UOL pays $313m for Lion City Hotel, former Hollywood Theatre

http://www.businesstimes.com.sg/sub/...22462,00.html?

Published January 19, 2011

UOL pays $313m for Lion City Hotel, former Hollywood Theatre

By KALPANA RASHIWALA


(SINGAPORE) UOL Group has trumped five other contenders to bag the Lion City Hotel and adjoining former Hollywood Theatre site for $313 million.

The unit land price for the Tanjong Katong-Geylang Road area properties, with a total freehold land area of 147,909 square feet, works out to $779 per square foot (psf) of potential gross floor area inclusive of estimated development charges of $77.8 million, assuming UOL embarks on a mixed commercial and residential project with an average plot ratio of 3.39.

Based on an alternative scheme for a residential project with commercial space on the first storey with a 3.0 plot ratio, the unit land price would work out to about $871 psf per plot ratio.

The property was sold through a tender exercise which closed yesterday, attracting strong interest from six major developers, said Landmark Property Advisers and Knight Frank, which handled the sale.

UOL noted that the property is near the existing Paya Lebar MRT interchange station for the East-West and Circle lines. 'Based on the current allowable development options, the property may be redeveloped as a commercial-cum-residential development. The company will continue to assess the current allowable development options and other factors to determine the final development scheme for the property.'

Given its location, the future redevelopment of the property is expected to benefit from the nearby Paya Lebar Central commercial hub planned by the Urban Redevelopment Authority, UOL said. Lion City Hotel and the former Hollywood Theatre are being sold by the family of the late property magnate Wee Thiam Siew. The hotel was built in 1968 and the Wee family has been operating it.

The theatre stopped screening films in the 1990s and is today home to a food centre and a Sheng Siong supermarket.

In November, Shaw Brothers sold the former Singapura Theatre site at No 55 Changi Road to a consortium that includes Roxy-Pacific and Macly Capital for $44.9 million.

In the same month, Far East Organization bought Paramount Hotel and Shopping Centre along East Coast Road for $214 million. Far East is expected to keep the freehold asset as an investment property for recurring income although refurbishment is likely to be on the cards.

http://www.straitstimes.com/Money/St...ry_625682.html

Jan 19, 2011

UOL wins coveted Lion City Hotel site

It tops 6-way race with $313m bid and will tap area's growth potential

By Esther Teo


THE race to redevelop the landmark Lion City Hotel and the adjoining Hollywood Theatre site has ended with UOL Group clinching the coveted site near Paya Lebar MRT station for $313 million.

The property firm emerged tops in a six-way tussle that saw 'strong interest from major developers', joint marketing agents Knight Frank and Landmark Property Advisers said yesterday.

The freehold site - with a land area of 13,741 sq m - can be redeveloped into either a mixed residential and commercial complex or a residential development with a commercial element on its first storey, the joint agents said.

Inclusive of the development charge for re-zoning and a 10 per cent balcony allocation, the former redevelopment option works out to $761 per sq ft (psf) per plot ratio (ppr) while the latter will cost $834 psf ppr - inclusive of an additional plot of state land.

UOL chief operating officer Liam Wee Sin told The Straits Times that the freehold status will allow the firm to see the site as a 'mid- to longer-term property play'. He added that the group has yet to finalise plans for the site as it is assessing its various redevelopment options.

The deal, however, will allow UOL to tap the growth potential of the Paya Lebar area, which has been earmarked by the Government to be developed into a key commercial hub outside the central business district, Mr Liam said.

UOL also said in a statement yesterday that the acquisition will allow it to replenish its land bank here.

This comes after the launch of the 351-unit Spottiswoode Residences - the last of its residential land bank here - in November. As at the end of last month, only 68 units remained unsold.

In fact, UOL has already sold more than 1,200 homes in three residential launches last year - Terrene at Bukit Timah, Waterbank@Dakota and Spottiswoode Residences.

This is also the first land parcel the firm has acquired since the Dakota site through a government land tender in September 2009.

UOL Group said in a statement yesterday that the acquisition and redevelopment of the property will be financed by bank borrowings and internal resources.

Mr Colin Tan, research and consultancy director of Chesterton Suntec International, said that the top bid, which came in above the indicative price of $300 million, suggested that the market was still proving resilient despite the property cooling measures introduced last week.

There was still ample liquidity in the market with the economy going strong, he added.

'The site also comes with the flexibility of various mixed-use redevelopment options, which might allow developers to spread out their risk across various segments... It is also one of the districts that the Government is committed to developing,' Mr Tan said.

[email protected]