CBD rents softened at a pace similar to the modest correction the preceding quarter.
While markets have seen a large influx of new office supply in recent quarters, that flood is expected to ebb over the next two years, which could rekindle demand for projects.
The 110 Robinson Road building was a similar age to 139 Cecil and was sold for S$45.1 million or S$3,169 per square foot. More recently, GSH Plaza, found at 20 Cecil Street and one of Singapore’s biggest transactions of the first quarter of 2017, was sold to the Hong Kong-listed Fullshare via a company sale which valued the asset at S$725.2 million ($512 million) or S$2,900 psf for the office units.
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