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Mitre site sold to Heeton group for about $121m

Posted on 14 Nov 2009 | Comments Off

Price works out to almost $1,100 psf ppr for freehold residential plot

A CONSORTIUM led by Heeton Holdings is understood to have signed a deal to buy the freehold Mitre Hotel site at Killiney Road for about $121-122 million. The price works out to almost $1,100 per sq ft of potential gross floor area including an estimated development charge (DC) of $770,000.

Mitre Hotel: The Killiney Road site can be redeveloped into a new project with about 110 apartments

Jones Lang LaSalle is understood to have brokered the sale following a tender exercise that closed in September.

The 39,972 sq ft site is zoned for residential use with a 2.8 plot ratio – the ratio of maximum potential gross floor area to land area – under Master Plan 2008. There is a 10-storey height limit. The plot can be developed into a new project with about 110 units of an average size of 1,000 sq ft.

Analysts estimate that based on the unit land price of almost $1,100 psf per plot ratio (psf ppr), Heeton’s breakeven cost for a new apartment development could be about $1,600 psf.

The Mitre Hotel, which opened in 1948, stopped letting rooms when it lost its licence in 2002, according to earlier media reports.

The property – which is owned mostly by members of the Chiam family – was ordered to be put up for sale last year by the Court of Appeal, ending a 12-year legal tussle over its sale.

Market watchers said the last time the property was in the market was in August 2007 when it had a price tag of about $200 million or close to $1,800 psf ppr including an estimated $700,000 DC at the time.

Analysts also observe that the latest price of almost $1,100 psf ppr achieved for the property is a slight improvement on the $1,022 psf ppr (including DC) that Hoi Hup paid for the Killiney Apartments plot nearby in April 2007. Hoi Hup is now redeveloping that site into the Residences @ Killiney.

Heeton yesterday reported a 143 per cent year- on-year jump in net earnings for the nine months ended Sept 30, 2009 to $10.5 million.

The company is seeking shareholders’ approval for the disposal of five wet-market properties in Singapore to supermarket chain Sheng Siong.

Source : Business Times – 12 Nov 2009

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Posted in Developers

Tagged Heeton Holdings, Mitre Hotel, Singapore Hotels

OUE reports 21.7% fall in Q3 earnings

Posted on 11 Nov 2009 | Comments Off

OVERSEAS Union Enterprise (OUE) reported a 21.7 per cent fall in third-quarter net profit to $7.81 million, from $9.97 million a year ago.

Revenue for the three months ended Sept 30, 2009 fell 7.6 per cent to $33.5 million, from $36.2 million in Q3 2008.

The group, which gets the bulk of its revenue from its hotels, said that the decrease in total revenue was largely due to lower revenue generated by the hospitality division resulting from severe global economic downturn, as well as ongoing refurbishment works at Meritus Mandarin Singapore.

Revenue from the hotels that are owned and managed by the group fell to $32.8 million in Q3 2009, from $35.6 million in Q3 2008. The severe global economic downturn caused revenue per available room (RevPAR) for the hotels in Q3 2009 to fall to $121 from $147 a year ago.

Earnings per share for Q3 2009 fell to four cents from five cents a year ago.

For the nine months ended Sept 30, 2009, OUE posted a net loss of $27.4 million. For the same period last year, the company’s net profit was $45.8 million. This was due to a $52.2 million impairment loss on development properties. Revenue for the nine months fell 19 per cent to $94.9 million.

Looking ahead, OUE said that if the economy continues to recover, and with the completion of refurbishment works at Meritus Mandarin Singapore, revenue is expected to increase in the new financial year. It also said that its investment properties Mandarin Gallery and Overseas Union House/Change Alley Aerial Plaza are still undergoing retrofitting and development works respectively. Mandarin Gallery is expected to commence operation and contribute revenue in the new financial year, with current committed leases for about 99 per cent of the 126,000 square feet of retail space. The redevelopment works of Overseas Union House/Change Alley Aerial Plaza are expected to be completed by the second half of next year.

OUE shares last traded at $9.34.

Source : Business Times – 11 Nov 2009