Paterson Collection converted to serviced apartments

[bargain hunter]

According to a Maybank Kim Eng research report:

Converting Paterson Collection to serviced apts: Bukit Sembawang has been granted written approval to convert 85-unit Paterson Collection into 112 units of serviced apartments, while retaining three existing residential units. As such, it has reclassified the asset from development properties into property, plant and equipment. It paid a one-off SGD31.8m Additional Buyer’s Stamp Duty in 3Q18 and is no longer subjected to extension premiums under the Qualifying Certificate rules. We assume that BS will need to incur another SGD25m of capex to fit-out the property for leasing. On a stabilised basis, we estimate recurring EBITDA of SGD6.2m and a yield on cost of 2.3-2.6%

[D9/10]

why do you think they want to convert PC to serviced apartments? And choose to focus on selling 8 St Thomas. Given current market conditions wouldn't be that hard to sell >$3k psf and units are not huge just 2 & 3 bedders. Heavy construction at Orchard Station also coming towards the end and not much supply around that area.

[teddybear]

I can guess.....
With Paterson@Marq just across the road selling at >$5000 psf, Bukit Sembawang is waiting for the right time to sell at much higher price than $3000 psf right?


why do you think they want to convert PC to serviced apartments? And choose to focus on selling 8 St Thomas. Given current market conditions wouldn't be that hard to sell >$3k psf and units are not huge just 2 & 3 bedders. Heavy construction at Orchard Station also coming towards the end and not much supply around that area.